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: November 21, 1995
(Date of earliest event reported)
CS First Boston Mortgage Securities Corp.
(Exact name of registrant as specified in its charter)
Delaware 33-98604 13-3320910
(State or Other Juris- (Commission (I.R.S. Employer
diction of Incorporation) File Number) Identification No.)
55 East 52nd Street, New York, New York 10055
(Address of Principal Executive Office) (Zip Code)
Registrant's telephone number, including area code:(212) 909-2000
Item 2. Acquisition or Disposition of Assets
Description of the Certificates and the Mortgage Pool
On November 21, 1995, a single series of certificates, entitled CS First
Boston Mortgage Securities Corp. Mortgage Pass-Through Certificates, Series
1995-FHA1 (the "Certificates"), was issued pursuant to a pooling and servicing
agreement (the "Pooling and Servicing Agreement") attached hereto as Exhibit
4.1, dated as of November 1, 1995, among CS First Boston Mortgage Securities
Corp. as depositor (the "Depositor"), Greystone Servicing Corporation, Inc. as
master servicer, Greystone Funding Corporation as seller and LaSalle National
Bank as trustee. The Certificates consist of eleven classes identified as the
"Class A-1 Certificates", the "Class A-2 Certificates", the "Class A-3
Certificates", the "Class A-4 Certificates", the "Class A-X-1 Certificates", the
"Class A-X-2 Certificates", the "Class A-X-3 Certificates", the "Class A-X-4
Certificates" (collectively, the "Publicly Offered Certificates"), the "Class B
Certificates", the "Class R-I Certificates" and the "Class R-II Certificates",
respectively, and were issued in exchange for, and evidence the entire
beneficial ownership interest in, the assets of a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of fixed-rate, level
payment, fully-amortizing mortgage loans insured by the Federal Housing
Administration (the "FHA") of the United States Department of Housing and Urban
Development and mortgage pass-through certificates guaranteed by the Government
National Mortgage Association that are backed by fixed rate, level payment,
fully-amortizing mortgage loans insured by the FHA (the "Underlying Loans";
collectively with the Mortgage Loans, the "FHA Loans"), having, as of the close
of business on November 1, 1995 (the "Cut-off Date"), an aggregate principal
balance of $167,488,346 (the "Initial Pool Balance"), after taking into account
all payments of principal due on the FHA Loans on or before such date, whether
or not received. The Publicly Offered Certificates were sold by the Depositor
to CS First Boston Corporation (the "Underwriter") pursuant to (i) an
underwriting agreement (the "Underwriting Agreement") dated October 12, 1994,
between the Depositor and the Underwriter, as supplemented by a terms agreement
(the "Terms Agreement") dated November 15, 1995, between the Depositor and the
Underwriter. The Underwriting Agreement and the Terms Agreement are attached
hereto as Exhibit 1.1.
The Class A-1 Certificates have an initial stated principal balance (a
"Certificate Balance") of $45,000,000. The Class A-2 Certificates have an
initial Certificate Balance of $20,000,000. The Class A-3 Certificates have an
initial Certificate Balance of $45,789,713. The Class A-4 Certificates have an
initial Certificate Balance of $56,698,633. The Class A-X-1 Certificates will
not have a Certificate Principle Balance, but will represent the right to
receive distributions of interest accrued as provided in the Pooling and
Servicing Agreement on a hypothetical or notional amount (a "Notional Amount")
equal to the Certificate Principal Balance of the Class A-1 Certificates
outstanding from time to time. The Class A-X-2 Certificates will not have a
Certificate Principle Balance, but will represent the right to receive
distributions of interest accrued as provided in the Pooling and Servicing
Agreement on a Notional Amount equal to the Certificate Principal Balance of the
Class A-2 Certificates outstanding from time to time. The Class A-X-3
Certificates will not have a Certificate Principle Balance, but will represent
the right to receive distributions of interest accrued as provided in the
Pooling and Servicing Agreement on a Notional Amount equal to the Certificate
Principal Balance of the Class A-3 Certificates outstanding from time to time.
The Class A-X-4 Certificates will not
have a Certificate Principle Balance, but will represent the right to receive
distributions of interest accrued as provided in the Pooling and Servicing
Agreement on a Notional Amount equal to the Certificate Principal Balance of the
Class A-4 Certificates outstanding from time to time. The Class B Certificates
have an initial Certificate Balance of $4,055,014. The Class R-I and Class R-II
Certificates each have an initial Certificate Balance of $0.
Capitalized terms used herein and not otherwise defined shall have the
meanings assigned to them in the Pooling and Servicing Agreement.
Item 7. Financial Statements and Exhibits
(a) Not applicable
(b) Not applicable
(c) Exhibits
Exhibit No. Description
1.1 Underwriting Agreement dated October 12, 1994, between
CS First Boston Mortgage Securities Corp. as seller and
CS First Boston Corporation as Underwriter, and a Terms
Agreement dated November 15, 1995, between CS First
Boston Mortgage Securities Corp. as seller and CS First
Boston Corporation as underwriter.
4.1 Pooling and Servicing Agreement dated as of November 1,
1995, by and among CS First Boston Mortgage Securities
Corp. as depositor, Greystone Servicing Corporation,
Inc. as master servicer, Greystone Funding Corporation
as seller and LaSalle National Bank as trustee.
99.1 Mortgage Asset Purchase Agreement dated November 15,
1995, among CS First Boston Mortgage Securities Corp.
and Greystone Servicing Corporation, Inc.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
By:/s/ David Gertner
------------------------------------------
Name: David Gertner
Title: Vice President
Dated: November ___, 1995
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
By:/s/ David Gertner
------------------------------------------
Name: David Gertner
Title: Vice President
Dated: November ___, 1995
Index to Exhibits
<TABLE>
<CAPTION>
Sequentially
Numbered
Exhibit No. Description Page
- ----------- ----------- -------------
<C> <S> <C>
1.1
Underwriting Agreement dated October 12, 1994, between
CS First Boston Mortgage Securities Corp. as seller and CS First Boston
Corporation as underwriter, and a Terms Agreement dated November
15, 1995, between CS First Boston Mortgage Securities Corp. as
seller and CS First Boston Corporation as underwriter.
4.1 Pooling and Servicing Agreement dated as of November 1, 1995, by
and among CS First Boston Mortgage Securities Corp. as
depositor, Greystone Servicing Corporation, Inc. as master
servicer, Greystone Funding Corporation as seller and LaSalle
National Bank as trustee.
99.1 Mortgage Asset Purchase Agreement dated November 15, 1995, among
CS First Boston Mortgage Securities Corporation, Greystone
Servicing Corporation, Inc.
</TABLE>
Exhibit 1.1
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
Depositor
Commercial/Multifamily Mortgage Pass-Through Certificates
October 12, 1994
UNDERWRITING AGREEMENT
(Standard Terms)
CS FIRST BOSTON CORPORATION
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
Ladies and Gentlemen:
1. Introductory. CS First Boston Mortgage Securities Corp.,
a Delaware corporation (the "Depositor"), proposes to form one or more grantor
trusts or real estate mortgage investment conduits (the "Trusts"), which will
issue, from time to time, securities entitled Commercial/Multifamily Mortgage
Pass-Through Certificates or other titles to be designated from time to time
(the "Certificates") in one or more series (the "Securities"). Each Certificate
will evidence a fractional undivided, percentage interest or beneficial interest
in a Trust. The Trusts, in the aggregate, will issue, on terms determined at the
time of sale, up to $640,693,943 of the Certificates on the terms specified in
the applicable Prospectus (as hereinafter defined). The property of each Trust
may consist of a pool of one or more mortgage loans secured by first or junior
liens on commercial real estate properties, multifamily residential properties
and/or mixed residential/commercial properties and may also include
participation interests in such types of mortgage loans, installment contracts
for the sale of such types of properties and/or mortgage pass-through
certificates (collectively, the "Mortgage Loans") that are purchased by the
Depositor from various sellers (each an "Unaffiliated Seller") pursuant to an
agreement regarding the sale of the Mortgage Loans (the "Sale Agreement"), dated
the date of the Terms Agreement (as hereinafter defined) or the applicable
Specified Delivery Date (as hereinafter defined), between the Unaffiliated
Seller and the Depositor and are serviced by the Unaffiliated Seller in its
capacity as servicer (the "Servicer") pursuant to, if specified in the Terms
Agreement, a Seller's Warranties and Servicing Agreement (the "Servicing
Agreement"), dated as of the date set forth in the Terms Agreement, between the
Depositor and the Unaffiliated Seller and a Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement"), dated as of the date set forth in the Terms
Agreement, between the Depositor and certain qualified national banking
associations or corporations, as Trustee (in each case, the "Trustee") and
certain related property to be conveyed to the Trust by the Depositor (the
"Trust Fund"). The Mortgage Loans in the Trust Fund for a Series will be
transferred to the related
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Trust and the Certificates to which this Agreement applies will be issued
pursuant to the Pooling and Servicing Agreement.
Credit enhancement with respect to the Mortgage Loans included
in the Trust Fund for a Series may be provided by a letter of credit issued
pursuant to a Letter of Credit Agreement, in each case, dated as of the date set
forth in the Terms Agreement, between the Depositor and a bank or financial
institution named therein (the "Letter of Credit Bank"), or a certificate
guarantee insurance policy (the "Guarantee Policy") issued pursuant to a
Certificate Guarantee Insurance Policy Agreement, in each case, dated as of the
date set forth in the Terms Agreement, by and between the Depositor and an
insurance company named therein (the "Guarantor"), which Guarantee Policy will
guarantee timely distributions of interest and full distributions of principal,
as specified in the Pooling and Servicing Agreement with respect to such Series.
If so specified in the Pooling and Servicing Agreement with respect to a Series,
in lieu of, or in addition to, the foregoing methods of credit enhancement,
credit support may be provided by the subordination of a class or subclass of
Certificates or a fund may be established (the "Reserve Fund") into which
payments on or with respect to a percentage of the Mortgage Loans included in
the Trust Fund, as specified in such Pooling and Servicing Agreement, will be
deposited. If so specified in the Pooling and Servicing Agreement with respect
to a Series, the Trust Fund for a Series of Certificates may also include one or
more accounts or funds established by the Depositor pursuant to such Pooling and
Servicing Agreement, or one or more methods of credit enhancement in lieu of, or
in addition to, the methods of credit enhancement specified above (the
"Alternative Credit Enhancement").
The performance of the obligations of the Servicer under each
Servicing Agreement may be guaranteed by a bond, insurance policy, corporate
guaranty or other form of insurance coverage (the "Performance Bond") issued by
the entity specified in the applicable Servicing Agreement.
The Certificates are more fully described in the Registration
Statement, which the Depositor has furnished to you. Each Series of Certificates
and any classes or subclasses of Certificates (each, a "Class" or "Subclass,"
respectively) within such Series may vary, among other things, as to the number
and types of Classes or Subclasses, the aggregate principal or notional amount
or aggregate stated principal balance, the pass-through rate with respect to the
Mortgage Loans in the related Trust Fund, the percentage interest, if any,
evidenced by each Class or Subclass in the payments of principal and interest
on, or with respect to, the Mortgage Loans included in the related Trust Fund,
the stated principal balance and interest rate, if any, the priority of payment
among Classes or Subclasses, the method of credit enhancement with respect to
the Mortgage Loans in the Trust Fund for such Series, whether the Depositor will
elect to treat the related Trust Fund as a "real estate mortgage investment
conduit" (a "REMIC") under the Internal Revenue Code of 1986, as amended (the
"Code"), the Classes or Subclasses of Certificates of such Series subject to
this Agreement, and any other variable terms contemplated by the Pooling and
Servicing Agreement and in the Certificates of such Series.
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Each offering of the Certificates to which this Agreement
applies made pursuant to the Registration Statement will be made through you,
through you and other underwriters for whom you are acting as representative or
through an underwriting syndicate managed by you. Whenever the Depositor
determines to form a Trust and to make such an offering of Certificates, it will
enter into an agreement (the "Terms Agreement") providing for the sale of such
Certificates to, and the purchase and offering thereof by, (i) you, (ii) you and
such other underwriters who execute the Terms Agreement and agree thereby to
become obligated to purchase Certificates from the Depositor, or (iii) you and
such other underwriters, if any, selected by you as have authorized you to enter
into such Terms Agreement on their behalf (in each case, the "Underwriters").
Such Terms Agreement shall specify the fractional undivided interest, principal
or notional amount, or stated principal balance, of each Class or Subclass of
the Certificates to be issued and their terms not otherwise specified in the
related Pooling and Servicing Agreement, the Classes or Subclasses of
Certificates subject to this Agreement, the price at which such Certificates are
to be purchased by the Underwriters from the Depositor, the aggregate amount of
Certificates to be purchased by you and any other Underwriter that is a party to
such Terms Agreement and the initial public offering price or the method by
which the price at which such Certificates are to be sold will be determined.
The Terms Agreement, which shall be substantially in the form of Exhibit A
hereto, may take the form of an exchange of any standard form of written
telecommunication between or among the Underwriters and the Depositor. Each such
offering of the Certificates will be governed by this Agreement, as supplemented
by the applicable Terms Agreement, and this Agreement and such Terms Agreement
shall inure to the benefit of and be binding upon the Underwriters participating
in the offering of such Certificates.
2. Representations and Warranties of the Depositor. The
Depositor represents and warrants to you as of the date hereof and to
Underwriters named in the applicable Terms Agreement as of the date of such
Terms Agreement, as follows:
(a) a registration statement on Form S-3 (No. 33-82354),
including a prospectus and such amendments thereto as may have been required to
the date hereof, relating to the Certificates and the offering thereof from time
to time in accordance with Rule 415 under the Securities Act of 1933, as amended
(the "Act"), has been filed with the Securities and Exchange Commission (the
"Commission") and such registration statement, as amended, has become effective;
such registration statement, as amended, and the prospectus relating to the sale
of the Certificates offered thereby by the Depositor constituting a part
thereof, as from time to time amended or supplemented (including any prospectus
filed with the Commission pursuant to Rule 424(b) of the rules and regulations
of the Commission (the "Rules and Regulations") under the Act), are respectively
referred to herein as the "Registration Statement" and the "Prospectus";
provided, however, that a supplement to the Prospectus prepared pursuant to
Section 5(a) hereof shall be deemed to have supplemented the Prospectus only
with respect to the offering of the Series of the Certificates to which it
relates; and the conditions to the use
4
of a registration statement on Form S-3 under the Act, as set forth in the
General Instructions to Form S-3, and the conditions of Rule 415 under the Act,
have been satisfied with respect to the Registration Statement;
(b) on the effective date of the Registration Statement, the
Registration Statement and the Prospectus conformed in all respects to the
requirements of the Act and the Rules and Regulations, and the Registration
Statement did not include any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading, and on the date of each Terms Agreement, the
Registration Statement and the Prospectus will conform in all respects to the
requirements of the Act and the Rules and Regulations, and the Prospectus will
not include any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading; provided, however, that the foregoing does not apply to statements
in or omissions from either of the documents based upon written information
(including Computational Materials (as defined herein)) furnished to the
Depositor by any Underwriter specifically for use therein;
(c) the Depositor has been duly organized and is validly
existing as a corporation in good standing under the laws of the State of
Delaware, with full corporate power and authority to own its assets and conduct
its business as described in the Prospectus, is duly qualified as a foreign
corporation in good standing in all jurisdictions in which the ownership or
lease of its property or the conduct of its business requires such
qualification, except where the failure to be so qualified would not have a
material adverse effect on the Depositor, and is conducting its business so as
to comply in all material respects with the applicable statutes, ordinances,
rules and regulations of the jurisdictions in which it is conducting business;
(d) each applicable Pooling and Servicing Agreement,
Servicing Agreement and Sale Agreement and the Certificates of a Series conform,
or will conform as of the Specified Delivery Date (as defined herein), to the
description thereof contained in the Registration Statement and the Prospectus;
and the Certificates of such Series, on the date of such Terms Agreement, will
have been duly and validly authorized and, when such Certificates are duly and
validly executed by the Depositor, authenticated by the Trustee and delivered in
accordance with such Pooling and Servicing Agreement and delivered and paid for
as provided herein and in such Terms Agreement, will be validly issued and
outstanding and entitled to the benefits and security afforded by the Pooling
and Servicing Agreement;
(e) the execution and delivery by the Depositor of this
Agreement, each applicable Terms Agreement, each applicable Pooling and
Servicing Agreement, Servicing Agreement, Sale Agreement and the Certificates of
a Series, are within the
5
corporate power of the Depositor and have been, or will have been, duly
authorized by all necessary corporate action on the part of the Depositor; and
neither the execution and delivery by the Depositor of such instruments, nor the
consummation by the Depositor of the transactions herein or therein
contemplated, nor the compliance by the Depositor with the provisions hereof or
thereof, will (A) conflict with or result in a breach of, or constitute a
default under, any of the provisions of the certificate of incorporation or by-
laws of the Depositor, (B) conflict with any of the provisions of any law,
governmental rule, regulation, judgment, decree or order binding on the
Depositor or its properties, (C) conflict with any of the provisions of any
indenture, mortgage, contract or other instrument to which the Depositor is a
party or by which it is bound, or (D) result in the creation or imposition of
any lien, charge or encumbrance upon any of its property pursuant to the terms
of any such indenture, mortgage, contract or other instrument;
(f) this Agreement has been, and at the date thereof, each
applicable Terms Agreement will have been duly authorized, executed and
delivered by the Depositor;
(g) at the date thereof, each applicable Pooling and
Servicing Agreement, Servicing Agreement and Sale Agreement will have been duly
authorized, executed, and delivered by the Depositor and will be a valid and
binding agreement of the Depositor, enforceable against the Depositor in
accordance with its terms, except to the extent that enforcement thereof may be
limited by (1) bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights generally,
and (2) general principles of equity (regardless of whether enforceability is
considered in a proceeding at law or in equity);
(h) all approvals, authorizations, consents, orders or other
actions of any person, corporation or other organization, or of any court,
governmental agency or body or official (except with respect to the state
securities or Blue Sky laws of various jurisdictions), required in connection
with the valid and proper authorization, issuance and sale of the Certificates
of a Series pursuant to this Agreement, the applicable Terms Agreement, and the
applicable Pooling and Servicing Agreement, have been or will be taken or
obtained on or prior to the Specified Delivery Date;
(i) the Reserve Fund, if any, with respect to a Series will
be established in accordance with the applicable Pooling and Servicing Agreement
on or prior to the Specified Delivery Date and a UCC-1 financing statement with
respect to such Reserve Fund naming the Trustee for the benefit of the holders
of the Certificates of such Series as secured party has been, or on the
Specified Delivery Date will have been, filed in the office of the Secretary of
State of the state in which the principal trust office of the Trustee is located
and, upon the purchase by you of the Certificates subject to this Agreement in
the manner contemplated by this Agreement, and the initial deposit of any
6
amount required to be deposited therein pursuant to the applicable Pooling and
Servicing Agreement, the Trustee, for the benefit of the holders of the
Certificates will, on the date of such deposit, have a first perfected priority
security interest in such Reserve Fund;
(j) at the Specified Delivery Date, each of the Mortgage
Loans included in the related Trust Fund will meet the criteria for selection
described in the Prospectus;
(k) the characteristics of the Trust Fund with respect to
each Series will not subject the related Trust to registration as an investment
company under the Investment Company Act of 1940, as amended (the "Investment
Company Act").
3. Purchase, Sale and Delivery of Certificates. Delivery of
and payment for the Certificates to which this Agreement applies will be made at
such place and at such time or shall be specified in the applicable Terms
Agreement, or at such other time thereafter as set forth in the applicable Terms
Agreement or as you and the Depositor shall agree upon, each such time being
hereinafter referred to as a "Specified Delivery Date." Delivery of such
Certificates shall be made by the Depositor to the Underwriters against payment
of the purchase price specified in the applicable Terms Agreement in same day
funds wired to such bank as may be designated by the Depositor, or by such other
manner of payment as may be agreed upon by the Depositor and you. Unless
otherwise provided for, the Certificates to be so delivered will be in
definitive, fully registered form, in such denominations and registered in such
names as you request, and will be made available for checking and packaging at
the office of CS First Boston Corporation, Park Avenue Plaza, 55 East 52nd
Street, New York, New York 10055 (or at some other location specified by
Underwriter at least 48 hours prior to delivery), at least 24 hours prior to the
applicable Closing Date.
4. Offering by Underwriters. It is understood that the
several Underwriters propose to offer the Certificates subject to this Agreement
for sale to the public as set forth in
the Prospectus.
5. Covenants of the Depositor. The Depositor covenants and
agrees with you and the several Underwriters participating in the applicable
offering of the Certificates that:
(a) immediately following the execution of each Terms
Agreement, the Depositor will prepare a Prospectus Supplement setting forth the
amount of Certificates covered thereby and the terms thereof not otherwise
specified in the Prospectus, the price at which such Certificates are to be
purchased by the Underwriters from the Depositor, either the initial public
offering price or the method by which the price at which such Certificates are
to be sold will be determined, the selling concessions and reallowances, if any,
and such other information as you and the Depositor deem appropriate in
connection with the offering of such Certificates, but the Depositor will not
file any amendments to the Registration Statement as in effect with respect to
the Certificates, or
7
any amendments or supplements to the Prospectus, unless it shall first have
delivered copies of such amendments or supplements to you, or if you shall have
reasonably objected thereto promptly after receipt thereof; the Depositor will
immediately advise you or your counsel (i) when notice is received from the
Commission that any post-effective amendment to the Registration Statement has
become or will become effective and (ii) of any order or communication
suspending or preventing, or threatening to suspend or prevent, the offer and
sale of the Certificates or of any proceedings or examinations that may lead to
such an order or communication, whether by or of the Commission or any authority
administering any state securities or Blue Sky law, as soon as the Depositor is
advised thereof, and will use its best efforts to prevent the issuance of any
such order or communication and to obtain as soon as possible its lifting, if
issued. Subject to the Underwriter's compliance with its obligations set forth
in Section 8 hereof, the Depositor shall file with the Commission a current
report on Form 8-K including any Computational Materials (as defined herein)
provided to it by the Underwriter pursuant to Section 8 hereof no later than the
date that the Prospectus Supplement is filed;
(b) if, at any time when a Prospectus relating to the
Certificates is required to be delivered under the Act, any event occurs as a
result of which the Prospectus as then amended or supplemented would include any
untrue statement of a material fact or omit to state any material fact necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading, or if it is necessary at any time to amend or
supplement the Prospectus to comply with the Act or the Rules and Regulations,
the Depositor will promptly prepare and file with the Commission, an amendment
or supplement that will correct such statement or omission or an amendment that
will effect such compliance;
(c) the Depositor will make generally available to the
holders of the Certificates (the "Certificateholders") of the related Series, in
each case as soon as practicable, earning statements covering (i) a period of 12
months beginning not later than the first day of the related Trust's fiscal
quarter next following the effective date of the Registration Statement and (ii)
a period of 12 months beginning no later than the first day of such Trust's
fiscal quarter next following the date of the related Terms Agreement which will
satisfy the provisions of Section 11(a) of the Act and Rule 158 of the
Commission with respect to the related Series of Certificates. The Depositor
will cause the Trustee to furnish or make available, within a reasonable time
after the end of each calendar year, to each holder of a Certificate at any time
during such year, such information as the Depositor deems necessary or desirable
to assist Certificateholders in preparing their federal income tax returns;
(d) the Depositor will furnish to you copies of the
Registration Statement, the Prospectus, and all amendments and supplements to
such documents relating to the
8
Certificates, in each case as soon as available and in such quantities as you
reasonably request;
(e) the Depositor will arrange for the qualification of the
Certificates for sale and the determination of their eligibility for investment
under the laws of such jurisdictions as you designate and will continue such
qualifications in effect so long as required for the distribution; provided,
however that neither the Depositor nor the applicable Trust shall be required to
qualify to do business in any jurisdiction where it is now not qualified or to
take any action which would subject it to general or unlimited service of
process in any jurisdiction in which it is now not subject to service of
process;
(f) the Depositor will, while the Certificates of a Series
are outstanding:
(i) furnish to you, and upon request to each of the
other Underwriters, within 90 days after the close of each fiscal year,
appropriate annual financial statements of the related Trust, certified by a
nationally recognized firm of independent public accountants, in such form as to
disclose its financial condition at the end of, and the results of its
operations for, such fiscal year;
(ii) furnish to you, and upon request to each of the
other Underwriters, as soon as available, copies of all reports filed with the
Commission and copies of each notice published or mailed to holders of the
Certificates pursuant to the related Pooling and Servicing Agreement; and
(iii) furnish to you, and upon request to each of the
other Underwriters, such other information with respect to the related Trust or
its financial condition or results of operations, as you may reasonably request,
including but not limited to information necessary or appropriate to the
maintenance of a secondary market in the Certificates of such Series;
(g) the Depositor will pay all expenses incident to the
performance of its obligations under this Agreement and the related Terms
Agreement and will reimburse the Underwriters for any expenses (including fees
and disbursements of its counsel) incurred by them in connection with
qualification of the related Series of Certificates and determination of their
eligibility for investment under the laws of such jurisdictions as you may
designate and the printing of memoranda relating thereto, for any fees charged
by such investment rating agencies for the rating of such Certificates and, to
the extent previously agreed upon with you, for expenses incurred in
distributing the Prospectus (including any amendments and supplements thereto)
to the Underwriters; and
(h) during the period when a prospectus is required by law
to be delivered in connection with the sale of a Series of Certificates pursuant
to this Agreement, the
9
Depositor will file, or cause the Trustee to file on behalf of the related
Trust, on a timely and complete basis, all documents that are required to be
filed by the related Trust with the Commission pursuant to Sections 13, 14 or
15(d) of the Exchange Act.
6. Conditions to the Obligations of the Underwriters. The
obligations of the several Underwriters named in any Terms Agreement to purchase
and pay for the Certificates of the related Series subject to this Agreement
will be subject to the accuracy of the representations and warranties on the
part of the Depositor as of the date hereof, the date of the applicable Terms
Agreement and the applicable Specified Delivery Date, to the accuracy of the
statements of the Depositor made pursuant to the provisions thereof, to the
performance by the Depositor in all material respects of its obligations
hereunder and to the following additional conditions precedent:
(a) you shall have received two letters of Kenneth Leventhal
& Co., one dated the date of the applicable Terms Agreement and the other dated
the date of the applicable Specified Delivery Date, each in the forms heretofore
agreed to;
(b) all actions required to be taken and all filings
required to be made by the Depositor under the Act prior to the sale of the
Certificates of such Series shall have been duly taken or made; and prior to the
applicable Specified Delivery Date, no stop order suspending the effectiveness
of the Registration Statement shall have been issued and no proceedings for that
purpose shall have been instituted, or to the knowledge of the Depositor or any
Underwriter, shall be contemplated by the Commission;
(c) unless otherwise specified in the applicable Terms
Agreement, the Certificates subject to this Agreement and offered by means of
the Registration Statement shall be rated the ratings specified in the
applicable Terms Agreement;
(d) you shall have received an opinion of Milbank, Tweed,
Hadley & McCloy, counsel for the Depositor and the Underwriters, dated the
applicable Specified Delivery Date, substantially to the effect that:
(i) the Depositor has been duly organized and is
validly existing as a corporation in good standing under the laws of the State
of Delaware, with full corporate power and authority to own its assets and
conduct its business as described in the Prospectus, and is duly qualified to do
business as a foreign corporation in the State of New York, which is the
jurisdiction which the Depositor has advised such counsel in writing as the
jurisdiction in which the Depositor owns or leases real property or conducts
material operations;
(ii) this Agreement and the Terms Agreement have been
duly authorized, executed and delivered by the Depositor;
10
(iii) the applicable Pooling and Servicing Agreement
has been duly and validly authorized, executed and delivered by the Depositor
and (assuming the due authorization, execution and delivery of the other parties
thereto) is a valid and binding agreement of the Depositor, enforceable against
the Depositor in accordance with its terms, except to the extent that (a)
enforcement thereof may be limited by (1) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally, and (2) general principles of equity
regardless of whether enforceability is considered in a proceeding at law or in
equity), and (b) the exercise by the Trustee of certain remedial provisions
contained in the Pooling and Servicing Agreement may be unenforceable in whole
or in part, but the inclusion of such provisions does not affect the validity of
the Pooling and Servicing Agreement, taken as a whole, and the Pooling and
Servicing Agreement, taken as a whole, together with applicable law, contains
adequate provisions for the practical realization by the Trustee of the rights
and benefits purported to be afforded thereby, except for the economic
consequences of any delay that may arise from such unenforceability;
(iv) the applicable Servicing Agreement and Sale
Agreement have been duly authorized, executed and delivered by the Depositor and
(assuming due authorization, execution and delivery of the other parties
thereto) are valid and binding agreements of the Depositor, enforceable against
the Depositor in accordance with their terms, except to the extent that (a)
enforcement thereof may be limited by (1) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally, and (2) general principles of equity
(regardless of whether enforceability is considered in a proceeding at law or in
equity);
(v) the Certificates of a Series have been duly
authorized by the Depositor and, when the Certificates have been duly executed
and authenticated and issued in accordance with the terms of the Pooling and
Servicing Agreement and delivered to and paid for by you pursuant to this
Agreement and the Terms Agreement, will be entitled to the benefits provided by
the Pooling and Servicing Agreement, except to the extent that enforcement
thereof may be limited by (1) bankruptcy, insolvency, reorganization, moratorium
or other similar laws now or hereafter in effect relating to creditors' rights
generally, and (2) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity);
(vi) to the knowledge of such counsel, no consent,
approval, authorization or order of any court or supervisory, regulatory,
administrative or governmental agency, body or official, is required in
connection with the consummation of the transactions contemplated by this
Agreement and the Terms
11
Agreement, except such as may have been obtained under the Act and such as may
be required under the state securities or Blue Sky laws of any jurisdiction and
such other approvals as have been obtained;
(vii) the Pooling and Servicing Agreement is not
required to be qualified under the Trust Indenture Act of 1939, as amended, and
the Trust Fund is not, and will not become, as a result of the offer and sale of
the Certificates as contemplated in the Prospectus, in this Agreement and in the
Terms Agreement, required to be registered under the Investment Company Act of
1940, as amended;
(viii) the statements in the Prospectus under the
caption "Description of the Certificates" insofar as such statements constitute
a summary of certain terms of the Certificates and the Pooling and Servicing
Agreement, constitute a fair summary of such documents in all material respects;
and the statements in the Prospectus under the caption "ERISA Considerations,"
insofar as they describe federal statutes and regulations, have been prepared or
reviewed by such counsel, and such statements fairly summarize such statutes and
regulations; and the statements in the Prospectus contained under the caption
"Certain Federal Income Tax Consequences," insofar as they constitute matters of
law or legal conclusions with respect thereto, have been prepared or reviewed by
such counsel and are correct in all material respects; and
(ix) either (a) the Trust Fund created by the Pooling
and Servicing Agreement will not be classified as an association taxable as a
corporation for federal income tax purposes or (b) in the event that the
Depositor makes an election to treat the related Trust Fund as a REMIC pursuant
to Section 860D of the Code, the Trust Fund will qualify as a REMIC and each
Certificate will qualify as a regular or residual interest in the Trust Fund.
In addition, you shall have received an opinion of counsel to
the Unaffiliated Seller or an opinion of counsel to the Trustee to the effect
that for income, franchise or excise tax purposes of the State of Illinois, the
Trust will not be classified as an association taxable as a corporation; and
each holder of a Certificate will be treated in the same manner as for Federal
income tax purposes.
The Registration Statement was declared effective under the Act
on August 12, 1994, and to the best knowledge of such counsel, no stop order
suspending its effectiveness has been issued and no proceedings for that purpose
have been instituted or are pending or threatened under the Act.
12
With respect to the matter specified in (x) above, the
applicable Terms Agreement shall specify the jurisdictions with respect to which
such opinion shall be rendered. Such opinions may be rendered by such counsel or
by such other counsel satisfactory to you and admitted to practice in such
jurisdiction and either such counsel may rely on Officers' Certificates,
certificates and records of public officials, certificates of the Trustee and
such other certificates as such counsel deems necessary and reasonable;
(e) you shall have received an opinion of counsel to the
Letter of Credit Bank, if any, dated the Specified Delivery Date, and in the
form agreed to on or prior to the date of the applicable Terms Agreement;
(f) you shall have received an opinion of counsel to the
Guarantor, if any, dated the Specified Delivery Date, and in the form agreed to
on or prior to the date of the applicable Terms Agreement;
(g) you shall have received an opinion of counsel to the
issuer of the Alternative Credit Enhancement, if any, dated the Specified
Delivery Date, and in the form agreed to on or prior to the date of the
applicable Terms Agreement;
(h) you shall have received an opinion of counsel to the
issuer of the Performance Bond, if any, dated the Specified Delivery Date, and
in the form agreed to on or prior to the date of the applicable Terms Agreement;
(i) you shall have received an opinion of counsel to the
Trustee, dated the Specified Delivery Date, and in the form agreed to on or
prior to the date of the applicable Terms Agreement;
(j) you shall have received an opinion of counsel to the
Servicer, dated the Specified Delivery Date, and in the form agreed to on or
prior to the date of the applicable Terms Agreement;
(k) you shall have received letters, dated the Specified
Delivery Date, from counsel rendering opinions to any nationally recognized
statistical rating organization rating the applicable Series of Certificates, to
the effect that you may rely upon their opinion to such rating organization, as
if such opinion were rendered to you;
(l) you shall have received a certificate or certificates
signed by such of the principal executive, financial and accounting officers of
the Depositor as you may request, dated the Specified Delivery Date, in
substantially the same form as Exhibit B hereto;
(m) you shall have received a certificate of the Trustee,
signed by one or more
13
duly authorized officers of the Trustee, dated the applicable Specified Delivery
Date, in substantially the same form as Exhibit C hereto;
(n) you shall have received a certificate of the Servicer,
signed by one or more duly authorized officers of the Servicer, dated the
applicable Specified Delivery Date in substantially the same form as Exhibit D
hereto;
(o) you shall have received a certificate of the Letter of
Credit Bank, if any, signed by one or more duly authorized officers of the
Letter of Credit Bank, dated the applicable Specified Delivery Date, and in the
form agreed to on or prior to the date of the applicable Terms Agreement;
(p) you shall have received a certificate of the Guarantor,
if any, signed by one or more duly authorized officers of the Guarantor, dated
the applicable Specified Delivery Date, and in the form agreed to on or prior to
the date of the applicable Terms Agreement;
(q) you shall have received a certificate of the issuer of
the Alternative Credit Enhancement, if any, signed by one or more duly
authorized officers of the issuer of the Alternative Credit Enhancement, dated
the applicable Specified Delivery Date, and in the form agreed to on or prior to
the date of the applicable Terms Agreement;
(r) you shall have received a certificate of the issuer of
the Performance Bond, if any, signed by one or more duly authorized officers of
the issuer of the Performance Bond, dated the applicable Specified Delivery
Date, and in the form agreed to on or prior to the date of the applicable Terms
Agreement; and
(s) the Unaffiliated Seller shall have sold the Mortgage
Loans to the Depositor pursuant to the Sale Agreement.
The Depositor will furnish you with such conformed copies of
such other opinions, certificates, letters and documents as you reasonably
request.
7. Indemnification.
(a) The Depositor will indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of the Act, against any losses, claims, damages or liabilities, joint or
several, to which the Underwriter or such controlling person may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
the Registration Statement, the Prospectus or any amendment or supplement
thereto, or arise out of or are based
14
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading; and will reimburse
each Underwriter and each such controlling person for any legal or other
expenses reasonably incurred by such Underwriter and each such controlling
person in connection with investigating or defending any such loss, claim,
damage, liability or action; provided, however, that the Depositor will not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon any such untrue statement or alleged
untrue statement in or omission or alleged omission made in any such documents
in reliance upon and in conformity with written information furnished to the
Depositor by an Underwriter specifically for use therein. This indemnity
agreement will be in addition to any liability which the Depositor may otherwise
have;
(b) each Underwriter will indemnify and hold harmless the
Depositor, each of its directors, each of its officers who has signed the
Registration Statement and each person, if any, who controls the Depositor
within the meaning of the Act, against any losses, claims, damages or
liabilities to which the Depositor or any such director, officer, or controlling
person may become subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of any material
fact contained in the Registration Statement, the Prospectus, or any amendment
or supplement thereto, or arise out of or are based upon the omission or the
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, and will reimburse any legal or other
expenses reasonably incurred by the Depositor or any such director, officer or
controlling person in connection with investigating or defending any such loss,
claim, damage, liability or action, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with written
information furnished to the Depositor by such Underwriter specifically for use
therein. This indemnity agreement will be in addition to any liability that such
Underwriter may otherwise have;
(c) promptly after receipt by an indemnified party under
this Section of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section, notify the indemnifying party of the commencement thereof;
but the omission so to notify the indemnifying party will not relieve it from
any liability which it may have to any indemnified party otherwise than in this
Section. In case any such action is brought against any indemnified party, and
it notified the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein, and, to the extent that it may
jointly with any other indemnifying party similarly notified, to assume the
defense thereof, with counsel satisfactory to such indemnified party (who shall
not, except with the consent of the indemnified party, be counsel to the
indemnifying party), and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such
15
indemnified party under this Section for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation; and
(d) if recovery is not available under the foregoing
indemnification provisions of this Section for any reason other than as
specified therein, the parties entitled to indemnification by the terms thereof
shall be entitled to contribution to liabilities and expenses, except to the
extent that contribution is not permitted under Section 11(f) of the Act. In
determining the amount of contribution to which the respective parties are
entitled, there shall be considered the relative benefits received by each party
from the offering of the Certificates subject to this Agreement (taking into
account the portion of the proceeds of the offering realized by each), the
parties' relative knowledge and access to information concerning the matter with
respect to which the claim was asserted, the opportunity to correct and prevent
any statement or omission, and any other equitable considerations appropriate
under the circumstances. The Depositor and the Underwriters agree that it would
not be equitable if the amount of such contribution were determined by pro rata
or per capita allocation (even if the Underwriters were treated as one entity
for such purpose). No Underwriter or person controlling such Underwriter shall
be obligated to make contribution hereunder which in the aggregate exceeds the
total public offering price of the Certificates purchased by such Underwriter
under this Agreement, less the aggregate amount of any damages which such
Underwriter and its controlling persons have otherwise been required to pay in
respect of the same claim or any substantially similar claim.
8. Computational Materials.
(a) The Underwriter agrees to provide to the Depositor no
less than two business days prior to the date on which the Prospectus is
proposed to be filed pursuant to Rule 424(b) under the Act, for the purpose of
permitting the Depositor to comply with the filing requirement set forth in
Section 5(a), all information (in such written or electronic format as required
by the Depositor) with respect to the Certificates which constitutes
"Computational Materials", as defined in the Commission's No-Action Letter,
dated May 20, 1994, addressed to Kidder, Peabody Acceptance Corporation I,
Kidder, Peabody & Co. Incorporated and Kidder Structured Asset Corporation (the
"Kidder Letter"), and that is required to be filed as described in the Kidder
Letter.
(b) The Underwriter shall provide to the Depositor, together
with the information required to be provided to the Depositor pursuant to
Section 8(a) or 8(c)(ii) hereof, a letter, in form and substance acceptable to
the Depositor, of independent certified public accountants acceptable to
Depositor, stating in effect that such independent certified public accountants
have performed certain specified procedures, all of which have been agreed to by
the Depositor, and that they have verified or confirmed, as appropriate, the
financial, numerical or statistical information to be filed by the Depositor as
part of the Computational Materials and
16
have found such information to be accurate without exception. Such letter will
be obtained at the sole expense of the Underwriter.
(c) (i) The Underwriter represents and warrants to, and
covenants with, the Depositor that all information provided to the Depositor
pursuant to this Section 8, as of the date such information is so provided and
as of the date such information is filed by the Depositor with the Commission
will not include any untrue statements of a material fact and will not omit to
state any material facts required to be stated therein or necessary to make the
statements contained therein, in the light of the circumstances under which they
were made, not misleading.
(ii) The Underwriter further covenants with the
Depositor that if any Computational Materials required to be provided to the
Depositor pursuant to Section 8(a) are determined to contain any information
that is inaccurate or misleading, the Underwriter (whether or not such
Computational Materials were provided to the Depositor or filed by the Depositor
with the Commission) shall promptly prepare and deliver to the Depositor and
each prospective investor which received such Computational Materials corrected
Computational Materials. All information provided to the Depositor pursuant to
this Section 8(c)(ii) shall be provided within the time periods set forth in
Section 8(a) hereof.
(iii) The Underwriter represents and warrants to the
Depositor that the Underwriter has taken all necessary and required steps to
ensure that no written material of any kind relating to the Certificates (or any
certificates similar to the Certificates) will be delivered to potential
investors other than Computational Materials and that all Computational
Materials required to be filed pursuant to the Kidder Letter will be provided to
the Depositor and to ensure that all such Computational Materials are accurate
and not misleading.
(iv) The Underwriter covenants with Depositor that
all Computational Materials delivered to prospective investors shall contain the
following legend:
"THIS INFORMATION IS FURNISHED TO YOU SOLELY BY CS FIRST BOSTON
CORPORATION AND NOT BY CS FIRST BOSTON MORTGAGE SECURITIES CORP. (THE
"DEPOSITOR") OR ANY OF ITS AFFILIATES (OTHER THAN THE UNDERWRITER). CS FIRST
BOSTON CORPORATION IS NOT ACTING AS AGENT FOR THE DEPOSITOR IN CONNECTION WITH
THE PROPOSED TRANSACTION."
(d) The Underwriter agrees to indemnify and hold harmless
the Depositor, each of the Depositor's officers and directors and each person
who controls the Depositor within the meaning of either the Act or the Exchange
Act against any and all losses, claims, damages or liabilities, joint or
several, to which they may become subject under the Act, the Exchange Act, or
other Federal or State statutory law or regulation, at common law or otherwise,
insofar
17
as such losses, claims, damages or liabilities (or actions in respect thereof)
(i) are based on, result from or arise out of: (A) the Underwriter's use or
delivery to any prospective investor in the Certificates of any Computational
Materials; (B) the Underwriter's failure to comply with Section 8(a) or 8(c)
hereof; (C) the filing by the Depositor with the Commission of any information
pursuant to the last sentence of Section 5(a); or (ii) arise out of or are based
upon any untrue statement or alleged untrue statement of a material fact
contained in any information required to be delivered to the Depositor pursuant
to Section 8(a) or 8(c) hereof, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, and agrees to
reimburse each such indemnified party for any legal or other expenses reasonably
incurred by him, her or it in connection with investigating or defending any
such loss, claim, damage, liability or action. The obligations of the
Underwriter under this Section 8 shall be in addition to any liability which the
Underwriter may otherwise have.
The procedures set forth in Section 7(c) shall be equally
applicable to this Section 8(d).
(e) In order to provide for just and equitable contribution
in circumstances in which the indemnification provided for in paragraph (d) of
this Section 8 is due in accordance with its terms but is for any reason held by
a court to be unavailable from the Underwriter on the grounds of policy or
otherwise, the Depositor and the Underwriter shall contribute to the aggregate
losses, claims, damages and liabilities (including legal or other expenses
reasonably incurred in connection with investigating or defending same) to which
the Depositor and the Underwriter may be subject in such proportion as is
appropriate to reflect the relative fault of the Underwriter on the one hand and
the Depositor on the other in connection with the actions, statements or
omissions that resulted in such losses, claims, damages or liabilities. The
relative fault of the Underwriter on the one hand and the Depositor on the other
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Underwriter or
by the Depositor and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Underwriter and the Depositor agree that it would not be
just and equitable if contribution pursuant to this Section 8(e) were determined
by pro rata allocation or by any other method of allocation that does not take
into account the equitable contribution referred to in the immediately preceding
paragraph.
The right of contribution to which the Depositor is entitled
under this paragraph (e) shall be equally available to each of the Depositor's
officers and directors and each person who controls the Depositor within either
the meaning of the Act or the Exchange Act.
18
(f) Notwithstanding any other provision herein, the
Underwriter agrees to pay all costs and expenses of the Depositor incurred in
connection with (i) the filing by the Depositor of any Computational Material
with the Commission and (ii) any action by the Depositor against the Underwriter
to enforce any of its rights set forth in this Section 8, including, without
limitation, legal fees and expenses.
9. Default of Underwriters. If any Underwriter or
Underwriters participating in an offering of Certificates default in their
obligations to purchase Certificates hereunder and under the Terms Agreement and
the aggregate principal amount of such Certificates which such defaulting
Underwriter or Underwriters agreed, but failed, to purchase does not exceed 10%
of the total principal amount of the Certificates set forth in such Terms
Agreement, you may make arrangements satisfactory to the Depositor for the
purchase of such Certificates by other persons, including any of the
Underwriters participating in such offering, but if no such arrangements are
made within a period of 36 hours after the applicable Specified Delivery Date,
the non-defaulting Underwriters shall be obligated severally, in proportion to
their respective total commitments hereunder and under such Terms Agreement, to
purchase the Certificates which such defaulting Underwriter or Underwriters
agreed but failed to purchase. If any Underwriter or Underwriters so default and
the aggregate principal amount of Certificates with respect to which such
default or defaults occur is more than 10% of the total principal amount of the
Certificates set forth in such Terms Agreement and arrangements satisfactory to
you and the Depositor for the purchase of such Certificates by other persons are
not made within 36 hours after such default, this Agreement will terminate
without liability on the part of any nondefaulting Underwriter or the Company,
except as provided in Section 10. As used in this Agreement, the term
"Underwriter" includes any person substituted for an Underwriter under this
Section. Nothing herein will relieve a defaulting Underwriter from liability for
its default.
10. Termination of the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Certificates on the Specified
Delivery Date shall be terminable by the Underwriters if (a) at any time on or
prior to the Specified Delivery Date (i) trading in securities generally on the
New York Stock Exchange shall have been suspended or materially limited, or
there shall have been any setting of minimum prices for trading on such
exchange, (ii) a general moratorium on commercial banking activities in New York
shall have been declared by any Federal or New York State authorities, (iii)
there shall have occurred any material outbreak or escalation of hostilities or
other calamity or crisis, the effect of which on the financial markets of the
United States is such as to make it, in your judgment as representative of the
Underwriters, impracticable to consummate the transactions contemplated herein
or is such as would materially and adversely affect the marketability of or the
market price for the Certificates or (iv) any change or any development
involving a prospective change occurs, materially and adversely affecting (A)
the Trust Fund taken as a whole or (B) the business or properties of the
Depositor, which, in your reasonable judgment as representative of the
Underwriters, in the case of either (A) or (B), materially impairs the
investment quality of the Certificates or (b) any representation or warranty of
another party shall be incorrect in
19
any material respect.
11. Survival of Certain Representations and Obligations. The
respective indemnities, agreements, representations, warranties and other
statements by the Depositor or its officers and of the several Underwriters set
forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation or statement as to the results thereof,
made by or on behalf of the Underwriters, the Depositor or any of its officers
or directors or any controlling person, and will survive delivery of and payment
of the Certificates.
If this Agreement is terminated pursuant to Section 9 or 10 or
if for any reason the purchase of the Certificates by the Underwriters is not
consummated, the Depositor shall remain responsible for the expenses to be paid
or reimbursed by it pursuant to Section 5(g), and the obligations of the
Depositor and the Underwriters pursuant to Section 7 or 8 shall remain in
effect.
12. Notices. All communications hereunder will be in writing
and, if sent to an Underwriter, will be mailed, delivered or telegraphed and
confirmed to Park Avenue Plaza, 55 East 52nd Street, New York, New York 10055
and to any other Underwriter at such address, if any, as is specified in writing
to the Depositor for notices hereunder, or if sent to the Depositor, will be
mailed, delivered or telegraphed and confirmed to it at Park Avenue Plaza, 55
East 52nd Street, New York, New York 10055 Attention: President; provided,
however, that any notice to an Underwriter pursuant to Section 7 will be mailed,
delivered or telegraphed to such Underwriter at the address furnished by it.
13. Successors. This Agreement will inure to the benefit of
and be binding upon the parties hereto and their respective successors and the
officers, directors and controlling persons referred to in Section 7 hereof, and
their successors and assigns, and no other person will have any right or
obligation hereunder.
14. Representations of Underwriters. You will act for the
several Underwriters in connection with this financing, and any action under
this Agreement and any Terms Agreement taken by you will be binding upon all the
Underwriters identified in such Terms Agreement.
15. Applicable Law. This Agreement will be governed by and
construed in accordance with the laws of the State of New York.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon it will
become a binding agreement among the Depositor and the several Underwriters in
accordance with its terms. Alternatively, the execution of this Agreement by the
Depositor and its acceptance by or on behalf of the Underwriters may be
evidenced by an exchange of telegraphic or other written communications.
20
Very truly yours,
CS FIRST BOSTON MORTGAGE SECURITIES CORP.,
as Depositor
By: /s/ Allan J. Baum
--------------------------------------
Name: Allan J. Baum
Title: Director
The foregoing Agreement is
hereby confirmed and accepted
as of the date first above
written.
CS FIRST BOSTON CORPORATION
as Underwriter
By: /s/ Marc J. Warren
--------------------------------------------------------
Name: Marc J. Warren
Title: Vice President
EXHIBIT A
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
(DEPOSITOR)
COMMERCIAL/MULTIFAMILY MORTGAGE
PASS-THROUGH CERTIFICATES
TERMS AGREEMENT
Dated: , 1994
To: CS First Boston Mortgage Securities Corp., as Depositor under
the Pooling and Servicing Agreement dated as of , 1994.
Re: Underwriting Agreement dated , 1994.
Registration Statement No. 33-
Basic Prospectus dated , 1994
Prospectus Supplement dated , 1994
Title:Commercial/Multifamily Mortgage Pass-Through Certificates, Series 1994,
Class ______
Pooling and Servicing Agreement dated as of 1, 1994.
Seller's Warranties and Servicing Agreement dated as of 1, 1994.
Principal Amount:$ (approximate)
Class Designation Schedule:[insert relevant description of Classes of
Certificates]
Class [A] Certificate Rating:[" " by Moody's Investors Service, Inc.] [" " by
Standard & Poor's Corporation]
[Initial Pass-Through Rate: % per annum.
Terms of Sale: The purchase price for the Class [A] Certificates to the
Underwriters will be % of the aggregate principal amount of the Class
[A] Certificates as of , 19 , plus accrued interest at the initial
Pass-Through Rate from 19 , together with estimated expenses of
approximately $___________ [The Underwriters will offer the Class [A]
Certificates to the public from time to time, in negotiated transactions or
otherwise, at varying prices to be determined at the time of sale.] [The
Underwriters will offer the Class [A]
A-1
Certificates to the public at the following prices [(expressed as a percentage
of the original principal amount or notional amount of such Class,
respectively)]: Class A-[1], _% [; Class A-2, _%; Class A-3, _% [and] Class A-4,
_%]].
[The Class [B] Certificates issued pursuant to the Pooling and Servicing
Agreement are not subject to this Agreement.]
Contracts: [Insert description of Contracts], as more fully described in Exhibit
A hereto.
[Distribution Dates: .]
Opinion of Counsel: The jurisdiction specified in Paragraph (xi) of the opinion
of counsel to be delivered pursuant to Section 6(d) of the Underwriting
Agreement shall be the States of and .
Specified Delivery Date and Location: : A.M., New York Time, on , 19
or at such other time not later than seven full business days
thereafter as may be agreed upon, at the offices of [Milbank, Tweed, Hadley
& McCloy, New York, New York 10005] [Orrick, Herrington & Sutcliffe, New York,
New York]
[The Certificates will be issued as one or more certificates registered in the
name of Cede & Co., the nominee of The Depository Trust Company. Beneficial
owners will hold interests in the Certificates through the book-entry facilities
of The Depository Trust Company in minimum denominations in initial Certificate
Principal Balance of $ and in integral multiples of $ in
excess thereof. No person acquiring an Offered Certificate will be entitled to
receive a physical certificate representing such Certificate.].
[The Certificates will be delivered in definitive, fully registered form.]
The Underwriters named in Schedule 1 hereto agree[s], severally
and not jointly], subject to the terms and provisions of the Agreement, which is
incorporated by reference herein and made a part hereof, to purchase the
[numbers of Single] Certificates [set forth opposite their names in Schedule 1].
Capitalized terms not otherwise defined herein shall have the
meanings assigned to them in the Prospectus Supplement.
CS FIRST BOSTON CORPORATION
By
----------------------------
Vice President
A-2
Accepted
CS FIRST BOSTON MORTGAGE
SECURITIES CORP.
By
-------------------------------
A-3
EXHIBIT B
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
OFFICER'S CERTIFICATE
I, , do hereby certify that I
am the duly elected of CS First Boston Mortgage Securities
Corp., a Delaware corporation (the "Company") and further certify as follows.
Capitalized terms used but otherwise not defined herein shall have the meanings
ascribed to them in the Underwriting Agreement, dated , 1994,
between the Company and CS First Boston Corporation (the "Underwriting
Agreement").
1. The representations and warranties of the Company in the
Underwriting Agreement are true and correct.
2. The Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied at or prior to
the Specified Delivery Date.
3. No stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose have
been instituted or, to my knowledge, are contemplated.
4. Subsequent to the respective dates as of which
information is given in the Prospectus, and except as set forth or contemplated
in the Prospectus, there has not been any material adverse change in the general
affairs, capitalization, financial condition or results of operations of the
Company.
5. Except as otherwise stated in the Prospectus, there are
no material actions, suits or proceedings pending before any court or
governmental agency, authority or body or, to my knowledge, threatened,
affecting the Company or the transactions contemplated by the Underwriting
Agreement, as supplemented by the Terms Agreement, dated , 1994,
between the Company and CS First Boston Corporation.
[6. Attached hereto are true and correct copies of a letter
from the rating agency or agencies rating the Certificates subject to the
Underwriting Agreement confirming that, unless otherwise specified in the
applicable Underwriting Agreement, the Class _ Certificates and the Class _
Certificates have been rated in one of the two highest rating categories
established by such agency or agencies and that such ratings have not been
lowered since the date of such letter.]
IN WITNESS WHEREOF, I have hereunto signed my name and affixed
the seal of the Company.
B-1
Dated: , 1995 CS FIRST BOSTON MORTGAGE SECURITIES
CORP.
By:
Name:
Title:
[Seal]
B-2
EXHIBIT C
LASALLE NATIONAL BANK
OFFICER'S CERTIFICATE
I, , do hereby certify that I am the duly
elected of (the "Trustee"), a National Banking Association
organized under the laws of the United States and further certify as follows.
Capitalized terms used but otherwise not defined herein shall have the meanings
ascribed to them in the Pooling and Servicing Agreement, dated as of November 1,
1994 (the "Agreement"), among CS First Boston Mortgage Securities Corp., as
Depositor, the Trustee, as Trustee and Greystone Servicing Corporation, Inc., as
Master Servicer and Greystone Funding Corporation, as Seller.
1. The Trustee has been duly organized and is validly
existing and in good standing under the laws of the United States, duly
qualified to do business as a foreign corporation and in good standing under the
laws of each jurisdiction in which the performance of its duties under the
Agreement would require such qualification.
2. The Agreement has been duly authorized, executed and
delivered by the Trustee and (assuming the due authorization, execution and
delivery of the other parties thereto) is a valid and binding agreement of the
Trustee, enforceable against the Trustee in accordance with its terms, except to
the extent that (a) enforcement thereof may be limited by (1) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally, and (2) general principles of
equity (regardless of whether enforceability is considered in a proceeding at
law or in equity).
3. The execution and delivery by the Trustee of the
Agreement is within the corporate power of the Trustee and has been duly
authorized by all necessary corporate action on the part of the Trustee; and
neither the execution and delivery of such instrument by the Trustee nor the
consummation by the Trustee of the transactions therein contemplated, nor
compliance with the provisions thereof by the Trustee, will (A) conflict with or
result in a breach of, or will constitute a default under, any of the provisions
of the articles of association or bylaws of the Trustee or any law, governmental
rule or regulation, or any judgment, decree or order binding on the Trustee or
its properties, or any of the provisions of any indenture, mortgage, deed of
trust, contract or other instrument to which the Trustee is a party or by which
it is bound or (B) result in the creation or imposition of any lien, charge or
encumbrance upon any of its properties pursuant to the terms of any such
indenture, mortgage, deed of trust, contract or other instrument.
4. The Trustee holds all material licenses, certificates
and permits from all governmental authorities necessary for the performance of
its obligations under the Agreement, and has received no notice of proceedings
relating to the revocation of any such license, certificate or permit, which
singly or in the aggregate, if the subject of any unfavorable decision,
C-1
ruling or finding, would materially affect the conduct of the business, results
of operations, net worth or condition (financial or otherwise) of the Trustee;
and the Trustee has the corporate power and authority to perform its obligations
under the Agreement.
IN WITNESS WHEREOF, the undersigned has caused this certificate
to be executed by its officer hereunto authorized, and its corporate seal to be
hereunto affixed this day of, 1995.
LASALLE NATIONAL BANK
By:
---------------------------
Name:
Title:
[Seal]
C-2
EXHIBIT D
GREYSTONE SERVICING CORPORATION, INC.
OFFICER'S CERTIFICATE
I, , do hereby certify that I am the duly
elected of Greystone Servicing Corporation, Inc. (the "Servicer"), a
corporation, and further certify as follows. Capitalized terms used
but otherwise not defined herein shall have the meanings ascribed to them in the
Underwriting Agreement, dated , 1994, between CS First Boston
Mortgage Securities Corp. and CS First Boston Corporation.
1. The Servicer has been duly incorporated and is validly
existing and in good standing under the laws of the State of , duly
qualified to do business as a foreign corporation and in good standing under the
laws of each jurisdiction in which the performance of its duties under the
Seller's Warranties and Servicing Agreement (the "Servicing
Agreement"), dated as of , 1994, between the Servicer and
CS First Boston Mortgage Securities Corp. ("FBMSC"), and the Sale Agreement,
dated , 1994, between the Servicer, [CS First Boston Mortgage
Capital Corp.] and FBMSC (the "Sale Agreement"), would require such
qualification.
2. The Servicing Agreement and the Sale Agreement have been
duly authorized, executed and delivered by the Servicer and (assuming due
authorization, execution and delivery by the other parties thereto) are valid
and binding agreements of the Servicer, enforceable against the Servicer in
accordance with their terms, except to the extent that enforcement thereof may
be limited by (1) bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights generally,
and (2) general principles of equity (regardless of whether enforceability is
considered in a proceeding at law or in equity).
3. The Servicer has the corporate power and authority to
conduct its business as described in the Prospectus.
4. The execution and delivery by the Servicer of the
Servicing Agreement and the Sale Agreement is within the corporate power of the
Servicer and has been duly authorized by all necessary corporate action on the
part of the Servicer; and neither the execution and delivery of such instruments
by the Servicer, nor the consummation by the Servicer of the transactions
therein contemplated, nor compliance with the provisions thereof by the
Servicer, will (A) conflict with or result in a breach of, or will constitute a
default under, any of the provisions of the certificate of incorporation or
bylaws of the Servicer or any law, governmental rule or regulation, or any
judgment, decree or order binding on the Servicer or its properties, or any of
the provisions of any indenture, mortgage, deed of trust, contract or other
instrument to which the Servicer is a party or by which it is bound or (B)
result in the creation or imposition of any lien, charge or encumbrance upon any
of its properties pursuant to the terms of any such indenture, mortgage, deed of
trust, contract or other instrument.
D-1
5. The Servicer holds all material licenses, certificates
and permits from all governmental authorities necessary for the conduct of its
business as described in the Prospectus and has received no notice of
proceedings relating to the revocation of any such license, certificate or
permit, which singly or in the aggregate, if the subject of any unfavorable
decision, ruling or finding, would materially affect the conduct of the
business, results of operations, net worth or condition (financial or otherwise)
of the Servicer.
IN WITNESS WHEREOF, the undersigned has caused this certificate
to be executed by its officer hereunto authorized, and its corporate seal to be
hereunto affixed this day of , 1995.
GREYSTONE SERVICING CORPORATION, INC.
By:
--------------------------------------
Name:
Title:
[Seal]
D-2
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
(DEPOSITOR)
MORTGAGE PASS-THROUGH CERTIFICATES
TERMS AGREEMENT
Dated: November 15, 1995
To: CS First Boston Mortgage Securities Corp., as Depositor under
the Pooling and Servicing Agreement dated as of November 1,
1995.
Re: Underwriting Agreement dated October 12, 1994.
Registration Statement No. 33-98604
Basic Prospectus dated November 13, 1995
Prospectus Supplement dated November 15, 1995
Title: Mortgage Pass-Through Certificates, Series 1995-FHA1, Class A-1, Class A-
2, Class A-3, Class A-4, Class A-X-1, Class A-X-2 Class A-X-3 and Class A-X-4
(together, the "Underwritten Certificates").
Pooling and Servicing Agreement dated as of November 1, 1995.
Aggregate Principal Amount: $167,488,346 (approximate)
Class Designation Schedule:
<TABLE>
<CAPTION>
Initial Class Pass-
Series 1995-FHA1 Principal Balance Through S&P Selling Price
Class Designation (approximate) Rate Rating of the Securities
- ----------------- ----------------- ------------ ------ -----------------
<S> <C> <C> <C> <C>
Class A-1 $45,000,000 6.6650% AAA (3)
Class A-2 $20,000,000 6.8300% AAA (3)
Class A-3 $45,789,713 7.1940% AAA (3)
Class A-4 $56,698,633 7.6450% AAA (3)
Class A-X-1 (1) Variable(2) AAAr (3)
Class A-X-2 (1) Variable(2) AAAr (3)
Class A-X-3 (1) Variable(2) AAAr (3)
Class A-X-4 (1) Variable(2) AAAr (3)
</TABLE>
- ---------------
(1) None of the Classes of Interest-Only Certificates will have a Class
Principal Balance. Interest will accrue on each Class of Interest-Only
Certificates at the respective variable Pass-Through Rates thereof on a Class
Notional Amount. The Class Notional Amount of the Class A-X-1 Certificates is
equal to the Class Principal Balance of the Class A-1 Certificates outstanding
from time to time. The Class Notional Amount of the Class A-X-2 Certificates is
equal to the Class Principal Balance of the Class A-2 Certificates outstanding
from time to time. The Class Notional Amount of the Class A-X-3 Certificates is
equal to the Class Principal Balance of the Class A-3 Certificates outstanding
from time to time. The Class Notional Amount of the Class A-X-4 Certificates is
equal to the Class Principal Balance of the Class A-4 Certificates outstanding
from time to time.
(2) The Pass-Through Rates applicable to the Interest-Only Certificates are
variable. The Pass-Through Rate applicable to the Class A-X-1 Certificates for
the initial Distribution Date will equal 2.9114% per annum and thereafter will
equal the excess, if any, of the weighted average of the Net Asset Rates of the
Mortgage Assets from time to time, over the Pass-Through Rate applicable to the
Class A-1 Certificates. The Pass-Through Rate applicable to the Class A-X-2
Certificates for the initial Distribution Date will equal 2.7464% per annum and
thereafter will equal the excess, if any, of the weighted average of the Net
Asset Rates of the Mortgage Assets from time to time, over the Pass-Through Rate
applicable to the Class A-2 Certificates. The Pass-Through Rate applicable to
the Class A-X-3 Certificates for the initial Distribution Date will equal
2.3824% per annum and thereafter will equal the excess, if any, of the weighted
average of the Net Asset Rates of the Mortgage Assets from time to time, over
the Pass-Through Rate applicable to the Class A-3 Certificates. The Pass-
Through Rate applicable to the Class A-X-4 Certificates for the initial
Distribution Date will equal 1.9314% per annum and thereafter will equal the
excess, if any, of the weighted average of the Net Asset Rates of the Mortgage
Assets from time to time, over the Pass-Through Rate applicable to the Class A-4
Certificates.
(3) The Underwriter proposes to offer the Underwritten Securities from time
to time to the public in negotiated transactions or otherwise at varying prices
to be determined at the price of sale.
Terms of Sale: The purchase price for the Class A-1, Class A-2, Class A-3,
Class A-4, Class A-X-1, Class A-X-2, Class A-X-3 and Class A-X-4 Certificates to
the Underwriter will be $176,525,213, plus accrued interest at the initial Pass-
Through Rate from November 1, 1995, together with expenses.
Distribution Dates: The 25th day of each month (unless such day is not a
Business Day, in which case distributions will be made on the next succeeding
Business Day) commencing in December 1995.
Specified Delivery Date and Location: 10:00 A.M., New York City time, on
November 21, 1995 or at such other time as may be agreed upon, at the offices of
Thacher Proffitt & Wood, New York, New York.
The Class A-1, Class A-2, Class A-3 and Class A-4 Certificates (the "Book-Entry
Certificates") will be issued as one or more certificates registered in the name
of Cede & Co., the nominee of The Depository Trust Company. Beneficial owners
will hold interests in the Book-Entry Certificates through the book-entry
facilities of The Depository Trust Company in minimum denominations in initial
Certificate Principal Balance of $25,000 and in integral multiples of $1 in
excess thereof. No person acquiring a Book-Entry Certificate will be entitled
to receive a physical certificate representing such Certificate.
It is hereby understood and agreed that the opinions listed in Section 6(d) of
the Underwriting Agreement will be rendered by one of Milbank, Tweed, Hadley &
McCloy or Thacher Proffitt & Wood, each in case in its capacity as counsel to
the Depositor and the Underwriter.
Exhibit 4.1
CS FIRST BOSTON MORTGAGE SECURITIES CORP.,
Depositor,
GREYSTONE SERVICING CORPORATION, INC.,
Master Servicer,
GREYSTONE FUNDING CORPORATION,
Seller,
and
LASALLE NATIONAL BANK,
Trustee
_____________
POOLING AND SERVICING AGREEMENT
Dated as of November 1, 1995
relating to
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 1995-FHA1
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS; CERTAIN CALCULATIONS
SECTION 1.01. Definitions ...................................... 3
SECTION 1.02. Certain Calculations Respecting the
Mortgage Pool .................................... 34
ARTICLE II
CONVEYANCE OF TRUST FUND;
REPRESENTATIONS AND WARRANTIES;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01. Conveyance of Mortgage Assets .................... 36
SECTION 2.02. Acceptance of REMIC I by Trustee; Review
of Mortgage Loan Documentation .................. 39
SECTION 2.03. Representations, Warranties and Covenants of the
Depositor as to the Mortgage Assets .............. 40
SECTION 2.04. Representations, Warranties and Covenants of the
Master Servicer and the Seller ................... 41
SECTION 2.05. Execution, Authentication and Delivery of Class
R-I Certificates; Creation of REMIC I Regular
Interests ........................................ 47
SECTION 2.06. Conveyance of REMIC I Regular Interests;
Acceptance of REMIC II by Trustee ................ 47
SECTION 2.07. Execution, Authentication and Delivery of REMIC II
Certificates ..................................... 47
SECTION 2.08 Retained Yield ................................... 48
ARTICLE III
ADMINISTRATION AND SERVICING
OF TRUST FUND
SECTION 3.01. General Servicing Provisions ..................... 48
SECTION 3.02. Administration of GNMA Certificates and FHA
Debentures ....................................... 50
SECTION 3.03. Collection of Mortgage Asset Payments ............ 51
SECTION 3.04. Rights of the Depositor and the Trustee in
Respect of the Master Servicer and the Seller .... 52
SECTION 3.05. Sub-Servicers .................................... 52
SECTION 3.06. Collection of Taxes, Assessments and Similar Items;
Escrow Accounts .................................. 53
SECTION 3.07. Reserve Accounts ................................. 53
- i -
<PAGE>
SECTION 3.08. Maintenance of the Collection Account ............ 53
SECTION 3.09. Permitted Withdrawals from the Collection
Account .......................................... 55
SECTION 3.10. Maintenance of Hazard Insurance and Other
Insurance ........................................ 57
SECTION 3.11. Enforcement of Due-On-Sale and Due-On-Encumbrance
Clauses; Assumption Agreements ................... 57
SECTION 3.12. Maintenance of FHA Mortgage Insurance; Collection
Thereunder ....................................... 59
SECTION 3.13. Trustee to Cooperate; Release of Mortgage Files .. 61
SECTION 3.14. Documents, Records and Funds in Possession of
Master Servicer to be Held on Behalf of the
Trustee for the Benefit of the
Certificateholders ............................... 62
SECTION 3.15. Sale of Defaulted Mortgage Loans and FHA
Debentures ....................................... 63
SECTION 3.16. Servicing Compensation ........................... 64
SECTION 3.17. Reports to the Depositor; Account Statements ..... 64
SECTION 3.18. Annual Statement as to Compliance ................ 65
SECTION 3.19. Annual Independent Public Accountants' Servicing
Report ........................................... 65
SECTION 3.20. Access to Certain Information .................... 65
ARTICLE IV
PAYMENTS AND STATEMENTS TO CERTIFICATEHOLDERS
SECTION 4.01. Distribution Account ............................. 66
SECTION 4.02. Distributions .................................... 67
SECTION 4.03. Statements to Certificateholders; Collection
Reports .......................................... 71
SECTION 4.04. Allocation of Realized Losses and Certain Other
Expenses and Shortfalls .......................... 76
SECTION 4.05. Prepayment Interest Shortfalls ................... 77
SECTION 4.06 Calculations ..................................... 78
SECTION 4.07 Use of Agents .................................... 78
ARTICLE V
ADVANCES
SECTION 5.01. Monthly Advances by the Master Servicer .......... 79
SECTION 5.02. Monthly Advance Procedures ....................... 80
SECTION 5.03. Servicing Advances ............................... 81
SECTION 5.04. Nonrecoverable Advances .......................... 81
SECTION 5.05 Interest on Advances ............................. 82
ARTICLE VI
THE CERTIFICATES
SECTION 6.01. The Certificates ................................. 82
SECTION 6.02. Registration of Transfer and Exchange of
Certificates ..................................... 83
- ii -
<PAGE>
SECTION 6.03. Mutilated, Destroyed, Lost or Stolen
Certificates ..................................... 88
SECTION 6.04. Persons Deemed Owners ............................ 88
SECTION 6.05. Access to List of Certificateholders' Names and
Addresses ........................................ 89
SECTION 6.06. Maintenance of Office or Agency .................. 89
SECTION 6.07. Book-Entry Certificates .......................... 89
SECTION 6.08. Notices to Clearing Agency ....................... 90
SECTION 6.09. Definitive Certificates .......................... 90
ARTICLE VII
THE DEPOSITOR, THE SELLER AND THE MASTER SERVICER
SECTION 7.01. Liabilities of the Depositor, the Seller
and the Master Servicer .......................... 91
SECTION 7.02. Merger or Consolidation of the Depositor, the
Seller or the Master Servicer .................... 91
SECTION 7.03. Limitation on Liability of the Depositor, the
Seller, the Master Servicer and Others ........... 92
SECTION 7.04. Master Servicer Not to Resign .................... 93
SECTION 7.05. Errors and Omissions Insurance; Fidelity
Bonds ............................................ 93
SECTION 7.06. Depositor, Seller and Master Servicer May Own
Certificates ..................................... 93
ARTICLE VIII
DEFAULT
SECTION 8.01. Events of Default ................................ 94
SECTION 8.02. Trustee to Act; Appointment of Successor ......... 96
SECTION 8.03. Notification to Certificateholders ............... 97
SECTION 8.04. Other Remedies of Trustee ........................ 97
ARTICLE IX
CONCERNING THE TRUSTEE
SECTION 9.01. Duties of Trustee ............................... 98
SECTION 9.02. Certain Matters Affecting the Trustee ........... 100
SECTION 9.03. Trustee Not Liable for Certificates or Mortgage
Loans ........................................... 101
SECTION 9.04. Trustee May Own Certificates .................... 102
SECTION 9.05. Trustee's Fees and Expenses ..................... 102
SECTION 9.06. Eligibility Requirements for Trustee ............ 103
SECTION 9.07. Resignation and Removal of Trustee .............. 103
SECTION 9.08. Successor Trustee ............................... 104
SECTION 9.09. Merger or Consolidation of Trustee .............. 104
SECTION 9.10. Appointment of Co-Trustee or Separate Trustee ... 105
SECTION 9.11. Representations and Warranties of the Trustee ... 106
- iii -
<PAGE>
SECTION 9.12. Certain Reports by the Trustee .................. 107
ARTICLE X
TERMINATION
SECTION 10.01. Termination upon Liquidation or Repurchase of all
Mortgage Loans .................................. 107
SECTION 10.02. Procedure Upon Optional Termination ............. 108
SECTION 10.03. Additional Termination Requirements ............. 109
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.01. Amendment ....................................... 110
SECTION 11.02. Recordation of Agreement; Counterparts .......... 111
SECTION 11.03. Governing Law ................................... 111
SECTION 11.04. Notices ......................................... 112
SECTION 11.05. Severability of Provisions ...................... 112
SECTION 11.06. Limitation on Rights of Certificateholders ...... 112
SECTION 11.07. Certificates Nonassessable and Fully Paid ....... 113
SECTION 11.08. HUD Regulations and Documents Control ........... 113
SECTION 11.09. Miscellaneous REMIC Provisions .................. 113
- iv -
<PAGE>
EXHIBITS
Exhibit A-1: Form of Class A-1 Certificate .......................... A-1-1
Exhibit A-2: Form of Class A-2 Certificate .......................... A-2-1
Exhibit A-3: Form of Class A-3 Certificate .......................... A-3-1
Exhibit A-4: Form of Class A-4 Certificate .......................... A-4-1
Exhibit A-5: Form of Class A-X-1 Certificate ........................ A-5-1
Exhibit A-6: Form of Class A-X-2 Certificate ........................ A-6-1
Exhibit A-7: Form of Class A-X-3 Certificate ........................ A-7-1
Exhibit A-8: Form of Class A-X-4 Certificate ........................ A-8-1
Exhibit A-9: Form of Class B Certificate ............................ A-9-1
Exhibit A-10: Form of Class R-I Certificate .......................... A-10-1
Exhibit A-11: Form of Class R-II Certificate ......................... A-11-1
Exhibit B: Schedule of Mortgage Assets .................... B-1
Exhibit C: Form of Certification of Trustee ............... C-1-1
Exhibit D-1: Form of Transferor Representation Letter ............... D-1-1
Exhibit D-2: Form of Transferee Representation Letter ............... D-2-1
Exhibit E: Form of Investor Letter relating to ERISA ...... E-1
Exhibit F-1: Form of Transfer Affidavit and Agreement ............... F-1-1
Exhibit F-2: Form of Transfer Certificate ........................... F-2-1
Exhibit G: Letter of Representations ...................... G-1
Exhibit H: Form of Lost Note Affidavit and Indemnity ...... H-1
Exhibit I: Form of HUD Indemnity .......................... I
Exhibit J: Schedule of Past Due or Unpaid Tax
and Assessment Obligations ..................... K
- v -
<PAGE>
THIS POOLING AND SERVICING AGREEMENT, dated as of November 1,
1995, is hereby executed by and among CS FIRST BOSTON MORTGAGE SECURITIES CORP.,
as depositor (the "Depositor"), GREYSTONE SERVICING CORPORATION, INC., as master
servicer (the "Master Servicer"), GREYSTONE FUNDING CORPORATION, as Seller (the
"Seller"), and LASALLE NATIONAL BANK, as trustee (the "Trustee"). Capitalized
terms used in this Agreement and not otherwise defined will have the meanings
assigned to them in Article I below.
PRELIMINARY STATEMENT
The Depositor intends to sell mortgage pass-through certificates
(collectively, the "Certificates"), to be issued hereunder in multiple classes
(each, a "Class"), which in the aggregate will evidence the entire beneficial
ownership interest in a trust fund (the "Trust Fund") to be created hereunder.
As provided herein, the Trustee will elect to treat the
segregated pool of assets consisting of the Mortgage Assets (as defined herein),
exclusive of any Retained Yield (as defined herein) collected thereon, and
certain other related assets subject to this Agreement as a real estate mortgage
investment conduit (a "REMIC") for federal income tax purposes, and such
segregated pool of assets will be designated as "REMIC I". The Class R-I
Certificates will represent the sole class of "residual interests" in REMIC I
for purposes of the REMIC Provisions (as defined herein) under federal income
tax law. The following table irrevocably sets forth the designation, remittance
rate (the "REMIC I Remittance Rate") and initial stated principal amount (the
initial "Uncertificated Principal Balance") for each of the "regular interests"
in REMIC I (the "REMIC I Regular Interests"). The "latest possible maturity
date" (determined solely for purposes of satisfying Treasury Regulation Section
1.860G-1(a)(4)(iii)) for each REMIC I Regular Interest shall be the first
Distribution Date that follows the Stated Maturity Date (as defined herein) for
the Mortgage Loan or GNMA Certificate (each as defined herein), as the case may
be, with the longest remaining term to stated maturity. None of the REMIC I
Regular Interests will be certificated.
REMIC I Initial Uncertificated
Designation Remittance Rate Principal Balance
----------- --------------- ------------------------
A-1 Variable(1) $45,000,000
A-2 Variable(1) $20,000,000
A-3 Variable(1) $45,789,713
A-4 Variable(1) $56,698,633
B Variable(1) $ 4,055,014
- --------------
(1) As more specifically provided in the definition of "REMIC I Remittance
Rate", the REMIC I Remittance Rate for each REMIC I Regular Interest will
equal the weighted average of the Net Asset Rates (as defined herein) for
the Mortgage Assets (the "Weighted Average Net Asset Rate") in effect from
time to time.
As provided herein, the Trustee will elect to treat the segregated pool of
assets consisting of the REMIC I Regular Interests as a REMIC for federal income
tax purposes, and such segregated pool of assets will be designated as REMIC II.
The Class R-II Certificates will represent the sole class of "residual
interests" in REMIC II for purposes of the REMIC Provisions under federal income
tax law. The following table irrevocably sets forth the class designation,
pass-through rate (the "Pass-Through Rate") and initial aggregate stated
principal amount (the initial "Class Principal Balance") for each of the Classes
of Certificates representing "regular interests" in REMIC II (the "REMIC II
Regular Certificates"). The "latest possible maturity date" (determined solely
for purposes of satisfying Treasury Regulation Section 1.860G-1(a)(4)(iii)) for
each Class of REMIC II Regular Certificates shall be the first Distribution Date
that follows the Stated Maturity Date for the Mortgage Loan or GNMA Certificate,
as the case may be, with the longest remaining term to stated maturity. As and
to the extent provided herein, the Class B, Class R-I and Class R-II
Certificates (collectively, the "Subordinate Certificates") will be subordinated
in right of payment to the Class A-1, Class A-2, Class A-3, Class A-4, Class A-
X-1, Class A-X-2, Class A-X-3 and Class A-X-4 Certificates (collectively, the
"Senior Certificates").
Class Initial Class
Designation Pass-Through Rate Principal Balance(1)
- ------------ -------------------- ----------------------
Class A-1 6.665% per annum $45,000,000
Class A-2 6.830% per annum $20,000,000
Class A-3 7.194% per annum $45,789,713
Class A-4 7.645% per annum $56,698,633
Class A-X-1 Variable(2) N/A(2)
Class A-X-2 Variable(2) N/A(2)
Class A-X-3 Variable(2) N/A(2)
Class A-X-4 Variable(2) N/A(2)
Class B Variable(3) $4,055,014
_________________________________
(1) As provided herein, as of any date of determination, the Uncertificated
Principal Balance of REMIC I Regular Interest A-1 will equal the Class
Principal Balance of the Class A-1 Certificates, the Uncertificated
Principal Balance of REMIC I Regular Interest A-2 will equal the Class
Principal Balance of the Class A-2 Certificates, the Uncertificated
Principal Balance of REMIC I Regular Interest A-3 will equal the Class
Principal Balance of the Class A-3 Certificates, the Uncertificated
Principal Balance of REMIC I Regular Interest A-4 will equal the Class
Principal Balance of the Class A-4 Certificates and the Uncertificated
Principal Balance of REMIC I Regular Interest B will equal the Class
Principal Balance of the Class B Certificates.
(2) None of the Classes of Interest-Only Certificates will have a Class
Principal Balance. Each Class of Interest-Only Certificates will accrue
interest as described herein at the related Pass-Through Rate in effect
from time to time on a hypothetical or notional principal amount (in each
case, a "Class Notional Amount") that is, in the case of the Class A-X-1
Certificates, equal to the Uncertificated Principal Balance of REMIC I
Regular Interest A-1 (and, accordingly, the Class Principal Balance of
the Class A-1 Certificates) outstanding from time to time, in the case of
the Class A-X-2 Certificates, equal to the Uncertificated Principal
Balance of REMIC I Regular Interest A-2 (and, accordingly, the Class
Principal Balance of the Class A-2 Certificates) outstanding from time to
time, in the case of the Class A-X-3 Certificates, equal to the
Uncertificated Principal Balance of REMIC I Regular Interest A-3 (and,
accordingly, the Class Principal Balance of the Class A-3 Certificates)
outstanding
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from time to time and, in the case of the Class A-X-4
Certificates, equal to the Uncertificated Principal Balance of REMIC I
Regular Interest A-4 (and, accordingly, the Class Principal Balance of
the Class A-4 Certificates) outstanding from time to time. The Pass-
Through Rates for the respective Classes of Interest-Only Certificates
will, in each case, equal the excess, if any, of the REMIC I Remittance
Rate in effect from time to time for a specified REMIC I Regular Interest
(which, in each case, will equal the Weighted Average Net Asset Rate in
effect from time to time) over (i) in the case of the Class A-X-1
Certificates, 6.665%, (ii) in the case of the Class A-X-2 Certificates,
6.830%, (iii) in the case of the Class A-X-3 Certificates, 7.194%, and
(iv) in the case of the Class A-X-4 Certificates, 7.645%.
(3) As more specifically provided in the definition of "Pass-Through Rate",
the Pass-Through Rate for the Class B Certificates will equal the
weighted average of the REMIC I Remittance Rates for the REMIC I Regular
Interests (and, accordingly, the Weighted Average Net Asset Rate) in
effect from time to time.
The Depositor is entering into this Agreement, and the Trustee is accepting
the trusts created hereby, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged. The aggregate of the Cut-off Date
Balances of the Mortgage Assets, the aggregate of the Uncertificated Principal
Balances of the REMIC I Regular Interests, and the aggregate of the Class
Principal Balances of the respective Classes of REMIC II Regular Certificates
will in each case be $171,543,360.
W I T N E S S E T H T H A T:
In consideration of the mutual agreements herein contained, the Depositor,
the Master Servicer, the Seller and the Trustee agree as follows:
ARTICLE I
DEFINITIONS; CERTAIN CALCULATIONS
SECTION 1.01. Definitions.
Whenever used in this Agreement, the following words and phrases, unless the
context otherwise requires, shall have the following meanings:
Accrued Certificate Interest: With respect to any Class of REMIC II Regular
Certificates for any Distribution Date, one month's interest at the Pass-Through
Rate applicable to such Class of Certificates for such Distribution Date,
accrued on the related Class Principal Balance or Class Notional Amount, as the
case may be, outstanding immediately prior to such Distribution Date. Accrued
Certificate Interest shall be calculated on the basis of a 360-day year
consisting of twelve 30-day months.
Additional Trust Fund Expense: Any expense of the Trust Fund the payment of
which resulted in any Holders of REMIC II Regular Certificates receiving less
than the full amount of interest, principal or both to which they are entitled.
Advance: Any Monthly Advance or Servicing Advance.
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Advance Interest: Interest accrued on any Advance at the Reimbursement Rate
and payable to the Master Servicer, all in accordance with Section 5.05.
Adverse REMIC Event: Either (i) the endangerment of the status of either
REMIC I or REMIC II as a REMIC or (ii) the imposition of a tax upon either REMIC
I or REMIC II or any of their respective assets or transactions (including,
without limitation, the tax on prohibited transactions as defined in Section
860F(a)(2) of the Code and the tax on prohibited contributions set forth in
Section 860G(d) of the Code).
Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Agreement: This Pooling and Servicing Agreement and any and all amendments
or supplements hereto.
Annual Debt Service: As defined in the Prospectus Supplement.
Assignment of Leases: With respect to any Mortgaged Property, any
assignment of leases, rents and profits or similar document or instrument
executed by the Mortgagor in connection with the origination of the related
Mortgage Loan.
Available Distribution Amount: With respect to any Distribution Date, the
excess of: (a) the sum of (i) the aggregate amount of payments and other
collections received or, in accordance with Section 3.15, made by the Master
Servicer and/or the Trustee in respect of the Mortgage Assets on or prior to the
related Determination Date, from any source, and not previously remitted to
Certificateholders (exclusive, however, of any portion of the foregoing
representing Prepayment Premiums, Retained Yield and/or amounts received in
respect of Mortgage Assets previously removed from the Trust Fund), (ii) the
aggregate amount of Monthly Advances made, and Compensating Interest paid, by
the Master Servicer or any other Person for such Distribution Date, (iii) all
amounts required to be paid by the Depositor, the Trustee or the Master Servicer
to indemnify the Trust Fund pursuant to any specific provision of this Agreement
and (iv) in the case of the Optional Termination Date, if any, the Termination
Price; over (b) the sum of (i) the aggregate amount of the Servicing
Compensation (including, without limitation, Servicing Fees, late payment
charges, modification fees and assumption fees) paid or payable from and
included in the sum described in clause (a) above, (ii) any amount included in
the sum described in clause (a) above representing late payments or other
recoveries (including, without limitation, in the form of Liquidation Proceeds
(net of Liquidation Expenses), Insurance Proceeds and Condemnation Proceeds)
with respect to any Mortgage Assets in respect of which the Master Servicer has
made a previously unreimbursed Advance, (iii) the amount of any Nonrecoverable
Advances and Advance Interest reimbursed or reimbursable from the sum described
in clause (a) above, (iv) any amount included in the sum
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described in clause (a) above that has been or is to be deposited in an Escrow
Account or a Reserve Account, (v) all payments (other than Principal Prepayments
and other unscheduled collections of principal) or portions thereof received in
respect of scheduled principal and interest on any Mortgage Asset due after the
end of the related Collection Period and included in the sum described in clause
(a) above, (vi) all payments due on any Mortgage Asset on or prior to the Cut-
off Date and included in the sum described in clause (a) above, (vii) an amount
equal to the Trustee Fee for such Distribution Date and, to the extent not
previously paid, for each prior Distribution Date, and (viii) any other expenses
of the Trust Fund paid or payable from the sum described in clause (a) above
pursuant to this Agreement.
Bankruptcy Code: The United States Bankruptcy Code, as amended from time to
time (11 U.S.C.).
Beneficial Holder: A Person holding a beneficial interest in any
Certificate through a Participant or an Indirect Participant or a Person holding
a beneficial interest in any Definitive Certificate, as defined in Section 6.07.
BIF: The Bank Insurance Fund, or any successor thereto.
Book-Entry Certificate: Any Class A-1, Class A-2, Class A-3 or Class A-4
Certificate.
Business Day: Any day other than (i) a Saturday or a Sunday, or (ii) a day
on which banking institutions in 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.
CERCLA: The Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended.
Certificate: Any Class A-1, Class A-2, Class A-3, Class A-4, Class A-X-1,
Class A-X-2, Class A-X-3, Class A-X-4, Class B, Class R-I or Class R-II
Certificate executed and authenticated by the Trustee for the benefit of the
Certificateholders in substantially the form or forms attached as Exhibits
hereto.
Certificate Factor: With respect to any Class of REMIC II Regular
Certificates, as of any date of determination, a fraction, expressed as a
decimal carried to six places, the numerator of which is the then related Class
Principal Balance or Class Notional Amount, as the case may be, and the
denominator of which is the related Initial Class Principal Balance or Initial
Class Notional Amount, as the case may be.
Certificateholder: The Person in whose name a Certificate is registered in
the Certificate Register, except that (i) neither a Disqualified Organization
nor a Non-United States Person shall be Holder of a Residual Certificate for any
purpose hereof and, (ii) except where herein specifically stated otherwise,
solely for the purposes of giving any consent, approval or waiver pursuant to
this Agreement that relates to any of the Depositor, the Seller, the Master
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Servicer or the Trustee in its respective capacity as such, any Certificate
registered in the name of the Depositor, the Seller, the Master Servicer or the
Trustee, as the case may be, or any Certificate registered in the name of any of
its Affiliates, shall be deemed not to be outstanding, and the Voting Rights to
which it is entitled shall not be taken into account in determining whether the
requisite percentage of Voting Rights necessary to effect any such consent,
approval or waiver that relates to it has been obtained. The Trustee shall be
entitled to request and rely upon a certificate of the Depositor, the Seller or
the Master Servicer, as the case may be, in determining whether a Certificate is
registered in the name of an Affiliate of such Person. All references herein to
"Holders" or "Certificateholders" shall reflect the rights of Beneficial Holders
as they may indirectly exercise such rights through DTC, the Participants and
the Indirect Participants, except as otherwise specified herein; provided,
however, that the parties hereto shall be required to recognize as a "Holder" or
"Certificateholder" only the Person in whose name a Certificate is registered in
the Certificate Register.
Certificate Notional Amount: With respect to any Interest-Only Certificate,
as of any date of determination, the then hypothetical or notional principal
amount on which such Certificate accrues interest equal to the product of (a)
the Percentage Interest evidenced by such Certificate, multiplied by (b) the
then Class Notional Amount of the Class of Certificates to which such
Certificate belongs.
Certificate Principal Balance: With respect to any Sequential Pay
Certificate, as of any date of determination, the then outstanding principal
amount of such Certificate equal to the product of (a) the Percentage Interest
evidenced by such Certificate, multiplied by (b) the then Class Principal
Balance of the Class of Certificates to which such Certificate belongs.
Certificate Register: The register maintained pursuant to Section 6.02(a)
hereof.
Class: Collectively, all of the Certificates bearing the same alphabetical
and, if applicable, numerical class designation.
Class A-1 Certificate: A Certificate executed and authenticated by the
Trustee in substantially the form set forth in Exhibit A-1 hereto and designated
as a Class A-1 Certificate.
Class A-2 Certificate: A Certificate executed and authenticated by the
Trustee in substantially the form set forth in Exhibit A-2 hereto and designated
as a Class A-2 Certificate.
Class A-3 Certificate: A Certificate executed and authenticated by the
Trustee in substantially the form set forth in Exhibit A-3 hereto and designated
as a Class A-3 Certificate.
Class A-4 Certificate: A Certificate executed and authenticated by the
Trustee in substantially the form set forth in Exhibit A-4 hereto and designated
as a Class A-4 Certificate.
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Class A-X-1 Certificate: A Certificate executed and authenticated by the
Trustee in substantially the form set forth in Exhibit A-5 hereto and designated
as a Class A-X-1 Certificate.
Class A-X-2 Certificate: A Certificate executed and authenticated by the
Trustee in substantially the form set forth in Exhibit A-6 hereto and designated
as a Class A-X-2 Certificate.
Class A-X-3 Certificate: A Certificate executed and authenticated by the
Trustee in substantially the form set forth in Exhibit A-7 hereto and designated
as a Class A-X-3 Certificate.
Class A-X-4 Certificate: A Certificate executed and authenticated by the
Trustee in substantially the form set forth in Exhibit A-8 hereto and designated
as a Class A-X-4 Certificate.
Class B Certificate: A Certificate executed and authenticated by the
Trustee in substantially the form set forth in Exhibit A-9 hereto and designated
as a Class B Certificate.
Class Notional Amount: The aggregate hypothetical or notional principal
amount on which a Class of Interest-Only Certificates accrues interest from time
to time. As of any date of determination, the Class Notional Amount of the
Class A-X-1 Certificates shall equal the then Uncertificated Principal Balance
of REMIC I Regular Interest A-1 (and, accordingly, the then Class Principal
Balance of the Class A-1 Certificates), the Class Notional Amount of the Class
A-X-2 Certificates shall equal the then Uncertificated Principal Balance of
REMIC I Regular Interest A-2 (and, accordingly, the then Class Principal Balance
of the Class A-2 Certificates), the Class Notional Amount of the Class A-X-3
Certificates shall equal the then Uncertificated Principal Balance of REMIC I
Regular Interest A-3 (and, accordingly, the then Class Principal Balance of the
Class A-3 Certificates), and the Class Notional Amount of the Class A-X-4
Certificates shall equal the then Uncertificated Principal Balance of REMIC I
Regular Interest A-4 (and, accordingly, the then Class Principal Balance of the
Class A-4 Certificates).
Class Principal Balance: The aggregate principal amount of any Class of
Sequential Pay Certificates outstanding as of any date of determination. As of
the Closing Date, the Class Principal Balance of each such Class of Certificates
shall equal the Initial Class Principal Balance thereof. On each Distribution
Date, the Class Principal Balance of each such Class of Certificates shall be
reduced by the amount of any distributions of principal made thereon on such
Distribution Date pursuant to Section 4.02(a) or 10.02(d), as applicable, and if
and to the extent appropriate, shall be further reduced on such Distribution
Date as provided in Section 4.04(a).
Class R-I Certificate: A Certificate executed and authenticated by the
Trustee in substantially the form set forth in Exhibit A-10 hereto and
designated as a Class R-I Certificate.
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Class R-II Certificate: A Certificate executed and authenticated by the
Trustee in substantially the form set forth in Exhibit A-11 hereto and
designated as a Class R-II Certificate.
Clearing Agency: An organization registered as a "clearing agency" pursuant
to Section 17A of the Securities Exchange Act of 1934, as amended, which
initially shall be DTC.
Closing Date: November 21, 1995.
Code: The Internal Revenue Code of 1986, as amended.
Collection Account: The deposit account or accounts created and maintained
by the Master Servicer pursuant to Section 3.08 hereof in the name of the Master
Servicer on behalf of the Trustee for the benefit of the Certificateholders,
which account or accounts must be an Eligible Account or Accounts.
Collection Period: With respect to any Distribution Date, the period
commencing immediately following the Determination Date in the calendar month
preceding the calendar month in which such Distribution Date occurs (or, in the
case of the initial Distribution Date, commencing immediately following the Cut-
off Date) to and including the Determination Date in the calendar month in which
such Distribution Date occurs.
Collection Report: As defined in Section 4.03(b) hereof.
Compensating Interest: As defined in Section 4.05(a) hereof.
Condemnation Proceeds: Amounts paid by the applicable governmental
authority in connection with the condemnation of any Mortgaged Property or the
taking of all or any portion thereof by right of eminent domain, which amounts
have not been applied to the restoration of the related property or released to
the related Mortgagor.
Corporate Trust Office: The designated office of the Trustee at which at
any particular time its corporate trust business with respect to the Trust Fund
shall be administered, which office at the date of the execution of this
Agreement is located at 135 South LaSalle Street, Suite 200, Chicago, Illinois
60603, Attention: Asset-Backed Securities Trust Services Department.
CPR: As defined in the Prospectus Supplement.
Cut-off Date: November 1, 1995.
Cut-off Date Balance: With respect to any Mortgage Loan, the unpaid
principal balance thereof as of the Cut-off Date, after application of the
payment of any principal due thereon on or prior to such date, whether or not
received; and with respect to any GNMA Certificate, the unpaid principal balance
thereof as of the Cut-off Date, exclusive of any payment
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of principal due on the related Underlying Loan on or prior to such date,
whether or not received.
Cut-off Date Debt Service Coverage Ratio: As defined in the Prospectus
Supplement.
Definitive Certificate: As defined in Section 6.07.
Depositor: CS First Boston Mortgage Securities Corp. or its successor in
interest.
Depository Agreement: The Letter of Representation dated as of November 20,
1995 by and among DTC, the Depositor and the Trustee.
Determination Date: With respect to any Distribution Date, the 18th day
(or, if such 18th day is not a Business Day, the Business Day immediately
succeeding such 18th day) of the calendar month in which such Distribution Date
occurs.
Disqualified Organization: (i) The United States, any State or any
political subdivision thereof, or any agency or instrumentality of any of the
foregoing (other than an instrumentality which is a corporation if all of its
activities are subject to tax and, except for FHLMC, a majority of its board of
directors is not selected by any such governmental unit), (ii) a foreign
government, international organization or any agency or instrumentality of
either of the foregoing, (iii) an organization (except certain farmers'
cooperatives described in Section 521 of the Code) which is exempt from tax
imposed by Chapter 1 of the Code (unless such organization is subject to the tax
imposed by Section 511 of the Code on unrelated business taxable income), (iv)
rural electric and telephone cooperatives described in Section 1381 of the Code
and (v) any other Person so designated by the Trustee based upon an Opinion of
Counsel (which shall be obtained at no cost to the Trustee) that the holding of
an Ownership Interest in a Residual Certificate by such Person may cause either
of the REMICs created hereunder or any Person having an Ownership Interest in
any Class of Certificates, other than such Person, to incur a liability for any
federal tax imposed under the Code that would not otherwise be imposed but for
the Transfer of an Ownership Interest in a Residual Certificate to such Person.
The terms "United States," "State" and "international organization" shall have
the meanings set forth in Section 7701 of the Code or successor provisions.
Distributable Certificate Interest: With respect to any Class of REMIC II
Regular Certificates, for any Distribution Date, the Accrued Certificate
Interest in respect of such Class of Certificates for such Distribution Date,
reduced (to not less than zero) by that portion of all Uncovered Prepayment
Interest Shortfalls, if any, incurred during the related Collection Period that
are allocable to such Class of Certificates in reduction of its "Distributable
Certificate Interest" for such Distribution Date pursuant to Section 4.05(b).
Distribution Account: The separate account or accounts created and
maintained by the Trustee pursuant to Section 4.01 hereof in the name of the
Trustee for the benefit of the Certificateholders, which account or accounts
must be an Eligible Account or Accounts.
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Distribution Date: The 25th day of each calendar month, or if such 25th day
is not a Business Day, the next succeeding Business Day, commencing in December,
1995.
Distribution Date Statement: As defined in Section 4.03(a) hereof.
DTC: The Depository Trust Company.
Due Date: As the context requires, each date on which a payment, whether of
principal, interest or both, is due on a Mortgage Loan, an FHA Debenture or a
GNMA Certificate in accordance with the terms thereof.
Eligible Account: Either (i) an account or accounts maintained with a
federal or state-chartered depository institution or trust company (which may be
an affiliate of the Master Servicer or which may be the Trustee or an affiliate
of the Trustee) the short-term unsecured debt obligations of which (or, in the
case of a depository institution or trust company that is the principal
subsidiary of a holding company, the short-term unsecured debt obligations of
such holding company) are rated A-1+ by the Rating Agency, (ii) an account or
accounts the deposits in which are fully insured by the FDIC (the BIF or the
SAIF), provided that any such deposits not so insured shall be otherwise
maintained such that (as evidenced by an Opinion of Counsel delivered to the
Trustee and the Rating Agency) the Certificateholders have a claim with respect
to the funds in such account or a perfected first priority security interest
against any collateral (which shall be limited to Permitted Investments)
securing such funds that is superior to claims of any other depositors or
creditors of the depository institution or trust company with which such account
is maintained or (iii) a trust account or accounts maintained with the trust
department of a federal or state chartered depository institution or trust
company acting in its fiduciary capacity, provided that any such state chartered
depository institution is subject to regulation regarding funds on deposit
substantially similar to the regulations set forth in 12 C.F.R. Section
9.10(b).
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
Escrow Account: As defined in Section 3.06.
Event of Default: As defined in Section 8.01 hereof.
Exchange Act: Securities Exchange Act of 1934, as amended.
FDIC: The Federal Deposit Insurance Corporation or any successor thereto.
FHA: The Federal Housing Administration, which is a sub-division of HUD, or
any successor. The term "FHA" is used interchangeably in this Agreement with
the term "HUD".
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FHA-Approved Mortgagee: A corporation or institution approved as a
mortgagee by the FHA under the Housing Act and applicable FHA Regulations, and
eligible to own and service project mortgage loans such as the Mortgage Loans.
FHA Assigned Mortgage Loan: Any Mortgage Loan that has been in default for
longer than the applicable FHA grace period and respecting which written notice
of an intention to assign has been filed with the FHA, whether or not such
Mortgage Loan has in fact been assigned to the FHA.
FHA Debenture Delivery Date: The date on which an FHA Debenture is
delivered by the FHA to the Trustee in respect of an FHA Assigned Mortgage Loan.
FHA Debenture Rate: The rate per annum at which interest accrues in respect
of any FHA Debenture.
FHA Debentures: Debentures issued by the FHA pursuant to an FHA Mortgage
Insurance Contract.
FHA Insurance Benefits: The amount of insurance benefits, whether in the
form of cash or FHA Debentures or some combination thereof, payable by the FHA
in the event of a default with respect to a Mortgage Loan.
FHA Loan: A mortgage loan which is the subject of an FHA Mortgage Insurance
Contract.
FHA Loan Program: The program pursuant to which the FHA will insure loans
made to borrowers for construction and permanent financing of housing projects.
The FHA Loan Program for each Mortgage Loan and Underlying Loan is identified on
the Mortgage Asset Schedule with the applicable section number.
FHA Mortgage Insurance: Insurance granted by the FHA with respect to any
mortgage loan under the applicable section of the Housing Act.
FHA Mortgage Insurance Contract: The contractual obligation of the FHA
respecting the insurance of a mortgage loan.
FHA Regulations: Regulations promulgated by HUD under the Housing Act,
codified in 24 Code of Federal Regulation, and other HUD issuances relating to
FHA Loans, including, without limitation, the related handbooks, circulars,
notices and mortgagee letters.
FHLMC: The Federal Home Loan Mortgage Corporation or any successor thereto.
FNMA: The Federal National Mortgage Association or any successor thereto.
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Final Recovery Determination: A determination by the Master Servicer with
respect to any defaulted Mortgage Loan (other than a Mortgage Loan that was
purchased by the Depositor or the Seller pursuant to Article II or by the Master
Servicer pursuant to Section 10.01) that there has been a recovery of all FHA
Insurance Benefits, Insurance Proceeds (including, without limitation, in the
form of FHA Debentures), Condemnation Proceeds, Liquidation Proceeds and other
payments or recoveries that the Master Servicer has determined, in its
reasonable and good faith judgment, will be ultimately recoverable.
GNMA: The Government National Mortgage Association or any successor
thereof.
GNMA Certificate: Each of the mortgage pass-through certificates
transferred and assigned to the Trustee pursuant to the provisions hereof as
from time to time are held as part of the Trust Fund, guaranteed by GNMA and
backed by an FHA Loan, the mortgage pass-through certificates so held being
identified in the Mortgage Asset Schedule, as amended from time to time.
GNMA Certificate Rate: The rate per annum at which interest accrues in
respect of any GNMA Certificate.
Hazardous Materials: Any dangerous, toxic or hazardous pollutants,
chemicals, wastes, or substances, including, without limitation, those so
identified pursuant to CERCLA or any other federal, state or local environmental
related laws and regulations now existing or hereafter enacted, and specifically
including, without limitation, asbestos and asbestos-containing materials,
polychlorinated biphenyls ("PCBs"), radon gas, petroleum and petroleum products,
urea formaldehyde and any substances classified as being "in inventory", "usable
work in process" or similar classification which would, if classified as
unusable, be included in the foregoing definition.
Housing Act: The National Housing Act, as amended.
HUD: The United States Department of Housing and Urban Development, or any
federal agency or official thereof which may from time to time succeed to the
functions thereof with regard to FHA Mortgage Insurance. The term "HUD," for
purposes of this Agreement, is used interchangeably with the term "FHA".
HUD Indemnity: With respect to any Mortgage Loan that is to be assigned to
the FHA and as to which the original Mortgage Note has been permanently lost or
misplaced, an indemnity from the Trustee in favor of HUD substantially in the
form of Exhibit I.
Independent: When used with respect to any specified Person, any such
Person who (i) is in fact independent of the Depositor, the Master Servicer, the
Seller, the Trustee and any and all Affiliates thereof, (ii) does not have any
direct financial interest in or any material indirect financial interest in any
of the Depositor, the Master Servicer, the Seller, the Trustee or any Affiliate
thereof, and (iii) is not connected with the Depositor, the Master Servicer, the
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Seller, the Trustee or any Affiliate thereof as an officer, employee, promoter,
underwriter, trustee, partner, director or Person performing similar functions;
provided, however, that a Person shall not fail to be Independent of the
Depositor, the Master Servicer, the Seller, the Trustee or any Affiliate thereof
merely because such Person is the beneficial owner of 1% or less of any class of
securities issued by the Depositor, the Master Servicer, the Seller, the Trustee
or any Affiliate thereof, as the case may be.
Indirect Participants: Entities, such as banks, brokers, dealers and trust
companies, that clear through or maintain a custodial relationship with a
Participant, either directly or indirectly.
Initial Class Notional Amount: With respect to each Class of Interest-Only
Certificates, the amount set forth below:
Class Initial Class Notional Amount
----- ------------------------------
A-X-1 $45,000,000
A-X-2 $20,000,000
A-X-3 $45,789,713
A-X-4 $56,698,633
Initial Class Principal Balance: With respect to each Class of Sequential
Pay Certificates, the amount set forth below:
Class Initial Class Principal Balance
----- -------------------------------
A-1 $45,000,000
A-2 $20,000,000
A-3 $45,789,713
A-4 $56,698,633
B $4,055,014
Insurance Proceeds: Amounts (other than FHA Insurance Benefits) paid
pursuant to any insurance policy with respect to a Mortgage Loan or related
Mortgaged Property that have not been used to restore the property.
Issue Price: With respect to each Class of Certificates, the "issue price"
as defined in the Code and Treasury Regulations promulgated thereunder.
Interest-Only Certificate: Any Class A-X-1, Class A-X-2, Class A-X-3 or
Class A-X-4 Certificate.
Liquidated Loan: Any Mortgage Loan as to which the Master Servicer has made
a Final Recovery Determination.
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Liquidation Expenses: Expenses incurred by or on behalf of the Master
Servicer in connection with the liquidation of any defaulted Mortgage Loan and
not recovered by the Master Servicer under the related FHA Mortgage Insurance,
or otherwise, for reasons other than the Master Servicer's failure to comply
with Section 3.12 hereof.
Liquidation Proceeds: Cash amounts received in connection with the
liquidation or sale of a defaulted Mortgage Loan, whether through assignment of
the Mortgage Loan to HUD, acquisition of title to the related Mortgaged Property
and conveyance thereof to HUD, trustee's sale, foreclosure sale, sale of the
Mortgage Loan pursuant to Section 3.15(a), sale of any FHA Debentures received
as FHA Insurance Benefits in respect of the Mortgage Loan pursuant to Section
3.15(b), or otherwise.
Lost Note Affidavit and Indemnity: With respect to any Mortgage Loan as to
which the Seller is unable to deliver the original Mortgage Note to the Trustee
pursuant to Section 2.02 because the original Mortgage Note has been permanently
lost or misplaced, an affidavit from the Seller certifying that the original
Mortgage Note has been lost or misplaced and an indemnity from the Seller in
favor of, among others, the Trustee and its successors and assigns in respect of
such Mortgage Loan, substantially in the form annexed hereto as Exhibit H.
Majority Class B Certificateholder: Any single Holder of Class B
Certificates representing a greater than 50% Percentage Interest in such Class.
Master Servicer: Greystone Servicing Corporation, Inc. or any successor
under the terms of this Agreement.
Master Servicer Remittance Date: With respect to any Distribution Date, the
Business Day prior to such Distribution Date.
Monthly Advance: As to any Mortgage Asset, any advance made by the Master
Servicer or the Trustee with respect to any Distribution Date pursuant to
Section 5.01 or 5.02 hereof.
Monthly Advance Date: As defined in Section 5.02(a).
Monthly Payment: The scheduled monthly payment of principal and interest on
a Mortgage Loan.
Mortgage: The mortgage, deed of trust or other instrument creating a first
lien on a fee simple or leasehold estate in real property securing a Mortgage
Note.
Mortgage Asset: Any Mortgage Loan, any GNMA Certificate or, if acquired as
part of the Trust Fund, any FHA Debenture.
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Mortgage Asset Purchase Agreement: The Mortgage Asset Purchase Agreement,
dated November 15, 1995, among the Depositor, the Master Servicer and the
Seller.
Mortgage Asset Schedule: The list of Mortgage Assets transferred on the
Closing Date to the Trustee as part of the Trust Fund, which list is attached
hereto as Exhibit B. The Mortgage Asset Schedule shall set forth, among other
things, the following information with respect to each Mortgage Asset:
(i) the Mortgage Asset type;
(ii) the type of real property securing the Mortgage Loan or related
Underlying Loan, as the case may be;
(iii) the Section of the Housing Act under which the Mortgage Loan or
the related Underlying Loan, as the case may be, is insured;
(iv) in the case of each GNMA Certificate, the GNMA pool number;
(v) the original principal balance;
(vi) the Cut-off Date Balance;
(vii) based solely on Seller's review of the related lender's title
insurance policy, the lien position of the related Mortgage;
(viii) the Mortgage Rate of the Mortgage Loan or related Underlying
Loan, as the case may be;
(ix) the Net Asset Rate;
(x) the Servicing Fee Rate, if applicable;
(xi) the first scheduled due date for the Mortgage Loan or related
Underlying Loan, as the case may be;
(xii) the Stated Maturity Date;
(xiii) the remaining term to stated maturity;
(xiv) in the case of each Mortgage Loan, the applicable FHA Debenture
Rate;
(xv) in the case of each Mortgage Loan, any applicable Retained Yield
Rate;
(xvi) the prepayment provisions of the Mortgage Loan or related
Underlying Loan, as the case may be (including, without
limitation, any such
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provisions relating to a prepayment lock-out
period and/or the payment of a Prepayment Premium);
(xvii) the location (including city and state) of the real property
securing the Mortgage Loan or related Underlying Loan, as the
case may be;
(xviii) the Annual Debt Service;
(xix) if available, the Cut-off Date Debt Service Coverage Ratio;
(xx) if available, the NOI; and
(xxi) the last day of the fiscal year for which the NOI described in
clause (xx) above was calculated.
The Mortgage Asset Schedule shall also set forth the aggregate Cut-off Date
Balance for all of the Mortgage Assets. Such list may be in the form of more
than one list, collectively setting forth all of the information required.
Mortgage File: For each Mortgage Loan, collectively the following
documents:
(i) The original Mortgage Note (bearing a final endorsement
evidencing the FHA Mortgage Insurance), endorsed in blank or to
"LaSalle National Bank, as trustee for CS First Boston Mortgage
Securities Corp. Mortgage Pass-Through Certificates, Series 1995-
FHA1, without recourse," together with all intervening
endorsements showing an unbroken chain of endorsement from the
originator of the Mortgage Loan to the Person so endorsing (or,
in the case of the Mortgage Loans listed on the Mortgage Asset
Schedule as mortgage assets 15 and 23, a photocopy of the
original Mortgage Note, together with a Lost Note Affidavit and
Indemnity);
(ii) The original Mortgage, with evidence of recording thereon, and,
if such Mortgage was executed pursuant to a power of attorney,
the original of such power of attorney, with evidence of
recording thereon, or (A) if such original Mortgage or power of
attorney has not been returned from the applicable public
recording office due to a delay caused by the public recording
office, a true and correct copy thereof, together with an
Officer's Certificate of the Seller or the Depositor stating that
such original Mortgage and/or power of attorney has been sent to
the appropriate public recording office for recordation, or (B)
if such original Mortgage or power of attorney has been lost
after recordation or has been retained by the public recording
office, a copy thereof, certified by the appropriate public
recording office where such document is recorded or by the
related title insurance company to be a true and complete copy of
the recorded original of such Mortgage or power of attorney, as
the case may be;
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(iii) The originals of all modification, consolidation and extension
agreements, if any, with evidence of recording thereon, or (A) if
any such original modification, consolidation or extension
agreement has not been returned from the applicable public
recording office due to a delay caused by the public recording
office, a true and correct copy thereof, together with an
Officer's Certificate of the Seller or the Depositor stating that
such original modification, consolidation or extension agreement
has been sent to the appropriate public recording office for
recordation, or (B) if any such original modification,
consolidation or extension agreement has been lost after
recordation or has been retained by the public recording office,
a copy thereof, certified by the appropriate public recording
office where such document is recorded or by the related title
insurance company to be a true and complete copy of the recorded
original of such modification, consolidation or extension
agreement;
(iv) An original assignment of the Mortgage, in recordable form,
signed by the holder of record in blank or in favor of "LaSalle
National Bank, as trustee for CS First Boston Mortgage Securities
Corp. Mortgage Pass-Through Certificates, Series 1995-FHA1";
(v) Originals of all intervening assignments of the Mortgage, with
evidence of recording thereon and showing a complete recorded
chain of assignment from the originator of the Mortgage Loan to
the holder of record, or (A) if any such original intervening
assignment of the Mortgage has not been returned from the
applicable public recording office due to a delay caused by the
public recording office, a true and correct copy thereof,
together with an Officer's Certificate of the Seller or the
Depositor stating that such original intervening assignment of
the Mortgage has been sent to the appropriate public recording
office for recordation, or (B) if any such original intervening
assignment of the Mortgage has been lost after recordation or has
been retained by the public recording office, a copy thereof,
certified by the appropriate public recording office where such
assignment is recorded or by the related title insurance company
to be a true and complete copy of the recorded original of such
intervening assignment of the Mortgage;
(vi) If any related Assignment of Leases is separate from the
Mortgage, the original version of such Assignment of Leases with
evidence of recording thereon, or (A) if such Assignment of
Leases has not been returned from the applicable public recording
office due to a delay caused by the public recording office, a
true and correct copy thereof, together with an Officer's
Certificate of the Seller or the Depositor stating that such
original Assignment of Leases has been sent to the appropriate
public recording office for recordation, or (B) if such original
Assignment of Leases has been lost after recordation or has been
retained by the public recording office, a copy thereof,
certified by the appropriate public recording office where such
document is recorded or by the related title insurance
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company to be a true and complete copy of the recorded original
of such Assignment of Leases;
(vii) If any related Assignment of Leases is separate from the
Mortgage, an original assignment of such Assignment of Leases, in
recordable form, signed by the holder of record in blank or in
favor of "LaSalle National Bank, as trustee for CS First Boston
Mortgage Securities Corp. Mortgage Pass-Through Certificates,
Series 1995-FHA1", which assignment may be effected in the
related assignment of the Mortgage referred to in clause (iv)
above;
(viii) If any related Assignment of Leases is separate from the
Mortgage, originals of all intervening assignments of such
Assignment of Leases (which in each case may be effected in the
related intervening assignment of the Mortgage referred to in
clause (v) above), with evidence of recording thereon and showing
a complete recorded chain of assignment from the originator of
the Mortgage Loan to the holder of record, or (A) if any such
original intervening assignment of such Assignment of Leases has
not been returned from the applicable public recording office due
to a delay caused by the public recording office, a true and
correct copy thereof, together with an Officer's Certificate of
the Seller or the Depositor stating that such original
intervening assignment of such Assignment of Leases has been sent
to the appropriate public recording office for recordation, or
(B) if any such original intervening assignment of such
Assignment of Leases has been lost after recordation or has been
retained by the public recording office, a copy thereof,
certified by the appropriate public recording office where such
assignment is recorded or by the related title insurance company
to be a true and complete copy of the recorded original of such
intervening assignment of such Assignment of Leases;
(ix) If any related Security Agreement is separate from the Mortgage,
the original version of such Security Agreement, or if the
original version of such Security Agreement has been lost, a copy
thereof, together with an Officer's Certificate of the Seller or
the Depositor stating that the original version of the Security
Agreement has been lost and such copy is a true and complete copy
of the original version of the Security Agreement (the Seller
shall identify those Mortgage Files which should contain a
separate Security Agreement);
(x) If any related Security Agreement is separate from the Mortgage,
an original assignment of such Security Agreement, signed by the
holder of record in blank or in favor of "LaSalle National Bank,
as trustee for CS First Boston Mortgage Securities Corp. Mortgage
Pass-Through Certificates, Series 1995-FHA1", which assignment
may be effected in the related assignment of the Mortgage
referred to in clause (iv) above;
(xi) If any related Security Agreement is separate from the Mortgage,
originals of all intervening assignments of such Security
Agreement (which in
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each case may be effected in the related intervening assignment of
the Mortgage referred to in clause (v) above), showing a complete
recorded chain of assignment from the originator of the Mortgage
Loan to the holder of record, or if any such original intervening
assignment of such Security Agreement has been lost, a copy
thereof, together with an Officer's Certificate of the Seller or
the Depositor stating that such original intervening assignment of
the Security Agreement has been lost and such copy is a true and
complete copy of the original of such intervening assignment of
the Security Agreement;
(xii) The original lender's title insurance policy or in the event such
original lender's title insurance policy is unavailable, any one
of an original title binder, an original title commitment or a
copy of such policy certified to be a true and complete copy by
the title company or the Seller;
(xiii) An original assignment of each recorded or filed effective
financing statement, in form and substance acceptable for
recording or filing, as appropriate, signed by the secured party
currently designated of record in blank or in favor of "LaSalle
National Bank, as trustee for CS First Boston Mortgage Securities
Corp. Mortgage Pass-Through Certificates, Series 1995-FHA1" (the
Seller shall identify those Mortgage Files which should contain
financing statements, and the type of such financing statements);
and
(xiv) HUD form 92080, properly completed to reflect the transactions
contemplated by this Agreement in respect of such Mortgage Loan;
provided that whenever the term "Mortgage File" is used to refer to documents
actually received by the Trustee, such term shall be deemed not to include such
documents required to be included therein unless they are actually so received.
Mortgage Loan: Each of the mortgage loans transferred and assigned to the
Trustee pursuant to the provisions hereof as from time to time are held as a
part of the Trust Fund, the mortgage loans originally so held being identified
in the Mortgage Asset Schedule. As used herein, the term "Mortgage Loan"
includes the related Mortgage Note, Mortgage and other security documents
contained in the related Mortgage File and all rights incident to ownership of
such documents. Unless the context otherwise requires, a "Mortgage Loan" shall
be deemed to remain outstanding for purposes hereof until its Stated Principal
Balance is reduced to zero.
Mortgage Note: The original executed note or other evidence of the
indebtedness of a Mortgagor under a Mortgage Loan.
Mortgage Pool: Collectively, all of the Mortgage Assets.
Mortgage Rate: The fixed annual rate of interest borne by a Mortgage Loan
in the absence of a default thereunder, which is (subject to any change therein
in connection with
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a bankruptcy or similar proceeding involving the related Mortgagor or a
modification granted or agreed to by the Master Servicer in accordance with the
terms hereof) set forth in the related Mortgage Note.
Mortgaged Property: The underlying property securing a Mortgage Loan.
Mortgagor: The obligor on a Mortgage Note.
Net Asset Rate: As to each Mortgage Loan, as of any date of determination,
a rate per annum equal to the related Mortgage Rate, minus the sum of the
applicable Servicing Fee Rate and the Trustee Fee Rate. As to each FHA
Debenture, as of any date of determination, the related FHA Debenture Rate,
minus the sum of the Trustee Fee Rate and any related Retained Yield Rate. As
to each GNMA Certificate, as of any date of determination, the related GNMA
Certificate Rate, minus the Trustee Fee Rate.
NOI: As defined in the Prospectus Supplement.
Nonrecoverable Advance: Any Advance or portion thereof previously made or
proposed to be made by the Master Servicer or the Trustee that, in the good
faith and reasonable judgment of the Master Servicer or the Trustee, will not
or, if made, would not, as the case may be, ultimately be recoverable from late
payments, Insurance Proceeds, Liquidation Proceeds (net of Liquidation Expenses)
or any other amount with respect to the related Mortgage Loan. The
determination of whether an Advance constitutes a Nonrecoverable Advance shall
be made by the Master Servicer or the Trustee in accordance with Section 5.04.
Non-Registered Certificate: Unless and until registered under the
Securities Act, any Class B or Residual Certificate.
Non-United States Person: Any person other than a United States Person.
Officers' Certificate: A certificate signed by the Chairman of the Board,
the Vice Chairman of the Board, the President, a Vice President, a member of the
Executive Committee or other authorized officer, and by the Treasurer, the
Secretary, or one of the Assistant Treasurers or Assistant Secretaries of the
Depositor, the Master Servicer or the Seller or by a Responsible Officer of the
Trustee, as the case may be, and delivered to the Depositor, the Master Servicer
or the Trustee, as required by this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be counsel for
the Depositor, the Seller or the Master Servicer, reasonably acceptable to the
Trustee; provided that with respect to the opinion referred to in the definition
of Eligible Account in this Article I and Section 7.04 hereof and any opinion
dealing with the qualification of a REMIC or compliance with the REMIC
Provisions, such counsel must in fact be Independent.
Optional Termination: The purchase of all the Mortgage Assets by the Master
Servicer pursuant to Section 10.01.
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Optional Termination Date: The final Distribution Date in connection with
any Optional Termination.
OTS: The Office of Thrift Supervision or any successor thereto.
Ownership Interest: As to any Certificate, any ownership or security
interest in such Certificate as the Holder thereof and any other interest
therein, whether direct or indirect, legal or beneficial, as owner or as pledgee
thereof.
Participant: A broker, dealer, bank, other financial institution or other
Person for whom DTC effects book-entry transfers and pledges of securities
deposited with DTC.
Pass-Through Entity: Either (a) a regulated investment company described in
Section 851 of the Code, a real estate investment trust described in Section 856
of the Code, a common trust fund or an organization described in Section 1381(a)
of the Code, (b) any partnership, trust or estate or (c) any person holding a
Residual Certificate as nominee for another person.
Pass-Through Rate: With respect to:
(i) the Class A-1 Certificates, the Class A-2 Certificates, the Class A-3
Certificates and the Class A-4 Certificates for any Distribution
Date, the respective fixed rates per annum specified as such in the
Preliminary Statement;
(ii) the Class A-X-1 Certificates for any Distribution Date, a rate per
annum equal to the excess, if any, of the REMIC I Remittance Rate for
REMIC I Regular Interest A-1 (and, accordingly, the Weighted Average
Net Asset Rate) for such Distribution Date, over 6.665% per annum;
(iii) the Class A-X-2 Certificates for any Distribution Date, a rate per
annum equal to the excess, if any, of the REMIC I Remittance Rate for
REMIC I Regular Interest A-2 (and, accordingly, the Weighted Average
Net Asset Rate) for such Distribution Date, over 6.830% per annum;
(iv) the Class A-X-3 for any Distribution Date, a rate per annum equal to
the excess, if any, of the REMIC I Remittance Rate for REMIC I
Regular Interest A-3 (and, accordingly, the Weighted Average Net
Asset Rate) for such Distribution Date, over 7.194% per annum;
(v) the Class A-X-4 Certificates for any Distribution Date, a rate per
annum equal to the excess, if any, of the REMIC I Remittance Rate for
REMIC I Regular Interest A-4 (and, accordingly, the Weighted Average
Net Asset Rate) for such Distribution Date, over 7.645% per annum;
and
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(vi) the Class B Certificates for any Distribution Date, the Weighted
Average REMIC I Remittance Rate (and, accordingly, the Weighted
Average Net Asset Rate) for such Distribution Date.
Percentage Interest: The percentage interest in any Class evidenced by any
Certificate of such Class, which (a) in the case of a REMIC II Regular
Certificate, is equal to a fraction (expressed as a percentage), the numerator
of which is the initial Certificate Principal Balance or initial Certificate
Notional Amount, as the case may be, of such Certificate as of the Closing Date,
as set forth on the face thereof, and the denominator of which is equal to the
Initial Class Principal Balance or Initial Class Notional Amount, as the case
may be, of the relevant Class, and (b) in the case of a Residual Certificate, is
set forth on the face thereof.
Permitted Investments: At any time, any one or more of the following
obligations, instruments and securities:
(i) direct obligations of, or guarantees as to timely payment of
principal and interest by, the United States or any agency or
instrumentality thereof, provided that such obligations are backed by
the full faith and credit of the United States;
(ii) direct obligations of, or guarantees as to timely payment of
principal and interest by, FHLMC, FNMA or the Federal Farm Credit
System, provided that any such obligation, at the time of purchase of
such obligations or contractual commitment providing for the purchase
thereof, is qualified by the Rating Agency as an investment of funds
backing securities having ratings equivalent to the Rating Agency's
highest initial rating of the Rated Certificates;
(iii) demand and time deposits in or certificates of deposit of, or
bankers' acceptances issued by, any bank or trust company, savings
and loan association or savings bank, provided that, in the case of
obligations that are not deposits fully insured by the FDIC, the
commercial paper and/or long-term unsecured debt obligations of such
depository institution or trust company (or, in the case of the
principal depository institution in a holding company system, the
commercial paper or long-term unsecured debt obligations of such
holding company) have received the highest applicable rating
available for such securities from the Rating Agency;
(iv) general obligations of or obligations guaranteed by any state of the
United States or the District of Columbia receiving the highest
applicable rating available for such securities from the Rating
Agency;
(v) commercial or finance company paper (including both non-interest-
bearing discount obligations and interest-bearing obligations payable
on demand or on a specified date not more than one year after the
date of issuance thereof) that is rated by the Rating Agency in its
highest short-term unsecured debt rating category at the time of such
investment or contractual commitment providing for such investment,
and is issued by
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a corporation the outstanding senior long-term unsecured debt
obligations of which are then rated by the Rating Agency in its
highest long-term unsecured debt rating category;
(vi) guaranteed reinvestment agreements issued by any bank, insurance
company or other corporation and rated by the Rating Agency in the
highest applicable rating category at the time of such investment or
contractual commitment providing for such investment, provided that
any such agreement must by its terms provide that it is terminable by
the purchaser without penalty in the event any such rating is at any
time lower than such level;
(vii) repurchase obligations with respect to any security described in
clause (i) or (ii) above entered into with a depository institution
or trust company (acting as principal) meeting the rating standard
described in clause (iii) above;
(viii) securities bearing interest or sold at a discount issued by any
corporation incorporated under the laws of the United States or any
state thereof and rated by the Rating Agency in its highest long-term
unsecured debt rating category at the time of such investment or
contractual commitment providing for such investment, provided that
securities issued by any such corporation will not be Permitted
Investments to the extent that investment therein would cause the
then outstanding principal amount of securities issued by such
corporation and held as part of the Collection Account or the
Distribution Account to exceed 20% of the aggregate principal amount
of all Permitted Investments held in the Collection Account and the
Distribution Account;
(ix) units of taxable money market funds which funds are regulated
investment companies, seek to maintain a constant net asset value per
share and invest solely in obligations backed by the full faith and
credit of the United States, and have been designated in writing by
the Rating Agency as Permitted Investments with respect to this
definition;
(x) if previously confirmed in writing to the Trustee, any other demand,
money market or time deposit, or any other obligation, security or
investment, as may be acceptable to the Rating Agency as an
investment of funds backing securities having ratings equivalent to
the Rating Agency's highest initial rating of the Rated Certificates;
and
(xi) such other obligations as are acceptable as Permitted Investments to
the Rating Agency;
provided that, unless otherwise specified herein, (a) any such Permitted
Investments must be available for withdrawal without penalty, or must mature, no
later than the Business Day immediately preceding the first date on which the
funds invested therein would be subject to withdrawal from the relevant account
maintained hereunder (except that if such Permitted Investment is an obligation
of the institution that maintains such account, then such Permitted Investment
shall mature not later than such date of withdrawal), (b) no such obligation,
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instrument or security set forth above shall constitute a Permitted Investment
unless it qualifies as a "cash flow investment" pursuant to the Code and (c) no
such obligation, instrument or security set forth above shall constitute a
Permitted Investment if such obligation, instrument or security evidences either
(1) a right to receive only interest payments with respect to the obligations
underlying such obligation, instrument or security or (2) a right to receive
both principal and interest payments derived from obligations underlying such
obligation, instrument or security and the principal and interest payments with
respect to such obligation, instrument or security provide for a yield to
maturity of greater than 120% of the yield to maturity at par of such underlying
obligations.
Permitted Transferee: Any Transferee of a Residual Certificate other than a
Disqualified Organization or Non-United States Person.
Person: Any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government, or any agency or political subdivision thereof.
Phase I Environmental Assessment: A "Phase I assessment" as described in
and meeting the criteria of Chapter 5 of the FNMA Multifamily Guide, as amended
from time to time.
Prepayment Interest Excess: With respect to any Mortgage Loan that was
subject to a Principal Prepayment in full or in part during any Collection
Period, which Principal Prepayment was applied to such Mortgage Loan following
such Mortgage Loan's Due Date in such Collection Period, the amount of interest
(at the related Net Asset Rate) accrued on the amount of such Principal
Prepayment during the period from and after such Due Date, to the extent
collected.
Prepayment Interest Shortfall: With respect to any Mortgage Loan that was
subject to a Principal Prepayment in full or in part during any Collection
Period, which Principal Prepayment was applied to such Mortgage Loan prior to
such Mortgage Loan's Due Date in such Collection Period, the amount of interest
that would have accrued at the related Net Asset Rate plus the Trustee Fee Rate
on the amount of such Principal Prepayment during the period commencing on the
date as of which such Principal Prepayment was applied to such Mortgage Loan and
ending on the day immediately preceding such Due Date, inclusive, to the extent
such interest was not (without regard to any Prepayment Premium) collected from
the related Mortgagor.
Prepayment Premium: With respect to any Mortgage Loan, any premium, penalty
or fee paid or payable, as the context requires, by a Mortgagor in connection
with a Principal Prepayment on, or other early collection of principal of, a
Mortgage Loan. With respect to any GNMA Certificate, if and to the extent
received or receivable, as the context requires, thereon, any comparable
premium, penalty or fee in respect of the related Underlying Loan.
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Prime Rate: The "prime rate" published in the "Money Rates" section of The
Wall Street Journal, as such "prime rate" may change from time to time. If The
Wall Street Journal ceases to publish the "prime rate," then the Trustee shall
select an equivalent publication that publishes such "prime rate"; and if such
"prime rate" is no longer generally published or is limited, regulated or
administered by a governmental or quasi-governmental body, then the Trustee
shall select a comparable interest rate index. In either case, such selection
shall be made by the Trustee in its sole discretion, and the Trustee shall
notify the Master Servicer in writing of its selection.
Principal Distribution Amount: With respect to each Distribution Date, an
amount equal to the aggregate of (without duplication) the following:
(i) the aggregate of all payments of principal (other than Principal
Prepayments) received on the Mortgage Loans during the related Collection
Period, in each case net of any portion of the particular payment that
represents a late collection of principal due on or before the Cut-off Date or
for which a Monthly Advance was previously made for a prior Distribution Date or
that represents the principal portion of a Monthly Payment due on a Due Date
subsequent to the related Collection Period;
(ii) the aggregate of the principal portions of all Monthly Payments due
in respect of the Mortgage Loans for their respective Due Dates
occurring during the related Collection Period that were received
prior to the related Collection Period;
(iii) the aggregate of all Principal Prepayments made by the respective
Mortgagors on the Mortgage Loans during the related Collection
Period;
(iv) the aggregate of all Insurance Proceeds, Condemnation Proceeds,
Liquidation Proceeds and any other amounts (exclusive of payments by
Mortgagors, Repurchase Proceeds and proceeds received in connection
with the sale of any Mortgage Asset pursuant to Section 3.15 and/or
Section 10.01) that were received on or in respect of the Mortgage
Loans during the related Collection Period and that were identified
and applied by the Master Servicer as recoveries of principal thereof
in accordance with Section 1.02(b), in each case net of any portion
thereof that represents a late collection of principal for which a
Monthly Advance was previously made for a prior Distribution Date;
(v) the aggregate of all payments of principal that were received on the
GNMA Certificates and any FHA Debentures during the related
Collection Period, other than, in the case of a GNMA Certificate, any
such payment of principal that relates to principal due on the
related Underlying Loan on or before the Cut-off Date;
(vi) the Stated Principal Balance (calculated immediately prior to such
Distribution Date) of each Mortgage Asset, if any, that was
repurchased by the Seller or the Depositor during the related
Collection Period pursuant to Article II hereof;
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(vii) the Stated Principal Balance (calculated immediately prior to such
Distribution Date) of each defaulted Mortgage Loan and FHA Debenture,
if any, that was purchased by the Majority Class B Certificateholder,
the Master Servicer and/or the Trustee during the related Collection
Period pursuant to Section 3.15; and
(viii) if such Distribution Date is the Optional Termination Date, the
Stated Principal Balance (calculated immediately prior to such
Distribution Date) of each Mortgage Asset purchased as part of the
Optional Termination.
Principal Prepayment: Any Mortgagor payment on a Mortgage Loan that is
received in advance of its scheduled Due Date and is not accompanied by an
amount as to interest representing scheduled interest due on any date or dates
in any month or months subsequent to the month of prepayment.
Prospectus: The prospectus dated November 13, 1995, as supplemented by the
Prospectus Supplement, relating to the Registered Certificates.
Prospectus Supplement: The prospectus supplement dated November 15, 1995
relating to the Registered Certificates.
Purchase Price: With respect to any Mortgage Loan, GNMA Certificate or FHA
Debenture, the sum of (i) 100% of the unpaid principal balance of such Mortgage
Asset on the date of such purchase, (ii) all accrued and unpaid interest on such
Mortgage Asset at a rate equal to the related Mortgage Rate, GNMA Certificate
Rate or FHA Debenture Rate, as applicable, to the later of (A) the date of
purchase and (B) the related Due Date (or, in the case of an FHA Debenture, the
date that had been the Due Date for the related FHA Assigned Mortgage Loan) in
the Collection Period of purchase and (iii) in the case of a Mortgage Loan, the
amount of any unreimbursed Servicing Advances made by and reimbursable to the
Master Servicer with respect to such Mortgage Loan hereunder.
Putable Mortgage Loan: Any Mortgage Loan which, under the related FHA Loan
Program and the terms of the related FHA Mortgage Insurance Contract, the
related holder of record is entitled on a specified date or during a specified
period to assign to the FHA (notwithstanding that such loan is not in default).
Qualified Insurer: An insurance company or security or bonding company duly
qualified to write the insurance provided by the insurance policy or bond issued
by it, which is approved as an insurer by the FHA.
Rated Certificates: All Certificates except the Class B and Residual
Certificates.
Rating Agency: Standard & Poor's Ratings Services or its successor in
interest. If neither such rating agency nor any successor remains in existence,
"Rating Agency" shall be deemed to refer to such other nationally recognized
statistical rating agency or other comparable Person designated by the
Depositor, notice of which designation shall be given to the other
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parties hereto, and specific ratings of Standard & Poor's Ratings Services
herein referenced shall be deemed to refer to the equivalent ratings of the
party so designated.
Realized Loss: With respect to: (1) each Liquidated Loan, an amount (not
less than zero) equal to (a) the unpaid principal balance of such Liquidated
Loan as of the commencement of the Collection Period in which the relevant Final
Recovery Determination was made, plus (b) without taking into account the amount
described in subclause (1)(d) of this definition, all accrued but unpaid
interest on such Liquidated Loan at the related Mortgage Rate to but not
including the Due Date in the Collection Period in which the relevant Final
Recovery Determination was made, plus (c) any related unreimbursed Servicing
Advances as of the commencement of the Collection Period in which the relevant
Final Recovery Determination was made, together with any new related Servicing
Advances made during such Collection Period, minus (d) all payments and
proceeds, if any, received in respect of such Liquidated Loan during the
Collection Period in which the relevant Final Recovery Determination was made;
(2) each defaulted Mortgage Loan as to which any portion of the principal and/or
the accrued but unpaid interest payable thereunder was cancelled in connection
with a bankruptcy or similar proceeding involving the related Mortgagor or a
modification, waiver or amendment of such Mortgage Loan granted or agreed to by
the Master Servicer pursuant to the terms hereof, the amount of such principal
and/or interest so cancelled; and (3) each defaulted Mortgage Loan as to which
the Mortgage Rate thereon has been permanently reduced and not recaptured for
any period in connection with a bankruptcy or similar proceeding involving the
related Mortgagor or a modification, waiver or amendment of such Mortgage Loan
granted or agreed to by the Master Servicer pursuant to the terms hereof, the
amount of the consequent reduction in the interest portion of each successive
Monthly Payment due thereon (each such Realized Loss to be deemed to have been
incurred on the Due Date for each affected Monthly Payment).
Record Date: With respect to any Distribution Date, the last Business Day
of the month preceding the month in which the applicable Distribution Date
occurs.
Registered Certificate: Any Class A-1, Class A-2, Class A-3, Class A-4,
Class A-X-1, Class A-X-2, Class A-X-3 or Class A-X-4 Certificate.
Reimbursement Rate: The rate per annum applicable to the accrual of
interest on Advances in accordance with Section 5.05, which rate per annum is
equal to the Prime Rate.
REMIC: A "real estate mortgage investment conduit", within the meaning of
Section 860D of the Code.
REMIC Election: An election, for federal income tax purposes, to treat
certain assets as a REMIC.
REMIC I: The segregated pool of assets subject hereto, constituting the
primary trust created hereby and to be administered hereunder, consisting of:
(i) the Mortgage Assets as from time to time are subject to this Agreement and
all payments under and proceeds of such Mortgage Assets (other than Retained
Yield) received after the Cut-off Date (exclusive of any
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payments of or relating to principal and interest due on the Mortgage Loans and
the Underlying Loans on or before the Cut-off Date), together with all documents
included in the related Mortgage Files and Servicing Files for the Mortgage
Loans; (ii) the FHA Mortgage Insurance in respect of the Mortgage Loans,
together with all FHA Insurance Benefits (other than Retained Yield) derived
therefrom; (iii) such funds or assets (other than Retained Yield) as from time
to time are deposited in the Distribution Account and/or the Collection Account;
(iv) any insurance policies with respect to the Mortgage Loans; and (v) all
proceeds of the conversion, voluntary or involuntary, of any of the foregoing
into cash or other liquid property.
REMIC I Regular Interest: Any of the five separate non-certificated
beneficial ownership interests in REMIC I issued hereunder and designated as a
"regular interest" in REMIC I. Each REMIC I Regular Interest shall accrue
interest at the related REMIC I Remittance Rate in effect from time to time, and
shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Principal Balance. The designations for the respective REMIC I Regular
Interests are set forth in the Preliminary Statement hereto.
REMIC I Remittance Rate: With respect to any REMIC I Regular Interest for
any Distribution Date, the Weighted Average Net Asset Rate for such Distribution
Date.
REMIC II: The segregated pool of assets consisting of all of the REMIC I
Regular Interests conveyed in trust to the Trustee for the benefit of the
Holders of the REMIC II Certificates pursuant to Section 2.06, with respect to
which a separate REMIC election is to be made.
REMIC II Certificate: Any Certificate, other than a Class R-I Certificate.
REMIC II Regular Certificate: Any REMIC II Certificate, other than a Class
R-II Certificate.
REMIC Provisions: Provisions of the federal income tax law relating to real
estate mortgage investment conduits, which appear at Sections 860A through 860G
of Subchapter M of Chapter 1 of the Code, and related provisions, and proposed,
temporary and final Treasury regulations and any published rulings, notices and
announcements promulgated thereunder, as the foregoing may be in effect from
time to time.
Repurchase Proceeds: Cash amounts paid by or on behalf of the Depositor or
Seller in connection with the repurchase of any Mortgage Loan pursuant to
Article II hereof.
Required Insurance Policy: With respect to any Mortgage Loan or related
Mortgaged Property, any insurance policy that is required to be maintained from
time to time under this Agreement in respect of such Mortgage Loan, including
each standard hazard and, if applicable, flood insurance policy.
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Reserve Account: The account or accounts created and maintained pursuant to
Section 3.07.
Reserve Funds: With respect to any Mortgage Loan, any amounts delivered by
the related Mortgagor to be held in escrow by or on behalf of the related
mortgagee representing reserves for replacements, repairs and/or capital
improvements to the related Mortgaged Property (including, without limitation,
any furniture, fixture and equipment reserves) and for any tenant improvement
and leasing concessions.
Residual Certificate: Any Class R-I or Class R-II Certificate.
Responsible Officer: When used with respect to the Trustee, any officer of
the Asset-Backed Securities Trust Department of the Trustee assigned to the
Corporate Trust Office with direct responsibility for the administration of this
Agreement and also, with respect to a particular matter, any other officer to
whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject.
Retained Yield: With respect to any FHA Debenture for which the related FHA
Debenture Rate is greater than the Mortgage Rate for the related FHA Assigned
Mortgage Loan, that portion of the interest accrued in respect of such FHA
Debenture for so long as it is part of the Trust Fund that is calculated at the
related Retained Yield Rate. With respect to any FHA Assigned Mortgage Loan for
which the Mortgage Rate is lower than the applicable FHA Debenture Rate, that
portion of the related cash FHA Insurance Benefits that represents interest
accrued in respect of such FHA Assigned Mortgage Loan at the related Retained
Yield Rate.
Retained Yield Rate: With respect to any FHA Debenture, the excess, if any,
of the related FHA Debenture Rate over the Mortgage Rate for the related FHA
Assigned Mortgage Loan. With respect to any FHA Assigned Mortgage Loan, the
excess, if any, of the applicable FHA Debenture Rate over the related Mortgage
Rate.
Rule 144A: Rule 144A under the Securities Act, as in effect from time to
time.
SAIF: The Savings Association Insurance Fund, or any successor thereto.
Security Agreement: With respect to any Mortgage Loan, any security
agreement, chattel mortgage or similar document or instrument, whether contained
in the related Mortgage or executed separately, creating in favor of the holder
of such Mortgage a security interest in the personal property constituting
security for repayment of such Mortgage Loan.
Securities Act: The Securities Act of 1933, as amended.
Seller: Greystone Funding Corporation or its successor in interest.
Senior Certificate: Any Class A-1, Class A-2, Class A-3, Class A-4, Class
A-X-1, Class A-X-2, Class A-X-3 or Class A-X-4 Certificate.
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Sequential Pay Certificate: Any Class A-1, Class A-2, Class A-3, Class A-4
or Class B Certificate.
Servicing Advances: All customary, reasonable and necessary "out of pocket"
costs and expenses incurred by the Master Servicer in connection with the
servicing of a Mortgage Loan after a default, delinquency or other unanticipated
event, including, but not limited to, the cost of (a) assigning any defaulted
Mortgage Loan to HUD, (b) compliance with the obligations of the Master Servicer
set forth in Sections 3.01(c), (c) the preservation, insurance, restoration,
protection and management of a Mortgaged Property, (d) obtaining any Insurance
Proceeds, Condemnation Proceeds or Liquidation Proceeds and (e) any enforcement
or judicial proceedings with respect to a Mortgaged Property, including, without
limitation, foreclosures. Notwithstanding anything to the contrary, "Servicing
Advances" shall not include (x) allocable overhead of the Master Servicer, which
shall include costs for office space, office equipment, supplies and related
expenses, employee salaries and related expenses and similar internal costs and
expenses, or (y) costs and expenses associated with the assignment of any
defaulted Mortgage Loan to the FHA.
Servicing Compensation: For any time period, the aggregate of all Servicing
Fees in respect of the Mortgage Loans paid to the Master Servicer during such
time period, increased by (i) any Prepayment Interest Excesses, late payment
charges, assumption fees and other usual and customary fees collected from the
respective Mortgagors during such time period (other than Prepayment Premiums)
and (ii) any net income earned during such time period on Permitted Investments
of funds held in the Distribution Account and the Collection Account.
Servicing Fee: For each calendar month, commencing with December, 1995, as
to each Mortgage Loan, an amount equal to one month's interest accrued on the
basis of a 360-day year consisting of twelve 30-day months (or, in the event of
any payment of interest which accompanies a Principal Prepayment in full made by
the Mortgagor, interest for the number of days covered by such payment of
interest) at the applicable Servicing Fee Rate on the Stated Principal Balance
of such Mortgage Loan as of the commencement of such month. No Servicing Fee
shall accrue or be payable with respect to a GNMA Certificate or an FHA
Debenture.
Servicing Fee Rate: As to each Mortgage Loan, the rate per annum set forth
on the related Mortgage Asset Schedule under the caption "Servicing Fee Rate".
Servicing File: Any documents (other than documents required to be part of
the related Mortgage File) in the possession of the Master Servicer and relating
to the origination and servicing of any Mortgage Loan.
Servicing Officer: Any officer of the Master Servicer involved in, or
responsible for, the administration and servicing of the Mortgage Loans whose
name and specimen signature appear on a list of servicing officers furnished to
the Trustee on the Closing Date by the Master Servicer pursuant to this
Agreement, as such list may from time to time be amended.
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Startup Day: With respect to each of REMIC I and REMIC II, the day
designated as such in Section 11.09(c).
Stated Maturity Date: With respect to: (a) any Mortgage Loan, the Due Date
on which the last payment of principal is due and payable under the terms of the
related Mortgage Note as in effect on the Closing Date, without regard to any
change in or modification of such terms in connection with a bankruptcy or
similar proceeding involving the related Mortgagor or a modification, waiver or
amendment of such Mortgage Loan granted or agreed to by the Master Servicer; and
(b) any GNMA Certificate or FHA Debenture, the Due Date on which the last
payment of principal is due or payable under the terms of such security.
Stated Principal Balance: With respect to any Mortgage Loan, as of any date
of determination, a principal amount equal to the Cut-off Date Balance of such
Mortgage Loan, reduced on each Distribution Date (to not less than zero) by:
(a) without duplication, the aggregate of all payments (including, without
limitation, any Principal Prepayments), Insurance Proceeds, Condemnation
Proceeds, Liquidation Proceeds, Repurchase Proceeds and any other amounts that
were received on or in respect of such Mortgage Loan during the related
Collection Period and that were identified and applied by the Master Servicer as
recoveries of principal thereof in accordance with Section 1.02(b), in each case
net of any portion of such amounts that represents a late collection of
principal due on or before the Cut-off Date or for which a Monthly Advance was
previously made for a prior Distribution Date or that represents the principal
portion of a Monthly Payment due on a Due Date subsequent to the related
Collection Period; (b) if and to the extent paid prior to the related Collection
Period (other than as part of a Principal Prepayment), the principal portion of
the Monthly Payment due on such Mortgage Loan during the related Collection
Period; (c) the principal portion of any Monthly Advance made by the Master
Servicer or the Trustee with respect to such Mortgage Loan for such Distribution
Date; (d) the principal amount of any FHA Debentures received during the related
Collection Period as FHA Insurance Benefits in respect of such Mortgage Loan;
and (e) the principal portion of any Realized Loss incurred in respect of such
Mortgage Loan during the related Collection Period. With respect to any GNMA
Certificate, as of any date of determination coinciding with or following the
Cut-off Date, a principal amount equal to the Cut-off Date Balance of such GNMA
Certificate, reduced on each Distribution Date by all payments of principal
received on such GNMA Certificate during the related Collection Period (other
than any such payment of principal that relates to principal due on the related
Underlying Loan on or before the Cut-off Date). With respect to any FHA
Debenture, as of any date of determination coinciding with or following the
related FHA Debenture Delivery Date, a principal amount equal to the unpaid
principal balance of such FHA Debenture as of the related FHA Debenture Delivery
Date, reduced on each subsequent Distribution Date by all payments of principal
received on such FHA Debenture during the related Collection Period.
Notwithstanding the foregoing, if any Mortgage Asset is paid in full,
liquidated, purchased out of the Trust Fund or otherwise disposed of by the
Trust Fund, the Stated Principal Balance of such Mortgage Asset will be zero
commencing as of the Distribution Date relating to the Collection Period in
which such payment in full, liquidation, sale or other disposition occurred and
as of each date thereafter.
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Subordinate Certificates: Collectively, the Class B and Residual
Certificates.
Sub-Servicer: Any servicer to which to the Master Servicer delegates any of
its servicing responsibilities with respect to any of the Mortgage Loans.
Sub-Servicing Agreement: Any servicing agreement between the Master
Servicer and a Sub-Servicer pursuant to which the Master Servicer delegates any
of its servicing responsibilities with respect to any of the Mortgage Loans.
Tax Returns: The federal income tax return on Internal Revenue Service Form
1066, U.S. Real Estate Mortgage Investment Conduit Income Tax Return, including
Schedule Q thereto, Quarterly Notice to Residual Interest Holders of REMIC
Taxable Income or Net Loss Allocation, or any successor forms, to be filed on
behalf of each of REMIC I and REMIC II due to its classification as a REMIC
under the REMIC Provisions, together with any and all other information, reports
or returns that may be required to be furnished to the Certificateholders or
filed with the Internal Revenue Service under any applicable provisions of
federal tax law or any other governmental taxing authority under applicable
state or local tax laws.
Termination Price: The price at which an Optional Termination is to be
effected as specified in Section 10.01.
Transfer: Any direct or indirect transfer, sale, pledge, hypothecation, or
other form of assignment of any Ownership Interest in a Certificate.
Transferee: Any Person who is acquiring by Transfer any Ownership Interest
in a Certificate.
Transferee Affidavit and Agreement: As defined in Section 6.02(f)(i).
Transferor: Any Person who is disposing by Transfer any Ownership Interest
in a Certificate.
Trust Fund: Collectively, all of the assets of REMIC I and REMIC II.
Trustee: LaSalle National Bank, not in its individual capacity, but solely
in its capacity as trustee for the benefit of the Certificateholders under this
Agreement, and any successor thereto, as provided herein.
Trustee Fee: The fee payable to the Trustee on each Distribution Date for
its services as Trustee hereunder, in an amount equal to one-twelfth of the
Trustee Fee Rate multiplied by the aggregate Stated Principal Balance of the
Mortgage Assets immediately prior to such Distribution Date.
Trustee Fee Rate: 0.03% per annum.
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UCC: The Uniform Commercial Code in effect in the applicable jurisdiction.
Uncertificated Accrued Interest: With respect to any REMIC I Regular
Interest, for any Distribution Date, one month's interest at the REMIC I
Remittance Rate applicable to such REMIC I Regular Interest for such
Distribution Date, accrued on the Uncertificated Principal Balance of such REMIC
I Regular Interest outstanding immediately prior to such Distribution Date.
Uncertificated Accrued Interest shall be calculated on the basis of a 360-day
year consisting of twelve 30-day months.
Uncertificated Distributable Interest: With respect to any REMIC I Regular
Interest for any Distribution Date, the Uncertificated Accrued Interest in
respect of such REMIC I Regular Interest for such Distribution Date, reduced (to
not less than zero) by that portion of all Uncovered Prepayment Interest
Shortfalls, if any, incurred during the related Collection Period that are
allocable to such REMIC I Regular Interest in reduction of its "Uncertificated
Distributable Interest" for such Distribution Date pursuant to Section 4.05(c).
Uncertificated Principal Balance: The principal amount of any REMIC I
Regular Interest outstanding as of any date of determination. As of the Closing
Date, the Uncertificated Principal Balance of each REMIC I Regular Interest
shall equal the amount set forth in the Preliminary Statement hereto as its
initial stated principal amount. On each Distribution Date, the Uncertificated
Principal Balance of each REMIC I Regular Interest shall be reduced by all
distributions of principal deemed to have been made thereon on such Distribution
Date pursuant to Section 4.02(h) and, if and to the extent appropriate, shall be
further reduced on such Distribution Date as provided in Section 4.04(b).
Uncovered Prepayment Interest Shortfalls: As defined in Section 4.05(b).
Underlying Loan: The FHA Loan that backs a GNMA Certificate.
United States Person: A citizen or resident of the United States, a
corporation, partnership or other entity created or organized in, or under the
laws of, the United States or any political subdivision thereof, or an estate or
trust whose income from sources without the United States is includable in gross
income for United States federal income tax purposes regardless of its
connection with the conduct of a trade or business within the United States.
Voting Rights: The portion of the aggregate voting rights of all the
Certificates evidenced by any particular Certificate. 99% of all Voting Rights
will be allocated among the various Classes of Sequential Pay Certificates in
proportion to their respective Class Principal Balances, 1% of all Voting Rights
will be allocated among the various Classes of Interest-Only Certificates in
proportion to their respective Class Notional Amounts (but only for so long as
the aggregate Class Notional Amount of the Interest-Only Certificates is greater
than zero), and any and all Voting Rights not otherwise allocated to the REMIC
II Regular Certificates as described above will be allocated equally between the
two Classes of Residual Certificates. All Voting Rights allocated to a Class of
Certificates shall be allocated among the Certificates of such Class in
proportion to the Percentage Interests evidenced thereby.
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Weighted Average Net Asset Rate: With respect to any Distribution Date, the
rate per annum equal to the weighted average, expressed as a percentage and
rounded to six decimal places, of the respective Net Asset Rates in respect of
the Mortgage Assets as of the commencement of the Collection Period for such
Distribution Date, weighted on the basis of the respective Stated Principal
Balances of such Mortgage Assets outstanding immediately prior to such
Distribution Date.
Weighted Average REMIC I Remittance Rate: With respect to any Distribution
Date, the rate per annum equal to the weighted average, expressed as a
percentage and rounded to six decimal places, of the respective REMIC I
Remittance Rates in respect to the REMIC I Regular Interests for such
Distribution Date, weighted on the basis of the respective Uncertificated
Principal Balances of the REMIC I Regular Interests outstanding immediately
prior to such Distribution Date.
SECTION 1.02. Certain Calculations Respecting the Mortgage Pool.
(a) Calculations required to be made pursuant to this Agreement with respect
to any Mortgage Loan shall be made based upon current information as to the
terms of the Mortgage Loans and reports of payments and other collections
received from the Master Servicer with respect to the Mortgage Loans and
payments to be made to the Trustee as supplied to the Trustee by the Master
Servicer. The Trustee shall not be required to recompute, verify or recalculate
the information supplied to it by the Master Servicer. To the extent that it is
not patently incorrect on its face, such information or accounting may be
conclusively relied upon by the Trustee in making such calculations.
(b) All cash amounts collected on or in respect of any Mortgage Loan,
whether in the form of payments from Mortgagors, Insurance Proceeds,
Condemnation Proceeds, Liquidation Proceeds, Repurchase Proceeds or otherwise,
shall be applied to amounts due and owing under the related Mortgage Loan
documents (including, without limitation, for principal and accrued and unpaid
interest) in accordance with the express provisions of such documents and/or
applicable FHA Regulations and, in the absence of such express provisions, shall
be applied by the Master Servicer (after reimbursement to the Master Servicer
for any related Servicing Advances): first, if such Mortgage Loan is still to
be serviced and administered hereunder, as a recovery of amounts to be currently
applied to the payment of, or escrowed for the future payment of, real estate
taxes, assessments, insurance premiums and similar items; second, if such
Mortgage Loan is still to be serviced and administered hereunder, as a recovery
of Reserve Funds to the extent then required to be held in escrow; third, as a
recovery of accrued and unpaid interest on such Mortgage Loan at the related
Mortgage Rate in effect from time to time through the date of receipt (or, in
the case of a full Monthly Payment from any Mortgagor, through the related Due
Date); fourth, as a recovery of principal of such Mortgage Loan then due and
owing, including, without limitation, by reason of acceleration of the Mortgage
Loan following a default thereunder; fifth, as a recovery of any Prepayment
Premiums due and owing under such Mortgage Loan; sixth, in accordance with the
Master Servicer's normal servicing practices, as a recovery of any other amounts
then due and owing under such Mortgage Loan, including, without limitation,
default interest and late payment charges; and
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seventh, as a recovery of any remaining principal of such Mortgage Loan to the
extent of its entire remaining unpaid principal balance.
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ARTICLE II
CONVEYANCE OF TRUST FUND;
REPRESENTATIONS AND WARRANTIES;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01. Conveyance of Mortgage Assets.
(a) The Seller and the Master Servicer, concurrently with the execution and
delivery hereof, and at the direction and on behalf of the Depositor, do hereby
sell and assign to the Trustee without recourse for the benefit of the
Certificateholders all the right, title and interest of the Seller and the
Master Servicer in and to the Mortgage Assets identified on the Mortgage Asset
Schedule (exclusive of any Retained Yield collected with respect thereto) and
all other assets included or to be included in REMIC I. Such sale and
assignment of the Mortgage Assets includes all interest and principal and
proceeds received or receivable on or with respect to the Mortgage Assets after
the Cut-off Date (other than payments of or relating to principal and interest
due and payable on the Mortgage Loans and Underlying Loans on or before the Cut-
off Date and other than any payments of Retained Yield) and all amounts held in
escrow for the payment of taxes or insurance on or with respect to, or to effect
repairs and replacements in respect of, the Mortgaged Properties after the Cut-
off Date.
It is intended that the conveyance of the Mortgage Assets by the Seller and
the Master Servicer to the Trustee, at the direction of the Depositor, as
provided in this Section 2.01(a) be, and be construed as, a sale of the Mortgage
Assets by the Seller and the Master Servicer to the Trustee for the benefit of
the Certificateholders. It is, further, not intended that such conveyance be
deemed a pledge of the Mortgage Assets by the Seller or the Master Servicer to
the Trustee to secure a debt or other obligation of the Seller or the Master
Servicer. However, in the event that the Mortgage Assets are held to be
property of the Seller, the Master Servicer or the Depositor, or if for any
reason this Agreement is held or deemed to create a security interest in the
Mortgage Assets, then it is intended that, (a) this Agreement shall also be
deemed to be a security agreement within the meaning of Articles 8 and 9 of the
New York UCC and the UCC of any other applicable jurisdiction; (b) the
conveyance provided for in this Section 2.01(a) shall be deemed to be (1) a
grant by the Seller, the Master Servicer and the Depositor to the Trustee of a
security interest in all of their respective right (including the power to
convey title thereto), title and interest, whether now owned or hereafter
acquired, in and to (A) with respect to the Mortgage Loans, the Mortgage Notes,
the Mortgages, any related insurance policies and all other documents in the
related Mortgage Files, (B) all amounts payable to the holders of the Mortgage
Assets in accordance with the terms thereof (other than payments of principal
and interest due and payable on the Mortgage Assets on or before the Cut-off
Date and other than payments of Retained Yield) and (C) all proceeds of the
conversion, voluntary or involuntary, of the foregoing into cash, instruments,
securities or other property, including without limitation all amounts from time
to time held or invested in the Distribution Account or the Collection Account
(other than payments of principal and interest due and payable on the Mortgage
Assets on or before the Cut-off Date and other than payments of Retained Yield),
and (2) an assignment by the Depositor to the Trustee of any security interest
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in any and all of the Seller's and the Master Servicer's right (including the
power to convey title thereto), title and interest, whether now owned or
hereafter acquired, in and to the property described in the foregoing clauses
(1)(A) through (C) granted by the Seller and the Master Servicer to the
Depositor pursuant to the Mortgage Asset Purchase Agreement; (c) the possession
by the Trustee or its agent of Mortgage Notes with respect to the Mortgage Loans
and such other items of property as constitute instruments, money, negotiable
documents or chattel paper shall be deemed to be "possession by the secured
party" or possession by a purchaser or a person designated by such secured
party, for purposes of perfecting the security interest pursuant to the New York
UCC and the UCC of any other applicable jurisdiction (including, without
limitation, Sections 9-305, 8-313 or 8-321 thereof); and (d) notifications to
persons holding such property, and acknowledgments, receipts or confirmations
from persons holding such property, shall be deemed notifications to, or
acknowledgments, receipts or confirmations from, financial intermediaries,
bailees or agents (as applicable) of the Trustee for the purpose of perfecting
such security interest under applicable law. The Depositor, the Seller and the
Trustee shall, to the extent consistent with this Agreement, take such actions
as may be necessary to ensure that, if this Agreement were deemed to create a
security interest in the Mortgage Assets, such security interest would be deemed
to be a perfected security interest of first priority under applicable law and
will be maintained as such throughout the term of the Agreement. The Master
Servicer shall file, at its expense, all filings necessary to maintain the
effectiveness of any original filings necessary under the UCC as in effect in
any jurisdiction to perfect the Trustee's security interest in or lien on the
Trust Fund, including without limitation (A) continuation statements, and (B)
such other statements as may be occasioned by any transfer of any interest of
the Master Servicer, Trustee or the Depositor in the Trust Fund. In connection
herewith, the Trustee shall have all of the rights and remedies of a secured
party and creditor under the UCC as in force in the relevant jurisdiction.
(b) In connection with the Seller's and Master Servicer's sale and
assignment pursuant to subsection (a) above, the Seller and the Master Servicer
shall, with respect to each Mortgage Loan so sold and assigned, deliver to and
deposit with the Trustee, on or before the Closing Date, the related Mortgage
File and shall, with respect to each GNMA Certificate so assigned, cause such
GNMA Certificate to be registered in the name of the Trustee (in its capacity as
such) on the books and records of the appropriate "financial intermediary"
(within the meaning of Section 8-313(4) of the New York UCC) designated by the
Trustee.
The Trustee shall, if any of the following were delivered in blank, complete
the endorsement of the Mortgage Note referred to in clause (i) of the definition
of "Mortgage File", the assignment of Mortgage referred to in clause (iv) of the
definition of "Mortgage File", the assignment of Assignment of Leases referred
to in clause (vii) of the definition of "Mortgage File", and the assignment of
financing statements referred to in clause (xiii) of the definition of "Mortgage
File", in the name of the Trustee for the benefit of the Holders of the CS First
Boston Mortgage Securities Corp. Mortgage Pass-Through Certificates, Series
1995-FHA1.
Also in connection with the Seller's and the Master Servicer's sale and
assignment pursuant to subsection (a) above, the Seller shall with respect to
each Mortgage Loan so assigned, deliver to and deposit with the Master Servicer,
any and all funds held by or on behalf
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of the Seller which, if collected after the Closing Date, would be deposited by
the Master Servicer in either of a Reserve Account or an Escrow Account
established in respect of such Mortgage Loan. The Master Servicer shall deposit
such funds in the Reserve Account or the Escrow Account, as appropriate to be
established in respect of such Mortgage Loan.
In the case of Mortgage Loans and Underlying Loans that have been prepaid
after the Cut-off Date and prior to the Closing Date and, if any such loan was
prepaid in full, in lieu of delivering or causing the Master Servicer to deliver
the related Mortgage File to the Trustee or registering the related GNMA
Certificate in the name of the Trustee, as applicable, the Seller will deposit
in the Collection Account or, in the case of an Underlying Loan, deliver to the
Trustee for deposit in the Distribution Account the amount of such prepayment
and will provide the Trustee with written notice of such prepayment.
(c) Within 45 days after the Closing Date, the Trustee, at the Seller's
expense, shall cause the following documents and instruments to be properly
recorded or filed, as the case may be, in the appropriate public office for real
property records or UCC financing statements, as appropriate: (i) each
assignment of a Mortgage referred to in clause (iv) of the definition of
"Mortgage File"; (ii) each assignment of an Assignment of Leases, if any,
referred to in clause (vii) of the definition of "Mortgage File"; and (iii) each
assignment of a financing statement referred to in clause (xiii) of the
definition of "Mortgage File". If any such assignment of a Mortgage, assignment
of an Assignment of Leases or assignment of a financing statement is lost or
returned unrecorded because of a defect therein, the Trustee, upon becoming
aware of such loss or defect, shall promptly give written notice of such loss or
defect to the Seller, and the Seller shall promptly prepare a substitute
therefor or use its best efforts to cure such defect, as the case may be, and
shall then return the same to the Trustee. The Trustee shall cause the same to
be duly recorded or filed at the Seller's expense. The Seller shall, promptly
upon receipt thereof, deliver or cause to be delivered to the Trustee the
original recorded Mortgage and, if applicable, Assignment of Leases and any
original recorded intervening assignments of such documents, in those instances
where a copy thereof was delivered to the Trustee. Within 45 days after the
Closing Date, the Trustee shall file with HUD each HUD Form 92080 referred to in
clause (xiv) of the definition of "Mortgage File".
(d) If, within one year after the Closing Date, any assignment of a Mortgage
referred to in clause (iv) of the definition of "Mortgage File" or, if
applicable, any assignment of an Assignment of Leases referred to in clause
(vii) of the definition of "Mortgage File", in each case with evidence of the
recording of the Trustee's interest thereon, or a copy (certified by the
applicable public recording office to be a true and correct copy) of such
recorded assignment of a Mortgage or assignment of an Assignment of Leases, is
not delivered to the Trustee, the Seller shall repurchase the related Mortgage
Loan from the Trustee at the applicable Purchase Price therefor. The Purchase
Price for any such Mortgage Loan shall be deposited by the Seller in the
Collection Account. Upon receipt by the Trustee of written notification of such
deposit signed by a Servicing Officer (which notification shall include a
statement as to the accuracy of the Purchase Price), the Trustee shall release
the related Mortgage File to or at the direction of the Seller, and shall
execute and deliver such instruments of transfer or assignment (which shall be
prepared by the Seller), in each case without recourse, as shall be necessary
to
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vest in the Seller, or its designee, title (to the extent that such title was
transferred to the Trustee) to any Mortgage Loan released pursuant hereto. The
repurchase obligation pursuant to this Section 2.01(d), which shall be effected
solely at the cost and expense of the Seller, shall constitute the sole recourse
against the Seller available to the Trustee, the Depositor and the
Certificateholders for failure of an assignment of a Mortgage referred to in
clause (iv) of the definition of "Mortgage File" or, if applicable, any
assignment of an Assignment of Leases referred to in clause (vii) of the
definition of "Mortgage File", to be recorded.
(e) In instances where a title commitment or binder is delivered to the
Trustee with respect to any Mortgage Loan, the Seller shall provide an original
of the related lender's title insurance policy in accordance with the terms of
such commitment or binder to the Trustee as promptly as practicable after the
execution and delivery hereof but, in any event, within 180 days of the Closing
Date.
SECTION 2.02. Acceptance of REMIC I by Trustee; Review of Mortgage
Loan Documentation.
The Trustee, by execution and delivery hereof, acknowledges receipt of the
Mortgage Files, in good faith and without actual notice or knowledge of any
adverse claim pertaining to the Mortgage Loans listed on the Mortgage Loan
Schedule, subject to its further review thereof under this Section 2.02. The
Trustee will hold all documents constituting a part of the Mortgage Files
delivered to it, and all other assets constituting part of the Trust Fund that
come into its possession or under its control, in trust for the use and benefit
of all present and future Certificateholders. The Trustee, by execution and
delivery hereof, with respect to each Mortgage Loan specified on the Mortgage
Asset Schedule, specifically acknowledges receipt of those items specified in
clauses (i), (ii) and (iv) of the definition of Mortgage File.
Within 60 days after the execution and delivery of this Agreement, the
Trustee shall ascertain whether all documents required to be delivered to it
pursuant to Section 2.01 hereof are in its possession, and shall deliver to the
Depositor, the Seller and the Master Servicer a certification in the form set
forth as Exhibit C hereto to the effect that, as to each Mortgage Loan listed in
the Mortgage Asset Schedule, and subject to any exceptions noted on an
attachment to such certification: (a) all documents required to be delivered to
the Trustee by the Seller pursuant to this Agreement are in its possession, (b)
such documents have been reviewed by it and have not been mutilated, damaged,
defaced, torn or otherwise physically altered, and such documents relate to such
Mortgage Loan, (c) based on its examination and only as to the foregoing
documents, the information set forth in items (v), (viii), (xi), (xii) and
(xvii) of the second sentence of the definition of Mortgage Asset Schedule
respecting such Mortgage Loan accurately reflects the information contained in
the documents in the related Mortgage File and (d) the related Mortgage Note has
a final endorsement from the FHA. If, in the course of such review or at any
time thereafter, the Trustee (through no negligence of its own) finds any
document or documents constituting a part of a Mortgage File which did not meet
the requirements of (a) through (d) above at the time of delivery, the Trustee
shall promptly notify the Master Servicer, the Seller and the Depositor in
writing. The Seller shall use reasonable efforts to correct or cure any such
defect of which it has been so notified within 60 days from
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the date the Seller was notified of such defect. If the Seller does not correct
or cure such defect within the period set forth in the immediately preceding
sentence, the Seller shall repurchase such Mortgage Loan from the Trust Fund at
the Purchase Price therefor. The Purchase Price for any such Mortgage Loan
shall be deposited by the Seller in the Collection Account. Upon receipt by the
Trustee of written notification of such deposit signed by a Servicing Officer
(which notification shall include a statement as to the accuracy of the Purchase
Price), the Trustee shall release the related Mortgage File to or at the
direction of the Seller, and shall execute and deliver such instruments of
transfer or assignment (which instruments shall be prepared and provided by the
Seller), in each case without recourse, as shall be necessary to vest in the
Seller, or its designee, title (to the extent that such title was transferred to
the Trustee) to any Mortgage Loan released pursuant hereto.
In reviewing any Mortgage File pursuant to this Section, the Trustee shall
have no responsibility to determine whether any document or opinion is legal,
valid, binding or enforceable, whether the text of any assignment or endorsement
is in proper or recordable form (except, if applicable, to determine if the
Trustee is the assignee or endorsee), whether a blanket assignment is permitted
in any applicable jurisdiction, or whether any Person executing any document or
rendering any opinion is authorized to do so or whether any signature thereon is
genuine.
The Trustee shall retain possession and custody of each Mortgage File in
accordance with and subject to the terms and conditions set forth herein.
It is understood and agreed that the obligation of the Seller to purchase
any Mortgage Loan which does not meet the requirements of (a) through (d) above
shall constitute the sole and exclusive recourse respecting such defect
available to the Trustee, the Depositor and the Certificateholders.
SECTION 2.03. Representations, Warranties and Covenants of the
Depositor as to the Mortgage Assets.
The Depositor hereby represents and warrants to the Trustee, for the benefit
of the Certificateholders, as of the date hereof or such other date set forth
herein, that:
(a) as of the Cut-off Date, no Mortgage Loan is more than 30 days
delinquent in payment of principal and interest;
(b) the information set forth in the Mortgage Asset Schedule with
respect to each Mortgage Asset is true and correct in all material
respects at the date or dates respecting which such information is
furnished; and
(c) each Mortgage Asset constitutes a "qualified mortgage" within the
meaning of Section 860G(a)(3) of the Code (but without regard to the rule
in Treasury Regulation Section 1.860G-2(f)(2) that treats a defective
obligation as a qualified mortgage, or
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any substantially similar provision) and applicable Treasury Regulations
thereto.
It is understood and agreed that the representations and warranties set
forth in this Section 2.03 shall survive delivery of the respective Mortgage
Files to the Trustee. Upon discovery by the Depositor, the Master Servicer or
the Trustee (or upon written notice thereof from any Certificateholder) of a
breach or breaches of any of the representations and warranties set forth in
this Section 2.03 that materially and adversely affects the interests of the
Certificateholders in the related Mortgage Asset, the party discovering such
breach or breaches shall give prompt written notice to the other parties. The
Trustee shall promptly notify the Depositor of a breach of the Depositor's
representations and warranties set forth in this Section 2.03 and request that
the Depositor correct or cure such breach within 60 days from the date the
Depositor was notified in writing of such breach and, if the Depositor does not
correct or cure such breach within such period, or if such breach cannot be so
cured, that the Depositor purchase the affected Mortgage Asset at the Purchase
Price therefor. The Purchase Price for any such Mortgage Asset shall be
deposited in the Collection Account. Upon receipt by the Trustee of written
notification of the deposit of the Purchase Price signed by a Servicing Officer
(which notification shall include a statement as to the accuracy of the Purchase
Price), the Trustee shall: (i) in the case of a Mortgage Loan, release the
related Mortgage File to or at the direction of the Depositor, and the Trustee
shall execute and deliver the related instruments of transfer or assignment, in
each case without recourse, as shall be necessary to vest in the Depositor, or
its designee, title (to the extent that such title was transferred to the
Trustee) to any Mortgage Loan purchased pursuant to this Section 2.03; and (ii)
in the case of a GNMA Certificate, cause the registration thereof in the name of
the Depositor on the books of the appropriate "financial intermediary" (within
the meaning of Section 8-313(4) of the New York UCC) designated by the
Depositor. It is understood and agreed that the obligation of the Depositor to
repurchase any Mortgage Asset as to which a breach of the representations and
warranties set forth in this Section 2.03 has occurred and is continuing shall
constitute the sole and exclusive recourse respecting such breach available to
Certificateholders or the Trustee on their behalf.
SECTION 2.04. Representations, Warranties and Covenants of the Master
Servicer and the Seller.
(a) The Master Servicer hereby represents and warrants to, and covenants
with, the other parties hereto and for the benefit of the Certificateholders,
as of the date hereof, that:
(i) the Master Servicer is a corporation, duly organized, validly
existing and in good standing under the laws of the State of Georgia and
is duly authorized and qualified to transact any and all business
contemplated by this Agreement in any state in which a Mortgaged Property
is located or is otherwise not required under applicable law to effect
such qualification and, in any event, is in compliance with the doing
business laws of any such State, to the extent necessary to ensure the
enforceability
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of each Mortgage Loan and the servicing of the Mortgage Loans in
accordance with the terms of this Agreement;
(ii) the Master Servicer has the full corporate power and authority
to service each Mortgage Loan, and to execute, deliver and perform, and
to enter into and consummate the transactions contemplated by this
Agreement and has duly authorized by all necessary corporate action on
the part of the Master Servicer the execution, delivery and performance
of this Agreement; and this Agreement, assuming the due authorization,
execution and delivery thereof by the other parties hereto, constitutes a
legal, valid and binding obligation of the Master Servicer, enforceable
against the Master Servicer in accordance with its terms, except that (A)
the enforceability thereof may be limited by bankruptcy, insolvency,
moratorium, receivership and other similar laws relating to creditors'
rights generally and (B) the remedy of specific performance and
injunctive and other forms of equitable relief may be subject to the
equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought;
(iii) the execution and delivery of this Agreement by the Master
Servicer, the servicing of the Mortgage Loans by the Master Servicer
hereunder, the consummation of any other of the transactions herein
contemplated, and the fulfillment of or compliance with the terms hereof
are in the ordinary course of business of the Master Servicer and will
not (A) result in a material breach of any term or provision of the
charter or by-laws of the Master Servicer or (B) materially conflict
with, result in a material breach, violation or acceleration of, or
result in a material default under, the terms of any other material
agreement or instrument to which the Master Servicer is a party or by
which it may be bound, or any statute, order or regulation applicable to
the Master Servicer of any court, regulatory body, administrative agency
or governmental body having jurisdiction over the Master Servicer; and
the Master Servicer is not a party to, bound by, or in breach or
violation of any indenture or other agreement or instrument, or subject
to or in violation of any statute, order or regulation of any court,
regulatory body, administrative agency or governmental body having
jurisdiction over it, which materially and adversely affects, or, to the
Master Servicer's knowledge would in the future materially and adversely
affect, (X) the ability of the Master Servicer to perform its obligations
under this Agreement or (Y) the business, operations, financial
condition, properties or assets of the Master Servicer;
(iv) the Master Servicer is, and will remain, subject to supervision
and examination by any state or federal authority as may be applicable
and will remain in good standing and qualified to do business where so
required by applicable law and is, and will remain, an FHA-Approved
Mortgagee;
(v) no litigation is pending or, to the best of the Master
Servicer's knowledge, threatened, against the Master Servicer that would
adversely affect the execution, delivery or enforceability of this
Agreement or, in any material respect, the ability of the Master Servicer
to service the Mortgage Loans or to perform any of its other obligations
hereunder in accordance with the terms hereof;
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(vi) no written information, certificate of an officer, statement
furnished in writing or written report delivered to the Depositor, any
affiliate of the Depositor or the Trustee and prepared by the Master
Servicer pursuant to this Agreement contains any untrue statement of a
material fact or omits to state a material fact necessary to make the
information, certificate, statement or report not misleading;
(vii) except for permits and similar authorizations required under the
securities or "blue sky" laws 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
consummation of the transactions contemplated hereby, or if any such
consent, approval, authorization or order is required, the Master
Servicer has obtained the same; and
(viii) all Sub-Servicing Agreements substantially comply with the
provisions of this Agreement.
(b) The Seller hereby represents and warrants to, and covenants with, the
other parties hereto and for the benefit of the Certificateholders, as of the
date hereof, that:
(i) the Seller is a corporation, duly organized, validly existing and
in good standing under the laws of the Commonwealth of Virginia and is
duly authorized and qualified to transact any and all business
contemplated by this Agreement in any state in which a Mortgaged Property
is located or is otherwise not required under applicable law to effect
such qualification and, in any event, is in compliance with the doing
business laws of any such State, to the extent necessary to ensure the
enforceability of each Mortgage Loan;
(ii) the Seller has the full corporate power and authority to transfer
the Mortgage Assets, and to execute, deliver and perform, and to enter
into and consummate the transactions contemplated by this Agreement and
has duly authorized by all necessary corporate action on the part of the
Seller the execution, delivery and performance of this Agreement; and
this Agreement, assuming the due authorization, execution and delivery
thereof by the other parties hereto, constitutes a legal, valid and
binding obligation of the Seller, enforceable against the Seller in
accordance with its terms, except that (A) the enforceability thereof may
be limited by bankruptcy, insolvency, moratorium, receivership and other
similar laws relating to creditors' rights generally and (B) the remedy
of specific performance and injunctive and other forms of equitable
relief may be subject to the equitable defenses and to the discretion of
the court before which any proceeding therefor may be brought;
(iii) the execution and delivery of this Agreement by the Seller, the
transfer of the Mortgage Assets by the Seller hereunder, the consummation
of any other of the transactions herein contemplated, and the fulfillment
of or compliance with the terms hereof are in the ordinary course of
business of the Seller and will not (A) result
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in a material breach of any term or provision of the charter or by-laws
of the Seller or (B) materially conflict with, result in a material
breach, violation or acceleration of, or result in a material default
under, the terms of any other material agreement or instrument to which
the Seller is a party or by which it may be bound, or any statute, order
or regulation applicable to the Seller of any court, regulatory body,
administrative agency or governmental body having jurisdiction over the
Seller; and the Seller is not a party to, bound by, or in breach or
violation of any indenture or other agreement or instrument, or subject
to or in violation of any statute, order or regulation of any court,
regulatory body, administrative agency or governmental body having
jurisdiction over it, which materially and adversely affects, or, to the
Seller's knowledge would in the future materially and adversely affect,
(X) the ability of the Seller to perform its obligations under this
Agreement or (Y) the business, operations, financial condition,
properties or assets of the Seller;
(iv) no litigation is pending or, to the best of the Seller's
knowledge, threatened, against the Seller that would adversely affect the
execution, delivery or enforceability of this Agreement or the ability of
the Seller to transfer the Mortgage Assets or to perform in all material
respects any of its other obligations hereunder in accordance with the
terms hereof;
(v) no written information, certificate of an officer, statement
furnished in writing or written report delivered to the Depositor, any
Affiliate of the Depositor or the Trustee and prepared by the Seller
pursuant to this Agreement contains any untrue statement of a material
fact or omits to state a material fact necessary to make the information,
certificate, statement or report not misleading;
(vi) except for permits and similar authorizations required under
the securities or "blue sky" laws no consent, approval, authorization or
order of any court or governmental agency or body is required for the
execution, delivery and performance by the Seller of, or compliance by
the Seller with, this Agreement or the consummation of the transactions
contemplated hereby, or if any such consent, approval, authorization or
order is required, the Seller has obtained the same; and
(vii) the consummation of the transactions contemplated by this
Agreement are not subject to the bulk transfer or any similar statutory
provisions in effect in any applicable jurisdiction.
(c) The Seller hereby represents and warrants to, and covenants with, the
other parties hereto for the benefit of the Certificateholders, as of the
Closing Date or such other date specifically set forth herein, that:
(i) the information set forth in the Mortgage Asset Schedule with
respect to each Mortgage Asset (and, in the case of each GNMA
Certificate, with respect to the related Underlying Loan) is true and
correct in all material respects at the date or dates respecting which
such information is provided;
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(ii) as of the Closing Date, none of the Mortgage Loans is:
(A) delinquent under the original or modified terms thereof to the
extent of more than one monthly installment of interest, principal or
escrow deposits or is otherwise in default; or
(B) subject to any outstanding advance or advances made by the
mortgagee to the Mortgagor;
(iii) immediately prior to the transfer of the Mortgage Assets to the
Trustee, the Seller had good and marketable title to the Mortgage Assets, free
and clear from all liens, charges, encumbrances or rights of others (except the
right of the Depositor to direct the assignment of the Mortgage Assets to the
Trustee);
(iv) except in the case of the Mortgage Loan as to which the Seller
delivered a Lost Note Affidavit and Indemnity, the chain of title of each
Mortgage Loan from the originator thereof to the Trustee is unbroken and free
from defect and is duly endorsed on the related Mortgage Note;
(v) the terms of each Mortgage Loan and the related Mortgage have not
been impaired, waived, altered or modified in any respect, except by written
instruments, approved by the FHA. No Mortgagor has been released in whole or in
part except in connection with an agreement approved by the FHA which agreement
is part of the related Mortgage File delivered to the Trustee;
(vi) each Mortgage Loan is fully insured by the FHA, and all necessary
steps have been taken to make and keep such insurance valid, binding and
enforceable. No defect exists that would prevent recovery in full or in part
under any FHA Mortgage Insurance Contract. Such insurance is the binding, valid
and enforceable obligation of the FHA to the full extent thereof, without any
surcharge, set-off or defense. Each document which is required in order to
assign such Mortgage Loan to the FHA and to collect the FHA Insurance Benefits
in full, without the imposition of any surcharge, is included in the related
Mortgage File;
(vii) the Seller has reviewed each Mortgage File, and the related
Mortgaged Property is covered by a lender's title policy insuring that the
related Mortgage is a valid first (or, if identified on the Mortgage Asset
Schedule as such, a second) mortgage lien on such Mortgaged Property, subject
only to the exceptions stated therein. Such title insurance policy is in full
force and effect, no claims have been made thereunder, is freely assignable and
will inure to the benefit of the Trustee as mortgagee of record;
(viii) with respect to each Mortgage Loan, all relevant real estate tax
and assessment obligations to date (except those set forth on Exhibit J) have
been satisfied;
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(ix) the transfer of each Mortgage Loan to the Trustee, and the
transfers of Certificates evidencing interests therein, as contemplated hereby
is and will be in compliance with 24 CFR Section 207.261 or, if not, the Seller
has received the required written authorization from the FHA to permit such
transfer of each Mortgage Loan and such transfers of Certificates, and any prior
transfers of each Mortgage Loan have been in compliance with 24 CFR Section
207.261;
(x) no Mortgage Loan is a Putable Mortgage Loan, and no GNMA
Certificate is a PN (non-level) payment type (except if such GNMA Certificate is
designated as a PN (non-level) payment type solely because the first payment
thereon following origination was made up only of interest);
(xi) it is not necessary to notify the FHA of any past due or unpaid
taxes or assessment obligations set forth on Exhibit J, and no such past due or
unpaid item could be the basis for the assignment of the related Mortgage Loan
to the FHA; and
(xii) FHA Insurance Benefits in respect of each Mortgage Loan will be
payable in cash or FHA Debentures or both.
(d) Upon the discovery by any party hereto (or upon notice thereof in
writing from a Certificateholder) of a breach or breaches of any representation
or warranty of the Master Servicer or the Seller set forth in Section 2.04(a),
2.04(b) or 2.04(c), which breach materially and adversely affects the interests
of the Certificateholders, the party discovering such breach shall give prompt
written notice to the other parties. The Trustee shall promptly notify the
Master Servicer or the Seller, as appropriate, of such breach and request that
such party cure such breach within 60 days from the date of such notice. If
such breach is a breach of a representation and warranty set forth in Section
2.04(c) and the Seller does not cure such breach in all material respects,
within such 60-day period, the Seller shall repurchase the affected Mortgage
Asset from the Trustee at the applicable Purchase Price. The Purchase Price for
any such Mortgage Asset shall be deposited in the Collection Account. Upon
receipt by the Trustee of written notification (which notification shall include
a statement as to the accuracy of such Purchase Price) of the deposit of the
Purchase Price signed by a Servicing Officer, the Trustee shall: (i) in the case
of a Mortgage Loan, release the related Mortgage File to the Seller and shall
execute and deliver such instruments of transfer or assignment (which
instruments shall be prepared and provided by the Seller), in each case without
recourse, as shall be necessary to vest in the Seller, or its designee, title
(to the extent that such title was transferred to the Trustee) to any Mortgage
Loan purchased pursuant to this Section 2.04(d); and (ii) in the case of a GNMA
Certificate, cause the re-registration thereof in the name of the Seller on the
books of the appropriate "financial intermediary" (within the meaning of Section
(8-313(4) of the New York UCC) designated by the Seller. Except as set forth in
Section 2.03 hereof, it is understood and agreed that the obligation of the
Seller to purchase any Mortgage Loan as to which any such breach (or breaches)
of a representation and warranty contained in Section 2.04(c) has occurred and
is continuing shall constitute the sole recourse respecting such breach or
breaches available to the Depositor, the Trustee or the Certificateholders.
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SECTION 2.05. Execution, Authentication and Delivery of Class R-I
Certificates; Creation of REMIC I Regular Interests.
The Trustee hereby acknowledges the assignment to it of the assets included
in REMIC I. Concurrently with such assignment and in exchange therefor, the
Trustee, pursuant to the written request of the Depositor executed by an officer
of the Depositor, has executed, authenticated and delivered to or upon the order
of the Depositor, the Class R-I Certificates in authorized denominations. The
interests evidenced by the Class R-I Certificates, together with the REMIC I
Regular Interests, constitute the entire beneficial ownership of REMIC I. The
rights of the Class R-I Certificateholders and REMIC II (as holder of the REMIC
I Regular Interests) to receive distributions from the proceeds of REMIC I in
respect of the Class R-I Certificates and the REMIC I Regular Interests,
respectively, and all ownership interests in such distributions evidenced or
constituted by the Class R-I Certificates and the REMIC I Regular Interests,
shall be as set forth in this Agreement.
SECTION 2.06. Conveyance of REMIC I Regular Interests; Acceptance of
REMIC II by Trustee.
The Depositor, as of the Closing Date, and concurrently with the execution
and delivery of this Agreement, does hereby sell and assign without recourse all
the right, title and interest of the Depositor in and to the REMIC I Regular
Interests to the Trustee for the benefit of the Holders of the REMIC II
Certificates. The Trustee acknowledges the sale and assignment to it of the
REMIC I Regular Interests and declares that it holds and will hold the same in
trust for the exclusive use and benefit of all present and future Holders of the
REMIC II Certificates.
SECTION 2.07. Execution, Authentication and Delivery of REMIC II
Certificates.
Concurrently with the sale and assignment to it of the REMIC I Regular
Interests and in exchange therefor, the Trustee has executed, authenticated and
delivered to or upon the order of the Depositor, the REMIC II Certificates in
authorized denominations evidencing the entire beneficial ownership of REMIC II.
The rights of the Holders of the respective Classes of REMIC II Certificates to
receive distributions from the proceeds of REMIC II in respect of their REMIC II
Certificates, and all ownership interests in such distributions evidenced by the
respective Classes of REMIC II Certificates, shall be as set forth in this
Agreement.
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SECTION 2.08 Retained Yield.
(a) The Seller's right to receive the Retained Yield with respect to any
FHA Debenture shall be absolute and unconditional, but shall last only for so
long as such FHA Debenture is part of the Trust Fund. The Seller's right to
receive the Retained Yield with respect to an FHA Assigned Mortgage Loan shall
also be absolute and unconditional, but shall last only until a Final Recovery
Determination has been made with respect to such FHA Assigned Mortgage Loan.
The Seller's right to receive the Retained Yield shall not be subject to offset
or counterclaim, notwithstanding any breach of any representation or warranty of
the Seller under this Agreement or any default by the Seller of any of its
obligations or covenants under this Agreement.
(b) The Master Servicer shall remit any Retained Yield received with
respect to any FHA Debenture or FHA Assigned Mortgage Loan to the Seller
pursuant to such reasonable arrangements as may be entered into between the
Master Servicer and the Seller.
(c) Retained Yield in respect of any FHA Debenture shall be payable solely
from payments of interest received on such FHA Debenture and from the interest
portion of any proceeds received in connection with the sale of such FHA
Debenture pursuant to Section 3.15 or 10.01. Any Retained Yield with respect to
any FHA Debenture shall cease to accrue at such time as the FHA Debenture is
paid in full or otherwise removed from the Trust Fund. Retained Yield in
respect of any FHA Assigned Mortgage Loan shall be payable solely from payments
of interest received from the FHA with respect to such FHA Assigned Mortgage
Loan. Any Retained Yield with respect to any FHA Assigned Mortgage Loan shall
cease to accrue at such time as a Final Recovery Determination has been made
with respect to such FHA Assigned Mortgage Loan.
ARTICLE III
ADMINISTRATION AND SERVICING
OF TRUST FUND
SECTION 3.01. General Servicing Provisions.
(a) For and on behalf of the Trust Fund and solely in the best interests of
and for the benefit of the Trustee (as trustee for the Certificateholders) and
the Certificateholders, the Master Servicer shall service and administer the
Mortgage Loans in accordance with the applicable provisions of the Housing Act
and the FHA Regulations, the terms of this Agreement and the respective Mortgage
Loans and, to the extent consistent with the foregoing, the normal and usual
standards of practice of prudent servicers of FHA-insured project mortgage loans
in the respective states where the Mortgaged Properties are located.
(b) Subject to the foregoing, the Master Servicer shall have full power and
authority, acting alone and/or through any Sub-Servicer, to do or cause to be
done any and all
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things that it may deem necessary or desirable in connection with such servicing
and administration; provided that the Master Servicer shall take no action that
is materially inconsistent with or materially prejudices the interest of the
Trustee or the Certificateholders in any Mortgage Loan or under the related FHA
Mortgage Insurance or the rights and interest of the Depositor, the Trustee or
the Certificateholders under the terms of this Agreement unless such action is
specifically called for by the terms hereof; and provided further that, without
the consent of the FHA (if required under FHA Regulations), the Master Servicer
shall not: (i) modify or extend any Mortgage Loan; (ii) make or consent to any
material amendment, change, modification or alteration of any Mortgage Loan;
(iii) consent to any release, substitution or exchange of the collateral given
for any Mortgage Loan; (iv) waive any claim or right against the Mortgagor or
any guarantor, standby creditor or obligor of a Mortgage Loan; or (v) consent to
any transfer of or subordinate financing on any Mortgaged Property unless such
transfer or subordinate financing is permitted under the loan documents relating
thereto.
To the extent consistent with the foregoing, and subject to Section 3.01(d)
and any other specific provisions hereof that may be applicable to any
particular matter, the Master Servicer, in its own name or in the name of the
Depositor and the Trustee, is hereby authorized and empowered by the Depositor
and the Trustee, when the Master Servicer believes it appropriate in its best
judgment, to execute and deliver, on behalf of the Trustee, the Depositor, the
Certificateholders or any of them, any and all instruments of modification,
satisfaction, cancellation or assignment, or of partial or full release or
discharge and all other comparable instruments, with respect to the Mortgage
Loans, and with respect to the Mortgaged Properties held for the benefit of the
Certificateholders. The Master Servicer shall promptly notify the Trustee of
any such execution and delivery. Subject to Section 3.13, the Depositor and the
Trustee for the benefit of the Certificateholders shall furnish the Master
Servicer with any powers of attorney and other documents necessary or
appropriate to enable the Master Servicer to service and administer the Mortgage
Loans.
(c) In accordance with the standards of the preceding subsections, but
subject to any applicable limitations set forth in Section 5.03, the Master
Servicer shall advance or cause to be advanced funds, as and when necessary, for
the purpose of effecting the timely payment of taxes, assessments and ground
rents (if any) on each Mortgaged Property, FHA Mortgage Insurance premiums in
respect of the Mortgage Loans or any other related unpaid insurance premiums
that are not timely paid by the Mortgagors and no or insufficient amounts have
been escrowed for the payment thereof. Any such advances shall be reimbursable
in the first instance from related collections from the Mortgagors pursuant to
Section 3.06 hereof, and further as Liquidation Expenses as provided in Section
3.17 hereof and may be withdrawn from the Collection Account pursuant to Section
3.09 hereof. All costs incurred by the Master Servicer in effecting the timely
payments of taxes, assessments and ground rents (if any) on the Mortgaged
Properties, FHA Mortgage Insurance premiums in respect of the Mortgage Loans and
any other related insurance premiums shall not, for the purpose of calculating
any amounts which affect monthly distributions to the Certificateholders, be
added to the principal balance under the related Mortgage Loans, notwithstanding
that the terms of such Mortgage Loans so permit.
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(d) Notwithstanding anything in this Agreement to the contrary, the Master
Servicer shall not (unless (i) the related Mortgagor is in default with respect
to the Mortgage Loan or such default is, in the good faith and reasonable
judgment of the Master Servicer, reasonably foreseeable, (ii) the Master
Servicer has obtained the written consent of the FHA if required under FHA
Regulations and (iii) the Master Servicer has obtained written confirmation from
the Rating Agency that there would be no resulting downgrade, withdrawal or
qualification of the then-current rating of any Class of Rated Certificates)
permit any modification with respect to any Mortgage Loan that would affect the
amount or timing of any related payment of principal, interest or other amount
payable thereunder or, in the Master Servicer's good faith and reasonable
judgment, would materially impair the security for such Mortgage Loan or reduce
the likelihood of timely payment of amounts due thereon.
In addition, the Master Servicer shall not make or permit any modification,
waiver or amendment of any term of, or take any other action with respect to,
any Mortgage Loan that would (A) result in an Adverse REMIC Event with respect
to either REMIC I or REMIC II or (B) cause any Mortgage Loan to cease to be a
"qualified mortgage" within the meaning of Section 860G(a)(3) of the Code. Any
modification, waiver or amendment of any term of any Mortgage Loan shall be
consistent with the servicing standard set forth in the first paragraph of this
Section 3.01.
(e) At no time prior to six months before the Stated Maturity Date of any
Mortgage Loan shall the Seller, the Master Servicer, the Depositor or any of
their respective Affiliates solicit the related Mortgagor, directly or
indirectly, for purposes of providing such Mortgagor with financing to prepay
such Mortgage Loan.
(f) The relationship of the Master Servicer to the Trustee under this
Agreement is intended by the parties to be that of an independent contractor and
not that of a joint venturer, partner or agent.
(g) The Master Servicer shall maintain accurate records, certified by a
Servicing Officer, of each Final Recovery Determination in respect of any
Mortgage Loan and the basis thereof. Each Final Recovery Determination shall be
evidenced by an Officer's Certificate delivered to the Trustee no later than the
tenth Business Day following such Final Recovery Determination.
SECTION 3.02. Administration of GNMA Certificates and FHA Debentures.
If at any time the Trustee, as the registered holder of a GNMA Certificate
or an FHA Debenture, is requested in such capacity, by any Person whatsoever to
take any action (other than the disposition thereof) or to give any consent,
approval or waiver, then the Trustee shall promptly notify all of the
Certificateholders of such request in writing and shall, in its capacity as the
registered holder of such GNMA Certificate or FHA Debenture, as the case may be,
take such action in connection with the exercise and/or enforcement of any
rights and/or remedies available to it in such capacity with respect to such
request only as Holders entitled to
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at least 51% of the Voting Rights allocated to the Classes affected thereby
shall direct in writing. If the Trustee does not receive written instructions
from Holders entitled to at least 51% of such Voting Rights within 30 days of
their receipt of such notification from the Trustee, the Trustee may (i) take
such course of action as it determines, in its reasonable and good faith
judgment, is in the best interests of the Certificateholders or (ii) refuse to
take such requested action or to give any such requested consent, approval or
waiver.
SECTION 3.03. Collection of Mortgage Asset Payments.
(a) The Master Servicer shall proceed diligently, using all reasonably
practicable methods, to collect all payments called for under the terms and
provisions of the Mortgage Loans, when and as they become due and payable, and
shall, to the extent such procedures shall be consistent with this Agreement and
the terms and provisions of the FHA Mortgage Insurance, follow such collection
procedures as it follows with respect to mortgage loans comparable to the
Mortgage Loans and serviced by it for others. The Master Servicer shall not
accept any prepayment of the principal of any Mortgage Loan unless the
prepayment is permitted by the terms of the Mortgage Loan and FHA Regulations.
(b) The Trustee shall deposit or cause to be deposited in the Distribution
Account all distributions actually received on the GNMA Certificates and any FHA
Debentures (except those amounts which constitute (i) Retained Yield with
respect to any FHA Debentures and (ii) payments of interest on any FHA Debenture
with respect to which the Master Servicer has previously made a Monthly
Advance). If such distributions are to be made by wire transfer, the Trustee
shall direct that such wire transfer be made to the Distribution Account. The
Trustee shall remit to the Master Servicer by wire transfer any amounts received
by it constituting (i) Retained Yield on any FHA Debentures and (ii) payments of
interest on any FHA Debenture with respect to which the Master Servicer has
previously made a Monthly Advance, which amounts shall, upon receipt thereby, be
deposited by the Master Servicer in the Collection Account. If the full amount
of any distribution on any GNMA Certificate or FHA Debenture shall not have been
received by the Trustee by the close of business on the date on which such
distribution was due to be received thereon, the Trustee shall notify the Master
Servicer and the party required to make such distribution. If the full amount
of such distribution shall not have been received by the Trustee or the Master
Servicer one Business Day following such notice, the Trustee shall promptly
notify the Certificateholders, and such parties shall proceed in accordance with
Section 3.02.
Neither the Trustee nor the Master Servicer shall accept a second payment on
any GNMA Certificate in any calendar month after the Due Date for such GNMA
Certificate in such month.
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SECTION 3.04. Rights of the Depositor and the Trustee in Respect of the
Master Servicer and the Seller.
The Master Servicer and the Seller each shall afford the Depositor and the
Trustee, without charge but only upon reasonable notice and during normal
business hours, access to all records and documentation in the Master Servicer's
or the Seller's, as the case may be, possession regarding the Mortgage Loans and
to all accounts, insurance policies and other matters in the Master Servicer's
or the Seller's, as the case may be, possession relating to this Agreement and
access to officers of the Master Servicer responsible for its obligations
hereunder. The Depositor may, but is not obligated to, enforce the obligations
of the Master Servicer and/or the Seller hereunder. The Depositor shall not
have any responsibility or liability for any action or failure to act by the
Master Servicer or the Seller and is not obligated to supervise the performance
of the Master Servicer or the Seller hereunder or otherwise.
SECTION 3.05. Sub-Servicers.
(a) It is understood that the Master Servicer may perform its servicing
obligations under this Agreement through Sub-Servicers, provided that each such
Sub-Servicer, at all times it is servicing any Mortgage Loan, is an established
and approved servicer of FHA-insured project mortgage loans. For purposes of
this Agreement, the Master Servicer shall be deemed to have received payments on
Mortgage Loans upon receipt thereof by a Sub-Servicer. The Master Servicer
shall pay all fees and expenses of each Sub-Servicer out of the Servicing
Compensation or out of the Master Servicer's own funds. Any agreement that may
be entered into by the Master Servicer and any transactions or services relating
to the Mortgage Loans involving a Sub-Servicer in its capacity as such shall be
deemed to be between the Sub-Servicer and the Master Servicer alone, and except
to the extent that the Trustee (or any other successor master servicer) succeeds
to the rights and obligations of the Master Servicer hereunder as provided in
subsection (b) below, neither the Trustee (or any other successor master
servicer) nor any Certificateholder shall be deemed to be a party thereto or
have any claims, rights, obligations, duties or liabilities with respect to the
Sub-Servicer or for the payment of the fees and expenses of any Sub-Servicer.
Any such Sub-Servicing Agreement shall conform in all material respects with
this Agreement. Notwithstanding the fact that the Master Servicer may perform
its servicing obligations under this Agreement through another entity, the
Master Servicer shall at all times remain obligated and liable to the Trustee
and the Certificateholders without diminution by virtue of such servicing being
performed by such other entity and to the same extent and under the same terms
and conditions as if the Master Servicer alone were performing its obligations
under this Agreement.
(b) If the Master Servicer shall for any reason no longer be the Master
Servicer (including by reason of any Event of Default), the Trustee (or any
other successor master servicer) shall succeed to any rights and obligations of
the Master Servicer under any Sub-Servicing Agreement and shall be deemed to
have assumed the Master Servicer's interest therein; provided, however, that the
Master Servicer shall not thereby be relieved of any liability or obligations
under any Sub-Servicing Agreement arising prior to the date of such succession.
The Master Servicer shall, upon request of the Trustee, but at the expense of
the Master
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Servicer, deliver to the assuming party all documents and records relating to
the Mortgage Loans then being serviced thereunder and an accounting of collected
amounts held by or on behalf of it and otherwise use its best efforts to effect
the orderly and efficient transfer of servicing to the assuming party.
SECTION 3.06. Collection of Taxes, Assessments and Similar Items; Escrow
Accounts.
The Master Servicer shall establish and maintain one or more custodial
accounts (each, an "Escrow Account") and deposit and retain therein all
collections from the Mortgagors for the payment of taxes, assessments, FHA
Mortgage Insurance premiums, hazard and other insurance premiums and comparable
items for the account of the Mortgagors. The Master Servicer shall deposit all
such funds and maintain such accounts in accordance with applicable FHA
Regulations. All Escrow Accounts shall be Eligible Accounts.
Subject to the terms of the related Mortgage Loans and the applicable FHA
Regulations, withdrawals of amounts so collected from the Escrow Accounts may be
made to effect timely payment of taxes, assessments, FHA Mortgage Insurance
premiums, hazard and other insurance premiums and comparable items, to reimburse
the Master Servicer for prior advances of such items, to refund to any
Mortgagors any sums as may be determined to be overages, to pay interest, if
required, to Mortgagors on balances in the Escrow Account or to clear and
terminate the Escrow Account at the termination of this Agreement in accordance
with Section 10.01 hereof. As part of its servicing duties, the Master
Servicer, without right of reimbursement, shall pay to the Mortgagors interest
on funds in the Escrow Account, to the extent required by law.
SECTION 3.07. Reserve Accounts.
The Master Servicer shall establish and maintain, as applicable, one or more
accounts (the "Reserve Accounts"), into which all Reserve Funds, if any, shall
be deposited and retained. Withdrawals of amounts so deposited may be made (i)
to pay for, or to reimburse the related Mortgagor in connection with,
replacements, repairs and/or capital improvements at the related Mortgaged
Property if the replacements have been effected or the repairs or capital
improvements have been completed, and such withdrawals are made, in accordance
with the servicing standard set forth in Section 3.01(a), FHA Regulations and
the terms of the related Mortgage Note, Mortgage and any agreement with the
related Mortgagor governing such Reserve Funds, and (ii) to distribute interest
earned on such amounts to the related Mortgagor pursuant to the FHA Regulations.
All Reserve Accounts shall be Eligible Accounts.
SECTION 3.08. Maintenance of the Collection Account.
The Master Servicer shall establish and maintain, in its name on behalf of
the Trustee for the benefit of the Certificateholders, the Collection Account.
The Master Servicer shall deposit into the Collection Account on a daily basis,
except as otherwise specifically provided herein, the following payments and
collections received or made by it subsequent to
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the Cut-off Date (other than in respect of principal of and interest and any
other payments on the Mortgage Loans due on or before the Cut-off Date):
(i) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans;
(ii) all payments on account of interest on the Mortgage Loans;
(iii) all Insurance Proceeds, Condemnation Proceeds and Liquidation
Proceeds collected on or in respect of the Mortgage Loans (and any FHA
Debentures received in respect thereof), other than proceeds to be
applied to the restoration or repair of the Mortgaged Property or
released to the Mortgagor in accordance with the Master Servicer's normal
servicing procedures and the terms of the applicable FHA Mortgage
Insurance Contract;
(iv) all Prepayment Premiums collected with respect to the Mortgage
Loans;
(v) any amount of any losses required to be deposited by the Master
Servicer pursuant to the second succeeding paragraph of this Section 3.08
in connection with any losses on Permitted Investments;
(vi) all amounts constituting Retained Yield with respect to any FHA
Debentures or interest on any FHA Debentures with respect to which the
Master Servicer has previously made a Monthly Advance;
(vii) all proceeds of any purchase by the Depositor, the Seller or
the Master Servicer, as the case may be, of any Mortgage Asset pursuant
to Article II or Section 10.01 hereof; and
(viii) any other amounts specifically required to be deposited in the
Collection Account pursuant to this Agreement.
The foregoing requirements for remittance by the Master Servicer shall be
exclusive, it being understood and agreed that, without limiting the generality
of the foregoing, amounts to be deposited in the Escrow Accounts and/or the
Reserve Accounts and payments in the nature of late payment charges, assumption
fees and modification fees in respect of the Mortgage Loans, if collected, need
not be remitted or deposited into the Collection Account by the Master Servicer.
In the event that the Master Servicer shall deposit any amount not required to
be so deposited, it may at any time withdraw such amount from the Collection
Account, any provision herein to the contrary notwithstanding. All funds
deposited in the Collection Account shall be held by the Master Servicer in
trust on behalf of the Trustee for the benefit of the Certificateholders until
disbursed in accordance with this Agreement or withdrawn in accordance with
Section 3.09. In no event shall the Trustee incur liability for withdrawals
from the Collection Account made by the Master Servicer.
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The Master Servicer may invest the funds in the Collection Account in
Permitted Investments, which shall mature not later than the Business Day
preceding the Master Servicer Remittance Date next following the date of such
investment (except that if such Permitted Investment is an obligation of the
institution that maintains the Collection Account, then such Permitted
Investment shall mature not later than such Master Servicer Remittance Date).
All such Permitted Investments shall be made in the name of the Trustee for the
benefit of the Certificateholders (in its capacity as such) or its nominee. All
income and gain net of any losses realized from any such investment shall be for
the benefit of the Master Servicer and shall be subject to withdrawal from time
to time. The amount of any losses net of any gains not paid to the Master
Servicer incurred in respect of any such investments shall be remitted to the
Trustee or deposited in the Collection Account out of the Master Servicer's own
funds promptly following the date that same are realized.
The Master Servicer shall promptly give notice to the Trustee, the Rating
Agency and the Depositor of the location of the Collection Account and of any
change thereof.
SECTION 3.09. Permitted Withdrawals from the Collection Account.
The Master Servicer may, from time to time, make withdrawals from the
Collection Account for the following purposes:
(a) to pay to the Master Servicer, as servicing compensation, that
portion of any payment or other collection of interest on or in respect
of any Mortgage Loan that represents Servicing Fees with respect to such
Mortgage Loan accrued for the period with respect to which such payment
or other collection of interest applies (to the extent that such amount
was not previously paid to or retained by the Master Servicer), and to
pay to the Master Servicer, as additional servicing compensation,
earnings on or investment income with respect to funds credited to the
Collection Account and any other amounts on deposit in the Collection
Account that constitute Servicing Compensation;
(b) to reimburse the Master Servicer for Advances made in respect of
any Mortgage Loan, such right of reimbursement pursuant to this subclause
(b) being limited to amounts received in respect of such Mortgage Loan
(including, for this purpose, late payments, Insurance Proceeds,
Condemnation Proceeds, Liquidation Proceeds and Repurchase Proceeds) and
amounts received in connection with the sale pursuant to Section 3.15 or
10.01 of any FHA Debentures that constitute related FHA Insurance
Benefits;
(c) to reimburse the Master Servicer for Monthly Advances made in
respect of any FHA Debenture, such right of reimbursement pursuant to
this subclause (c) being limited to amounts received in respect of such
FHA Debenture (including, without limitation, from the sale thereof
pursuant to Section 3.15 or 10.01) that represents a payment or other
collection of interest (net of any portion thereof that constitutes
Retained Yield);
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(d) to reimburse the Master Servicer for any Nonrecoverable Advances;
(e) at such time as any Advance is reimbursed pursuant to any of the
preceding clauses (b), (c) or (d) to pay the Master Servicer all related
unpaid Advance Interest;
(f) to pay, or to reimburse the Master Servicer for, Liquidation
Expenses incurred in respect of any Mortgage Loan (other than those
associated with the assignment of any defaulted Mortgage Loan to the FHA)
from related Liquidation Proceeds;
(g) to pay to the Depositor, the Seller, the Master Servicer or the
Trustee, as the case may be, with respect to each Mortgage Asset that has
been purchased thereby pursuant to any of Sections 2.01, 2.02, 2.03,
2.04, 3.15 or 10.01 hereof all amounts received on such Mortgage Asset
and not taken into account in determining the Purchase Price of such
Mortgage Asset;
(h) to reimburse the Master Servicer, the Seller, the Depositor
and/or certain related Persons for expenses incurred thereby and
reimbursable thereto pursuant to Section 7.03 hereof;
(i) to withdraw any amount deposited in the Collection Account
pursuant to Section 3.08 and not required to be deposited therein;
(j) to pay to the Seller any amounts deposited in the Collection
Account which constitute Retained Yield in respect of any FHA Debenture
or FHA Assigned Mortgage Loan;
(k) to pay any and all taxes imposed on REMIC I or REMIC II by
federal, state or local governmental authorities to the extent such taxes
are to be paid by the Trust Fund pursuant to Section 11.09(h)(iv);
(l) to make any other withdrawals permitted or required to be made
from the Collection Account pursuant to this Agreement; and
(m) to clear and terminate the Collection Account upon termination of
this Agreement pursuant to Section 10.01 hereof.
The Master Servicer shall keep and maintain separate accounting, on a
Mortgage Loan-by-Mortgage Loan basis, for the purpose of justifying any
withdrawal from the Collection Account pursuant to any of the foregoing clauses.
On or prior to each Master Servicer Remittance Date, after payment of items
(a) through (l) above (to the extent necessary and without regard to the
withdrawal contemplated by this paragraph), the Master Servicer shall withdraw
from the Collection Account and remit to
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the Trustee, in immediately available funds, and the Trustee, upon receipt
thereof, shall deposit in the Distribution Account, all amounts then on deposit
in the Collection Account that represent Prepayment Premiums or any part of the
Available Distribution Amount for the next succeeding Distribution Date or
which, if they were on deposit in the Distribution Account, would be applied to
pay an expense of the Trust Fund withdrawable therefrom.
SECTION 3.10. Maintenance of Hazard Insurance and Other Insurance.
Pursuant to the Housing Act or as may be stipulated by the Commissioner of
the FHA, and specifically in compliance with 24 CFR Section 207.260 and any
superseding or supplemental regulation, the Master Servicer shall arrange that
at all times during the existence of this Agreement all buildings and
improvements on the Mortgaged Properties are, in each case, insured by Qualified
Insurers in accordance with the related Mortgage and applicable FHA Regulations
against insurable loss by fire and other hazards, casualties, floods and
contingencies to the extent that such insurance is available at a reasonably
competitive price, and where such insurance is for any reason not so available,
the Master Servicer shall so notify the FHA as required to ensure that no
payment of FHA Insurance Benefits is diminished by the absence of such
insurance. Such policies, with copies of all notices thereunder to be given to
the Master Servicer, shall be endorsed with standard mortgagee clauses with loss
payable to the Trustee. All proceeds paid under any such policies shall, after
receipt by the Trustee of a direction from a Servicing Officer of the Master
Servicer, be delivered by the Trustee to the Master Servicer for application to
the restoration or repair of the Mortgaged Property or for release by the Master
Servicer to the related Mortgagor, in accordance with the Master Servicer's
normal servicing procedures and the terms of the applicable FHA Mortgage
Insurance Contract, and any such proceeds remaining after such application or
release shall be deposited in the Collection Account pursuant to Section 3.08.
Any cost incurred by or on behalf of the Master Servicer in maintaining any such
insurance shall not, for the purpose of calculating any amounts which affect
monthly distributions to the Certificateholders or remittances to the Trustee
for their benefit, be added to the principal balance of the Mortgage Loan,
notwithstanding the terms of the Mortgage Loan so permit.
SECTION 3.11. Enforcement of Due-On-Sale and Due-On-Encumbrance Clauses;
Assumption Agreements.
(a) Except as otherwise provided in this Section 3.11(a), when any
Mortgaged Property has been conveyed by the related Mortgagor, the Master
Servicer shall, to the extent that it has knowledge of such conveyance, enforce
any due-on-sale clause contained in the related Mortgage Note or Mortgage, to
the extent permitted under applicable law and governmental regulations, but only
to the extent that such enforcement will not adversely affect or jeopardize
coverage under the related FHA Mortgage Insurance Contract or any Required
Insurance Policy. In the event that the Master Servicer is prohibited by law
from enforcing any such due-on-sale clause, or if coverage under the related FHA
Mortgage Insurance Contract or any Required Insurance Policy would be adversely
affected, the Master Servicer is authorized, subject to Section 3.11(b), to take
or enter into an assumption and modification agreement from or with the person
to whom such property has been or is about to be conveyed, pursuant to
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which such person becomes liable under the Mortgage Note and, unless prohibited
by applicable state law, the Mortgagor remains liable thereon, provided that the
Mortgage Loan shall continue to be covered (if so covered before the Master
Servicer enters such agreement) by the related FHA Mortgage Insurance Contract
and the applicable Required Insurance Policies. The Master Servicer, subject to
Section 3.11(b), is also authorized with the prior approval of the FHA and, if
necessary and appropriate, the insurers under any Required Insurance Policies to
enter into a substitution of liability agreement with such person, pursuant to
which the original Mortgagor is released from liability and such person is
substituted as Mortgagor and becomes liable under the Mortgage Note.
Notwithstanding the foregoing, the Master Servicer shall not be deemed to be in
default under this Section 3.11(a) by reason of any transfer or assumption which
the Master Servicer is restricted by law from preventing, for any reason
whatsoever.
(b) Subject to the Master Servicer's duty to enforce any due-on-sale clause
to the extent set forth in Section 3.11(a) hereof, in any case in which a
Mortgaged Property has been conveyed by the related Mortgagor, if an assumption
is permitted under Section 3.11(a) and the Person to whom the Mortgaged Property
is to be conveyed is to enter into an assumption agreement or modification
agreement or supplement to the Mortgage Note or Mortgage held for the benefit of
the Certificateholders that requires the signature of the Trustee, or if an
instrument of release signed by the Trustee is required releasing the Mortgagor
from liability on the Mortgage Loan, the Master Servicer shall deliver or cause
to be delivered to the Trustee for signature the assumption agreement with the
Person to whom the Mortgaged Property is to be conveyed and such modification
agreement or supplement to the Mortgage Note or Mortgage or other instruments as
are reasonable or necessary to carry out the terms of the Mortgage Note or
Mortgage or otherwise to comply with any applicable laws regarding assumptions
or the transfer of the Mortgaged Property to such Person. The Master Servicer
shall also deliver or cause to be delivered to the Trustee with the foregoing
documents a letter explaining the nature of such documents and the reason or
reasons why the Trustee's signature is required.
With such letter, the Master Servicer shall deliver to the Trustee a
certificate of a Servicing Officer certifying that: (i) a Servicing Officer has
examined and approved such documents as to form and substance, (ii) the
Trustee's execution and delivery thereof will not conflict with or violate any
terms of this Agreement or cause the unpaid principal balance and interest on
the Mortgage Loan to be uncollectible in whole or in part, (iii) any required
consents of the FHA and insurers under any Required Insurance Policies have been
obtained and (iv) subsequent to the closing of the transaction involving the
assumption or transfer (A) the Mortgage Loan will continue to be secured by a
first (or, if so reflected on the Mortgage Asset Schedule, a second) mortgage
lien pursuant to the terms of the Mortgage, (B) such transaction will not
adversely affect the coverage under the related FHA Mortgage Insurance or any
Required Insurance Policies, (C) the Mortgage Loan will fully amortize over the
remaining term thereof, (D) the Mortgage Rate on the Mortgage Loan will not be
altered nor will the term of the Mortgage Loan be increased as a result of such
assumption or transfer and (E) if the seller/transferor of the Mortgaged
Property is to be released from liability on the Mortgage Loan, the Master
Servicer used underwriting standards of prudent underwriters of FHA-insured
project mortgage loans in the state where the related Mortgaged Property is
located in evaluating the creditworthiness of the purchaser/transferee, and such
release will not (based on the Master
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Servicer's good faith and reasonable determination) adversely affect the
collectibility of the Mortgage Loan. Upon receipt of such certificate, the
Trustee for the benefit of the Certificateholders shall execute any necessary
instruments for such assumption or substitution of liability. Upon the closing
of the transactions contemplated by such documents, the Master Servicer shall
cause the originals of the assumption agreement, the release (if any), or the
modification or supplement to the Mortgage Note or Mortgage to be delivered to
the Trustee for the benefit of the Certificateholders and deposited in the
Mortgage File for such Mortgage Loan. Any fee collected by the Master Servicer
for entering into an assumption or substitution of liability agreement will be
retained by the Master Servicer as additional servicing compensation.
(c) When any Mortgaged Property has been further encumbered by the related
Mortgagor, the Master Servicer shall, to the extent it has knowledge of such
encumbrance, enforce any due-on-encumbrance clause contained in the related
Mortgage Note or Mortgage, to the extent permitted under applicable law and
governmental regulations, but only to the extent that such enforcement will not
adversely affect or jeopardize coverage under the related FHA Mortgage Insurance
Contract or any Required Insurance Policy.
SECTION 3.12. Maintenance of FHA Mortgage Insurance; Collection
Thereunder.
(a) The Master Servicer covenants and agrees not to act, or fail to act, in
any such manner as to impair the full force and effect of the FHA Mortgage
Insurance in respect of any Mortgage Loan throughout the term of this Agreement
and also covenants and agrees to exercise its best reasonable efforts to
discharge its obligations arising out of the FHA Mortgage Insurance Contract in
respect of each Mortgage Loan. The Master Servicer hereby agrees that it shall
be liable to the Trustee and the Trust Fund for any loss, liability or expense
incurred by the Trustee and/or the Trust Fund by reason of any FHA Mortgage
Insurance being voided, reduced, released or adversely affected by reason of the
failure by the Master Servicer to perform its obligations hereunder in strict
compliance with the terms and conditions of this Agreement. The Master Servicer
shall service and administer the Mortgage Loans in accordance with the servicing
standard set forth in Section 3.01(a), shall discharge all obligations of the
mortgagee under each Mortgage Loan and, subject to the right to assign the
Mortgage Loan to the FHA, shall take all action reasonably necessary to preserve
the lien of the related Mortgage, including, without limitation, the defense of
actions to challenge or foreclose such lien. In particular, the Master Servicer
shall:
(i) ensure the payment, on a timely basis, of the premiums
on the FHA Mortgage Insurance in respect of each Mortgage Loan;
(ii) make or cause to be made an annual physical inspection
of the property subject to each Mortgage Loan, and furnish an inspection
report to the FHA and the Trustee; and
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(iii) maintain insurance in accordance with Section 3.10 in
respect of, and pay ground rents, if any, taxes and other assessments on,
any Mortgaged Property if the related Mortgagor fails to do so.
(b) If a Mortgagor shall fail to make any payment due on any Mortgage Loan
or fail to perform any other covenant under the provisions of any Mortgage Loan
which results in the acceleration of the debt, and such failure continues for a
period of thirty (30) days, the Master Servicer shall, by written instructions
signed by a Servicing Officer, promptly direct the Trustee to, and the Trustee
shall, promptly notify the FHA of the default and (unless such defaulted
Mortgage Loan is purchased by the Majority Class B Certificateholder pursuant to
Section 3.15(a) hereof) shall, in accordance with such instructions within
forty-five (45) days (or such other period as permitted or required by the FHA)
after the expiration of the 30-day grace period, notify the FHA of its intention
to file an insurance claim and of its election to assign the Mortgage Loan to
the FHA (the Trustee shall also notify the Majority Class B Certificateholder of
its intention to file an insurance claim, and the date on which it intends to
file such a claim, no later than 10 days prior to such date). The Master
Servicer and, in accordance with such instructions, the Trustee shall thereafter
take such reasonable action as is necessary to perfect the claim under the FHA
Mortgage Insurance. With respect to any defaulted Mortgage Loan as to which the
Trustee is unable to deliver the original Mortgage Note to the FHA because the
original Mortgage Note has been permanently lost or misplaced, the Trustee shall
deliver to the FHA a HUD Indemnity. The Master Servicer shall, as a condition
to the taking by the Trustee of any action under this paragraph, complete and
provide to the Trustee all forms and other documentation needed to notify the
FHA of, file and perfect such an insurance claim on a timely basis. In any such
connection, the Master Servicer shall be obligated to advance from its own funds
all amounts necessary to preserve rights under the related FHA Mortgage
Insurance Contract and, subject to any applicable limitations set forth in
Section 5.03, to preserve and protect the related Mortgaged Property and title
thereto, including, but not limited to, FHA Mortgage Insurance premiums, hazard
and other insurance premiums, taxes, special assessments and other costs
associated with providing security for such premises. The Master Servicer shall
not be entitled to reimbursement for any cost or advance relating to the
assignment of a defaulted Mortgage Loan to the FHA. Any amounts collected from
or on behalf of the FHA under or in connection with the FHA Mortgage Insurance
shall be deposited in the Collection Account pursuant to Section 3.08. If the
FHA allows the Trustee or the Master Servicer to decide the form in which FHA
Insurance Benefits will be paid (e.g., cash, FHA Debentures or some combination
thereof), the Trustee and the Master Servicer shall in each case request that
such FHA Insurance Benefits be paid in cash.
(c) Notwithstanding the foregoing, the Master Servicer shall, in servicing
a defaulted Mortgage Loan that is subject to HUD Mortgagee Letter 87-9, alter
the procedures set forth in Section 3.12(b) as necessary to comply with such HUD
Mortgagee Letter 87-9.
(d) Notwithstanding the foregoing, if for any reason a defaulted Mortgage
Loan cannot be assigned to the FHA (including, without limitation, by reason of
any change in the FHA Regulations), then the Master Servicer may foreclose upon
such Mortgage Loan or acquire a deed in lieu thereof (and may direct the Trustee
to provide the appropriate notices to
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the FHA), but only if the Master Servicer receives (and delivers to the Trustee)
written confirmation from the Rating Agency that such foreclosure or such other
acquisition of title, in and of itself, will not result in a withdrawal,
qualification or downgrade of the rating assigned by the Rating Agency to any
Class of Rated Certificates. The Trustee shall cooperate with all reasonable
requests of the Master Servicer in connection with the foregoing.
(e) If the Master Servicer forecloses upon a Mortgage Loan or accepts a
deed in lieu thereof in accordance with Section 3.12(d), then following such
foreclosure or such other acquisition of title to the related Mortgaged
Property, title thereto shall be taken in the name of the Trustee or its
designee. Immediately upon acquiring title to any Mortgaged Property, the
Trustee shall convey or cause the conveyance of such Mortgaged Property to the
FHA or, alternatively, the Master Servicer shall, subject to Section 11.09, take
such other action in respect of such Mortgaged Property as is in the best
interests of the Certificateholders and as will not, as confirmed in writing by
the Rating Agency, result in a withdrawal, qualification or downgrade of the
rating assigned by the Rating Agency to any Class of Rated Certificates.
(f) No Certificateholder shall have any rights with respect to the FHA
Mortgage Insurance in respect of any Mortgage Loan except as provided for
herein. The Trustee shall be the "principal mortgagee" (as such term is used in
the FHA Regulations) with respect to each Mortgage Loan for purposes of the FHA
Regulations and the FHA Mortgage Insurance, and the Trustee shall retain legal
title to the Mortgage Loan and remain the mortgagee of record under the FHA
Mortgage Insurance. Without diminishing the obligations of the Master Servicer
hereunder with respect to any FHA Mortgage Insurance Contract or Mortgage Loan,
and without increasing the duties or liabilities of the Trustee hereunder, the
FHA shall have no obligation to recognize or deal with anyone other than the
principal mortgagee with respect to the rights, benefits and obligations of the
mortgagee under the FHA Mortgage Insurance Contract in respect of any Mortgage
Loan. The Mortgagor under each Mortgage Loan shall have no obligation to
recognize or do business with anyone other than the principal mortgagee or the
Master Servicer with respect to the rights, benefits and obligations of the
Mortgagor or the mortgagee under the related Mortgage. Except as provided in
Section 3.13, the Mortgage File shall remain in the custody of the principal
mortgagee, which shall be an FHA Approved Mortgagee.
SECTION 3.13. Trustee to Cooperate; Release of Mortgage Files.
Upon the payment in full of any Mortgage Loan, the Master Servicer shall
immediately notify the Trustee of such payment by a certification of a Servicing
Officer (a "Master Servicer Release Certificate") (which certification shall
include a statement to the effect that all amounts received or to be received in
connection with such payment which are required to be deposited in the
Collection Account pursuant to Section 3.08 hereof have been so deposited) and
shall request delivery to it of the Mortgage File. Upon receipt of such
certification and request, the Trustee shall, and is hereby authorized by the
Certificateholders to, release promptly the related Mortgage File to the Master
Servicer. Upon any such payment in full, and the delivery by the Master
Servicer to the Trustee of such certification, the Master Servicer shall prepare
for execution by the Trustee a release of the related Mortgage and a deed
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of reconveyance of the property encumbered by such Mortgage or such other
document which is required by the law of the jurisdiction in which the Mortgaged
Property is located to effect a release of the lien of the Mortgage, and the
Trustee shall promptly execute and deliver such release and deed of reconveyance
or other document, which release and deed of reconveyance or other document
shall be without representation by or recourse to the Trustee and delivered by
the Master Servicer to the Person or Persons entitled thereto.
From time to time and as appropriate for the servicing or foreclosure of any
Mortgage Loan, including, for this purpose, collection under the FHA Mortgage
Insurance Contract in respect thereof, the Trustee shall, upon request of the
Master Servicer and delivery to the Trustee of a trust receipt signed by a
Servicing Officer, promptly release the related Mortgage File to the Master
Servicer and shall execute such documents as shall be necessary to prosecution
of any such proceedings. Such trust receipt shall obligate the Master Servicer
to return the Mortgage File to the Trustee when the Master Servicer no longer
needs the Mortgage File or at the request of the Trustee, unless the Mortgage
Loan shall be assigned to the FHA or otherwise liquidated, in which case, upon
receipt of a certification of a Servicing Officer similar to that hereinabove
specified relating to the Liquidation Proceeds or other FHA Insurance Benefits
(with appropriate modifications in connection with the receipt of FHA
Debentures), the trust receipt shall be released by the Trustee to the Master
Servicer.
SECTION 3.14. Documents, Records and Funds in Possession of Master
Servicer to be Held on Behalf of the Trustee for the
Benefit of the Certificateholders.
Notwithstanding any other provisions of this Agreement, the Master Servicer
shall transmit to the Trustee to the extent required by this Agreement all
documents and instruments coming into the possession of the Master Servicer or
any Sub-Servicer from time to time and shall account fully to the Trustee for
the benefit of the Certificateholders for any funds received by or on behalf of
the Master Servicer or which otherwise are collected by or on behalf the Master
Servicer as Liquidation Proceeds, Condemnation Proceeds or Insurance Proceeds in
respect of any Mortgage Loan. All Servicing Files and Mortgage Files in the
possession of the Master Servicer, and all funds collected or held by, or under
the control of, the Master Servicer in respect of any Mortgage Loans, whether
from the collection of principal and interest payments or from Liquidation
Proceeds, Condemnation Proceeds or Insurance Proceeds, including but not limited
to, any funds on deposit in the Collection Account, shall be held by the Master
Servicer for and on behalf of the Trustee for the benefit of the
Certificateholders and, to the extent of any Retained Yield, the Seller, and
shall be and remain the sole and exclusive property of the Trustee and, to the
extent of any Retained Yield, the Seller, subject to the applicable provisions
of this Agreement. The Master Servicer also agrees that it shall not create,
incur or subject any Servicing File or Mortgage File or any funds that are
deposited in the Collection Account or any Reserve Account or Escrow Account, or
any funds that otherwise are or may become due or payable to the Trustee for the
benefit of the Certificateholders, to any claim, lien, security interest,
judgment, levy, writ of attachment or other encumbrance, or assert by legal
action or otherwise any claim or right of setoff against any Servicing File or
Mortgage File or any funds collected on, or in connection with, a Mortgage Loan,
except, however, that the Master Servicer
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shall be entitled to set off against and deduct from any such funds any amounts
that are properly due and payable to the Master Servicer under this Agreement.
SECTION 3.15. Sale of Defaulted Mortgage Loans and FHA Debentures.
(a) If the Trustee has notified the Majority Class B Certificateholder of
its intention to file an insurance claim with respect to a defaulted Mortgage
Loan pursuant to Section 3.12, the Majority Class B Certificateholder may, at
its option, purchase such Mortgage Loan at the applicable Purchase Price by
delivering cash in an amount equal to the applicable Purchase Price to the
Master Servicer for deposit in the Collection Account at any time before such
insurance claim is filed. Upon receipt by the Trustee of written notification
(by facsimile transmission, with a confirmation by mail) of such deposit signed
by a Servicing Officer (which notification shall be made by the Master Servicer
immediately following such deposit and shall include a statement as to the
accuracy of the Purchase Price), the Trustee shall release the related Mortgage
File to or at the direction of the Majority Class B Certificateholder, and shall
execute and deliver such instruments of transfer or assignment (which
instruments shall be prepared and provided by the Majority Class B
Certificateholder), in each case without recourse, as shall be necessary to vest
in the Majority Class B Certificateholder, or its designee, title (to the extent
that such title was transferred to the Trustee) to any defaulted Mortgage Loan.
(b) If the Trustee receives FHA Debentures as part of the FHA Insurance
Benefits in respect of any FHA Assigned Mortgage Loan, then the Trustee shall
promptly so notify in writing the other parties hereto, the Rating Agency and
the Majority Class B Certificateholder, if any. If there exists a Majority
Class B Certificateholder, it may, at its option, purchase such FHA Debentures
at the applicable Purchase Price by so notifying the Trustee in writing of its
intention to do so within ten days of its receipt of the notice contemplated by
the preceding sentence and by delivering cash in an amount equal to the
applicable Purchase Price to the Master Servicer for deposit in the Collection
Account within fifteen days of its receipt of the notice contemplated by the
preceding sentence. If (i) such Majority Class B Certificateholder fails to
notify the Trustee within the applicable ten-day period of its intention to
purchase such FHA Debentures, (ii) such Majority Class B Certificateholder has
notified the Trustee of its intention to purchase such FHA Debentures within the
applicable ten-day period but fails to purchase such FHA Debentures within the
fifteen-day period applicable to its purchase thereof, or (iii) there is no
Majority Class B Certificateholder, the Trustee shall promptly so notify the
Master Servicer. Upon receiving such notice from the Trustee, the Master
Servicer shall, no later than the tenth day following such notice, purchase such
FHA Debentures by depositing a cash amount equal to the applicable Purchase
Price in the Collection Account. If the Master Servicer is required but fails
to purchase such FHA Debentures within the applicable ten-day period, then the
Trustee shall, no later than the third Business Day following the end of the
ten-day period during which the Master Servicer is required to purchase such FHA
Debentures as provided above, purchase such FHA Debentures by delivering to the
Master Servicer for deposit in the Collection Account a cash amount equal to the
applicable Purchase Price.
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Upon receipt of an Officer's Certificate from a Servicing Officer to the
effect that the sale proceeds for any FHA Debenture have been deposited in the
Collection Account (or, if such purchase is being effected by the Trustee, upon
delivery to the Master Servicer of a cash amount equal to the applicable
Purchase Price), the Trustee shall cause such FHA Debenture to be re-registered
in the name of the purchaser or its designee. The Trustee shall not be liable
for any costs associated with the sale of any FHA Debentures, including, but not
limited to, any brokerage fees associated with any such sale.
SECTION 3.16. Servicing Compensation.
As compensation for its activities hereunder, the Master Servicer shall be
entitled to retain or to withdraw from the Collection Account the amounts
specified in clause (a) of Section 3.09 hereof as payable to it.
Additional servicing compensation in the form of assumption fees,
modification fees and late payment charges actually collected in respect of any
Mortgage Loan shall be retained by the Master Servicer to the extent not
required to be deposited in the Collection Account pursuant to Section 3.08
hereof. The Master Servicer shall be required to pay all expenses incurred by
it in connection with its servicing activities hereunder (including, without
limitation, to the extent such premiums are not required to be paid or have not
been paid by the related Mortgagor, the payment of FHA Mortgage Insurance
premiums, as required by Section 3.12 hereof, and premiums for hazard insurance,
as required by Section 3.10 hereof, and the costs associated with the
maintenance of the other forms of insurance coverage, as required by Section
3.10 hereof, and the payment of servicing compensation to any Sub-Servicer
pursuant to any Sub-Servicing Agreement), and shall not be entitled to
reimbursement therefor except as specifically provided in Section 3.09 hereof.
SECTION 3.17. Reports to the Depositor; Account Statements.
Within five Business Days following each Distribution Date, the Master
Servicer shall deliver to the Trustee, the Depositor and the Rating Agency a
statement setting forth the status of the Collection Account as of the close of
business on the most recent Master Servicer Remittance Date showing, for the
period to such Master Servicer Remittance Date from the second preceding Master
Servicer Remittance Date (or, in the case of the initial Master Servicer
Remittance Date, from the Cut-off Date), the aggregate of deposits in and
withdrawals from the Collection Account, if any, for each category of deposit
specified in Section 3.08 hereof and each category of withdrawal specified in
Section 3.09 hereof. Within fifteen Business Days following each Distribution
Date, the Trustee shall deliver to the Depositor and the Rating Agency a
statement setting forth the status of the Distribution Account as of the close
of business on such Distribution Date showing, for the period to such
Distribution Date from the second preceding Distribution Date (or, in the case
of the initial Distribution Date, from the Cut-off Date), the aggregate of
deposits in or withdrawals from the Distribution Account, if any, for each
category of deposit and withdrawal specified in Section 4.01.
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SECTION 3.18. Annual Statement as to Compliance.
The Master Servicer shall deliver to the Depositor and the Trustee on or
before March 15 of each year, commencing in 1996, an Officers' Certificate
stating, as to each signer thereof, that (a) a review of the activities of the
Master Servicer during the preceding calendar year and of the performance of the
Master Servicer under this Agreement has been made under such officer's
supervision, (b) to the best of such officer's knowledge, based on such review,
the Master Servicer has fulfilled all 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, specifying each such default known to
such officer and the nature and status thereof, (c) a Servicing Officer has
conducted a review of the activities of each Sub-Servicer during the immediately
preceding year and its performance under the related Sub-Servicing Agreement,
and (d) to the best of such Servicing Officer's knowledge, based on such review,
each Sub-Servicer has performed and fulfilled its duties, responsibilities and
obligations under the related Sub-Servicing Agreement in all material respects
throughout such year, or if there has been a default in the performance or
fulfillment of any such duties, responsibilities or obligations, specifying each
such default known to such Servicing Officer and the nature and status thereof.
The Master Servicer shall forward a copy of each such statement to the Rating
Agency.
SECTION 3.19. Annual Independent Public Accountants' Servicing Report.
On or before March 15 of each year, commencing in 1996, the Master Servicer,
at its expense, shall cause a firm of independent public accountants that is a
member of the American Institute of Certified Public Accountants to furnish a
statement to the Depositor and the Trustee for the benefit of the
Certificateholders to the effect that such firm has examined the terms of this
Agreement and records of the Master Servicer relating to the servicing of the
Mortgage Loans and that, on the basis of an examination conducted substantially
in compliance with the Uniform Single Audit Program for Mortgage Bankers or the
Audit Program for Mortgages serviced for FHLMC, such servicing has been
conducted in compliance with the terms of this Agreement except for such
significant exceptions or errors in records that, in the opinion of such firm,
the Uniform Single Audit Program for Mortgage Bankers or the Audit Program for
Mortgages serviced for FHLMC requires it to report. In rendering such statement
such firm may rely, as to matters relating to direct servicing of the Mortgage
Loans by Sub-Servicers, if any, upon comparable statements for examinations
conducted substantially in compliance with the Uniform Single Audit Program for
Mortgage Bankers or the Audit Program for Mortgages serviced for FHLMC (rendered
within one year of such statement) of independent public accounts with respect
to the related Sub-Servicer. The Master Servicer shall forward a copy of each
such report to the Rating Agency.
SECTION 3.20. Access to Certain Information.
The Master Servicer shall afford to the Trustee and the Depositor, and to
the OTS, the FDIC and any other banking or insurance regulatory authority that
may exercise authority over any Certificateholder and to the FHA, access to any
records regarding the Mortgage Loans and its servicing thereof within its
control, except to the extent it is prohibited
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from doing so by applicable law or contract or to the extent such information is
subject to a privilege under applicable law to be asserted on behalf of the
Certificateholders. Such access shall be afforded without charge but only upon
reasonable prior written request and during normal business hours at the offices
of the Master Servicer designated by it. Upon request, the Master Servicer
shall furnish to the Trustee its most recent financial statements and such other
information in its possession regarding its business, affairs, property and
condition, financial or otherwise as the party requesting such information, in
its reasonable judgment, determines to be relevant to the performance of the
obligations hereunder of the Master Servicer. The Trustee shall have no
responsibility or liability for any action or failure to act by the Master
Servicer and the Trustee is not obligated to supervise the performance of the
Master Servicer under this Agreement or otherwise.
ARTICLE IV
PAYMENTS AND STATEMENTS TO CERTIFICATEHOLDERS
SECTION 4.01. Distribution Account.
The Trustee shall establish, prior to the Closing Date, and shall maintain,
in the name of the Trustee on behalf of the Certificateholders, the Distribution
Account, which shall be an Eligible Account, into which the Trustee shall
deposit upon receipt all payments received on the GNMA Certificates and any FHA
Debentures (net of any Retained Yield and any payments of interest on the FHA
Debentures with respect to which the Master Servicer has previously made Monthly
Advances), all payments remitted by the Master Servicer in respect of
Compensating Interest and Monthly Advances, all amounts remitted by the Master
Servicer pursuant to the last paragraph of Section 3.09, any amounts required to
be remitted by the Depositor to the Trust Fund pursuant to Section 11.09(o), any
amounts required to be remitted by the Trustee to the Trust Fund pursuant to
Section 11.09(n) and any amounts required to be remitted by the Master Servicer
to the Trust Fund pursuant to Section 3.12 or Section 11.09(n). All
distributions to be made from time to time to the Certificateholders out of
funds in the Distribution Account shall be made by or on behalf of the Trustee.
The Trustee will give notice to the Master Servicer, the Rating Agency and the
Depositor of the location of the Distribution Account and of any change thereof,
prior to the use thereof. Funds held in the Distribution Account and delivered
to the Trustee earlier than one Business Day prior to the next Distribution Date
shall be invested by the Trustee, to the extent practicable, in Permitted
Investments which mature no later than one Business Day prior to the next
Distribution Date as directed in writing by the Master Servicer. All income and
gain net of any losses realized from any such investment shall be for the
benefit of the Master Servicer and shall be subject to withdrawal at the Master
Servicer's direction from time to time. The amount of any losses net of any
gains not paid to the Master Servicer incurred in respect of any such
investments shall be deposited in the Distribution Account by the Master
Servicer out of its own funds immediately as realized.
The Trustee shall make, to the extent required or authorized hereunder,
withdrawals from the Distribution Account for the following purposes:
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(a) to withdraw any amount deposited in the Distribution Account
and not required to be deposited therein;
(b) to make required distributions to the Certificateholders
pursuant to Section 4.02(a) and Section 4.02(b);
(c) to pay itself on each Distribution Date the Trustee Fee for
such Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(d) reimburse itself for unreimbursed expenses incurred by it to
the extent expressly reimbursable under this Agreement;
(e) to pay for an Opinion of Counsel the expense of which this
Agreement explicitly assigns to the Trust Fund;
(f) to pay to the Master Servicer, as additional servicing
compensation, earnings on or investment income with respect to funds
credited to the Distribution Account;
(g) to the extent not paid out of the Collection Account pursuant
to Section 3.09(k), to pay any and all taxes imposed on REMIC I or REMIC II
by federal, state or local governmental authorities to the extent such
taxes are to be paid by the Trust Fund pursuant to Section 11.09(h)(iv);
and
(h) to clear and terminate the Distribution Account upon
termination of this Agreement pursuant to Article X hereof.
It is understood and agreed that, in the case of any payment or
reimbursement to the Trustee (in its capacity as such) payable or
reimbursed by the Trust Fund pursuant to this Agreement, the Trustee's
right thereto shall be prior to the right of the Certificateholders to
payment on any Distribution Date.
SECTION 4.02. Distributions.
(a) On each Distribution Date, the Trustee shall apply amounts on
deposit in the Distribution Account, in each case to the extent of the
remaining portion of the Available Distribution Amount for such
Distribution Date, in the following order of priority:
(i) to distributions of interest to the Holders of the
respective Classes of Senior Certificates, in an amount equal to, and pro
rata in accordance with, and to the extent of, all Distributable
Certificate Interest in respect of each such Class of Certificates for such
Distribution Date and, to the extent not previously paid, for all prior
Distribution Dates;
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(ii) to distributions of principal to the Holders of the Class
A-1 Certificates, the Holders of the Class A-2 Certificates, the Holders of
the Class A-3 Certificates and the Holders of the Class A-4 Certificates
(allocable as among such Classes of Certificateholders as provided below)
in an amount (not to exceed the then aggregate of the Class Principal
Balances of the Class A-1, Class A-2, Class A-3 and Class A-4 Certificates)
equal to the Principal Distribution Amount for such Distribution Date;
(iii) to distributions of interest to the Holders of the Class
B Certificates, in an amount equal to all Distributable Certificate
Interest in respect of such Class of Certificates for such Distribution
Date and, to the extent not previously paid, for all prior Distribution
Dates;
(iv) to distributions of principal to the Holders of the Class
B Certificates, until the Class Principal Balance of such Class of
Certificates is reduced to zero; and
(v) to distributions to the Holders of the Class R-I
Certificates, in an amount equal to the balance, if any, of the Available
Distribution Amount for such Distribution Date remaining after the
distributions to be made on such Distribution Date pursuant to clauses (i)
through (iv) above.
Distributions of principal made in respect of the Class A-1, Class A-2, Class A-
3 and Class A-4 Certificates as described in clause (ii) above shall be paid:
first, to the Holders of the Class A-1 Certificates, until the Class Principal
Balance of such Class of Certificates is reduced to zero; second, to the Holders
of the Class A-2 Certificates, until the Class Principal Balance of such Class
of Certificates is reduced to zero; third, to the Holders of the Class A-3
Certificates, until the Class Principal Balance of such Class of Certificates is
reduced to zero; and last, to the Holders of the Class A-4 Certificates, until
the Class Principal Balance of such Class of Certificates is reduced to zero;
provided that, notwithstanding the foregoing, on the final Distribution Date as
contemplated by Article X, and on each earlier Distribution Date (if prior
thereto the Class Principal Balance of the Class B Certificates has been reduced
to zero), such sequential distributions of principal shall be disregarded, and
the Trustee shall make the distributions of principal on such Classes of Senior
Certificates, on a pro rata basis, in accordance with the respective Class
Principal Balances of such Classes of Senior Certificates outstanding
immediately prior to such Distribution Date, until the Class Principal Balance
of each such Class has been reduced to zero.
(b) On each Distribution Date, the Trustee shall withdraw any amounts then
on deposit in the Distribution Account that represent Prepayment Premiums
collected during or prior to the related Collection Period and shall distribute
such amounts, in each case as additional interest, to the Holders of the Class
A-X-1 Certificates until the Class Notional Amount of the Class A-X-1
Certificates is reduced to zero, then to the Holders of the Class A-X-2
Certificates until the Class Notional Amount of the Class A-X-2 Certificates is
reduced to zero, then to the Holders of the Class A-X-3 Certificates until the
Class Notional Amount of the
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Class A-X-3 Certificates is reduced to zero, then to the Holders of the Class A-
X-4 Certificates until the Class Notional Amount of the Class A-X-4 Certificates
is reduced to zero, then to the Holders of the Class B Certificates until the
Class Principal Balance of the Class B Certificates is reduced to zero, and then
to the holders of the Class R-I Certificates; provided, however, that on any
Distribution Date on which Holders of two or more Classes of Sequential Pay
Certificates (other than the Class B Certificates) are entitled to distributions
in respect of principal, Prepayment Premiums collected during the related
Collection Period will be distributed among the Holders of the respective
Classes of Interest-Only Certificates on a pro rata basis in accordance with the
reductions in the Class Notional Amounts of each such Class of Certificates by
reason of actual and deemed distributions of principal on the Sequential Pay
Certificates and the REMIC I Regular Interests on such Distribution Date.
(c) All distributions made with respect to each Class on each Distribution
Date shall be allocated pro rata among the outstanding Certificates in such
Class based on their respective Percentage Interests. Except as otherwise
provided below, all such distributions with respect to each Class on each
Distribution Date shall be made to the Certificateholders of the respective
Class of record at the close of business on the related Record Date and shall be
made by wire transfer of immediately available funds to the account of any such
Certificateholder at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided the Trustee with wiring
instructions no less than five Business Days prior to the related Record Date
(which wiring instructions may be in the form of a standing order applicable to
all subsequent Distribution Dates) and is the registered owner of Certificates
the aggregate initial Certificate Principal Balance of which is at least
$5,000,000 (or $2,000,000 in the case of the Class B Certificates) or initial
Certificate Notional Amount of which is at least $10,000,000, or otherwise by
check mailed to the address of such Certificateholder as it appears in the
Certificate Register. The final distribution on each Certificate will be made
in like manner, but only upon presentation and surrender of such Certificate at
the offices of the Trustee or such other location specified in the notice to
Certificateholders of such final distribution.
(d) Each distribution with respect to a Book-Entry Certificate shall be
paid to DTC, as Holder thereof, and DTC shall be responsible for crediting the
amount of such distribution to the accounts of its Participants in accordance
with its normal procedures. Each Participant shall be responsible for
disbursing such distribution to the related Beneficial Holders that it
represents and to each Indirect Participant for which it acts as agent. Each
Indirect Participant shall be responsible for disbursing funds to the related
Beneficial Holders that it represents. None of the parties hereto shall have
any responsibility therefor except as otherwise provided by this Agreement or
applicable law. The Trustee and the Depositor shall perform their respective
obligations under the Letter of Representations among the Depositor, the Trustee
and the initial Depository, a copy of which Letter of Representations is
attached hereto as Exhibit G.
(e) The rights of the Certificateholders to receive distributions from the
proceeds of the Trust Fund in respect of their Certificates, and all rights and
interests of the Certificateholders in and to such distributions, shall be as
set forth in this Agreement. Neither the Holders of any Class of Certificates
nor any party hereto shall in any way be responsible or
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liable to the Holders of any other Class of Certificates in respect of amounts
properly previously distributed on the Certificates.
(f) Except as otherwise provided in Sections 10.01 and 10.02, whenever the
Trustee expects that the final distribution with respect to any Class of
Certificates will be made on the next Distribution Date, the Trustee shall, no
later than five days after the related Determination Date, mail to each Holder
of record on such date of such Class of Certificates a notice to the effect
that:
(i) the Trustee 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 Certificate Registrar or at such other location therein
specified, and
(ii) no interest shall accrue on such Certificates from and
after such Distribution Date.
Any funds not distributed to any Holder or Holders of Certificates of such Class
on such Distribution Date because of the failure of such Holder or Holders to
tender their Certificates shall, on such date, be set aside and held uninvested
in trust and credited to the account or accounts of the appropriate non-
tendering Holder or Holders. If any Certificates as to which notice has been
given pursuant to this Section 4.02(f) shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Trustee shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates for cancellation in order to
receive the final distribution with respect thereto. If within one year after
the second notice all such Certificates shall not have been surrendered for
cancellation, the Trustee, directly or through an agent, shall take such steps
to contact the remaining non-tendering Certificateholders concerning the
surrender of their Certificates as it shall deem appropriate. The costs and
expenses of holding such funds in trust and of contacting such
Certificateholders following the first anniversary of the delivery of such
second notice to the non-tendering Certificateholders shall be paid out of such
funds. No interest shall accrue or be payable to any former Holder on any
amount held in trust pursuant to this paragraph. If all of the Certificates
shall not have been surrendered for cancellation by the 270th day following
delivery of the second notice, the Trustee shall distribute to the Class R-II
Certificateholders all unclaimed funds and other assets which remain subject
hereto and shall have no further liability for such funds or other unclaimed
assets.
(g) Notwithstanding any other provision of this Agreement, the Trustee
shall comply with all federal withholding requirements respecting payments to
Certificateholders of interest or original issue discount that the Trustee
reasonably believes are applicable under the Code. The consent of
Certificateholders shall not be required for such withholding. If the Trustee
does withhold any amount from interest or original issue discount payments or
advances thereof to any Certificateholder pursuant to federal withholding
requirements, the Trustee shall indicate the amount withheld to such
Certificateholders.
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(h) All distributions of principal, interest and additional interest (in
the form of Prepayment Premiums) made in respect of the Class A-1 and Class A-X-
1 Certificates on each Distribution Date pursuant to Section(s) 4.02(a), 4.02(b)
and/or 10.02(d) shall be deemed to have first been distributed as principal,
interest and additional interest (in the form of Prepayment Premiums),
respectively, from REMIC I to REMIC II in respect of REMIC I Regular Interest A-
1; all distributions of principal, interest and additional interest (in the form
of Prepayment Premiums) made in respect of the Class A-2 and Class A-X-2
Certificates on each Distribution Date pursuant to Section(s) 4.02(a), 4.02(b)
and/or 10.02(d) shall be deemed to have first been distributed as principal,
interest and additional interest (in the form of Prepayment Premiums),
respectively, from REMIC I to REMIC II in respect of REMIC I Regular Interest A-
2; all distributions of principal, interest and additional interest (in the form
of Prepayment Premiums) made in respect of the Class A-3 and Class A-X-3
Certificates on each Distribution Date pursuant to Section(s) 4.02(a), 4.02(b)
and/or 10.02(d) shall be deemed to have first been distributed as principal,
interest and additional interest (in the form of Prepayment Premiums),
respectively, from REMIC I to REMIC II in respect of REMIC I Regular Interest A-
3; all distributions of principal, interest and additional interest (in the form
of Prepayment Premiums) made in respect of the Class A-4 and Class A-X-4
Certificates on each Distribution Date pursuant to Section(s) 4.02(a), 4.02(b)
and/or 10.02(d) shall be deemed to have first been distributed as principal,
interest and additional interest (in the form of Prepayment Premiums),
respectively, from REMIC I to REMIC II in respect of REMIC I Regular Interest A-
4; and all distributions of principal, interest and additional interest (in the
form of Prepayment Premiums) made in respect of the Class B Certificates on each
Distribution Date pursuant to Section(s) 4.02(a), 4.02(b) and/or 10.02(d) shall
be deemed to have first been distributed as principal, interest and additional
interest (in the form of Prepayment Premiums), respectively, from REMIC I to
REMIC II in respect of REMIC I Regular Interest B. The actual distributions
made by the Trustee on each Distribution Date in respect of the REMIC II
Certificates pursuant to Section(s) 4.02(a), 4.02(b) and/or 10.02(d), as
applicable, shall be deemed to have been so made from the amounts deemed
distributed in respect of the REMIC I Regular Interests on such Distribution
Date pursuant to this Section 4.02(h). Notwithstanding the deemed distributions
on the REMIC I Regular Interests described in this Section 4.02(h), actual
distributions of funds from the Distribution Account shall be made only in
accordance with Section(s) 4.02(a), 4.02(b) and/or 10.02(d), as applicable.
SECTION 4.03. Statements to Certificateholders; Collection Reports.
(a) On each Distribution Date, the Trustee shall forward by mail to all of
the Holders of each Class of REMIC II Regular Certificates a statement (a
"Distribution Date Statement") as to the distributions made on such Distribution
Date, based on information provided to it by the Master Servicer, setting forth:
(i) the amount of the distribution on such Distribution Date
to the Holders of such Class of REMIC II Regular Certificates in reduction
of the Class Principal Balance thereof;
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(ii) the amount of the distribution on such Distribution Date
to the Holders of such Class of REMIC II Regular Certificates allocable to
Distributable Certificate Interest;
(iii) the amount of the distribution on such Distribution Date
to the Holders of such Class of REMIC II Regular Certificates allocable to
Prepayment Premiums;
(iv) the Available Distribution Amount for such Distribution
Date;
(v) the aggregate amount of Monthly Advances made in respect
of such Distribution Date, the aggregate amount of unreimbursed Monthly
Advances that had been outstanding at the close of business on the related
Determination Date and the aggregate amount of unpaid Advance Interest in
respect of such unreimbursed Monthly Advances at the close of business on
the related Determination Date;
(vi) the aggregate Stated Principal Balance of the Mortgage
Pool outstanding immediately before and immediately after such Distribution
Date;
(vii) the number, aggregate principal balance, weighted
average remaining term to maturity and weighted average Mortgage Rate of
the Mortgage Loans as of the close of business on the related Determination
Date;
(viii) the number, aggregate principal balance, weighted
average remaining term to maturity and weighted average GNMA Certificate
Rate of the GNMA Certificates as of the close of business on the related
Determination Date;
(ix) the number, aggregate principal balance, weighted average
remaining term to maturity and weighted average FHA Debenture Rate of the
FHA Debentures, if any, as of the close of business on the related
Determination Date;
(x) (A) the number of Mortgage Loans and the aggregate amount
of Monthly Payments which were due but delinquent as of the Due Date in (1)
the month of the distribution, (2) the first month preceding distribution
and (3) the second month preceding distribution and (B) the identity and
outstanding principal balance of any Mortgage Loan assigned to the FHA for
which final settlement with the FHA has not been made, if any;
(xi) the status of any claims under the FHA Mortgage
Insurance, if any;
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(xii) if applicable, the amount of such distribution allocable
to the proceeds of the sale of a defaulted Mortgage Loan or the sale of FHA
Debentures pursuant to Section 3.15;
(xiii) with respect to any Mortgage Loan that became a
Liquidated Loan during the related Collection Period (other than by reason
of a payment in full), (A) the related FHA project number, (B) a brief
description of the basis for the relevant Final Recovery Determination, (C)
the aggregate of all FHA Insurance Benefits and/or Liquidation Proceeds and
other amounts received in connection with such liquidation (separately
identifying the portion thereof allocable to distributions on the
Certificates), and (D) the amount of any Realized Loss in connection with
such liquidation;
(xiv) the Accrued Certificate Interest and Distributable
Certificate Interest in respect of such Class of REMIC II Regular
Certificates for such Distribution Date;
(xv) any unpaid Distributable Certificate Interest in respect
of such Class of REMIC II Regular Certificates after giving effect to the
distributions made on such Distribution Date;
(xvi) the Pass-Through Rate for such Class of REMIC II Regular
Certificates for such Distribution Date;
(xvii) any Principal Prepayment or other unscheduled
collection of principal received during the related Collection Period, the
FHA project number for the related Mortgage Loan and the amount of such
prepayment or other collection of principal;
(xviii) the aggregate of all Realized Losses, if any, incurred
during the related Collection Period;
(xix) the Class Principal Balance or Class Notional Amount, as
applicable, of each Class of REMIC II Regular Certificates outstanding
immediately before and immediately after such Distribution Date, separately
identifying any reduction therein pursuant to Section 4.04;
(xx) the Certificate Factor for each Class of REMIC II Regular
Certificates immediately following such Distribution Date;
(xxi) the aggregate amount of Advance Interest paid to the
Master Servicer during the related Collection Period; and
(xxii) (A) the aggregate amount of servicing compensation
paid to the Master Servicer and, if payable directly out of the Trust Fund
without a reduction
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in the servicing compensation otherwise payable to the Master Servicer, to
each Sub-Servicer, during the most recently ended calendar month, and (B)
such other information as the Trustee is required by the Code or other
applicable law to furnish to enable Certificateholders to prepare their
tax returns.
Each Distribution Date Statement shall be accompanied by the corresponding
Collection Report delivered to the Trustee by the Master Servicer and, insofar
as any of the information to be provided pursuant to clauses (i) through (xxii)
above is adequately reflected in such Collection Report, such information need
not be repeated in the Distribution Date Statement; provided that the Trustee
shall only be obligated to deliver such Distribution Date Statement and the
corresponding Collection Report to the extent such Collection Report is
delivered to it by the Master Servicer in accordance with Section 4.03(b).
In the case of information to be furnished pursuant to clauses (i) through
(iii) above, the amounts shall be expressed as a dollar amount in the aggregate
for all Certificates of each applicable Class and per $1,000 denomination.
Within a reasonable period of time after the end of each calendar year, the
Trustee shall furnish to each Person who at any time during the calendar year
was a Holder of a REMIC II Regular Certificate a statement containing the
information set forth in clauses (i) through (iii) above as to the applicable
Class, aggregated for the portion of such calendar year that such Person was a
Holder. Such obligation of the Trustee shall be deemed to have been satisfied
to the extent that substantially comparable information shall be provided by the
Trustee pursuant to any requirements of the Code as from time to time are in
force.
On each Distribution Date, the Trustee shall forward to the Depositor, to
the Rating Agency, to each Holder of a Residual Certificate and, in the case of
reports regarding the respective Classes of Book-Entry Certificates, to The
Trepp Group (at 477 Madison Avenue, 18th Floor, New York, New York 10022, or
such other address as The Trepp Group may hereafter designate), a copy of the
reports forwarded to the Holders of the REMIC II Regular Certificates on such
Distribution Date and a statement setting forth the amounts, if any, actually
distributed with respect to each Class of Residual Certificates on such
Distribution Date.
Within a reasonable period of time after the end of each calendar year, the
Trustee shall furnish to each Person who at any time during the calendar year
was a Holder of a Residual Certificate a statement containing the information
provided pursuant to the previous paragraph in respect of distributions on each
Class of Residual Certificates and pursuant to clauses (i) through (iii) above
in respect of distributions on each Class of REMIC II Regular Certificates,
aggregated for the portion of such calendar year that such Person was a Holder.
Such obligation of the Trustee shall be deemed to have been satisfied to the
extent that substantially comparable information shall be provided by the
Trustee pursuant to any requirements of the Code as from time to time are in
force.
If any Beneficial Holder of a Book-Entry Certificate does not receive
through the Clearing Agency Participants any of the statements, reports and/or
other written information
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described above in this Section 4.03(a) that it would otherwise be entitled to
if it were the Holder of a Definitive Certificate evidencing its Ownership
Interest in the related Class of Book-Entry Certificates, then the Trustee shall
mail or cause the mailing of such statements, reports and/or other written
information to such Beneficial Holder upon such Beneficial Holder's request made
in writing to the Corporate Trust Office (accompanied by verification of such
Beneficial Holder's Ownership Interest). Such portion of such information as
may be agreed upon by the Depositor and the Trustee shall be available to any
Person via facsimile transmission from the Trustee. Any such Person may obtain
an account number on the Trustee's automated facsimile system and/or request a
statement to be delivered to such Person's facsimile number by calling (312)
904-2200 or such other number as the Trustee may specify to the Depositor and
Certificateholders.
(b) Not later than the second Business Day following each Determination
Date, the Master Servicer shall furnish to the Trustee and the Depositor (for
receipt by each not later than such second Business Day following each
Determination Date), by electronic transmission (or in such other form to which
the Trustee or the Depositor, as the case may be, and the Master Servicer may
agree), with a hard copy of such transmitted information to follow not later
than the third Business Day following such Determination Date, an accurate and
complete report (the "Collection Report") with respect to the related
Distribution Date containing the following information:
(i) with respect to each Mortgage Loan that was included in
the Trust Fund as of the commencement of the most recently ended Collection
Period, (A) the related project number, (B) the related Mortgage Rate and
Net Asset Rate, (C) the Stated Principal Balance outstanding immediately
before and to be outstanding immediately after the related Distribution
Date, (D) the date on which the final payment is scheduled to be due, (E)
the amount of the Monthly Payment due on the Due Date in the most recently
ended Collection Period, (F) all related payment and/or collection activity
since the preceding Collection Report (or, in the case of the initial
Collection Report, since the Closing Date) relevant to the Trustee's
calculations of amounts to be distributed on the Certificates on the
related Distribution Date and the application of such amounts in accordance
with Section 1.02(b), (G) the delinquency status as of such Determination
Date and (H) whether such Mortgage Loan became a Liquidated Loan during the
most recently ended Collection Period and, if so, a brief description
thereof, and the amount of any Realized Loss incurred in connection
therewith;
(ii) the information to be provided to Certificateholders on
the related Distribution Date pursuant to clauses (v), (vii), (x), (xi),
(xiii) and (xxii)(A) of Section 4.03(a);
(iii) the aggregate amount of the Prepayment Premiums received
during the most recently ended Collection Period;
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(iv) such other information regarding the Mortgage Loans as
the Trustee may reasonably request to perform its duties hereunder; and
(v) to the extent the Depositor requests additional
information not required pursuant to the terms of this Agreement, the
Trustee may request such information in order to deliver the same to the
Depositor on the Distribution Date following the Depositor's reasonable
request therefor, to the extent such information is readily available to
the Master Servicer without material additional cost or expense for which
the Master Servicer will not be reimbursed.
The Trustee may conclusively rely on the Collection Reports provided to it
by the Master Servicer. The Trustee shall not be responsible to recompute,
recalculate or verify the information provided to it by the Master Servicer,
unless such information is erroneous on its face, the Trustee has actual
knowledge that such information is erroneous or the Trustee is requested to do
so by the Depositor or a Certificateholder.
SECTION 4.04. Allocation of Realized Losses and Certain Other Expenses and
Shortfalls.
(a) If, following the distributions to be made in respect of the
Certificates pursuant to Section 4.02(a) on any Distribution Date, the aggregate
of the Stated Principal Balances of the Mortgage Assets that will be outstanding
immediately following such Distribution Date is less than the aggregate of the
Class Principal Balances of the respective Classes of Sequential Pay
Certificates, the Class Principal Balance of the Class B Certificates will be
reduced until such deficit (or such Class Principal Balance) is reduced to zero
(whichever occurs first). If any portion of such deficit remains at such time
as the Class Principal Balance of the Class B Certificates is reduced to zero,
then the respective Class Principal Balances of the remaining Classes of
Sequential Pay Certificates shall be reduced, pro rata in accordance with the
relative sizes of the remaining Class Principal Balances of each such Class of
Certificates, until such deficit (or each such Class Principal Balance) is
reduced to zero. Such reductions shall be deemed to be an allocation of
Realized Losses, Additional Trust Fund Expenses and, to the extent not allocated
pursuant to Section 4.05(b), Uncovered Prepayment Interest Shortfalls
experienced by the Trust Fund.
(b) If, following the distributions deemed to be made in respect of the
REMIC I Regular Interests pursuant to Section 4.02(h) on any Distribution Date,
the aggregate of the Stated Principal Balances of the Mortgage Assets that will
be outstanding immediately following such Distribution Date is less than the
aggregate of the Uncertificated Principal Balances of the respective REMIC I
Regular Interests, the Uncertificated Principal Balance of REMIC I Regular
Interest B will be reduced until such deficit (or such Uncertificated Principal
Balance) is reduced to zero (whichever occurs first). If any portion of such
deficit remains at such time as the Uncertificated Principal Balance of REMIC I
Regular Interest B is reduced to zero, then the respective Uncertificated
Principal Balances of the remaining REMIC I Regular Interests shall be reduced,
pro rata in accordance with the relative sizes of the remaining Uncertificated
Principal Balances of each such REMIC I Regular Interest, until such deficit (or
each such
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Uncertificated Principal Balance) is reduced to zero. Such reductions shall be
deemed to be an allocation of the Realized Losses, Additional Trust Fund
Expenses and, to the extent not allocated pursuant to Section 4.05(c), Uncovered
Prepayment Interest Shortfalls experienced by the Trust Fund.
SECTION 4.05. Prepayment Interest Shortfalls.
(a) In the event that any Mortgage Loan is the subject of a full or partial
Principal Prepayment prior to the Due Date for such Mortgage Loan in any
Collection Period and such full or partial Principal Prepayment is not
accompanied by a payment of interest on the amount thereof to such Due Date, the
Master Servicer shall, to the extent that such interest is not paid by the
Mortgagor and deposited in the Distribution Account on or before the Master
Servicer Remittance Date next succeeding the Collection Period during which such
full or partial Principal Prepayment was made, deposit into the Distribution
Account, on or before the close of business on the Business Day immediately
preceding the related Distribution Date, out of its own funds without any right
of reimbursement, additional interest ("Compensating Interest") in an amount
equal to the resulting Prepayment Interest Shortfall; provided, however, that
the aggregate amount of such Compensating Interest for any Distribution Date
shall not exceed the aggregate Servicing Compensation otherwise payable to the
Master Servicer for the most recently ended calendar month. Such payment of
Compensating Interest shall be made regardless of whether the Mortgage Note or
Mortgage requires the payment of such interest or whether such amount is
recoverable from Liquidation Proceeds, Insurance Proceeds, Condemnation Proceeds
or otherwise; and in case of such payment of Compensating Interest, the Master
Servicer shall not be entitled to any recovery or reimbursement from the
Depositor, the Trustee, the Trust Fund or the Certificateholders.
(b) Prepayment Interest Shortfalls resulting from Principal Prepayments of
the Mortgage Loans prior to their respective Due Dates during any Collection
Period, to the extent not covered by the payment of Compensating Interest by the
Master Servicer pursuant to Section 4.05(a) in respect of the related
Distribution Date (such Prepayment Interest Shortfalls that are not so covered,
"Uncovered Prepayment Interest Shortfalls"), will be allocated on the related
Distribution Date as follows:
(i) if the Class Principal Balance of the Class B Certificates is
greater than zero immediately prior to the related Distribution Date, first
in reduction of the Distributable Certificate Interest in respect of the
Class B Certificates for such Distribution Date and, if and to the extent
that the Uncovered Prepayment Interest Shortfalls incurred during such
Collection Period exceed the Accrued Certificate Interest in respect of the
Class B Certificates for the related Distribution Date, then in reduction
of the Class Principal Balances of the Class B Certificates and the other
Classes of Sequential Pay Certificates as and to the extent provided in
Section 4.04(a); and
(ii) if the Class Principal Balance of the Class B Certificates
has been reduced to zero prior to such Distribution Date, first in
reduction of the Distributable Certificate Interest in respect of each of
the then outstanding Classes of Senior
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Certificates, pro rata in accordance with the respective amounts of Accrued
Certificate Interest in respect of such Classes of Certificates for such
Distribution Date and, if and to the extent that the Uncovered Prepayment
Interest Shortfalls incurred during such Collection Period exceed the
aggregate amount of Accrued Certificate Interest in respect of the Senior
Certificates for the related Distribution Date, then in reduction of the
Class Principal Balances of the remaining Classes of Sequential Pay
Certificates as and to the extent provided in Section 4.04(a).
(c) Uncovered Prepayment Interest Shortfalls resulting from Principal
Prepayments of the Mortgage Loans prior to their respective Due Dates during any
Collection Period will also be allocated on the related Distribution Date as
follows:
(i) if the Uncertificated Principal Balance of REMIC I Regular
Interest B is greater than zero immediately prior to the related
Distribution Date, first in reduction of Uncertificated Distributable
Interest in respect of REMIC I Regular Interest B for such Distribution
Date and, if and to the extent that the Uncovered Prepayment Interest
Shortfalls incurred during such Collection Period exceed the Uncertificated
Accrued Interest in respect of REMIC I Regular Interest B for the related
Distribution Date, then in reduction of the Uncertificated Principal
Balances of REMIC I Regular Interest B and the other REMIC I Regular
Interests as and to the extent provided in Section 4.04(b); and
(ii) if the Uncertificated Principal Balance of REMIC I Regular
Interest B has been reduced to zero prior to such Distribution Date, first
in reduction of the Uncertificated Distributable Interest in respect of
each of the then outstanding REMIC I Regular Interests, pro rata in
accordance with the respective amounts of Uncertificated Accrued Interest
in respect of such REMIC I Regular Interests for such Distribution Date
and, if and to the extent that the Uncovered Prepayment Interest Shortfalls
incurred during such Collection Period exceed the aggregate amount of
Uncertificated Accrued Interest in respect of the remaining REMIC I Regular
Interests for the related Distribution Date, then in reduction of the
Uncertificated Principal Balances of the remaining REMIC I Regular
Interests as and to the extent provided in Section 4.04(b).
SECTION 4.06 Calculations.
The Trustee shall, provided it receives the necessary information from the
Master Servicer, be responsible for performing all calculations necessary in
connection with the actual and deemed distributions to be made pursuant to
Section 4.02 and Article X, the actual and deemed allocations of losses and
other shortfalls to be made pursuant to Section 4.04 and the allocations of
Prepayment Interest Shortfalls to be made pursuant to Section 4.05. The Trustee
shall calculate the Available Distribution Amount for each Distribution Date and
shall allocate such amount among Certificateholders in accordance with this
Agreement.
SECTION 4.07 Use of Agents.
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Each of the Master Servicer and the Trustee may at its own expense utilize
agents or attorneys-in-fact in performing any of its respective obligations
under this Article IV, but no such utilization shall relieve the Master Servicer
or the Trustee, as the case may be, from any of such obligations, and the Master
Servicer or the Trustee, as the case may be, shall remain responsible for all
acts and omissions or any such agent or attorney-in-fact. The Master Servicer
or the Trustee, as the case may be, shall have all the limitations upon
liability and all the indemnities for the actions and omissions of any such
agent or attorney-in-fact utilized thereby that it has for its own actions
hereunder pursuant to Article VII or VIII, as applicable, hereof, and any such
agent or attorney-in-fact shall have the benefit of all the limitations upon
liability and all the indemnities provided to the Master Servicer under Section
7.03 or to the Trustee under Sections 9.01, 9.02 and 9.05, as the case may be.
ARTICLE V
ADVANCES
SECTION 5.01. Monthly Advances by the Master Servicer.
(a) Subject to the conditions of this Article V, the Master Servicer, as
required below, shall, with respect to each Distribution Date, make Monthly
Advances to the Distribution Account maintained by the Trustee, in an amount
(calculated as of the related Determination Date) equal to the aggregate of the
following: (i) all Monthly Payments (after adjustment of the interest portion
of each such Monthly Payment to the related Mortgage Rate less the applicable
Servicing Fee Rate) that were due on the Mortgage Loans (other than FHA Assigned
Mortgage Loans) on their respective Due Dates during the related Collection
Period but that were not received on or before the related Determination Date;
(ii) with respect to each FHA Assigned Mortgage Loan as to which all reasonably
expected FHA Insurance Benefits had not been received as of the related
Determination Date, an amount equal to the excess, if any, of (A) one month's
interest on the Stated Principal Balance of such Mortgage Loan outstanding as of
the related Determination Date (accrued at the lesser of (1) the related
Mortgage Rate less the applicable Servicing Rate and (2) the applicable FHA
Debenture Rate less the applicable Servicing Fee, and calculated on the basis of
a 360-day year consisting of twelve 30-day months), over (B) any and all
payments and other amounts received in respect of such Mortgage Loan during the
related Collection Period that represent previously unadvanced interest (net of
any portion thereof constituting Servicing Fees); and (iii) with respect to each
FHA Debenture as to which no Due Date occurred during the related Collection
Period, one month's interest on the Stated Principal Balance of such FHA
Debenture outstanding as of the related Determination Date (accrued at the
related FHA Debenture Rate less any applicable Retained Yield and calculated on
the basis of a 360-day year consisting of twelve 30-day months).
(b) The Master Servicer shall be obligated to make any such Monthly Advance
only to the extent that such advance, in the reasonable and good faith judgment
of the Master Servicer would not, if made, constitute a Nonrecoverable Advance.
If the Master Servicer shall have determined that it is not obligated to make
the entire amount of any Monthly Advance
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because all or a lesser portion of such Monthly Advance would, if made,
constitute a Nonrecoverable Advance, the Master Servicer shall deliver to the
Trustee, not less than three Business Days prior to the related Distribution
Date, an Officers' Certificate setting forth the reasons for such determination.
(c) In lieu of making all or a portion of the Monthly Advances for any
Distribution Date, the Master Servicer may utilize any such funds in the
Collection Account that will constitute part of the Available Distribution
Amount for a future Distribution Date in discharge of its obligation to make any
such Monthly Advance and shall cause to be made in its records relating to the
Collection Account an appropriate entry reflecting such use of funds. Any funds
so applied shall be replaced by the Master Servicer by deposit in the Collection
Account no later than the Master Servicer Remittance Date for the applicable
future Distribution Date. The Master Servicer shall be entitled to be
reimbursed from the Collection Account for all Monthly Advances of its own funds
made pursuant to this Section 5.01 as provided in Section 3.09.
SECTION 5.02. Monthly Advance Procedures.
(a) If, with respect to any Distribution Date, the Master Servicer is
required to make one or more Monthly Advances in accordance with Section 5.01,
it shall make such Monthly Advances on or before 8 a.m., New York City time, on
the second Business Day prior to the related Distribution Date (the "Monthly
Advance Date"). The Master Servicer shall notify the Trustee of the aggregate
amount of Monthly Advances for a Distribution Date on or before the third
Business Day prior to such Distribution Date. Any such Monthly Advance shall be
included with the distribution to the Certificateholders on the related
Distribution Date.
(b) In the event that the Master Servicer fails to make a Monthly Advance
required to be made pursuant to Section 5.01 on or before 3 p.m., New York City
time, on the Monthly Advance Date, the Trustee shall on or before 12 noon, New
York City time, on the next succeeding Business Day provide to the Master
Servicer, by telecopy, written notice of such failure and the amount of such
failure and that continuance of such failure as of 5:00 p.m., New York City
time, on the related Distribution Date will be an Event of Default.
(c) If the Trustee does not receive, or there is not deposited in the
Distribution Account, on or before 12 noon, New York City time, on the related
Distribution Date, the full amount of all Monthly Advances, if any, required to
be made in respect of such Distribution Date, then the Trustee shall (except to
the extent that it determines that any such Monthly Advance would, if made, be a
Nonrecoverable Advance) make the portion of such Monthly Advances that was
required to be, but not, made by the Master Servicer.
(d) If the Trustee is required to make any Monthly Advance pursuant to
Section 5.02(c), the Master Servicer shall promptly (and in any event, by 5:00
p.m., New York City time, on the related Distribution Date) reimburse the
Trustee for such Monthly Advance, at which time such Monthly Advance shall be
deemed to have been made by the Master Servicer; provided that, if the Master
Servicer shall not have so reimbursed the Trustee by 5:00
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p.m., New York City time, on the related Distribution Date, then without
limiting the rights of the Trustee or the Certificateholders pursuant to Section
8.02, the Trustee shall terminate the Master Servicer in accordance with Section
8.02, in which case such Monthly Advance shall be deemed to have been made by
the Trustee in its capacity as successor master servicer.
(e) In the event that the Master Servicer and the Trustee, in its capacity
as successor master servicer, have both made Advances which are outstanding,
repayment of the Advances made by the Trustee, in its capacity as successor
master servicer, shall have priority over repayment of the Advances made by the
Master Servicer.
SECTION 5.03. Servicing Advances.
The Master Servicer shall make Servicing Advances as provided in this
Agreement; provided that, notwithstanding anything herein to the contrary, the
Master Servicer shall not make any particular Servicing Advance if and to the
extent that (i) the Master Servicer determines, in its good faith and reasonable
judgment, that such Servicing Advance would, if made, not be specifically
covered by the FHA Insurance Benefits with respect to the related Mortgage Loan
and (ii) the failure to make such Servicing Advance would not adversely affect
the ability to recover the full amount of FHA Insurance Benefits in respect of
the related Mortgage Loan; and provided further that the Master Servicer shall
not be required to make any Servicing Advance that the Master Servicer
determines, in its reasonable and good faith judgment, would, if made,
constitute a Nonrecoverable Advance. The Master Servicer shall be entitled to
be reimbursed from the Collection Account for all Servicing Advances of its own
funds made pursuant to this Agreement as provided in Section 3.09.
SECTION 5.04. Nonrecoverable Advances.
If the Master Servicer determines at any time that any Advance previously
made by it constitutes, or any proposed Advance, if made, would constitute, a
Nonrecoverable Advance, such determination shall be evidenced by an Officer's
Certificate of a Servicing Officer delivered to the Trustee and the Depositor by
the third Business Day following the next succeeding Determination Date, but in
no event (in the case of a Monthly Advance) later than three Business Days
preceding the Distribution Date on which such Advance would otherwise be paid to
Holders of the Certificates. Such Officer's Certificate shall set forth such
determination of nonrecoverability and the procedure and considerations of the
Master Servicer forming the basis of such determination (which shall include,
but not be limited to, with respect to any Mortgage Loan, financial or non-
financial information such as related income and expense statements, rent rolls,
occupancy status, property inspections, Master Servicer inquiries, an appraisal
performed by an MAI appraiser in accordance with MAI standards and methodologies
(the cost of which appraisal, if done externally, to be recoverable as a
Servicing Advance) or notification of material environmental concern). The
Master Servicer shall withdraw funds from the Collection Account pursuant to
Section 3.09 to reimburse itself for any Nonrecoverable Advance it has made.
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If the Trustee determines at any time that any Monthly Advance previously
made by it constitutes, or any proposed Monthly Advance, if made, would
constitute, a Nonrecoverable Advance, such determination shall be evidenced by
an Officer's Certificate of a Responsible Officer delivered to the Depositor no
later than the Distribution Date on which such Monthly Advance would otherwise
be paid to Holders of the Certificates. If the Trustee determines that a
proposed Monthly Advance, if made, would constitute a Nonrecoverable Advance
despite the fact that the Master Servicer had not previously made any such
determination, such Officer's Certificate shall set forth such determination of
nonrecoverability and the procedure and considerations of the Trustee forming
the basis of such determination (which shall include, but not be limited to,
with respect to any Mortgage Loan, an MAI appraisal performed by a MAI appraiser
in accordance with MAI standards and methodologies (the cost of which appraisal,
if done externally, to be recoverable as a Servicing Advance). The Trustee, in
determining whether or not a proposed Monthly Advance would be a Nonrecoverable
Advance, shall be subject to the standards for such a determination which are
applicable to the Master Servicer hereunder.
Notwithstanding the foregoing, and unless the circumstances under which such
a determination was made have materially changed or the basis for such a
determination has been proven to be erroneous, the Trustee shall be entitled to
conclusively rely upon any determination by the Master Servicer that an Advance
previously made or proposed to be made constitutes a Nonrecoverable Advance.
SECTION 5.05 Interest on Advances.
Any unreimbursed Advance funded from the Master Servicer's or the Trustee's
own funds shall accrue interest on a daily basis, at a per annum rate equal to
the Reimbursement Rate in effect from time to time, from the date such Advance
was made until the date on which such Advance has been reimbursed. Advance
Interest accrued in respect of any Advance shall be payable out of general
collections on the Mortgage Pool at any time on or after the date such Advance
is reimbursed to the Master Servicer.
ARTICLE VI
THE CERTIFICATES
SECTION 6.01. The Certificates.
The Certificates shall be in substantially the forms set forth in Exhibits
A-1, A-2, A-3, A-4, A-5, A-6, A-7, A-8, A-9, A-10 and A-11 hereto, with such
appropriate insertions, omissions, substitutions and other variations as are
required or permitted by this Agreement or as may in the reasonable judgment of
the Trustee or the Depositor be necessary, appropriate or convenient to comply,
or facilitate compliance, with applicable laws, and may have such letters,
numbers or other marks of identification and such legends or endorsements placed
thereon as may be required to comply with the rules of any securities exchange
on which any of the
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Certificates may be listed, or as may, consistent herewith, be determined by the
officers executing such Certificates, as evidenced by their execution thereof.
The definitive Certificates shall be printed, typewritten, lithographed or
engraved or produced by any combination of these methods or may be produced in
any other manner permitted by the rules of any securities exchange on which any
of the Certificates may be listed, all as determined by the officers executing
such Certificates, as evidenced by their execution thereof.
Each of the Class A-1, Class A-2, Class A-3 and Class A-4 Certificates will
be issued in fully-registered form only in minimum initial Certificate Principal
Balances as of the Closing Date of $25,000 and integral multiples of $1 in
excess thereof, each of the Interest-Only Certificates will be issued in fully-
registered form only in minimum initial Certificate Notional Amounts as of the
Closing Date of $1,000,000 and in integral multiples of $1 in excess thereof,
each of the Class B Certificates will be issued in fully-registered form only in
minimum initial Certificate Principal Balances of $250,000 and integral
multiples of $1 in excess thereof, and each of the Residual Certificates will be
issued in fully-registered form only in minimum Percentage Interests of no less
than 20%.
The Certificates shall be executed by manual or facsimile signature on
behalf of the Trustee by a Responsible Officer. Certificates bearing the manual
or facsimile signatures of individuals who were, at the time when such
signatures were affixed, authorized to sign on behalf of the Trustee shall bind
the Trustee, notwithstanding that such individuals or any of them have ceased to
be so authorized prior to the authentication and delivery of such Certificates
or did not hold such offices at the date of such Certificate. No Certificate
shall be entitled to any benefit under this Agreement, or be valid for any
purpose, unless there appears on such Certificate a certificate of
authentication executed by the Trustee by manual signature, and such certificate
of 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.
SECTION 6.02. Registration of Transfer and Exchange of Certificates.
(a) The Trustee shall maintain, or cause to be maintained, 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. Upon surrender for
registration of transfer of any Certificate, subject to the other subsections of
this Section 6.02, the Trustee shall execute, authenticate and deliver, in the
name of the designated Transferee or Transferees, one or more new Certificates
of the same Class in authorized denominations and evidencing a like aggregate
Percentage Interest.
(b) At the option of a Certificateholder, Certificates may be exchanged for
other Certificates of the same Class in authorized denominations and evidencing
a like aggregate Percentage Interest, upon surrender of the Certificates to be
exchanged at the office or agency of the Trustee set forth in Section 9.11.
Whenever any Certificates are so surrendered for
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exchange, the Trustee shall execute, authenticate and deliver the Certificates
which the Certificateholder making the exchange is entitled to receive. Every
Certificate presented or surrendered for registration of transfer or exchange
shall be accompanied by a written instrument of transfer in form satisfactory to
the Trustee duly executed by the Holder thereof or his attorney duly authorized
in writing.
(c) No service charge to the Certificateholders shall be made for any
registration of transfer or exchange of Certificates, but payment of a sum
sufficient to cover any tax or governmental charge may be imposed in connection
with any transfer or exchange of Certificates.
(d) All Certificates surrendered for registration of transfer and exchange
shall be canceled and subsequently destroyed by the Trustee in accordance with
the Trustee's customary procedures.
(e) No transfer of any Non-Registered Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration or qualification. In the event that a transfer of any Non-
Registered Certificate (other than a transfer by the Depositor or any Affiliate
thereof) is to be made without registration under the Securities Act, the
Trustee shall require, in order to assure compliance with such laws: (i) if
such transfer is purportedly being made based on Rule 144A, that the
Certificateholder desiring to effect the transfer and such Certificateholder's
prospective Transferee each certify to the Trustee in writing, substantially in
the forms attached hereto as Exhibit D-1 and Exhibit D-2, respectively, the
facts surrounding the transfer; and (ii) in all other cases, that it and the
Depositor receive an Opinion of Counsel reasonably satisfactory to the Trustee
and the Depositor that such transfer may be made without such registration,
which Opinion of Counsel shall not be required to be an expense of the
Depositor, the Trustee or the Trust Fund. Neither the Depositor nor the Trustee
is obligated to register or qualify any Non-Registered Certificate under the
Securities Act or any other securities law or to take any action not otherwise
required under this Agreement to permit the transfer of such Certificate without
registration or qualification. Any Holder desiring to effect a transfer of a
Non-Registered Certificate shall, and does hereby agree to, indemnify the
Trustee and the Depositor against any liability that may result if the transfer
is not so exempt, or is not made in accordance with federal and state laws.
(f) No transfer of a Subordinate Certificate or any interest therein shall
be made to any employee benefit plan that is subject to ERISA or the Code, or a
trustee of any such plan, unless the prospective Transferee of a
Certificateholder desiring to transfer its Subordinate Certificate or any
interest therein provides the Trustee with a certification, substantially in the
form attached hereto as Exhibit E or an Opinion of Counsel which establishes to
the reasonable satisfaction of the Depositor and the Trustee that the purchase
and holding of a Subordinate Certificate or any interest therein by or on behalf
of such employee benefit plan would not result in the assets of the Trust Fund
being deemed to be "plan assets" and subject to the fiduciary responsibility
provisions of ERISA or the prohibited transaction provisions of
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the Code (or comparable provisions of any subsequent enactments), would not
constitute or result in a prohibited transaction under Section 406 of ERISA or
Section 4975 of the Code, and would not subject the Depositor or the Trustee to
any obligation or liability (including liabilities under ERISA or Section 4975
of the Code) in addition to those undertaken in this Agreement or any other
liability. If no such certification, substantially in the form of Exhibit E
hereto and no such Opinion of Counsel are so delivered, the Trustee shall
require that such prospective Transferee certify to the Trustee in writing the
facts establishing that such Transferee is not such an employee benefit plan.
(g) Additional restrictions on transfers of the Residual Certificates to
Disqualified Organizations are set forth below:
(i) Each Person who has or who acquires any Ownership Interest in
a Residual Certificate shall be deemed by the acceptance or acquisition of
such Ownership Interest to have agreed to be bound by the following
provisions and to have irrevocably authorized the Trustee or its designee
under clause (iii)(A) below to deliver payments to a Person other than such
Person and to negotiate the terms of any mandatory sale under clause
(iii)(B) below and to execute all instruments of transfer and to do all
other things necessary in connection with any such sale. The rights of each
Person acquiring any Ownership Interest in a Residual Certificate are
expressly subject to the following provisions:
(A) Each Person holding or acquiring any Ownership
Interest in a Residual Certificate shall be other than a Disqualified
Organization and shall promptly notify the Trustee of any change or
impending change in its status as other than a Disqualified
Organization.
(B) In connection with any proposed transfer of any
Ownership Interest in a Residual Certificate to a U.S. Person, the
Trustee shall require delivery to it, and shall not register the
Transfer of a Residual Certificate until its receipt of (1) an
affidavit and agreement (a "Transferee Affidavit and Agreement") from
the proposed Transferee, substantially in the form attached hereto as
Exhibit F-1, representing and warranting, among other things, that it
is not a non-U.S. Person, that such Transferee is other than a
Disqualified Organization, that it is not acquiring its Ownership
Interest in a Residual Certificate that is the subject of the proposed
Transfer as a nominee, trustee or agent for any Person who is not
other than a Disqualified Organization, that for so long as it retains
its Ownership Interest in a Residual Certificate, it will endeavor to
remain a Permitted Transferee, and that it has reviewed the provisions
of this Section 6.02(g) and agrees to be bound by them, and (2) a
certificate from the Holder wishing to transfer a Residual
Certificate, substantially in the form attached hereto as Exhibit F-2,
representing and warranting, among other things, that no purpose of
the proposed Transfer is to allow such Holder to impede the assessment
or collection of tax.
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(C) Notwithstanding the delivery of a Transferee
Affidavit and Agreement by a proposed Transferee under clause (B)
above, if a Responsible Officer of the Trustee has actual knowledge
that the proposed Transferee is not a Permitted Transferee, no
Transfer of an Ownership Interest in a Residual Certificate to such
proposed Transferee shall be effected.
(D) Each Person holding or acquiring any Ownership
Interest in a Residual Certificate agrees, by holding or acquiring
such Ownership Interest, (1) to require a Transferee Affidavit and
Agreement from any other Person to whom such Person attempts to
Transfer its Ownership Interest and to provide to the Trustee a
certificate substantially in the form attached hereto as Exhibit F-2,
and (2) to obtain the express written consent of the Depositor prior
to any Transfer of such Ownership Interest, which consent may be
withheld in the Depositor's sole discretion.
(ii) The Trustee shall register the Transfer of any Residual
Certificate only if it shall have received the Transferee Affidavit and
Agreement, a certificate of the Holder effecting such Transfer
substantially in the form attached hereto as Exhibit F-2 and all of such
other documents as shall have been reasonably required by the Trustee as a
condition to such registration.
(iii) (A) If any Disqualified Organization shall become a Holder
of a Residual Certificate, then the last preceding Holder that was
other than a Disqualified Organization shall be restored, to the
extent permitted by law, to all rights and obligations as Holder
thereof retroactive to the date of registration of such transfer of
such Residual Certificate. If any non-U.S. Person shall become a
Holder of a Residual Certificate, then the last preceding Holder that
is a U.S. Person shall be restored, to the extent permitted by law, to
all rights and obligations as Holder thereof retroactive to the date
of registration of the transfer to such non-U.S. Person of such
Residual Certificate. If a transfer of a Residual Certificate is
disregarded pursuant to the provisions of Treasury Regulations Section
1.860E-1 or Section 1.860G-3, then the last preceding Holder that was
other than a Disqualified Organization shall be restored, to the
extent permitted by law, to all rights and obligations as Holder
thereof retroactive to the date of registration of such transfer of
such Residual Certificate. The Trustee shall be under no liability to
any Person for any registration of transfer of a Residual Certificate
that is in fact not permitted by this Section 6.02(g) or for making
any payments due on such Certificate to the Holder thereof or for
taking any other action with respect to such Holder under the
provisions of this Agreement.
(B) If any purported Transferee of a Residual
Certificate shall become a Holder of a Residual Certificate in
violation of the restrictions in this Section 6.02(g) and to the extent
that the retroactive restoration of the rights of the Holder of such
Residual Certificate as described in clause (iii)(A) above shall be
invalid, illegal or unenforceable, then the Trustee shall have the
right, without
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notice to the Holder or any prior Holder of such Residual Certificate,
to sell such Residual Certificate to a purchaser selected by the
Trustee on such terms as the Trustee may choose. Such purported
Transferee shall promptly endorse and deliver a Residual Certificate in
accordance with the instructions of the Trustee. Such purchaser may be
the Trustee itself or any affiliate of the Trustee. The proceeds of
such sale, net of the commissions (which may include commissions
payable to the Trustee or its affiliates), expenses and taxes due, if
any, shall be remitted by the Trustee to such purported Transferee.
The terms and conditions of any sale under this clause (iii)(B) shall
be determined in the sole discretion of the Trustee, and the Trustee
shall not be liable to any Person having an Ownership Interest or a
purported Ownership Interest in a Residual Certificate as a result of
its exercise of such discretion.
(iv) The Trustee shall make available all information reasonably
available to it that is necessary to compute any tax imposed (A) as a
result of the transfer of an Ownership Interest in a Residual Certificate
to any Person who is a Disqualified Organization, including the information
regarding "excess inclusions" of such Residual Certificate required to be
provided to the Internal Revenue Service and certain Persons as described
in Treasury Regulation Section 1.860D-1(b)(5), and (B) as a result of any
regulated investment company, real estate investment trust, common trust
fund, partnership, trust, estate or organizations described in Section 1381
of the Code having as among its record holders at any time any Person who
is a Disqualified Organization. Reasonable compensation for providing such
information may be required by the Trustee from such Person.
(v) The provisions of this Section 6.02(g) set forth prior to
this Section (v) may be modified, added to or eliminated by the Trustee,
provided that there shall have been delivered to the Trustee the following:
(A) written notification from the Rating Agency to the
effect that the modification, addition to or elimination of such
provisions will not cause the Rating Agency to downgrade any of its
then-current ratings of the Rated Certificates; and
(B) an Opinion of Counsel (the cost of which shall be
an expense of the Person requesting such modification, addition or
elimination), in form and substance satisfactory to the Trustee, to the
effect that such modification, addition to or elimination of such
provisions will not cause either REMIC I or REMIC II to cease to
qualify as a REMIC and will not create a risk that (i) either such
REMIC may be subject to an entity-level tax caused by the transfer of a
Residual Certificate to a Person which is a Disqualified Organization
or (2) a Certificateholder or another Person will be subject to a
REMIC-related tax caused by the transfer of the applicable Residual
Certificate to a Person which is a Disqualified Organization.
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(h) The Trustee shall have no liability to the Trust Fund arising from a
transfer of any Certificate in reliance upon a certification, ruling or Opinion
of Counsel described in this Section 6.02; provided, however, that the Trustee
shall not register the transfer of any Residual Certificate if it has actual
knowledge that the proposed Transferee does not meet the qualifications of a
permitted Holder of a Residual Certificate as set forth in this Section 6.02.
(i) In order to preserve the exemption for resales and transfers provided
by Rule 144A, the Depositor shall provide (and the Seller, the Master Servicer
and the Trustee shall use their reasonable efforts to cooperate with the
Depositor in providing) to any Holder of a Non-Registered Certificate and any
prospective purchaser designated by such Holder, upon request of such Holder or
such prospective purchaser, such information required by Rule 144A as will
enable the resale of such Certificate to be made pursuant to Rule 144A.
However, the Depositor shall not be required to provide with respect to any
Certificate more information than is required by Rule 144A as of the date such
Certificate is issued but may elect to do so if necessary under subsequent
revisions of Rule 144A. In addition, the Depositor may from time to time modify
the foregoing restrictions on resale and other transfers, without the consent
but upon notice to the Holders of the Certificates, in order to reflect any
amendment to Rule 144A or change in the interpretation thereof or practices
thereunder if the Depositor shall have received an Opinion of Counsel to the
effect that such amendment or supplement is necessary or appropriate.
SECTION 6.03. Mutilated, Destroyed, Lost or Stolen Certificates.
If (a) any mutilated Certificate is surrendered to the Trustee, or the
Trustee receives evidence to its satisfaction of the destruction, loss or theft
of any Certificate, and (b) there is delivered to the Master Servicer and the
Trustee such security or indemnity as may be required by them to save each of
them harmless, then, in the absence of notice to the Trustee that such
Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute, 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 interest in the Trust Fund. In connection with the issuance of any
new Certificate under this Section 6.03, the Trustee may require the payment of
a sum sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and any other expenses (including the fees and
expenses of the Trustee) connected therewith. Any replacement Certificate
issued pursuant to this Section 6.03 shall constitute complete and indefeasible
evidence of ownership in the Trust Fund, as if originally issued, whether or not
the lost, stolen or destroyed Certificate shall be found at any time.
SECTION 6.04. Persons Deemed Owners.
Prior to due presentment of a Certificate for registration of transfer, the
Depositor, the Master Servicer, the Seller, the Trustee and any agent of the
Depositor, the Master Servicer, the Seller or the Trustee may treat the person
in whose name any Certificate is registered as the owner of such Certificate for
the purpose of receiving distributions as provided in this Agreement and for all
other purposes whatsoever, and none of the Depositor,
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the Master Servicer, the Seller, the Trustee or any agent of the Depositor, the
Master Servicer, the Seller or the Trustee shall be affected by any notice to
the contrary.
SECTION 6.05. Access to List of Certificateholders' Names and Addresses.
(a) If three or more Certificateholders (i) request in writing from the
Trustee a list of the names and addresses of Certificateholders, (ii) state that
such Certificateholders desire to communicate with other Certificateholders with
respect to their rights under this Agreement or under the Certificates and (iii)
provide a copy of the communication which such Certificateholders propose to
transmit, then the Trustee shall, within ten Business Days after the receipt of
such request, afford such Certificateholders access during normal business hours
to a current list of the Certificateholders. The expense of providing any such
information requested by a Certificateholder shall be borne by the
Certificateholders requesting such information and shall not be borne by the
Trustee. Every Certificateholder, by receiving and holding a Certificate,
agrees that the Trustee shall not be held accountable by reason of the
disclosure of any such information as to the list of the Certificateholders
hereunder, regardless of the source from which such information was derived.
(b) The Master Servicer, so long as it is the master servicer hereunder,
shall have unlimited access to a list of the names and addresses of the
Certificateholders, which list shall be provided by the Trustee promptly upon
the request of the Master Servicer.
SECTION 6.06. Maintenance of Office or Agency.
In addition to its Corporate Trust Office, the Trustee will maintain or
cause to be maintained at its expense a presenting office in New York, New York
where Certificates may be surrendered for registration of transfer or exchange
and where notices and demands to or upon the Trustee in respect of the
Certificates and this Agreement may be served. The Trustee initially designates
IBJ Schroeder Trust Bank, Stock Transfer Department, One State Street Plaza, New
York, New York 10015, for such purpose. The Trustee will give prompt written
notice to the Certificateholders of any change in the location of any such
office or agency.
SECTION 6.07. Book-Entry Certificates.
Notwithstanding the foregoing, upon original issuance, each Class of Book-
Entry Certificates shall be issued in the form of one or more typewritten
Certificates representing such Certificates, to be delivered to DTC, the initial
Clearing Agency, by, or on behalf of, the Depositor. Each Class of Book-Entry
Certificates shall initially be registered on the Certificate Register in the
name of Cede & Co., the nominee of DTC, as the initial Clearing Agency, and no
Beneficial Holder will receive a definitive certificate representing such
Beneficial Holder's interest in the Book-Entry Certificates, except as provided
in Section 6.09. Unless and until definitive, fully registered Certificates
("Definitive Certificates") have been issued to the Beneficial Holders pursuant
to Section 6.09:
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(a) the provisions of this Section 6.07 shall be in full force
and effect with respect to the Book-Entry Certificates;
(b) the Depositor and the Trustee may deal with the Clearing
Agency for all purposes with respect to the Book-Entry Certificates
(including the making of distributions on such Certificates) as the sole
Holder of such Certificates;
(c) to the extent that the provisions of this Section 6.07
conflict with any other provisions of this Agreement, the provisions of
this Section 6.07 shall control; and
(d) the rights of the Beneficial Holders of the Book-Entry
Certificates shall be exercised only through the Clearing Agency and the
Participants and shall be limited to those established by law and
agreements between such Beneficial Holders and the Clearing Agency and/or
the Participants. Pursuant to the Depository Agreement, unless and until
Definitive Certificates are issued pursuant to Section 6.09, the initial
Clearing Agency will make book-entry transfers among the Participants and
receive and transmit distributions of principal and interest on the related
Certificates to such Participants.
For purposes of any provision of this Agreement requiring or permitting
actions with the consent of, or at the direction of, Holders of the Book-Entry
Certificates entitled to a specified percentage of the aggregate Voting Rights
allocated to such Certificates, such direction or consent may be given by the
Clearing Agency at the direction of Beneficial Holders owning such Certificates
entitled to the requisite aggregate percentage of Voting Rights allocated to
such Certificates. The Clearing Agency may take conflicting actions with
respect to the Book-Entry Certificates to the extent that such actions are taken
on behalf of the Beneficial Holders.
SECTION 6.08. Notices to Clearing Agency.
Whenever notice or other communication to the Holders of the Book-Entry
Certificates is required under this Agreement, unless and until Definitive
Certificates shall have been issued to the related Beneficial Holders pursuant
to Section 6.09, the Trustee shall give all such notices and communications
specified herein to be given to Holders of the Book-Entry Certificates to the
Clearing Agency which shall give such notices and communications to the related
Participants in accordance with its applicable rules, regulations and
procedures.
SECTION 6.09. Definitive Certificates.
If (a) the Depositor advises the Trustee in writing that the Clearing
Agency is no longer willing or able to properly discharge its responsibilities
under the Depository Agreement with respect to the Book-Entry Certificates and
the Trustee or the Depositor is unable to locate a qualified successor, (b) the
Depositor, at its option, advises the Trustee in writing that it elects to
terminate the book-entry system with respect to the Book-Entry Certificates
through the Clearing Agency or (c) after the occurrence of an Event of Default,
Holders of Book-Entry
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Certificates entitled to not less than 66% of the aggregate Voting Rights
allocated to the Book-Entry Certificates advise the Trustee in writing that the
continuation of a book-entry system with respect to such Certificates through
the Clearing Agency is no longer in the best interests of the Beneficial Holders
of such Certificates, the Trustee shall notify all Holders of such Certificates
of the occurrence of any such event and the availability of Definitive
Certificates. Upon surrender to the Trustee of such Certificates by the
Clearing Agency, accompanied by registration instructions from the Clearing
Agency for registration, the Trustee shall authenticate and deliver the
Definitive Certificates in respect thereof. Neither the Depositor nor the
Trustee shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Certificates, all references herein to
obligations imposed upon or to be performed by the Clearing Agency shall be
deemed to be imposed upon and performed by the Trustee, to the extent applicable
with respect to such Definitive Certificates, and the Trustee shall recognize
the Holders of such Definitive Certificates as Certificateholders hereunder.
ARTICLE VII
THE DEPOSITOR, THE SELLER AND THE MASTER SERVICER
SECTION 7.01. Liabilities of the Depositor, the Seller and the Master
Servicer.
The Depositor, the Seller and the Master Servicer shall each be liable in
accordance herewith only to the extent of the obligations specifically and
respectively imposed upon and undertaken by them herein.
SECTION 7.02. Merger or Consolidation of the Depositor, the Seller or the
Master Servicer.
The Depositor, the Seller and the Master Servicer will each do or cause to
be done all things necessary to preserve and keep in full force and effect its
existence, rights and franchises (charter and statutory) and will each obtain
and preserve its qualification to do business as a foreign corporation in each
jurisdiction in which such qualification is or shall be necessary to protect the
validity and enforceability of this Agreement, or any of the Mortgage Assets and
to perform its respective duties under this Agreement.
Any Person into which the Depositor, the Seller or the Master Servicer may
be merged or consolidated, or any Person resulting from any merger or
consolidation to which the Depositor, the Seller or the Master Servicer shall be
a party, or any Person succeeding to the business of the Depositor, the Seller
or the Master Servicer, shall be the successor of the Depositor, the Seller or
the Master Servicer, as the case may be, hereunder, without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding; provided, however, that the
successor or surviving Person to the Master Servicer shall be an FHA-Approved
Mortgagee.
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Notwithstanding anything else in this Section 7.02 or in Section 7.04 hereof
to the contrary, the Master Servicer may assign its rights and delegate its
duties and obligations under this Agreement; provided, however, that the Master
Servicer gives the Depositor and the Trustee notice of such assignment; and
provided further, that such purchaser or transferee accepting such assignment
and delegation shall be an institution that is an FHA-Approved Mortgagee in good
standing, which has a net worth of at least $5,000,000, and which is willing to
service the Mortgage Loans and executes and delivers to the Depositor, the
Seller and the Trustee an agreement accepting such delegation and assignment,
which contains an assumption by such Person of 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 provided
further, that the Rating Agency acknowledges that its ratings of the Rated
Certificates in effect immediately prior to such assignment and delegation will
not be qualified, withdrawn or reduced as a result of such assignment and
delegation. In the case of any such assignment and delegation, the Master
Servicer shall be released from its obligations 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 preceding
sentence.
SECTION 7.03. Limitation on Liability of the Depositor, the Seller, the
Master Servicer and Others.
None of the Depositor, the Seller, the Master Servicer or any of the
directors, officers, employees or agents of the Depositor, the Seller or the
Master Servicer shall be under any liability to the Certificateholders for any
action taken or for refraining from the taking of any action in good faith
pursuant to this Agreement, or for errors in judgment; provided, however, that
this provision shall not protect the Depositor, the Seller or the Master
Servicer against any breach of representations or warranties made by it herein
or protect the Depositor, the Seller or the Master Servicer or any such person
from any liability which would otherwise be imposed by reasons of willful
misfeasance, bad faith or negligence in the performance of its duties hereunder
or by reason of reckless disregard of obligations and duties hereunder. The
Depositor, the Seller, the Master Servicer and any director, officer, employee
or agent of the Depositor, the Seller or the Master Servicer may rely in good
faith on any document of any kind prima facie properly executed and submitted by
any Person respecting any matters arising hereunder and, in the case of any
questions arising with respect to the REMIC status of either of REMIC I or REMIC
II, on an Opinion of Counsel from Independent Counsel with substantial
experience in such matters. The Depositor, the Seller, the Master Servicer and
any director, officer, employee or agent of the Depositor, the Seller or the
Master Servicer shall be indemnified by the Trust Fund and held harmless against
any loss, liability or expense incurred in connection with any legal action
relating to this Agreement or the Certificates, other than any loss, liability
or expense incurred by reason of a breach of any representations, warranties or
covenants of any such party hereto or by reason of willful misfeasance, bad
faith or negligence in the performance of duties hereunder or by reason of
reckless disregard of obligations and duties hereunder. None of the Depositor,
the Seller or the Master Servicer shall be under any obligation to appear in,
prosecute or defend any legal action that is not incidental to their respective
duties hereunder and which in its opinion may involve it in any expense or
liability;
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provided, however, that any of the Depositor, the Seller or the Master Servicer
may in its discretion undertake any such action that it may deem necessary or
desirable in respect of this Agreement and the rights and duties of the parties
hereto and interests of the Trustee and the Certificateholders hereunder. In
such event, the legal expenses and costs of such action and any liability
resulting therefrom shall be expenses, costs and liabilities of the Trust Fund,
and the Depositor, the Seller or the Master Servicer, as the case may be, shall
be entitled to be reimbursed therefor out of the Collection Account.
SECTION 7.04. Master Servicer Not to Resign.
The Master Servicer shall not resign from the obligations and duties imposed
upon it hereunder except upon determination that such obligations and duties
hereunder are no longer permissible under applicable law. Any such
determination permitting the resignation of the Master Servicer under this
Section 7.04 shall be evidenced by an Opinion of Counsel to such effect
delivered to the Trustee. The Master Servicer shall give notice of any proposed
resignation to the Trustee, the Depositor, the Certificateholders and the Rating
Agency. No such resignation by the Master Servicer shall become effective until
the Trustee or a successor servicer shall have assumed the Master Servicer's
responsibilities and obligations in accordance with Section 8.02 hereof.
SECTION 7.05. Errors and Omissions Insurance; Fidelity Bonds.
The Master Servicer shall maintain with responsible companies, and at its
own expense, a fidelity bond and an errors and omissions insurance policy with
broad coverage on all officers, employees or other persons acting in any
capacity enabling such persons to handle funds, money, documents or papers
relating to the Mortgage Loans ("Master Servicer Employees"). Any such fidelity
bond and errors and omissions insurance shall be in the form of the Banker's
Blanket Bond and shall protect and insure the Master Servicer against losses,
including forgery, theft, embezzlement, fraud, errors and omissions and
negligent acts of such Master Servicer Employees. The Master Servicer is self-
insured for losses in connection with the release or satisfaction of a Mortgage
Loan without having obtained payment in full of the indebtedness secured thereby
by Master Servicer Employees. No provision of this Section 7.05 requiring such
fidelity bond and errors and omissions insurance shall diminish or relieve the
Master Servicer from its duties and obligations as set forth in this Agreement.
The minimum amount of coverage under any such bond and insurance policy shall be
$1,000,000. Upon request of any Certificateholder, the Master Servicer shall
cause to be delivered to such Certificateholder a certified true copy of such
fidelity bond and insurance policy and a statement from the surety and the
insurer that such fidelity bond and insurance policy shall in no event be
terminated without 15 days' prior written notice to the Trustee.
SECTION 7.06. Depositor, Seller and Master Servicer May Own Certificates.
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Each of the Depositor, the Seller and the Master Servicer in its individual
or any other capacity may become the owner or pledgee of Certificates with the
same rights as it would have if it were not the Depositor, the Seller or the
Master Servicer.
ARTICLE VIII
DEFAULT
SECTION 8.01. Events of Default.
"Event of Default", wherever used herein, means any one of the following
events (whatever reason for such Event of Default and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any
judgment, decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(a) any failure by the Master Servicer to deposit in the
Distribution Account or the Collection Account, or to remit to the Trustee
for deposit in the Distribution Account, any deposit or payment required to
be so made by the Master Servicer under the terms of this Agreement, which
failure shall continue unremedied for a period of one Business Day (or, in
the case of a failure to make a Monthly Advance required to be made
pursuant to Section 5.01, shall continue through the end of the cure period
specified in Section 5.02); or
(b) any failure by the Master Servicer to observe or perform in
any material respect any other of the covenants or agreements on the part
of the Master Servicer contained in this Agreement (except as set forth in
(c) below) which failure (i) materially affects the rights of the
Certificateholders and (ii) shall continue unremedied for a period of 60
days (except that such number of days shall be 15 in the case of a failure
to pay the premium for any FHA Mortgage Insurance or Required Insurance
Policy in respect of any Mortgage Loan) after the date on which written
notice of such failure shall have been given to the Master Servicer by the
Trustee or the Depositor, or to the Master Servicer, the Depositor and the
Trustee by the Holders of Certificates entitled to not less than 25% of the
Voting Rights evidenced by the Certificates; or
(c) if a representation or warranty set forth in Section 2.04(a)
hereof shall prove to be materially incorrect as of the time made in any
respect that materially and adversely affects interests of the
Certificateholders, and the circumstances or condition in respect of which
such representation or warranty was incorrect shall not have been
eliminated or cured within 120 days after the date on which written notice
thereof shall have been given to the Master Servicer by the Trustee for the
benefit of the Certificateholders or by the Depositor; or
(d) a decree or order of a court or agency or supervisory
authority having jurisdiction in the premises for the appointment of a
conservator or receiver or
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liquidator in any insolvency, readjustment of debt, marshalling of assets
and liabilities or similar proceedings, or for the winding-up or
liquidation of its affairs, shall have been entered against the Master
Servicer and such decree or order shall have remained in force undischarged
or unstayed for a period of 60 days; or
(e) the Master Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment of
debt, marshalling of assets and liabilities or similar proceedings of or
relating to the Master Servicer or all or substantially all of the property
of the Master Servicer; or
(f) the Master Servicer shall admit in writing its inability to
pay its debts generally as they become due, file a petition to take
advantage of, or commence a voluntary case under, any applicable insolvency
or reorganization statute, make an assignment for the benefit of its
creditors, or voluntarily suspend payment of its obligations; or
(g) the Master Servicer shall fail to purchase any FHA Debenture
as required in Section 3.15; or
(h) the Rating Agency shall provide written notice of its
intention to reduce, withdraw or qualify any of the then-current ratings of
the Rated Certificates because the existing or prospective financial
condition or mortgage loan servicing capability of the Master Servicer is
insufficient to maintain such outstanding rating; or
(i) the Master Servicer shall cease to be duly qualified as an
FHA-Approved Mortgagee with power and authority to service the Mortgage
Loans and make claims on the FHA under any FHA Mortgage Insurance as
contemplated herein.
If an Event of Default due to the actions or inaction of the Master Servicer
shall occur, then, and in each and every such case, so long as such Event of
Default shall not have been remedied, the Trustee may, and (i) in the case of an
Event of Default described in clause (a) above, if so directed by the Holders of
Certificates entitled to not less than 25% of the Voting Rights allocated to any
Class of REMIC II Regular Certificates, (ii) in the case of an Event of Default
described in either clause (b) or clause (c) above, if so directed by the
Holders of Certificates entitled to not less than 51% of all the Voting Rights,
and (iii) in the case of any other Event of Default, under all circumstances,
the Trustee shall, by notice in writing to the Master Servicer (with a copy to
the Depositor and the Rating Agency), terminate all of the rights and
obligations of the Master Servicer under this Agreement (other than rights to
reimbursement for Advances previously made, as provided in Section 3.09). On or
after the receipt by the Master Servicer of such written notice, all of its
authority and power under this Agreement shall pass to and be vested in the
Trustee, as acting master servicer, pursuant to and under this Section and,
without limitation, the Trustee is hereby authorized and empowered to execute
and deliver, on behalf of and at the expense of the Master Servicer, as
attorney-in-fact or otherwise, any and all documents and other instruments, and
to do or accomplish all other acts or things, necessary or appropriate to effect
such termination, whether to complete the transfer and
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endorsement or assignment of the Mortgage Assets and related documents, or
otherwise. In the event it is terminated under this Section, the Master
Servicer agrees that it shall be subject to the duties and obligations set forth
in Section 8.02.
SECTION 8.02. Trustee to Act; Appointment of Successor.
On and after the time the Master Servicer receives a notice of termination
pursuant to Section 8.01 hereof or resigns pursuant to Section 7.04 hereof, the
Trustee shall be the successor master servicer in all respects to the Master
Servicer in its capacity as servicer under this Agreement and with respect to
the transactions set forth or provided for herein and shall thereafter be
subject to all the responsibilities, duties and liabilities relating thereto
placed on the Master Servicer by the terms and provisions hereof; provided,
however, that the Trustee shall have no responsibilities, duties, liabilities or
obligations with respect to any act or omission of the Master Servicer incurred
prior to its resignation or termination. The Trustee, as acting or successor
master servicer, shall be indemnified to the full extent provided the Master
Servicer under this Agreement prior to the Master Servicer's termination. The
Trustee, as acting or successor master servicer, or any other successor master
servicer, as applicable, shall succeed to any rights and obligations of the
Master Servicer under any Sub-Servicing Agreement and shall be deemed to have
assumed the Master Servicer's interest therein, subject to Section 3.05;
provided, however, that the Master Servicer shall not thereby be relieved of any
liability or obligations under any Sub-Servicing Agreement arising prior to the
date of such succession. Neither the Trustee nor any successor master servicer
shall be responsible for any of the representations and warranties of the
terminated Master Servicer herein or in any related document or agreement, for
any acts or omissions of the terminated Master Servicer or for any losses
incurred in respect of any Permitted Investments selected by the terminated
Master Servicer pursuant to this Agreement. The Trustee shall not be required
to purchase any Mortgage Loan hereunder. The Master Servicer agrees to promptly
(and in any event no later than ten Business Days subsequent to the notice of
termination or resignation) provide, at its own expense, the Trustee with all
documents and records requested hereunder, and to cooperate hereunder in
effecting the termination of its responsibilities and rights hereunder,
including, without limitation, the transfer to the successor master servicer or
to the Trustee, as applicable, for administration by it of all cash amounts
which shall at the time be or should have been credited by the Master Servicer
to the Collection Account or any Escrow Account or Reserve Account or should
thereafter be received with respect to the Mortgage Assets, and shall promptly
provide the Trustee or such successor master servicer, as applicable, all
documents and records reasonably requested by it, such documents to be provided
in such form as the Trustee or such successor master servicer shall reasonably
request (including electronic form), to enable it to assume the Master
Servicer's functions hereunder. The terminated Master Servicer shall reimburse
the assuming party for any reasonable expenses incurred by the assuming party in
connection with the assumption of the duties and obligations of the Master
Servicer hereunder. If the Master Servicer does not reimburse the assuming
party for such expenses within a reasonable time, such expenses shall be
reimbursed from the Trust Fund. As compensation for being successor master
servicer, such successor master servicer shall be entitled to all funds relating
to the Mortgage Loans that the Master Servicer would have been entitled to
charge to the Collection Account if the Master Servicer had continued to act
hereunder (except that the
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terminated Master Servicer shall retain the right to be reimbursed for Advances
(including, without limitation, Monthly Advances) theretofore made by the Master
Servicer with respect to which it would be entitled to be reimbursed if it had
not been so terminated as Master Servicer). Notwithstanding the foregoing, if
the Trustee has become the successor to the Master Servicer in accordance with
this Section 8.02, 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 FHA-Approved Mortgagee with a net worth of at least
$5,000,000, the appointment of which does not adversely affect any of the then-
current ratings of the Rated Certificates, 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. Pending appointment of a
successor to the Master Servicer hereunder, the Trustee, unless the Trustee is
prohibited by law from so acting, shall act in such capacity as provided herein.
In connection with such appointment and assumption, the Trustee may make such
arrangements for the compensation of such successor out of payments on Mortgage
Loans as it and such successor shall agree; provided, however, that no such
compensation shall be in excess of that permitted the Master Servicer hereunder.
The Trustee and such successor shall take such action, consistent with this
Agreement, as shall be necessary to effectuate any such succession. Neither the
Trustee nor any other successor 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 the failure of the
Master Servicer to deliver, or any delay in delivering, cash, documents or
records in any form to it.
Any successor to the Master Servicer as servicer shall during the term of
its service as servicer maintain in force the policy or policies that the Master
Servicer is required to maintain pursuant to Section 7.05 hereof.
SECTION 8.03. Notification to Certificateholders.
(a) Upon any termination or appointment of a successor to the Master
Servicer, the Trustee shall give prompt written notice thereof to
Certificateholders at their respective addresses appearing in the Certificate
Register and to the Rating Agency.
(b) Within 60 days after the occurrence of any Event of Default, the
Trustee shall transmit by mail to all Certificateholders and the Rating Agency
notice of each such Event of Default hereunder known to the Trustee, unless such
Event of Default shall have been cured or waived.
SECTION 8.04. Other Remedies of Trustee.
During the continuance of any Event of Default, so long as such Event of
Default shall not have been remedied, the Trustee, in addition to the rights
specified in Section 8.01, shall have the right, in its own name as trustee of
an express trust, to take all actions now or hereafter existing at law, in
equity or by statute to enforce its rights and remedies and to protect the
interests, and enforce the rights and remedies, of the Certificateholders
(including the institution and prosecution of all judicial, administrative and
other proceedings and the filing of
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proofs of claim and debt in connection therewith). In such event, the legal
fees, expenses and costs of such action and any liability resulting therefrom,
to the extent that any such fees, expenses and costs were not recovered by the
Trustee as a result of such action, shall be expenses, costs and liabilities of
the Trust Fund, and the Trustee shall be entitled to be reimbursed therefor from
the Distribution Account as provided in Section 4.01(d). Except as otherwise
expressly provided in this Agreement, no remedy provided for by this Agreement
shall be exclusive of any other remedy, and each and every remedy shall be
cumulative and in addition to any other remedy and no delay or omission to
exercise any right or remedy shall impair any such right or remedy or shall be
deemed to be a waiver of any Event of Default.
ARTICLE IX
CONCERNING THE TRUSTEE
SECTION 9.01. Duties of Trustee.
The Trustee, prior to the occurrence of an Event of Default and after the
curing of all Events of Default that may have occurred, undertakes with respect
to the Trust Fund to perform such duties and only such duties as are
specifically set forth in this Agreement. In case an Event of Default has
occurred and remains uncured and a Responsible Officer of the Trustee has actual
knowledge thereof, the Trustee shall exercise such of the rights and powers
vested in it by this Agreement, and use the same degree of care and skill in
their exercise, as a prudent person would exercise or use under the
circumstances in the conduct of such person's own affairs. Any permissive right
of the Trustee set forth in this Agreement shall not be construed as a duty.
The Trustee, upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments furnished to the
Trustee that are specifically required to be furnished pursuant to any provision
of this Agreement, shall examine them to determine whether they conform to the
requirements of this Agreement; provided, however, that the Trustee shall not be
responsible for the accuracy or content of any such resolution, certificate,
statement, opinion, report, document, order or other instrument provided to it
hereunder by the Master Servicer. If any such instrument is found not to
conform on its face to the requirements of this Agreement in a material manner,
the Trustee shall take action as it deems appropriate to have the instrument
corrected, and if the instrument is not corrected to the Trustee's reasonable
satisfaction, the Trustee will provide notice thereof to the Certificateholders.
The Trustee may conclusively rely on information provided in any resolution,
certificate, statement, opinion, report, document, order or other instrument so
furnished to it, and the Trustee shall not be responsible to recompute,
recalculate or verify the information provided in any such resolution,
certificate, statement, opinion, report, document, order or other instrument so
furnished to it, in any event unless such information is erroneous on its face,
the Trustee has actual knowledge that such information is erroneous or, in the
case of recomputing,
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recalculating or verifying any such information, the Trustee is requested to do
so by the Depositor or a Certificateholder.
No provision of this Agreement shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act or
its own misconduct, its negligent failure to perform its obligations in
compliance with this Agreement, or any liability which would be imposed by
reason of its willful misfeasance or bad faith; provided, however, that:
(a) prior to the occurrence of an Event of Default of which a
Responsible Officer of the Trustee has actual knowledge, and after the
curing or waiver of all such Events of Default that 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 personally
liable except for the performance of such duties and obligations as are
specifically set forth in this Agreement, no implied covenants or
obligations shall be read into this Agreement against the Trustee and the
Trustee may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any certificates,
resolutions, reports, statements, documents, orders, opinions or other
instruments furnished to the Trustee and conforming on their face to the
requirements of this Agreement which it reasonably believed in good faith
to be genuine and to have been duly executed by the proper authorities
respecting any matters arising hereunder, without responsibility for
investigating the contents thereof;
(b) the Trustee shall not be personally liable for an error of
judgment made in good faith by a Responsible Officer or Responsible
Officers of the Trustee unless the Trustee was negligent or acted in bad
faith or with willful misfeasance;
(c) the Trustee shall not be personally liable with respect to
any action taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of Holders of Certificates entitled to not
less than 25% of the Voting Rights allocated to each Class of Certificates
relating to the time, method and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or power conferred
upon the Trustee, under this Agreement; and
(d) except as provided in Section 3.15 or as otherwise
specifically provided in this Agreement, no provision of this Agreement
shall require the Trustee to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties
hereunder or in the exercise of any of its rights or powers if it shall
have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured
to it.
None of the provisions contained in this Agreement shall in any event
require the Trustee to perform, or be responsible for the manner of performance
of, any of the obligations of the Master Servicer under this Agreement, except
(a) the obligation of the Trustee to make Monthly Advances pursuant to Section
5.02 and (b) during such time, if any, as the Trustee shall
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be the successor to, and be vested with the rights, duties, powers and
privileges of, the Master Servicer in accordance with the terms of this
Agreement. The Trustee shall not be required to post any surety or bond of any
kind in connection with its performance of its obligations under this Agreement.
Except with respect to an Event of Default described in clause (a) of
Section 8.01, the Trustee shall not be deemed to have knowledge of any Event of
Default or event which, with notice or lapse of time, or both, would become an
Event of Default, unless a Responsible Officer of the Trustee shall have
received written notice thereof from the Master Servicer, the Depositor, the
Rating Agency or a Certificateholder, or a Responsible Officer of the Trustee
has actual notice thereof, and in the absence of such notice no provision hereof
requiring the taking of any action or the assumption of any duties or
responsibility by the Trustee following the occurrence of any Event of Default
or event which, with notice or lapse of time or both, would become an Event of
Default, shall be effective as to the Trustee.
SECTION 9.02. Certain Matters Affecting the Trustee.
(a) Except as otherwise provided in Section 9.01:
(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 and the Trustee
shall have no responsibility to ascertain or confirm the genuineness of any
such 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 or
waived) of which a Responsible Officer of the Trustee has actual knowledge,
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;
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(iv) none of the Trustee, any of its Affiliates, or any officer,
director, employee or agent of the Trustee or any of its Affiliates shall
be personally liable for any action taken, suffered or omitted by it in
good faith and believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Agreement;
(v) prior to the occurrence of an Event of Default hereunder and
after the curing of all Events of Default that may have occurred, the
Trustee shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond or other
paper or document, unless requested in writing so to do by Holders of
Certificates entitled to not less than 25% of the Voting Rights allocated
to each Class of Certificates; provided, however, that if the payment
within a reasonable time to the Trustee of the costs, expenses or
liabilities likely to be incurred by it in the making of such investigation
is, in the opinion of the Trustee, not reasonably assured to the Trustee by
the security afforded to it by the terms of this Agreement, the Trustee may
require reasonable indemnity against such expense or liability as a
condition to taking any such action; the reasonable expense of every such
investigation shall be paid by the Master Servicer in the event that such
investigation relates to an Event of Default by the Master Servicer, if an
Event of Default by the Master Servicer shall have occurred and is
continuing, and otherwise by the Certificateholders requesting the
investigation;
(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;
(vii) except as provided in Section 3.15 or as otherwise
specifically provided in this Agreement, the Trustee shall not be required
to expend its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity
against such liability is not assured to it; and
(viii) the Trustee shall not be liable for any loss on any
investment of funds pursuant to this Agreement.
(b) All rights of action under this Agreement or under any of the
Certificates, enforceable by the Trustee, may be enforced by it without the
possession of any of the Certificates, or the production thereof at the trial or
other proceeding relating thereto, and any such suit, action or proceeding
instituted by the Trustee shall be brought in its name for the benefit of all
the Holders of such Certificates, subject to the provisions of this Agreement.
SECTION 9.03. Trustee Not Liable for Certificates or Mortgage Loans.
Except as specifically set forth in Section 9.11 and the acknowledgements of
the Trustee set forth in Section 2.02, the recitals contained herein and in the
Certificates (other than its signature and authentication), the Prospectus and
the Prospectus Supplement (other than information provided by the Trustee
specifically for inclusion therein) shall be taken as the
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statements of the Depositor, the Seller or the Master Servicer, as the case may
be, the Trustee assumes no responsibility for their correctness, and the Trustee
makes no representations as to the validity or sufficiency of this Agreement,
the Certificates or of any Mortgage Asset, FHA Mortgage Insurance Contract or
related document. Without limiting the obligation of the Trustee to act
hereunder in respect of an Event of Default on the part of the Master Servicer,
the Trustee shall not be liable for any act or omission of the Master Servicer
except to the extent the Trustee is acting in such capacity. The Trustee shall
not be accountable for the use or application by the Depositor, the Seller or
the Master Servicer of any funds paid to the Depositor, the Seller or the Master
Servicer in respect of the Mortgage Assets or deposited in or withdrawn from the
Distribution Account by the Depositor, the Seller or the Master Servicer. The
Trustee assumes no liability for or with respect to the perfection or priority
of any Mortgage Asset or the maintenance of any such perfection and priority, or
for or with respect to the sufficiency of the Trust Fund or its ability to
generate the payments to be distributed to Certificateholders under this
Agreement (other than its failure to perform its duties in accordance with the
terms of this Agreement).
SECTION 9.04. Trustee May Own Certificates.
The Trustee in its individual or any other capacity may become the owner or
pledgee of Certificates with the same rights as it would have if it were not the
Trustee.
SECTION 9.05. Trustee's Fees and Expenses.
The Trustee shall pay to itself on each Distribution Date from amounts on
deposit in the Distribution Account, an amount equal to the Trustee Fee for such
Distribution Date and, to the extent not previously paid, for all prior
Distribution Dates.
The Trustee shall reimburse itself from amounts on deposit in the
Distribution Account 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 reasonable expenses and
disbursements of its counsel and of all persons not regularly in its employ) as
set forth in Section 4.01 to the extent such payments are "unanticipated
expenses incurred by the REMIC" within the meaning of Treasury Regulations
Section 1.860G-1(b)(ii), and provided that the subject expense, disbursement or
advance was not incurred or made as a result of a breach of any representation,
warranty or covenant on the part of the Trustee or by reason of willful
misfeasance, bad faith or negligence in the performance of any of the Trustee's
duties hereunder or by reason of reckless disregard of the Trustee's obligations
and duties hereunder, and the subject expense, disbursement or advance was not
specifically required to be borne by the Trustee hereunder. The Trustee shall
pay all expenses incurred by it in connection with its routine activities
hereunder.
The Trustee and any director, officer, employee or agent of the Trustee
shall be indemnified by the Trust Fund and held harmless against any claim,
damage, penalty, fine loss, liability or expense (including any attorney's fees
and expenses) (a) incurred in connection with any legal action relating to this
Agreement or the Certificates, or the performance of any of the
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Trustee's duties hereunder (other than any loss, liability or expense incurred
as a result of a breach of any representation, warranty or covenant on the part
of the Trustee or by reason of willful misfeasance, bad faith or negligence in
the performance of any of the Trustee's duties hereunder, or by reason of
reckless disregard of the Trustee's obligations and duties hereunder) and (b)
resulting from the exercise of any power of attorney granted by the Trustee in
accordance with this Agreement. Such indemnity shall survive the termination of
this Agreement or the resignation or removal of the Trustee hereunder.
SECTION 9.06. 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 Depositor 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 rating on its long-term unsecured debt obligations at least equal to
"AA-" from the Rating Agency or such lower rating as will not cause the Rating
Agency to reduce, withdraw or qualify its then-current ratings of the Rated
Certificates, having a combined capital and surplus of at least $50,000,000 and
subject to supervision or examination by federal or state authority, and that is
an FHA-Approved Mortgagee. If such corporation or association publishes reports
of condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section 9.06 the combined capital and surplus of such corporation or association
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. In case at any time the Trustee shall
cease to be eligible in accordance with the provisions of this Section 9.06, the
Trustee shall resign immediately in the manner and with the effect specified in
Section 9.07 hereof.
SECTION 9.07. Resignation and Removal of Trustee.
The Trustee may at any time resign and be discharged from the trusts hereby
created by (a) giving written notice of resignation to the Depositor and by
mailing notice of resignation by first class mail, postage prepaid, to the
Certificateholders at their addresses appearing on the Certificate Register, and
to the Rating Agency, not less than 60 days before the date specified in such
notice when, subject to Section 9.08, such resignation is to take effect, and
(b) acceptance by such successor trustee in accordance with Section 9.08 meeting
the qualifications set forth in Section 9.06. 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 the Trustee shall cease to be eligible in accordance with the
provisions of Section 9.06 hereof and shall fail to resign after written request
thereto by the Depositor, or if at any time the Trustee shall become incapable
of acting, or shall be adjudged a bankrupt or insolvent, or a receiver of the
Trustee or of its property shall be appointed, or any public officer shall take
charge or control of the Trustee or of its property or affairs for the purpose
of rehabilitation, conservation or liquidation, then the Depositor may remove
the Trustee
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and appoint a successor trustee by written instrument, in duplicate, one copy of
which instrument shall be delivered to the Trustee and one copy to the successor
trustee. The Trustee may also be removed at any time by the Holders of
Certificates evidencing not less than 50% of the Voting Rights evidenced by the
Certificates. Notice of any removal of the Trustee and acceptance of
appointment by the successor trustee shall be given to the Rating Agency.
Any resignation or removal of the Trustee and appointment of a successor
thereto pursuant to any of the provisions of this Section 9.07 shall become
effective upon acceptance of such appointment by the successor trustee as
provided in Section 9.08 hereof.
SECTION 9.08. Successor Trustee.
Any successor trustee appointed as provided in Section 9.07 hereof shall
execute, acknowledge and deliver to the Depositor and to its predecessor trustee
an instrument accepting such appointment hereunder and thereupon the resignation
or removal of the predecessor trustee shall become effective and such successor
trustee, without any further act, deed or conveyance, shall become fully vested
with all the rights, powers, duties and obligations of its predecessor
hereunder, with the like effect as if originally named as trustee herein. The
Depositor and the predecessor trustee shall execute and deliver such instruments
and do such other things as may reasonably be required (including, without
limitation, by HUD) 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
9.08 unless at the time of such acceptance such successor trustee shall be
eligible under the provisions of Section 9.06 hereof and its appointment shall
not adversely affect the then-current rating of any Class of the Rated
Certificates.
Upon acceptance of appointment by a successor trustee as provided in this
Section 9.08, the Master Servicer shall mail notice of the succession of such
trustee hereunder to all Holders of Certificates at their addresses as shown in
the Certificate Register. If the Master Servicer fails to mail such notice
within ten days after acceptance of appointment by the successor trustee, the
successor trustee shall cause such notice to be mailed at the expense of the
Master Servicer.
SECTION 9.09. Merger or Consolidation of Trustee.
Any Person into which the Trustee may be merged or converted or with which
it may be consolidated or any Person resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any Person succeeding to
the business of the Trustee, shall be the successor of the Trustee hereunder,
provided that such Person shall be eligible under the provisions of Section 9.06
hereof, without the execution or filing of any paper or further act on the part
of any of the parties hereto, anything herein to the contrary notwithstanding.
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SECTION 9.10. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust Fund or property securing any Mortgage Note may at the time be
located, the Master Servicer and the Trustee acting jointly shall have the power
and shall execute and deliver all instruments to appoint one or more Persons
approved by the Trustee to act as co-trustee or co-trustees jointly with the
Trustee, or separate trustee or separate trustees, of all or any part of the
Trust Fund, and to vest in such Person or Persons, in such capacity and for the
benefit of the applicable Certificateholders, such title to the Trust Fund, or
any part thereof, and, subject to the other provisions of this Section 9.10,
such powers, duties, obligations, rights and trusts as the Master Servicer and
the Trustee may consider necessary or desirable. If the Master Servicer shall
not have joined in such appointment within fifteen days after the receipt by it
of a request to do so, or in the case an Event of Default shall have occurred
and be continuing, the Trustee alone shall have the power to make such
appointment. No co-trustee or separate trustee hereunder shall be required to
meet the terms of eligibility as a successor trustee under Section 9.06 and no
notice to Certificateholders of the appointment of any co-trustee or separate
trustee shall be required under Section 9.08, except that, to the extent
necessary to keep in full force and effect the FHA Mortgage Insurance in respect
of any Mortgage Loan, such co-trustee or separate trustee shall be an FHA-
Approved Mortgagee.
Every separate trustee and co-trustee shall, to the extent permitted by law,
be appointed and act subject to the following provisions and conditions:
(a) all rights, powers, duties and obligations conferred or
imposed upon the Trustee, except for any obligation of the Trustee under
this Agreement to make a required Advance in the event the Master Servicer
fails to make such Advance, shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-
trustee jointly (it being understood that such separate trustee or co-
trustee is not authorized to act separately without the Trustee joining in
such act), except to the extent that under any law of any jurisdiction in
which any particular act or acts are to be performed by the Trustee
(whether as Trustee hereunder or as successor to the Master Servicer), 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 singly by such separate
trustee or co-trustee, but solely at the direction of the Trustee;
(b) no trustee hereunder shall be held personally liable by
reason of any act or omission of any other trustee hereunder; and
(c) the Master Servicer and the Trustee acting jointly may at any
time accept the resignation of or remove any separate trustee or co-
trustee.
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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 IX. Each separate trustee and co-trustee, upon its acceptance
of the trusts conferred, shall be vested with the estates or property specified
in its instrument of appointment, either jointly with the Trustee or separately,
as may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee and a copy thereof given to the
Master Servicer and the Depositor.
Any separate trustee or co-trustee may, at any time, constitute the Trustee
its agent or attorney-in-fact, with full power and authority, to the extent not
prohibited by law, to do any lawful act under or in respect of this Agreement on
its behalf and in its name. If any separate trustee or co-trustee shall die,
become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee.
The Trust Fund shall pay the reasonable compensation of the co-trustees or
separate trustees appointed pursuant to this Section 9.10.
SECTION 9.11. Representations and Warranties of the Trustee.
The Trustee hereby represents and warrants to the Depositor and for the
benefit of the Certificateholders, as of the date hereof, that:
(i) The Trustee is a nationally chartered bank duly organized,
validly existing, and in good standing under the laws of the United States
and has full power, authority and legal right to own its properties and
conduct its business as presently conducted and to execute, deliver and
perform the terms of the Agreement.
(ii) The Agreement has been duly authorized, executed and
delivered by the Trustee and, assuming due authorization, execution and
delivering by the other parties hereto, constitutes a legal, valid and
binding instrument enforceable against the Trustee in accordance with its
terms, except as such enforcement may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of
creditors' rights in general and by general equity principles (regardless
of whether such enforcement is considered in a proceeding in equity or at
law).
(iii) Neither the execution and delivery of this Agreement by the
Trustee nor the consummation by the Trustee of the transactions herein
contemplated to be performed by the Trustee, nor compliance by the Trustee
with the provisions hereof, will conflict with or result in a breach of, or
constitute a default under, any of the provisions of any applicable law
(subject to the appointment in accordance with such applicable law of any
co-trustee or separate trustee required pursuant to this Agreement),
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rule, regulation, judgment, decree or order binding on the Trustee or its
properties or the organizational documents of the Trustee or the terms of
any material agreement, instrument or indenture to which the Trustee is a
party or by which it is bound.
(iv) The Trustee is duly qualified as an FHA-Approved Mortgagee
and, if the Trustee becomes the successor master servicer pursuant to
Section 8.02, the Trustee will comply with the provisions of the Housing
Act, as amended from time to time, and all regulations issued thereunder in
order that the Certificateholders' rights under the FHA Mortgage Insurance
will be fully protected.
SECTION 9.12. Certain Reports by the Trustee.
Based upon the various reports, documents and other information provided to
the Trustee pursuant to this Agreement, the Trustee shall file with the
Securities and Exchange Commission, in respect of the Trust and the
Certificates, copies of the annual reports and of the information, documents and
other reports (or copies of such portions of any of the foregoing as the
Securities and Exchange Commission may from time to time by rules and
regulations prescribe) required to be filed with the Securities and Exchange
Commission pursuant to Section 13 or 15(d) of the Exchange Act.
ARTICLE X
TERMINATION
SECTION 10.01. Termination upon Liquidation or Repurchase of all Mortgage
Loans.
The obligations and responsibilities of the Master Servicer, the Depositor,
the Seller and the Trustee with respect to the Trust Fund created hereby (other
than the obligation to make certain payments and to send certain notices to
Certificateholders as hereinafter set forth) shall terminate upon the last
action required to be taken by the Trustee with respect to the earliest of:
(a) the purchase by the Master Servicer, at its election, of all
the Mortgage Assets remaining in the Trust Fund and the corresponding
distribution to Certificateholders of all amounts required to be
distributed to them pursuant to this Agreement (the applicable Distribution
Date being herein referred to as the "Optional Termination Date"), which
repurchase right the Master Servicer may exercise at its sole and exclusive
election if the aggregate Stated Principal Balance of the Mortgage Pool at
the time of the repurchase is less than 5% of the aggregate Cut-off Date
Balance of the Mortgage Pool;
(b) the maturity or other liquidation (or any advance with
respect thereto) of the last Mortgage Asset remaining in the Trust Fund and
the corresponding
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distribution to Certificateholders of all amounts required to be
distributed to them pursuant to this Agreement; and
(c) the mutual agreement of the parties hereto and the
Certificateholders as to such termination;
provided 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
Mr. Joseph P. Kennedy, former Ambassador of the United States to Great Britain,
living on the date of execution of this Agreement.
The purchase price for any such Optional Termination of the Trust Fund (the
"Termination Price") shall be equal to (A) the aggregate of the Purchase Prices
of all the Mortgage Assets remaining in the Trust Fund, minus (B) the aggregate
amount of unreimbursed Advances made by the Master Servicer, together with any
related unpaid Advance Interest and any unpaid Servicing Fees, remaining
outstanding (which items shall be deemed to have been paid or reimbursed to the
Master Servicer in connection with the Optional Termination). The Termination
Price shall be calculated by the Master Servicer and the Trustee as of the last
Business Day in the Collection Period for the Optional Termination Date and as
if the purchase was to occur on such Business Day. The Trustee shall give
notice to the Rating Agency of the Master Servicer's election to purchase the
Mortgage Assets remaining in the Trust Fund pursuant to this Section 10.01 and
of the Optional Termination Date.
SECTION 10.02. Procedure Upon Optional Termination.
(a) In case of any Optional Termination pursuant to Section 10.01, the
Master Servicer shall, at least thirty days prior to the date notice is to be
mailed to the affected Certificateholders notify the Trustee of the Optional
Termination Date and of the applicable repurchase price of the Mortgage Loans to
be repurchased.
(b) Any repurchase of the Mortgage Loans by the Master Servicer shall be
made on the Master Servicer Remittance Date in the same month as the Optional
Termination Date by deposit of the Termination Price into the Collection
Account. Upon receipt by the Trustee of an Officers' Certificate of the Master
Servicer certifying as to the deposit of such Termination Price into the
Collection Account, the Trustee and each co-trustee and separate trustee, if
any, then acting as such under this Agreement, shall, upon request and at the
expense of the Master Servicer, execute and deliver all such instruments of
transfer or assignment, in each case without recourse, as shall be reasonably
requested by the Master Servicer, to vest title in the Master Servicer to the
Mortgage Assets so repurchased and shall transfer or deliver to the Master
Servicer the purchased Mortgage Assets. Any collections on the Mortgage Assets
received by the Trustee subsequent to (or with respect to any period subsequent
to) calculation of the Termination Price shall be promptly remitted by it to the
Master Servicer.
(c) Notice of the Distribution Date on which the Master Servicer
anticipates that the final distribution shall be made (whether upon Optional
Termination or otherwise), shall
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be given promptly by the Master Servicer to the Trustee and by the Trustee by
first class mail to Holders of the affected Certificates. Such notice shall be
mailed as soon as practicable. Such notice shall specify (i) the Distribution
Date upon which final distribution on the affected Certificates will be made
upon presentation and surrender of such Certificates at the office or agency
therein designated, (ii) the amount of such final distribution and (iii) that
the Record Date otherwise applicable to such Distribution Date is not
applicable, such distribution being made only upon presentation and surrender of
such Certificates at the office or agency maintained for such purposes (the
address of which shall be set forth in such notice).
(d) Upon presentation and surrender of the Certificates by the
Certificateholders on the final Distribution Date, the Trustee shall distribute
to each Certificateholder so presenting and surrendering its Certificates such
Certificateholder's Percentage Interest of that portion of the amounts then on
deposit in the Distribution Account that are allocable in accordance with
Sections 4.02(a) and 4.02(b) to payments on the Class of Certificates to which
such Certificates being so presented and surrendered belong.
(e) In the event that any Certificateholders shall not surrender
Certificates for cancellation within six months after the date specified in the
above mentioned written notice, the Trustee shall give a second written notice
to the remaining such Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If within
six months after the second notice all the Certificates shall not have been
surrendered for cancellation, the Trustee may take appropriate steps, or may
appoint an agent to take appropriate steps, to contact the remaining
Certificateholders concerning surrender of their Certificates, and the cost
thereof shall be paid out of the funds and other assets which remain subject to
the Trust Fund.
SECTION 10.03. Additional Termination Requirements.
(a) In the event the Master Servicer exercises its purchase option pursuant
to Section 10.01, the REMICs created hereby shall be terminated in accordance
with the following additional requirements, unless the Trustee has received an
Opinion of Counsel to the effect that the failure of such REMICs to comply with
the requirements of this Section 10.03 will not (i) result in the imposition of
taxes on a "prohibited transaction" of either of the REMICs created hereby as
described in Section 860F of the Code, or (ii) cause either of the REMICs
created hereby to fail to qualify as a REMIC at any time that any Certificates
are outstanding:
(i) the Trustee shall specify the first day in the 90-day
liquidation period in a statement attached to the final Tax Return for each
of REMIC I and REMIC II pursuant to Treasury regulation Section 1.860F-1
and shall satisfy all requirements of a qualified liquidation under Section
860F of the Code and any regulations thereunder as such requirements are
set forth in an Opinion of Counsel delivered to the Trustee by and at the
expense of the Master Servicer;
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(ii) during such 90-day liquidation period and at or prior to
the time of making of the final payment on the Certificates, the Trustee
shall sell or otherwise dispose of all of the assets of REMIC I to the
Master Servicer for cash; and
(iii) immediately following the making of the final payment on
the Certificates, the Trustee shall distribute or credit, or cause to be
distributed or credited, to the Holders of the applicable Class of Residual
Certificates all cash on hand (other than cash retained to meet claims),
and each of REMIC I and REMIC II shall terminate at that time.
(b) By their acceptance of Certificates, the Holders thereof hereby agree
to authorize the Trustee to adopt a plan of complete liquidation of each of
REMIC I and REMIC II in accordance with the terms and conditions of this
Agreement, which authorization shall be binding upon all successor
Certificateholders.
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.01. Amendment.
(a) This Agreement may be amended from time to time by the parties hereto,
without the consent of any of the Certificateholders, (i) to cure any ambiguity,
(ii) to correct or supplement any provisions herein which may be inconsistent
with any other provisions herein, (iii) to maintain the rating or ratings
assigned to the Rated Certificates by the Rating Agency (iv) to respond to
changes in applicable law other than as contemplated by the next succeeding
sentence or (v) to make other provisions with respect to matters or questions
arising under this Agreement which are not inconsistent with the provisions
hereof, provided that such action will not, as evidenced by an Opinion of
Counsel acceptable to the Depositor and the Trustee, adversely affect in any
material respect the interests of any Certificateholder. In addition, this
Agreement may be amended from time to time by the parties hereto, without the
consent of any of the Certificateholders, to modify, eliminate or add to any of
its provisions to such extent as shall be necessary to maintain the
qualification each of REMIC I and REMIC II as a REMIC at all times that any of
the Certificates are outstanding; provided, however, that such action, as
evidenced by an Opinion of Counsel acceptable to the Trustee, is necessary or
helpful to maintain such qualification, and would not adversely affect in any
material respect the interest of any Certificateholder.
(b) This Agreement may be amended from time to time by the parties hereto,
with the consent of the Holders of Certificates entitled to, in the aggregate,
not less than 66-2/3% of the Voting Rights of all the Certificates affected by
any such amendments, for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Agreement or for the
purpose of modifying in any manner the rights of the Holders of the
Certificates; provided, however, that no such amendment may (i) reduce in any
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manner the amount of, delay the timing of or change the manner in which payments
received on or with respect to Mortgage Assets are required to be distributed
with respect to any Certificate without the consent of the Holder of such
Certificate, (ii) modify the provisions of this Section 11.01 without the
consent of all of the Certificateholders or (iii) alter the servicing standard
set forth in Section 3.01(a).
It shall not be necessary for the consent of Certificateholders under this
Section 11.01 to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Certificateholders shall be subject to such reasonable
regulations as the Trustee may prescribe.
(c) Promptly after the execution of any amendment to this Agreement, the
Trustee shall furnish written notification of the substance of such amendment to
each Certificateholder and the Rating Agency.
SECTION 11.02. Recordation of Agreement; Counterparts.
(a) 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 Mortgaged Properties are situated, and
in any other appropriate public recording office or elsewhere. Such
recordation, if any, shall be effected by the Master Servicer at its expense on
direction of the Trustee, but only upon direction of the Trustee accompanied by
an Opinion of Counsel (which shall be an expense of the Trust Fund payable out
of the Distribution Account) to the effect that such recordation materially and
beneficially affects the interests of the Certificateholders of the Trust Fund.
(b) For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
SECTION 11.03. Governing Law.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
SUBSTANTIVE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO
BE PERFORMED IN THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND REMEDIES
OF THE PARTIES HERETO AND THE CERTIFICATEHOLDERS SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
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SECTION 11.04. Notices.
In addition to other notices provided under this Agreement, the Trustee
shall notify the Rating Agency in writing: (a) of any repurchase of a Mortgage
Asset pursuant to Article II; (b) of any payment or draw on any insurance policy
applicable to the Mortgage Loans; (c) of the final payment of any amounts owing
to a Class of Certificates; and (d) of any Event of Default under this
Agreement.
All directions, demands and notices hereunder shall be in writing and shall
be deemed to have been duly given when received (i) in the case of the
Depositor, at CS First Boston Mortgage Securities Corp., 55 East 52nd Street,
New York, New York 10055, Attention: President; (ii) in the case of the
Trustee, at LaSalle National Bank, 135 South LaSalle Street, Suite 200, Chicago,
Illinois 60603-4107, Attention: Asset-Backed Securities Trust Services
Department; (iii) in the case of the Master Servicer, at Greystone Servicing
Corporation, Inc., 98 Alexandria Pike, Warrenton, Virginia 22186 Attention: Ms.
Julie J. DeLimba; (iv) in the case of the Seller, at Greystone Funding
Corporation, 98 Alexandria Pike, Warrenton, Virginia 22186, Attention: Ms.
Julie J. DeLimba with a copy to Greystone & Co., Inc., 152 West 57th Street,
60th Floor, New York, New York 10019, Attention: Mr. Mark R. Jarrell; and (v)
in the case of the Rating Agency, at Standard & Poor's Ratings Services, 25
Broadway, New York, New York 10004, Attention: Commercial Mortgage
Surveillance; or, in each such case, at such other address as may hereafter be
furnished to each of the parties hereto in writing. Notices to
Certificateholders shall be deemed given when mailed, first class postage
prepaid.
SECTION 11.05. Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of this
Agreement shall be for any reason whatsoever held invalid, then such covenants,
agreements, provisions or terms shall be deemed severable from the remaining
covenants, agreements, provisions or terms of this Agreement and shall in no way
affect the validity or enforceability of the other provisions of this Agreement
or of the Certificates or the rights of the Holders thereof.
SECTION 11.06. 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 representative or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a petition or winding up of the Trust
Fund, or otherwise affect the rights, obligations and liabilities of the parties
hereto or any of them.
No Certificateholder shall have any right to vote (except as provided
herein) or in any manner otherwise control the operation and management of the
Trust Fund, or the obligations of the parties hereto, nor shall anything herein
set forth or contained in the terms of the Certificates be construed so as to
constitute the Certificateholders from time to time as partners or members of an
association; nor shall any Certificateholder be under any liability to
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any third party by reason of any action taken by the parties to this Agreement
pursuant to any provision hereof.
No Certificateholder shall have any right by virtue or by availing itself of
any provisions of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Holder previously shall have given to the Trustee a written notice of a default
hereunder and of the continuance thereof, as provided herein, and (except in the
case of any such default on the part of the Trustee) unless the Holders of
Certificates entitled to not less than 25% of the Voting Rights evidenced by the
Certificates shall also 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 shall have any right in any manner
whatever by virtue or by availing itself or themselves of any provisions of this
Agreement to affect, disturb or prejudice the rights of the Holders of any other
of the Certificates, or to obtain or seek to obtain priority over or preference
to any other such Holder or to enforce any right under this Agreement, except in
the manner herein provided and for the common benefit of all Certificateholders.
For the protection and enforcement of the provisions of this Section 11.06, each
and every Certificateholder and the Trustee shall be entitled to such relief as
can be given either at law or in equity.
SECTION 11.07. Certificates Nonassessable and Fully Paid.
It is the intention of the Depositor that Certificateholders shall not be
personally liable for obligations of the Trust Fund, that the interests in the
Trust Fund represented by the Certificates shall be nonassessable for any reason
whatsoever, and that the Certificates, upon due authentication thereof by the
Trustee pursuant to this Agreement, are and shall be deemed fully paid.
SECTION 11.08. HUD Regulations and Documents Control.
Notwithstanding any other provision of this Agreement or of the
Certificates, in the event of any conflict between the provisions of this
Agreement or of the Certificates and the provisions of the Housing Act, the
applicable FHA Regulations, or the Mortgages, Mortgage Notes or any other HUD-
prescribed document relating to the Mortgage Loans, the provisions of the latter
shall control.
SECTION 11.09. Miscellaneous REMIC Provisions.
(a) The Trustee shall, to the extent permitted by applicable law, act as
agent, and is hereby appointed to act as agent, of each of REMIC I and REMIC II,
and shall elect to treat each of REMIC I and REMIC II as a REMIC under the Code
and, if necessary, under
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applicable state law. Each such election will be made on Form 1066 or other
appropriate federal or state Tax Returns for the taxable year ending on the last
day of the calendar year in which the Certificates are issued.
(b) The REMIC I Regular Interests are hereby designated as "regular
interests" (within the meaning of Section 860G(a)(1) of the Code), and the Class
R-I Certificates are hereby designated as the single class of "residual
interests" (within the meaning of Section 860G(a)(2) of the Code), in REMIC I.
The REMIC II Regular Certificates are hereby designated as "regular interests"
(within the meaning of Section 860G(a)(1) of the Code), and the Class R-II
Certificates are hereby designated as the single class of "residual interests"
(within the meaning of Section 860G(a)(2) of the Code), in REMIC II. No party
hereto shall, to the extent within the control of any such Person, create or
permit the creation of any other "interests" in REMIC I or REMIC II (within the
meaning of Treasury regulation Section 1.860D-1(b)(1)).
(c) The Closing Date is hereby designated as the "startup day" of each of
REMIC I and REMIC II within the meaning of Section 860G(a)(9) of the Code.
(d) The Trustee shall pay any and all expenses relating to any tax audit of
REMIC I or REMIC II (including, but not limited to, any professional fees or any
administrative or judicial proceedings with respect thereto that involved the
Internal Revenue Service or state tax authorities), including the expense of
obtaining any tax-related Opinion of Counsel in connection with such an audit
and other taxes; provided, however, that if such audit resulted from the
negligence of the Master Servicer or the Depositor, then the Master Servicer or
the Depositor, as the case may be, shall pay such expenses. The
Certificateholder with the largest Percentage Interest in the Class R-I and
Class R-II Certificates shall be designated as the tax matters person with
respect to each of REMIC I and REMIC II, respectively, in the manner provided
under Treasury Regulations Section 1.860F-4(d) and Temporary Treasury
Regulations Section 301.6231(a)(7)-1T. The Trustee, as attorney-in-fact and
agent of the tax matters person for each of REMIC I and REMIC II, shall (i) act
on behalf of each of REMIC I and REMIC II in relation to any tax matter or
controversy involving such REMIC and (ii) represent each of REMIC I and REMIC II
in any administrative or judicial proceeding relating to an examination or audit
by any governmental taxing authority with respect to such REMIC. Each Holder of
the Class R-I and Class R-II Certificates, by acceptance thereof, is deemed to
have consented to the Trustee's appointment in such capacity and agrees to
execute any documents required to give effect thereto. To the extent authorized
under the Code and the regulations promulgated thereunder, each Holder of a
Residual Certificate, hereby irrevocably appoints and authorizes the Trustee to
be its attorney-in-fact for purposes of signing any Tax Returns required to be
filed on behalf of REMIC I or REMIC II, as the case may be. The legal expenses
and costs of any such action described in this subsection and any liability
resulting therefrom shall be borne by the Trust Fund.
(e) The Trustee shall prepare, file and sign all of the Tax Returns in
respect of each of REMIC I and REMIC II. The expenses of preparing and filing
such returns shall be borne by the Trustee without any right of reimbursement
therefor.
114
<PAGE>
(f) The Trustee shall perform on behalf of each of REMIC I and REMIC II all
reporting and other tax compliance duties that are the responsibility of each
such REMIC under the Code, the REMIC Provisions or other compliance guidance
issued by the Internal Revenue Service or any state or local taxing authority.
Included among such duties, the Trustee shall provide to: (i) any Transferror of
a Residual Certificate, such information as is necessary for the application of
any tax relating to the transfer of a Residual Certificate to any Person who is
not a Permitted Transferee; (ii) the Certificateholders, such information or
reports as are required by the Code or the REMIC Provisions, including, without
limitation, reports relating to interest, original issue discount and market
discount or premium (using the Prepayment Assumption as required); and (iii) the
Internal Revenue Service, the name, title, address and telephone number of the
Person who will serve as the representative of each of REMIC I and REMIC II.
(g) The Trustee shall take such action and shall cause each of REMIC I and
REMIC II to take such action as shall be necessary to create the status thereof
as a REMIC under the REMIC Provisions (and the Master Servicer shall assist it,
to the extent reasonably requested by it). Each of the Trustee and the Master
Servicer shall exercise reasonable care to the extent within its control and the
scope of its express duties under this Agreement, to maintain the status of each
of REMIC I and REMIC II as a REMIC. Neither the Trustee nor the Master Servicer
shall take any action, cause REMIC I or REMIC II to take any action or fail to
take (or fail to cause to be taken) any action that, under the REMIC Provisions,
if taken or not taken, as the case may be, could result in an Adverse REMIC
Event in respect of either of REMIC I or REMIC II, unless the Trustee has
received an Opinion of Counsel to the effect that the contemplated action will
not result in an Adverse REMIC Event. None of the other parties hereto shall
take or fail to take any action (whether or not authorized hereunder) as to
which the Trustee has advised it in writing that it has received an Opinion of
Counsel to the effect that an Adverse REMIC Event could occur with respect to
such action. In addition, prior to taking any action with respect to REMIC I or
REMIC II or the assets of any of them, or causing REMIC I or REMIC II to take
any action, which is not expressly permitted under the terms of this Agreement,
each of the other parties hereto will consult with the Trustee, in writing, with
respect to whether such action could cause an Adverse REMIC Event to occur, and
no such other party shall take any such action or cause REMIC I or REMIC II to
take any such action as to which the Trustee has advised it in writing that an
Adverse REMIC Event could occur. The Trustee may consult with counsel to make
such written advice, and the cost of same shall be borne by the party seeking to
take the action not permitted by this Agreement.
(h) In the event that any tax is imposed on REMIC I or REMIC II, including,
without limitation, "prohibited transactions" taxes as defined in Section
860F(a)(2) of the Code, any tax on "net income from foreclosure property" as
defined in Section 860G(c) of the Code, any taxes on contributions to REMIC I or
REMIC II after the Startup Day pursuant to Section 860G(d) of the Code, and any
other tax imposed by the Code or any applicable provisions of state or local tax
laws, such tax, together with all incidental costs and expenses (including,
without limitation, penalties or assessments and reasonable attorneys' fees) not
required to be borne by the Trustee pursuant to Section 11.09(d), shall be
charged to and paid by: (i) the Trustee, if such tax arises out of or results
from a breach by the Trustee of any of its obligations
115
<PAGE>
under this Article X; (ii) the Master Servicer, if such tax arises out of or
results from a breach by the Master Servicer of any of its obligations under
Article III or this Article X; (iii) the Depositor, if such tax arises out of or
results from a breach by the Depositor of any of its obligations under this
Article X; or (iv) the Trust Fund in all other instances. Any such amounts
payable by the Trust Fund in respect of taxes shall be paid by the Master
Servicer at the direction of the Trustee out of amounts on deposit in the
Collection Account or by the Trustee out of amounts on deposit in the
Distribution Account. The Trustee is hereby authorized to and shall retain or
cause to be retained from available funds sufficient funds to pay or provide for
the payment of, and to actually pay, such tax as is legally owed by either of
REMIC I or REMIC II. Such authorization (i) shall not prevent the Trustee from
contesting any such tax in appropriate law pending the outcome of such
proceedings and (ii) is subject to Section 11.09(n) and Section 11.09(o). The
costs of contesting any such tax shall be an expense of the Trust Fund unless
indemnification for such a tax is provided for hereunder.
(i) The Trustee and, to the extent that records are maintained thereby in
the normal course of its business, each of the other parties hereto shall, for
federal income tax purposes, maintain books and records with respect to each of
REMIC I and REMIC II on a calendar year and on an accrual basis.
(j) Following the Startup Day therefor, the Trustee shall not accept any
contributions of assets to REMIC I or REMIC II unless it shall have received an
Opinion of Counsel (at the expense of the party seeking to cause such
contribution) to the effect that the inclusion of such assets in such REMIC will
not cause an Adverse REMIC Event in respect of such REMIC.
(k) Neither the Master Servicer nor the Trustee shall consent to or, to the
extent of their respective control, permit: (i) the sale or disposition of any
Mortgage Asset (except in connection with (A) a breach of any representation or
warranty of the Seller or the Depositor regarding a Mortgage Asset, (B) the
foreclosure, default or imminent default of a Mortgage Loan, including but not
limited to, an assignment to HUD or the sale or other disposition of a Mortgaged
Property acquired by deed in lieu of foreclosure, (C) the bankruptcy of REMIC I
or REMIC II, or (D) the termination of the Trust Fund pursuant to Article X of
this Agreement); (ii) the sale or disposition of any investments in the
Collection Account or the Distribution Account for gain; or (iii) the
acquisition of any assets for the Trust Fund (other than a Mortgaged Property
acquired through foreclosure, deed in lieu of foreclosure or otherwise in
respect of a defaulted Mortgage Loan and other than Permitted Investments
acquired in connection with the investment of funds in the Collection Account or
the Distribution Account); in any event unless it has received an Opinion of
Counsel (at the expense of the party seeking to cause such sale, disposition, or
acquisition) to the effect that such sale, disposition, or acquisition will not
cause: (x) REMIC I or REMIC II to fail to qualify as a REMIC at any time that
any Certificates are outstanding or (y) the imposition of any tax on REMIC I or
REMIC II under the REMIC Provisions or other applicable provisions of federal,
state and local law or ordinances.
116
<PAGE>
(l) Neither the Master Servicer nor the Trustee shall enter into any
arrangement by which REMIC I or REMIC II will receive a fee or other
compensation for services or, to the extent it is within the control of such
Person, permit REMIC I or REMIC II to receive any income from assets other than
"qualified mortgages" as defined in Section 860G(a)(3) of the Code or "permitted
investments" as defined in Section 860G(a)(5) of the Code. At all times as may
be required by the Code, the Trustee shall ensure that substantially all of the
assets of REMIC I and REMIC II 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.
(m) The Depositor shall provide or cause to be provided to the Trustee,
within ten days after the Closing Date, all information or data that the Trustee
reasonably determines to be relevant for tax purposes as to the valuations and
issue prices of the Certificates, including, without limitation, the price,
yield, prepayment assumption and projected cash flow of the Certificates. The
Master Servicer shall furnish such reports, certifications and information, and
access to such books and records maintained thereby, as may relate to the
Certificates or the Trust Fund and as shall be reasonably requested by the
Trustee in order to enable it to perform its duties hereunder.
(n) The Trustee agrees to indemnify the Trust Fund, the Depositor and the
Master Servicer for any taxes and costs including, without limitation, any
reasonable attorneys fees imposed on or incurred by the Trust Fund, the
Depositor or the Master Servicer, as a result of a breach by the Trustee with
respect to the covenants set forth in this Section 11.09. All such amounts paid
by the Trustee to indemnify the Trust Fund shall be deposited by the Trustee
into the Distribution Account. The Master Servicer agrees to indemnify the
Trust Fund, the Depositor and the Trustee for any taxes and costs (including,
without limitation, any reasonable attorneys' fees) imposed on or incurred by
the Trust Fund, the Depositor or the Trustee, as a result of a breach of the
Master Servicer's covenants set forth in this Section 11.09 or in Article III
with respect to compliance with the REMIC Provisions. All such amounts paid by
the Master Servicer to indemnify the Trust Fund shall be delivered to the
Trustee and deposited by the Trustee into the Distribution Account.
(o) The Depositor agrees to indemnify the Trust Fund, the Trustee and the
Master Servicer for any taxes and costs (including, without limitation, any
reasonable attorney's fees) imposed on or incurred by the Trust Fund, the
Trustee or the Master Servicer as a result of a breach of the Depositor's
covenants set forth in this Section 11.09 or Article III with respect to
compliance with the REMIC Provisions. All such amounts paid by the Depositor to
indemnify the Trust Fund shall be delivered to the Trustee and deposited by the
Trustee into the Distribution Account.
117
<PAGE>
IN WITNESS WHEREOF, the Depositor, the Master Servicer, the Seller and
the Trustee have caused their names to be signed hereto by their respective
officers thereunto duly authorized all as of the first day of November, 1995.
CS FIRST BOSTON MORTGAGE SECURITIES
CORP., as Depositor
By:/s/ David Gertner
----------------------
Name: David Gertner
Title: Vice President
GREYSTONE SERVICING CORPORATION, INC.,
as Master Servicer
By:/s/ Stephen Rosenberg
------------------------
Name: Stephen Rosenberg
Title: President
GREYSTONE FUNDING CORPORATION,
as Seller
By:/s/ Stephen Rosenberg
------------------------
Name: Stephen Rosenberg
Title: President
LASALLE NATIONAL BANK,
as Trustee
By:/s/ Michael Evans
----------------------
Name: Michael Evans
Title: Vice President
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
On the 21st of November, 1995 before me, a Notary Public in and for said
state, personally appeared Michael B. Evans known to me to be a Vice President
of LaSalle National Bank, one of the banks that executed the within instrument
and also known to me to be the person who executed it on behalf of said
corporation, and acknowledged to me that such corporation executed the within
instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
/s/ Albert S. Choi
------------------
Notary Public
[NOTARIAL SEAL]
<PAGE>
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
On this 21st day of November, 1995, before me, personally appeared David
Gertner, known to me to be a Vice President of CS First Boston Mortgage
Securities Corp., one of the corporations that executed the within instrument
and also known to me to be the person who executed it on behalf of said
corporation, and acknowledged to me that such corporation executed the within
instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
/s/ Arthur James Cotins
-----------------------
Notary Public
[NOTARIAL SEAL]
<PAGE>
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
On the 20th of November, 1995, before me, personally appeared Stephen
Rosenberg, known to me to be a President of Greystone Servicing Corporation,
Inc. and one of the corporations that executed the within instrument and also
known to me to be the person who executed it on behalf of said corporation, and
acknowledged to me that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
/s/ Bonnie S. Dublin
--------------------
Notary Public
[NOTARIAL SEAL]
<PAGE>
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
On the 20th of November, 1995 before me, a Notary Public in and for said
State, personally appeared Stephen Rosenberg known to me to be a President of
Greystone Funding Corporation, one of the corporations that executed the within
instrument and also known to me to be the person who executed it on behalf of
said corporation, and acknowledged to me that such corporation executed the
within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
/s/ Bonnie S. Dublin
--------------------
Notary Public
[NOTARIAL SEAL]
EXHIBIT A-1
FORM OF CLASS A-1 CERTIFICATE
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-FHA1, CLASS A-1
Evidencing an undivided interest in a trust fund (the "Trust Fund") whose
assets consist primarily of a pool (the "Mortgage Pool") of fixed-rate, level
payment, fully-amortizing mortgage loans (the "Mortgage Loans") insured by the
Federal Housing Administration (the "FHA") of the United States Department of
Housing and Urban Development ("HUD") under certain sections of the National
Housing Act of 1934, as amended (the "Housing Act") and mortgage pass-through
certificates (the "GNMA Certificates") guaranteed by the Government National
Mortgage Association ("GNMA") that are backed by fixed rate, level payment,
fully-amortizing mortgage loans (the "Underlying Loans" and together with the
Mortgage Loans, the "FHA Loans") insured by the FHA. The Trust Fund was formed
and the Mortgage Loans and the GNMA Certificates were transferred thereto at
the direction of
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
Certificate Interest Initial Class Principal
Rate: ____% per annum Balance of the Class A-1
Certificates: $_____________
Cut-off Date:
November 1, 1995 Initial Certificate Principal
Balance of this Certificate:
Closing Date: $____________
November 21, 1995
First Distribution Date:
December 26, 1995
Cusip No. ___________
Certificate No. A-1-______
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR,
THE MASTER SERVICER, THE TRUSTEE OR ANY AGENT
A-1-1
THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE").
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF CS FIRST
BOSTON MORTGAGE SECURITIES CORP., GREYSTONE FUNDING CORPORATION, GREYSTONE
SERVICING CORPORATION, INC. OR THE TRUSTEE REFERRED TO BELOW, OR OF ANY OF
THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED OR INSURED BY ANY
GOVERNMENT AGENCY OR INSTRUMENTALITY.
THIS CERTIFIES THAT [Cede & Co.] is the registered owner of a
beneficial interest in the Trust Fund, which was created pursuant to the
Pooling and Servicing Agreement, dated as of November 1, 1995 (the
"Agreement"), among CS First Boston Mortgage Securities Corp. as depositor (the
"Depositor", which term includes any successor entity under the Agreement),
Greystone Servicing Corporation, Inc. as master servicer (the "Master
Servicer", which term includes any successor entity under the Agreement),
Greystone Funding Corporation as seller (the "Seller", which term includes any
successor entity under the Agreement) and LaSalle National Bank as trustee (the
"Trustee", which term includes any successor entity under the Agreement). This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the Agreement, and nothing herein shall be deemed inconsistent with
that meaning. If the terms hereof are inconsistent with the Agreement, the
Agreement shall control.
This Certificate is one of a duly authorized issue of
certificates of CS First Boston Mortgage Securities Corp., designated as its
Mortgage Pass-Through Certificates, Series 1995-FHA1 (the "Certificates"),
which is comprised of the following eleven classes (each, a "Class"): the Class
A-1, Class A-2, Class A-3, Class A-4, Class A-X-1, Class A-X-2, Class A-X-3 and
Class A-X-4, Class B, Class R-I and Class R-II Certificates. Reference is
hereby made to the Agreement for a statement of the respective rights
thereunder of the Depositor, the Seller, the Master Servicer, the Trustee and
the Holders of each Class of the Certificates and the terms upon which the
Certificates are authenticated and delivered. This Certificate represents an
interest in the Trust Fund, which Trust Fund consists of, among other things,
(i) the Mortgage
A-1-2
Assets and all payments under and proceeds of such Mortgage Assets (other than
any Retained Yield) received after the Cut-off Date (exclusive of any payments
of or relating to principal and interest due on the FHA Loans on or before the
Cut-off Date), together with all documents included in the related Mortgage
Files and Servicing Files for the Mortgage Loans; (ii) the FHA Mortgage
Insurance in respect of the Mortgage Loans, together with all FHA Insurance
Benefits (other than any Retained Yield) derived therefrom; (iii) such funds or
assets (other than any Retained Yield) as from time to time are deposited in
the Distribution Account and/or the Collection Account; (iv) any insurance
policies with respect to the Mortgage Loans; and (v) all proceeds of the
conversion, voluntary or involuntary, of any of the foregoing into cash or
other liquid property.
This Class A-1 Certificate represents a Percentage Interest in
the related class equal to the initial Certificate Principal Balance hereof
divided by the Initial Class Principal Balance of the Class A-1 Certificates,
both as set forth above.
The Trustee shall distribute from the Distribution Account, to
the extent of available funds, on the 25th day of each calendar month or, if
such 25th day is not a Business Day, the Business Day immediately following
such 25th day (each, a "Distribution Date"), commencing in December, 1995, to
the Person in whose name this Certificate is registered at the close of
business on the last Business Day of the month immediately preceding the month
of such distribution (each, a "Record Date"), interest and principal in an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and that portion of the Available Distribution Amount that is
allocated to distributions on the related Class of Certificates on such
Distribution Date.
Not later than each Distribution Date, the Trustee will send to
each Certificateholder a statement containing information relating to the
Mortgage Assets and payments made to Certificateholders.
Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Holder hereof entitled thereto as such
address appears in the Certificate Register or, if such Holder holds one or
more Certificates with an aggregate initial Certificate Principal Balance of at
least $5,000,000, by wire transfer in immediately available funds to the
account of such Certificateholder designated in writing to the Trustee at least
five Business Days prior to the applicable Record Date. Notwithstanding the
above, the final distribution on this Certificate will be made after due notice
of the pendency of such final distribution and only upon presentation and
surrender of this Certificate at the office or agency designated in such
notice.
[Notwithstanding the foregoing, for so long as this Certificate
is registered in the name of Cede & Co. or in such other name as is requested
by an authorized representative of DTC, transfers of interests in this
Certificate shall be made through the book-entry facilities of DTC.]
The Agreement permits, with certain exceptions as therein
provided, the amendment thereof by the Depositor, the Master Servicer, the
Seller and the Trustee with the
A-1-3
consent of the Holders of Certificates entitled to, in the aggregate, not less
than 66-2/3% of the Voting Rights of all the Certificates affected by any such
amendments, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Agreement or for the purpose
of modifying in any manner the rights of the Holders of the Certificates;
provided, however, that no such amendment may (i) reduce in any manner the
amount of, delay the timing of or change the manner in which payments received
on Mortgage Assets are required to be distributed in respect of any Certificate
without the consent of the Holder of such Certificate; (ii) modify the
amendment provisions of the Agreement without the consent of all the
Certificateholders; or (iii) modify the servicing standard set forth in the
Agreement pursuant to which the Master Servicer shall service and administer
the Mortgage Loans. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. Under certain limited circumstances set forth
therein, the Agreement may be amended by the parties thereto without the
consent of any Holder.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable on the
Certificate Register upon surrender of this Certificate for registration of
transfer at the office or agency of the Trustee designated therefor, duly
endorsed by, or accompanied by a written instrument of transfer in a form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
interest in the Trust Fund, will be issued to the designated transferee or
transferees.
The Class A-1 Certificates will be issued in fully registered
form in minimum denominations of $25,000 initial Certificate Principal Balance
and in integral multiples of $1 in excess of such amount. As provided in the
Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates of the same Class
and of authorized denominations and evidencing a like aggregate Certificate
Principal Balance, as requested by the Holder surrendering the same.
No service charge will be made for such registrations of
transfers or exchanges, but the Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the person in whose name
this Certificate is registered as the owner hereof for all purposes, and
neither the Trustee nor any such agent thereof shall be affected by notice to
the contrary.
The obligations and responsibilities of the Depositor, the
Master Servicer, the Seller and the Trustee created by the Agreement will
terminate upon the earliest of (i) the purchase by the Master Servicer, at its
election, of all the Mortgage Assets remaining in the Trust Fund and the
corresponding distribution to Certificateholders of all amounts required to be
distributed to them, which repurchase right the Master Servicer may exercise at
its sole and exclusive election if the aggregate Stated Principal Balance of
the Mortgage Pool at the time of the repurchase is less than 5% of the
aggregate Cut-off Date Balance of the Mortgage Pool; (ii)
A-1-4
the maturity or other liquidation (or any advance with respect thereto) of the
last Mortgage Asset remaining in the Trust Fund and the corresponding
distribution to Certificateholders of all amounts required to be distributed to
them; or (iii) the mutual agreement of the parties to the Agreement and the
Certificateholders as to such termination.
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid or
obligatory for any purpose.
A-1-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed under its corporate seal.
LASALLE NATIONAL BANK,
as Trustee
By:__________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-1 Certificates referred to in the within-mentioned
Agreement.
Date:
LASALLE NATIONAL BANK,
as Trustee
By:______________________________
Authorized Officer
A-1-6
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sell(s), assign(s) and
transfer(s) unto ____________________________________________________________
__________________________________________________ (Please print or typewrite
name and address, including postal zip code, of assignee) the undivided
interest in the Trust Fund evidenced by the within Certificate and hereby
authorize(s) the transfer of registration of such interest to the assignee on
the Certificate Register.
I (we) further direct the Trustee to issue a new Certificate of the
same Class and of a like initial Certificate Principal Balance and undivided
interest in the Trust Fund to the above-named assignee and to deliver such
Certificate to the following address ___________________________________
___________________________________________________________________________
Dated: _______________, ____
Social Security or ______________________________
other Tax Identification Signature by or on behalf of
No. of Assignee: assignor (signature must be signed
as registered)
_______________________________ ______________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for the information
of the Trustee:
Distribution shall be made by check mailed to _________________
______________________________________________________________________________,
or if the aggregate initial Certificate Principal Balance of all Certificates
held by the Holder is at least $5,000,000 and the Trustee shall have received
appropriate wiring instructions in accordance with the Agreement, by wire
transfer in immediately available funds to _______________ for the account of
________________, account number ______________. This information is provided
by the assignee named above, or its agent.
A-1-7
EXHIBIT A-2
FORM OF CLASS A-2 CERTIFICATE
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-FHA1, CLASS A-2
Evidencing an undivided interest in a trust fund (the "Trust Fund") whose
assets consist primarily of a pool (the "Mortgage Pool") of fixed-rate, level
payment, fully-amortizing mortgage loans (the "Mortgage Loans") insured by the
Federal Housing Administration (the "FHA") of the United States Department of
Housing and Urban Development ("HUD") under certain sections of the National
Housing Act of 1934, as amended (the "Housing Act") and mortgage pass-through
certificates (the "GNMA Certificates") guaranteed by the Government National
Mortgage Association ("GNMA") that are backed by fixed rate, level payment,
fully-amortizing mortgage loans (the "Underlying Loans" and together with the
Mortgage Loans, the "FHA Loans") insured by the FHA. The Trust Fund was formed
and the Mortgage Loans and the GNMA Certificates were transferred thereto at
the direction of
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
Certificate Interest Initial Class Principal
Rate: ____% per annum Balance of the Class A-2
Certificates: $_____________
Cut-off Date:
November 1, 1995 Initial Certificate Principal
Balance of this Certificate:
Closing Date: $____________
November 21, 1995
First Distribution Date:
December 26, 1995
Cusip No. ___________
Certificate No. A-2-______
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR,
THE MASTER SERVICER, THE TRUSTEE OR ANY AGENT
A-2-1
THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE").
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF CS FIRST
BOSTON MORTGAGE SECURITIES CORP., GREYSTONE FUNDING CORPORATION, GREYSTONE
SERVICING CORPORATION, INC. OR THE TRUSTEE REFERRED TO BELOW, OR OF ANY OF
THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED OR INSURED BY ANY
GOVERNMENT AGENCY OR INSTRUMENTALITY.
THIS CERTIFIES THAT [Cede & Co.] is the registered owner of a
beneficial interest in the Trust Fund, which was created pursuant to the
Pooling and Servicing Agreement, dated as of November 1, 1995 (the
"Agreement"), among CS First Boston Mortgage Securities Corp. as depositor (the
"Depositor", which term includes any successor entity under the Agreement),
Greystone Servicing Corporation, Inc. as master servicer (the "Master
Servicer", which term includes any successor entity under the Agreement),
Greystone Funding Corporation as seller (the "Seller", which term includes any
successor entity under the Agreement) and LaSalle National Bank as trustee (the
"Trustee", which term includes any successor entity under the Agreement). This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the Agreement, and nothing herein shall be deemed inconsistent with
that meaning. If the terms hereof are inconsistent with the Agreement, the
Agreement shall control.
This Certificate is one of a duly authorized issue of
certificates of CS First Boston Mortgage Securities Corp., designated as its
Mortgage Pass-Through Certificates, Series 1995-FHA1 (the "Certificates"),
which is comprised of the following eleven classes (each, a "Class"): the Class
A-1, Class A-2, Class A-3, Class A-4, Class A-X-1, Class A-X-2, Class A-X-3 and
Class A-X-4, Class B, Class R-I and Class R-II Certificates. Reference is
hereby made to the Agreement for a statement of the respective rights
thereunder of the Depositor, the Seller, the Master Servicer, the Trustee and
the Holders of each Class of the Certificates and the terms upon which the
Certificates are authenticated and delivered. This Certificate represents an
interest in the Trust Fund, which Trust Fund consists of, among other things,
(i) the Mortgage
A-2-2
Assets and all payments under and proceeds of such Mortgage Assets (other than
any Retained Yield) received after the Cut-off Date (exclusive of any payments
of or relating to principal and interest due on the FHA Loans on or before the
Cut-off Date), together with all documents included in the related Mortgage
Files and Servicing Files for the Mortgage Loans; (ii) the FHA Mortgage
Insurance in respect of the Mortgage Loans, together with all FHA Insurance
Benefits (other than any Retained Yield) derived therefrom; (iii) such funds or
assets (other than any Retained Yield) as from time to time are deposited in
the Distribution Account and/or the Collection Account; (iv) any insurance
policies with respect to the Mortgage Loans; and (v) all proceeds of the
conversion, voluntary or involuntary, of any of the foregoing into cash or
other liquid property.
This Class A-2 Certificate represents a Percentage Interest in
the related class equal to the initial Certificate Principal Balance hereof
divided by the Initial Class Principal Balance of the Class A-2 Certificates,
both as set forth above.
The Trustee shall distribute from the Distribution Account, to
the extent of available funds, on the 25th day of each calendar month or, if
such 25th day is not a Business Day, the Business Day immediately following
such 25th day (each, a "Distribution Date"), commencing in December, 1995, to
the Person in whose name this Certificate is registered at the close of
business on the last Business Day of the month immediately preceding the month
of such distribution (each, a "Record Date"), interest and principal in an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and that portion of the Available Distribution Amount that is
allocated to distributions on the related Class of Certificates on such
Distribution Date.
Not later than each Distribution Date, the Trustee will send to
each Certificateholder a statement containing information relating to the
Mortgage Assets and payments made to Certificateholders.
Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Holder hereof entitled thereto as such
address appears in the Certificate Register or, if such Holder holds one or
more Certificates with an aggregate initial Certificate Principal Balance of at
least $5,000,000, by wire transfer in immediately available funds to the
account of such Certificateholder designated in writing to the Trustee at least
five Business Days prior to the applicable Record Date. Notwithstanding the
above, the final distribution on this Certificate will be made after due notice
of the pendency of such final distribution and only upon presentation and
surrender of this Certificate at the office or agency designated in such
notice.
[Notwithstanding the foregoing, for so long as this Certificate
is registered in the name of Cede & Co. or in such other name as is requested
by an authorized representative of DTC, transfers of interests in this
Certificate shall be made through the book-entry facilities of DTC.]
The Agreement permits, with certain exceptions as therein
provided, the amendment thereof by the Depositor, the Master Servicer, the
Seller and the Trustee with the
A-2-3
consent of the Holders of Certificates entitled to, in the aggregate, not less
than 66-2/3% of the Voting Rights of all the Certificates affected by any such
amendments, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Agreement or for the purpose
of modifying in any manner the rights of the Holders of the Certificates;
provided, however, that no such amendment may (i) reduce in any manner the
amount of, delay the timing of or change the manner in which payments received
on Mortgage Assets are required to be distributed in respect of any Certificate
without the consent of the Holder of such Certificate; (ii) modify the
amendment provisions of the Agreement without the consent of all the
Certificateholders; or (iii) modify the servicing standard set forth in the
Agreement pursuant to which the Master Servicer shall service and administer
the Mortgage Loans. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. Under certain limited circumstances set forth
therein, the Agreement may be amended by the parties thereto without the
consent of any Holder.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable on the
Certificate Register upon surrender of this Certificate for registration of
transfer at the office or agency of the Trustee designated therefor, duly
endorsed by, or accompanied by a written instrument of transfer in a form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
interest in the Trust Fund, will be issued to the designated transferee or
transferees.
The Class A-2 Certificates will be issued in fully registered
form in minimum denominations of $25,000 initial Certificate Principal Balance
and in integral multiples of $1 in excess of such amount. As provided in the
Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates of the same Class
and of authorized denominations and evidencing a like aggregate Certificate
Principal Balance, as requested by the Holder surrendering the same.
No service charge will be made for such registrations of
transfers or exchanges, but the Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the person in whose name
this Certificate is registered as the owner hereof for all purposes, and
neither the Trustee nor any such agent thereof shall be affected by notice to
the contrary.
The obligations and responsibilities of the Depositor, the
Master Servicer, the Seller and the Trustee created by the Agreement will
terminate upon the earliest of (i) the purchase by the Master Servicer, at its
election, of all the Mortgage Assets remaining in the Trust Fund and the
corresponding distribution to Certificateholders of all amounts required to be
distributed to them, which repurchase right the Master Servicer may exercise at
its sole and exclusive election if the aggregate Stated Principal Balance of
the Mortgage Pool at the time of the repurchase is less than 5% of the
aggregate Cut-off Date Balance of the Mortgage Pool; (ii)
A-2-4
the maturity or other liquidation (or any advance with respect thereto) of the
last Mortgage Asset remaining in the Trust Fund and the corresponding
distribution to Certificateholders of all amounts required to be distributed to
them; or (iii) the mutual agreement of the parties to the Agreement and the
Certificateholders as to such termination.
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid or
obligatory for any purpose.
A-2-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed under its corporate seal.
LASALLE NATIONAL BANK,
as Trustee
By:__________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-2 Certificates referred to in the within-mentioned
Agreement.
Date:
LASALLE NATIONAL BANK,
as Trustee
By:______________________________
Authorized Officer
A-2-6
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sell(s), assign(s) and
transfer(s) unto ____________________________________________________________
____________________________________________________ (Please print or typewrite
name and address, including postal zip code, of assignee) the undivided
interest in the Trust Fund evidenced by the within Certificate and hereby
authorize(s) the transfer of registration of such interest to the assignee on
the Certificate Register.
I (we) further direct the Trustee to issue a new Certificate of the
same Class and of a like initial Certificate Principal Balance and undivided
interest in the Trust Fund to the above-named assignee and to deliver such
Certificate to the following address _____________________________________
_____________________________________________________________________________
Dated: _______________, ____
Social Security or ______________________________
other Tax Identification Signature by or on behalf of
No. of Assignee: assignor (signature must be signed
as registered)
_______________________________ _______________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for the information
of the Trustee:
Distribution shall be made by check mailed to _________________
______________________________________________________________________________,
or if the aggregate initial Certificate Principal Balance of all Certificates
held by the Holder is at least $5,000,000 and the Trustee shall have received
appropriate wiring instructions in accordance with the Agreement, by wire
transfer in immediately available funds to _______________ for the account of
________________, account number ______________. This information is provided
by the assignee named above, or its agent.
A-2-7
EXHIBIT A-3
FORM OF CLASS A-3 CERTIFICATE
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-FHA1, CLASS A-3
Evidencing an undivided interest in a trust fund (the "Trust Fund") whose
assets consist primarily of a pool (the "Mortgage Pool") of fixed-rate, level
payment, fully-amortizing mortgage loans (the "Mortgage Loans") insured by the
Federal Housing Administration (the "FHA") of the United States Department of
Housing and Urban Development ("HUD") under certain sections of the National
Housing Act of 1934, as amended (the "Housing Act") and mortgage pass-through
certificates (the "GNMA Certificates") guaranteed by the Government National
Mortgage Association ("GNMA") that are backed by fixed rate, level payment,
fully-amortizing mortgage loans (the "Underlying Loans" and together with the
Mortgage Loans, the "FHA Loans") insured by the FHA. The Trust Fund was formed
and the Mortgage Loans and the GNMA Certificates were transferred thereto at
the direction of
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
Certificate Interest Initial Class Principal
Rate: ____% per annum Balance of the Class A-3
Certificates: $_____________
Cut-off Date:
November 1, 1995 Initial Certificate Principal
Balance of this Certificate:
Closing Date: $____________
November 21, 1995
First Distribution Date:
December 26, 1995
Cusip No. ___________
Certificate No. A-3-______
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR,
THE MASTER SERVICER, THE TRUSTEE OR ANY AGENT
A-3-1
THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE").
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF CS FIRST
BOSTON MORTGAGE SECURITIES CORP., GREYSTONE FUNDING CORPORATION, GREYSTONE
SERVICING CORPORATION, INC. OR THE TRUSTEE REFERRED TO BELOW, OR OF ANY OF
THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED OR INSURED BY ANY
GOVERNMENT AGENCY OR INSTRUMENTALITY.
THIS CERTIFIES THAT [Cede & Co.] is the registered owner of a
beneficial interest in the Trust Fund, which was created pursuant to the
Pooling and Servicing Agreement, dated as of November 1, 1995 (the
"Agreement"), among CS First Boston Mortgage Securities Corp. as depositor (the
"Depositor", which term includes any successor entity under the Agreement),
Greystone Servicing Corporation, Inc. as master servicer (the "Master
Servicer", which term includes any successor entity under the Agreement),
Greystone Funding Corporation as seller (the "Seller", which term includes any
successor entity under the Agreement) and LaSalle National Bank as trustee (the
"Trustee", which term includes any successor entity under the Agreement). This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the Agreement, and nothing herein shall be deemed inconsistent with
that meaning. If the terms hereof are inconsistent with the Agreement, the
Agreement shall control.
This Certificate is one of a duly authorized issue of
certificates of CS First Boston Mortgage Securities Corp., designated as its
Mortgage Pass-Through Certificates, Series 1995-FHA1 (the "Certificates"),
which is comprised of the following eleven classes (each, a "Class"): the Class
A-1, Class A-2, Class A-3, Class A-4, Class A-X-1, Class A-X-2, Class A-X-3 and
Class A-X-4, Class B, Class R-I and Class R-II Certificates. Reference is
hereby made to the Agreement for a statement of the respective rights
thereunder of the Depositor, the Seller, the Master Servicer, the Trustee and
the Holders of each Class of the Certificates and the terms upon which the
Certificates are authenticated and delivered. This Certificate represents an
interest in the Trust Fund, which Trust Fund consists of, among other things,
(i) the Mortgage
A-3-2
Assets and all payments under and proceeds of such Mortgage Assets (other than
any Retained Yield) received after the Cut-off Date (exclusive of any payments
of or relating to principal and interest due on the FHA Loans on or before the
Cut-off Date), together with all documents included in the related Mortgage
Files and Servicing Files for the Mortgage Loans; (ii) the FHA Mortgage
Insurance in respect of the Mortgage Loans, together with all FHA Insurance
Benefits (other than any Retained Yield) derived therefrom; (iii) such funds or
assets (other than any Retained Yield) as from time to time are deposited in
the Distribution Account and/or the Collection Account; (iv) any insurance
policies with respect to the Mortgage Loans; and (v) all proceeds of the
conversion, voluntary or involuntary, of any of the foregoing into cash or
other liquid property.
This Class A-3 Certificate represents a Percentage Interest in
the related class equal to the initial Certificate Principal Balance hereof
divided by the Initial Class Principal Balance of the Class A-3 Certificates,
both as set forth above.
The Trustee shall distribute from the Distribution Account, to
the extent of available funds, on the 25th day of each calendar month or, if
such 25th day is not a Business Day, the Business Day immediately following
such 25th day (each, a "Distribution Date"), commencing in December, 1995, to
the Person in whose name this Certificate is registered at the close of
business on the last Business Day of the month immediately preceding the month
of such distribution (each, a "Record Date"), interest and principal in an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and that portion of the Available Distribution Amount that is
allocated to distributions on the related Class of Certificates on such
Distribution Date.
Not later than each Distribution Date, the Trustee will send to
each Certificateholder a statement containing information relating to the
Mortgage Assets and payments made to Certificateholders.
Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Holder hereof entitled thereto as such
address appears in the Certificate Register or, if such Holder holds one or
more Certificates with an aggregate initial Certificate Principal Balance of at
least $5,000,000, by wire transfer in immediately available funds to the
account of such Certificateholder designated in writing to the Trustee at least
five Business Days prior to the applicable Record Date. Notwithstanding the
above, the final distribution on this Certificate will be made after due notice
of the pendency of such final distribution and only upon presentation and
surrender of this Certificate at the office or agency designated in such
notice.
[Notwithstanding the foregoing, for so long as this Certificate
is registered in the name of Cede & Co. or in such other name as is requested
by an authorized representative of DTC, transfers of interests in this
Certificate shall be made through the book-entry facilities of DTC.]
The Agreement permits, with certain exceptions as therein
provided, the amendment thereof by the Depositor, the Master Servicer, the
Seller and the Trustee with the
A-3-3
consent of the Holders of Certificates entitled to, in the aggregate, not less
than 66-2/3% of the Voting Rights of all the Certificates affected by any such
amendments, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Agreement or for the purpose
of modifying in any manner the rights of the Holders of the Certificates;
provided, however, that no such amendment may (i) reduce in any manner the
amount of, delay the timing of or change the manner in which payments received
on Mortgage Assets are required to be distributed in respect of any Certificate
without the consent of the Holder of such Certificate; (ii) modify the
amendment provisions of the Agreement without the consent of all the
Certificateholders; or (iii) modify the servicing standard set forth in the
Agreement pursuant to which the Master Servicer shall service and administer
the Mortgage Loans. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. Under certain limited circumstances set forth
therein, the Agreement may be amended by the parties thereto without the
consent of any Holder.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable on the
Certificate Register upon surrender of this Certificate for registration of
transfer at the office or agency of the Trustee designated therefor, duly
endorsed by, or accompanied by a written instrument of transfer in a form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
interest in the Trust Fund, will be issued to the designated transferee or
transferees.
The Class A-3 Certificates will be issued in fully registered
form in minimum denominations of $25,000 initial Certificate Principal Balance
and in integral multiples of $1 in excess of such amount. As provided in the
Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates of the same Class
and of authorized denominations and evidencing a like aggregate Certificate
Principal Balance, as requested by the Holder surrendering the same.
No service charge will be made for such registrations of
transfers or exchanges, but the Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the person in whose name
this Certificate is registered as the owner hereof for all purposes, and
neither the Trustee nor any such agent thereof shall be affected by notice to
the contrary.
The obligations and responsibilities of the Depositor, the
Master Servicer, the Seller and the Trustee created by the Agreement will
terminate upon the earliest of (i) the purchase by the Master Servicer, at its
election, of all the Mortgage Assets remaining in the Trust Fund and the
corresponding distribution to Certificateholders of all amounts required to be
distributed to them, which repurchase right the Master Servicer may exercise at
its sole and exclusive election if the aggregate Stated Principal Balance of
the Mortgage Pool at the time of the repurchase is less than 5% of the
aggregate Cut-off Date Balance of the Mortgage Pool; (ii)
A-3-4
the maturity or other liquidation (or any advance with respect thereto) of the
last Mortgage Asset remaining in the Trust Fund and the corresponding
distribution to Certificateholders of all amounts required to be distributed to
them; or (iii) the mutual agreement of the parties to the Agreement and the
Certificateholders as to such termination.
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid or
obligatory for any purpose.
A-3-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed under its corporate seal.
LASALLE NATIONAL BANK,
as Trustee
By:__________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-3 Certificates referred to in the within-mentioned
Agreement.
Date:
LASALLE NATIONAL BANK,
as Trustee
By:______________________________
Authorized Officer
A-3-6
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sell(s), assign(s) and
transfer(s) unto _____________________________________________________________
__________________________________________________ (Please print or typewrite
name and address, including postal zip code, of assignee) the undivided
interest in the Trust Fund evidenced by the within Certificate and hereby
authorize(s) the transfer of registration of such interest to the assignee on
the Certificate Register.
I (we) further direct the Trustee to issue a new Certificate of the
same Class and of a like initial Certificate Principal Balance and undivided
interest in the Trust Fund to the above-named assignee and to deliver such
Certificate to the following address _______________________________________
_____________________________________________________________________________
Dated: _______________, ____
Social Security or ______________________________
other Tax Identification Signature by or on behalf of
No. of Assignee: assignor (signature must be signed
as registered)
_____________________________ _______________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for the information
of the Trustee:
Distribution shall be made by check mailed to _________________
______________________________________________________________________________,
or if the aggregate initial Certificate Principal Balance of all Certificates
held by the Holder is at least $5,000,000 and the Trustee shall have received
appropriate wiring instructions in accordance with the Agreement, by wire
transfer in immediately available funds to _______________ for the account of
________________, account number ______________. This information is provided
by the assignee named above, or its agent.
A-3-7
EXHIBIT A-4
FORM OF CLASS A-4 CERTIFICATE
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-FHA1, CLASS A-4
Evidencing an undivided interest in a trust fund (the "Trust Fund") whose
assets consist primarily of a pool (the "Mortgage Pool") of fixed-rate, level
payment, fully-amortizing mortgage loans (the "Mortgage Loans") insured by the
Federal Housing Administration (the "FHA") of the United States Department of
Housing and Urban Development ("HUD") under certain sections of the National
Housing Act of 1934, as amended (the "Housing Act") and mortgage pass-through
certificates (the "GNMA Certificates") guaranteed by the Government National
Mortgage Association ("GNMA") that are backed by fixed rate, level payment,
fully-amortizing mortgage loans (the "Underlying Loans" and together with the
Mortgage Loans, the "FHA Loans") insured by the FHA. The Trust Fund was formed
and the Mortgage Loans and the GNMA Certificates were transferred thereto at
the direction of
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
Certificate Interest Initial Class Principal
Rate: ____% per annum Balance of the Class A-4
Certificates: $_____________
Cut-off Date:
November 1, 1995 Initial Certificate Principal
Balance of this Certificate:
Closing Date: $____________
November 21, 1995
First Distribution Date:
December 26, 1995
Cusip No. ___________
Certificate No. A-4-______
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR,
THE MASTER SERVICER, THE TRUSTEE OR ANY AGENT
A-4-1
THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE").
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF CS FIRST
BOSTON MORTGAGE SECURITIES CORP., GREYSTONE FUNDING CORPORATION, GREYSTONE
SERVICING CORPORATION, INC. OR THE TRUSTEE REFERRED TO BELOW, OR OF ANY OF
THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED OR INSURED BY ANY
GOVERNMENT AGENCY OR INSTRUMENTALITY.
THIS CERTIFIES THAT [Cede & Co.] is the registered owner of a
beneficial interest in the Trust Fund, which was created pursuant to the
Pooling and Servicing Agreement, dated as of November 1, 1995 (the
"Agreement"), among CS First Boston Mortgage Securities Corp. as depositor (the
"Depositor", which term includes any successor entity under the Agreement),
Greystone Servicing Corporation, Inc. as master servicer (the "Master
Servicer", which term includes any successor entity under the Agreement),
Greystone Funding Corporation as seller (the "Seller", which term includes any
successor entity under the Agreement) and LaSalle National Bank as trustee (the
"Trustee", which term includes any successor entity under the Agreement). This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the Agreement, and nothing herein shall be deemed inconsistent with
that meaning. If the terms hereof are inconsistent with the Agreement, the
Agreement shall control.
This Certificate is one of a duly authorized issue of
certificates of CS First Boston Mortgage Securities Corp., designated as its
Mortgage Pass-Through Certificates, Series 1995-FHA1 (the "Certificates"),
which is comprised of the following eleven classes (each, a "Class"): the Class
A-1, Class A-2, Class A-3, Class A-4, Class A-X-1, Class A-X-2, Class A-X-3 and
Class A-X-4, Class B, Class R-I and Class R-II Certificates. Reference is
hereby made to the Agreement for a statement of the respective rights
thereunder of the Depositor, the Seller, the Master Servicer, the Trustee and
the Holders of each Class of the Certificates and the terms upon which the
Certificates are authenticated and delivered. This Certificate represents an
interest in the Trust Fund, which Trust Fund consists of, among other things,
(i) the Mortgage
A-4-2
Assets and all payments under and proceeds of such Mortgage Assets (other than
any Retained Yield) received after the Cut-off Date (exclusive of any payments
of or relating to principal and interest due on the FHA Loans on or before the
Cut-off Date), together with all documents included in the related Mortgage
Files and Servicing Files for the Mortgage Loans; (ii) the FHA Mortgage
Insurance in respect of the Mortgage Loans, together with all FHA Insurance
Benefits (other than any Retained Yield) derived therefrom; (iii) such funds or
assets (other than any Retained Yield) as from time to time are deposited in
the Distribution Account and/or the Collection Account; (iv) any insurance
policies with respect to the Mortgage Loans; and (v) all proceeds of the
conversion, voluntary or involuntary, of any of the foregoing into cash or
other liquid property.
This Class A-4 Certificate represents a Percentage Interest in
the related class equal to the initial Certificate Principal Balance hereof
divided by the Initial Class Principal Balance of the Class A-4 Certificates,
both as set forth above.
The Trustee shall distribute from the Distribution Account, to
the extent of available funds, on the 25th day of each calendar month or, if
such 25th day is not a Business Day, the Business Day immediately following
such 25th day (each, a "Distribution Date"), commencing in December, 1995, to
the Person in whose name this Certificate is registered at the close of
business on the last Business Day of the month immediately preceding the month
of such distribution (each, a "Record Date"), interest and principal in an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and that portion of the Available Distribution Amount that is
allocated to distributions on the related Class of Certificates on such
Distribution Date.
Not later than each Distribution Date, the Trustee will send to
each Certificateholder a statement containing information relating to the
Mortgage Assets and payments made to Certificateholders.
Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Holder hereof entitled thereto as such
address appears in the Certificate Register or, if such Holder holds one or
more Certificates with an aggregate initial Certificate Principal Balance of at
least $5,000,000, by wire transfer in immediately available funds to the
account of such Certificateholder designated in writing to the Trustee at least
five Business Days prior to the applicable Record Date. Notwithstanding the
above, the final distribution on this Certificate will be made after due notice
of the pendency of such final distribution and only upon presentation and
surrender of this Certificate at the office or agency designated in such
notice.
[Notwithstanding the foregoing, for so long as this Certificate
is registered in the name of Cede & Co. or in such other name as is requested
by an authorized representative of DTC, transfers of interests in this
Certificate shall be made through the book-entry facilities of DTC.]
The Agreement permits, with certain exceptions as therein
provided, the amendment thereof by the Depositor, the Master Servicer, the
Seller and the Trustee with the
A-4-3
consent of the Holders of Certificates entitled to, in the aggregate, not less
than 66-2/3% of the Voting Rights of all the Certificates affected by any such
amendments, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Agreement or for the purpose
of modifying in any manner the rights of the Holders of the Certificates;
provided, however, that no such amendment may (i) reduce in any manner the
amount of, delay the timing of or change the manner in which payments received
on Mortgage Assets are required to be distributed in respect of any Certificate
without the consent of the Holder of such Certificate; (ii) modify the
amendment provisions of the Agreement without the consent of all the
Certificateholders; or (iii) modify the servicing standard set forth in the
Agreement pursuant to which the Master Servicer shall service and administer
the Mortgage Loans. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. Under certain limited circumstances set forth
therein, the Agreement may be amended by the parties thereto without the
consent of any Holder.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable on the
Certificate Register upon surrender of this Certificate for registration of
transfer at the office or agency of the Trustee designated therefor, duly
endorsed by, or accompanied by a written instrument of transfer in a form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
interest in the Trust Fund, will be issued to the designated transferee or
transferees.
The Class A-4 Certificates will be issued in fully registered
form in minimum denominations of $25,000 initial Certificate Principal Balance
and in integral multiples of $1 in excess of such amount. As provided in the
Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates of the same Class
and of authorized denominations and evidencing a like aggregate Certificate
Principal Balance, as requested by the Holder surrendering the same.
No service charge will be made for such registrations of
transfers or exchanges, but the Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the person in whose name
this Certificate is registered as the owner hereof for all purposes, and
neither the Trustee nor any such agent thereof shall be affected by notice to
the contrary.
The obligations and responsibilities of the Depositor, the
Master Servicer, the Seller and the Trustee created by the Agreement will
terminate upon the earliest of (i) the purchase by the Master Servicer, at its
election, of all the Mortgage Assets remaining in the Trust Fund and the
corresponding distribution to Certificateholders of all amounts required to be
distributed to them, which repurchase right the Master Servicer may exercise at
its sole and exclusive election if the aggregate Stated Principal Balance of
the Mortgage Pool at the time of the repurchase is less than 5% of the
aggregate Cut-off Date Balance of the Mortgage Pool; (ii)
A-4-4
the maturity or other liquidation (or any advance with respect thereto) of the
last Mortgage Asset remaining in the Trust Fund and the corresponding
distribution to Certificateholders of all amounts required to be distributed to
them; or (iii) the mutual agreement of the parties to the Agreement and the
Certificateholders as to such termination.
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid or
obligatory for any purpose.
A-4-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed under its corporate seal.
LASALLE NATIONAL BANK,
as Trustee
By:__________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-4 Certificates referred to in the within-mentioned
Agreement.
Date:
LASALLE NATIONAL BANK,
as Trustee
By:______________________________
Authorized Officer
A-4-6
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sell(s), assign(s) and
transfer(s) unto ____________________________________________________________
___________________________________________________ (Please print or typewrite
name and address, including postal zip code, of assignee) the undivided
interest in the Trust Fund evidenced by the within Certificate and hereby
authorize(s) the transfer of registration of such interest to the assignee on
the Certificate Register.
I (we) further direct the Trustee to issue a new Certificate of the
same Class and of a like initial Certificate Principal Balance and undivided
interest in the Trust Fund to the above-named assignee and to deliver such
Certificate to the following address ________________________________________
______________________________________________________________________________
Dated: _______________, ____
Social Security or ______________________________
other Tax Identification Signature by or on behalf of
No. of Assignee: assignor (signature must be signed
as registered)
_____________________________ _______________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for the information
of the Trustee:
Distribution shall be made by check mailed to _________________
______________________________________________________________________________,
or if the aggregate initial Certificate Principal Balance of all Certificates
held by the Holder is at least $5,000,000 and the Trustee shall have received
appropriate wiring instructions in accordance with the Agreement, by wire
transfer in immediately available funds to _______________ for the account of
________________, account number ______________. This information is provided
by the assignee named above, or its agent.
A-4-7
EXHIBIT A-5
FORM OF CLASS A-X-1 CERTIFICATE
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-FHA1, CLASS A-X-1
Evidencing an undivided interest in a trust fund (the "Trust Fund") whose
assets consist primarily of a pool (the "Mortgage Pool") of fixed-rate, level
payment, fully-amortizing mortgage loans (the "Mortgage Loans") insured by the
Federal Housing Administration (the "FHA") of the United States Department of
Housing and Urban Development ("HUD") under certain sections of the National
Housing Act of 1934, as amended (the "Housing Act") and mortgage pass-through
certificates (the "GNMA Certificates") guaranteed by the Government National
Mortgage Association ("GNMA") that are backed by fixed rate, level payment,
fully-amortizing mortgage loans (the "Underlying Loans" and together with the
Mortgage Loans, the "FHA Loans") insured by the FHA. The Trust Fund was formed
and the Mortgage Loans and the GNMA Certificates were transferred thereto at
the direction of
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
Certificate Interest Initial Class Notional
Rate: Variable Amount of the Class A-X-1
Certificates: $_____________
Cut-off Date:
November 1, 1995 Initial Certificate Notional
Amount of this Certificate:
Closing Date: $____________
November 21, 1995
First Distribution Date:
December 26, 1995
Cusip No. ___________
Certificate No. A-X-1-______
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
A-5-1
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"). THE FOLLOWING
INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S. FEDERAL
INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE. THE
ISSUE DATE OF THIS CERTIFICATE IS NOVEMBER 21, 1995. ASSUMING THAT THE MORTGAGE
LOANS PREPAY AT AN ASSUMED RATE OF PREPAYMENT USED SOLELY FOR THE PURPOSES OF
APPLYING THE OID RULES TO THE CERTIFICATES EQUAL TO A CPR (AS DEFINED IN THE
PROSPECTUS DATED NOVEMBER 13, 1995 AND THE PROSPECTUS SUPPLEMENT DATED NOVEMBER
15, 1995 RELATING TO THIS CERTIFICATE) OF 0% (THE "PREPAYMENT ASSUMPTION"),
THIS CERTIFICATE HAS BEEN ISSUED WITH NO MORE THAN $_________ OF OID PER
$__________ OF INITIAL CERTIFICATE NOTIONAL AMOUNT, THE YIELD TO MATURITY IS
____% PER ANNUM, AND THE AMOUNT OF OID ATTRIBUTABLE TO THE INITIAL ACCRUAL
PERIOD IS NO MORE THAN $_________ PER $__________ OF INITIAL CERTIFICATE
NOTIONAL AMOUNT, COMPUTED UNDER THE EXACT METHOD. NO REPRESENTATION IS MADE
THAT THE MORTGAGE LOANS WILL PREPAY AT A RATE BASED ON THE PREPAYMENT
ASSUMPTION OR AT ANY OTHER RATE.
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF CS FIRST
BOSTON MORTGAGE SECURITIES CORP., GREYSTONE FUNDING CORPORATION, GREYSTONE
SERVICING CORPORATION, INC. OR THE TRUSTEE REFERRED TO BELOW, OR OF ANY OF
THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED OR INSURED BY ANY
GOVERNMENT AGENCY OR INSTRUMENTALITY.
THIS CERTIFIES THAT ______________ is the registered owner of a
beneficial interest in the Trust Fund, which was created pursuant to the
Pooling and Servicing Agreement, dated as of November 1, 1995 (the
"Agreement"), among CS First Boston Mortgage Securities Corp. as depositor (the
"Depositor", which term includes any successor entity under the Agreement),
Greystone Servicing Corporation, Inc. as master servicer (the "Master
Servicer", which term includes any successor entity under the Agreement),
Greystone Funding Corporation as seller (the "Seller", which term includes any
successor entity under the Agreement) and LaSalle National Bank as trustee (the
"Trustee", which term includes any successor entity under the Agreement). This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the Agreement, and nothing herein shall be deemed inconsistent with
that meaning. If the terms hereof are inconsistent with the Agreement, the
Agreement shall control.
This Certificate is one of a duly authorized issue of
certificates of CS First Boston Mortgage Securities Corp., designated as its
Mortgage Pass-Through Certificates, Series 1995-FHA1 (the "Certificates"),
which is comprised of the following eleven classes (each, a "Class"): the Class
A-1, Class A-2, Class A-3, Class A-4, Class A-X-1, Class A-X-2, Class A-X-3 and
Class A-X-4, Class B, Class R-I and Class R-II Certificates. Reference is
hereby made to the
A-5-2
Agreement for a statement of the respective rights thereunder of the Depositor,
the Seller, the Master Servicer, the Trustee and the Holders of each Class of
the Certificates and the terms upon which the Certificates are authenticated
and delivered. This Certificate represents an interest in the Trust Fund,
which Trust Fund consists of, among other things, (i) the Mortgage Assets and
all payments under and proceeds of such Mortgage Assets (other than any
Retained Yield) received after the Cut-off Date (exclusive of any payment of or
relating to principal and interest due on the FHA Loans on or before the Cut-
off Date), together with all documents included in the related Mortgage Files
and Servicing Files for the Mortgage Loans; (ii) the FHA Mortgage Insurance in
respect of the Mortgage Loans, together with all FHA Insurance Benefits (other
than any Retained Yield) derived therefrom; (iii) such funds or assets (other
than any Retained Yield) as from time to time are deposited in the Distribution
Account and/or the Collection Account; (iv) any insurance policies with respect
to the Mortgage Loans; and (v) all proceeds of the conversion, voluntary or
involuntary, of any of the foregoing into cash or other liquid property.
This Class A-X-1 Certificate represents a Percentage Interest
in the related Class equal to the initial Certificate Notional Amount hereof
divided by the Initial Class Notional Amount of the Class A-X-1 Certificates,
both as set forth above.
The Trustee shall distribute from the Distribution Account, to
the extent of available funds, on the 25th day of each calendar month or, if
such 25th day is not a Business Day, the Business Day immediately following
such 25th day (each, a "Distribution Date"), commencing in December, 1995, to
the Person in whose name this Certificate is registered at the close of
business on the last Business Day of the month immediately preceding the month
of such distribution (each, a "Record Date"), interest and Prepayment Premiums
in an amount equal to the product of the Percentage Interest evidenced by this
Certificate and that portion of the Available Distribution Amount and
Prepayment Premiums that are allocated to distributions on the related Class of
Certificates on such Distribution Date.
Not later than each Distribution Date, the Trustee will send to
each Certificateholder a statement containing information relating to the
Mortgage Assets and payments made to Certificateholders.
Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Holder hereof entitled thereto as such
address appears in the Certificate Register or, if such Holder holds one or
more Interest-Only Certificates with an initial Certificate Notional Amount of
at least $10,000,000, by wire transfer in immediately available funds to the
account of such Certificateholder designated in writing to the Trustee at least
five Business Days prior to the applicable Record Date. Notwithstanding the
above, the final distribution on this Certificate will be made after due notice
of the pendency of such final distribution and only upon presentation and
surrender of this Certificate at the office or agency designated in such
notice.
The Agreement permits, with certain exceptions as therein
provided, the amendment thereof by the Depositor, the Master Servicer, the
Seller and the Trustee with the
A-5-3
consent of the Holders of Certificates entitled to, in the aggregate, not less
than 66-2/3% of the Voting Rights of all the Certificates affected by any such
amendments, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Agreement or for the purpose
of modifying in any manner the rights of the Holders of the Certificates;
provided, however, that no such amendment may (i) reduce in any manner the
amount of, delay the timing of or change the manner in which payments received
on Mortgage Assets are required to be distributed in respect of any Certificate
without the consent of the Holder of such Certificate; (ii) modify the
amendment provisions of the Agreement without the consent of all the
Certificateholders; or (iii) modify the servicing standard set forth in the
Agreement pursuant to which the Master Servicer shall service and administer
the Mortgage Loans. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. Under certain limited circumstances set forth
therein, the Agreement may be amended by the parties thereto without the
consent of any Holder.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable on the
Certificate Register upon surrender of this Certificate for registration of
transfer at the office or agency of the Trustee designated therefor, duly
endorsed by, or accompanied by a written instrument of transfer in a form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
interest in the Trust Fund, will be issued to the designated transferee or
transferees.
The Class A-X-1 Certificates will be issued in fully registered
form in minimum denominations of $1,000,000 initial Certificate Notional Amount
and in integral multiples of $1 in excess of such amount. As provided in the
Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates of the same Class
in authorized denominations and evidencing a like aggregate Certificate
Notional Balance, as requested by the Holder surrendering the same.
No service charge will be made for such registrations of
transfers or exchanges, but the Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the person in whose name
this Certificate is registered as the owner hereof for all purposes, and
neither the Trustee nor any such agent thereof shall be affected by notice to
the contrary.
The obligations and responsibilities of the Depositor, the
Master Servicer and the Trustee created by the Agreement will terminate upon
the earliest of (i) the purchase by the Master Servicer, at its election, of
all the Mortgage Assets remaining in the Trust Fund and the corresponding
distribution to Certificateholders of all amounts required to be distributed to
them, which repurchase right the Master Servicer may exercise at its sole and
exclusive election if the aggregate Stated Principal Balance of the Mortgage
Pool at the time of the repurchase is less than 5% of the aggregate Cut-off
Date Balance of the Mortgage Pool; (ii) the maturity or other
A-5-4
liquidation (or any advance with respect thereto) of the last Mortgage Asset
remaining in the Trust Fund and the corresponding distribution to
Certificateholders of all amounts required to be distributed to them; or (iii)
the mutual agreement of the parties to the Agreement and the Certificateholders
as to such termination.
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid or
obligatory for any purpose.
A-5-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed under its corporate seal.
LASALLE NATIONAL BANK,
as Trustee
By:__________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-X-1 Certificates referred to in the within-mentioned
Agreement.
Date:
LASALLE NATIONAL BANK,
as Trustee
By:______________________________
Authorized Officer
A-5-6
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sell(s), assign(s) and
transfer(s) unto ____________________________________________________________
__________________________________________________ (Please print or typewrite
name and address, including postal zip code, of assignee) the undivided
interest in the Trust Fund evidenced by the within Certificate and hereby
authorize(s) the transfer of registration of such interest to the assignee on
the Certificate Register.
I (we) further direct the Trustee to issue a new Certificate of the
same Class and of a like initial Certificate Notional Amount and undivided
interest in the Trust Fund to the above-named assignee and to deliver such
Certificate to the following address _________________________________________
_______________________________________________________________________________
Dated: _______________, ____
Social Security or ______________________________
other Tax Identification Signature by or on behalf of
No. of Assignee: assignor (signature must be signed
as registered)
_____________________________ _______________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for the information
of the Trustee:
Distribution shall be made by check mailed to _________________
______________________________________________________________________________,
or if the aggregate initial Certificate Notional Amount of Interest-Only
Certificates held by the Holder is at least $10,000,000 and the Trustee shall
have received appropriate wiring instructions in accordance with the Agreement,
by wire transfer in immediately available funds to _______________ for the
account of ________________, account number ______________. This information
is provided by the assignee named above, or its agent.
A-5-7
EXHIBIT A-6
FORM OF CLASS A-X-2 CERTIFICATE
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-FHA1, CLASS A-X-2
Evidencing an undivided interest in a trust fund (the "Trust Fund") whose
assets consist primarily of a pool (the "Mortgage Pool") of fixed-rate, level
payment, fully-amortizing mortgage loans (the "Mortgage Loans") insured by the
Federal Housing Administration (the "FHA") of the United States Department of
Housing and Urban Development ("HUD") under certain sections of the National
Housing Act of 1934, as amended (the "Housing Act") and mortgage pass-through
certificates (the "GNMA Certificates") guaranteed by the Government National
Mortgage Association ("GNMA") that are backed by fixed rate, level payment,
fully-amortizing mortgage loans (the "Underlying Loans" and together with the
Mortgage Loans, the "FHA Loans") insured by the FHA. The Trust Fund was formed
and the Mortgage Loans and the GNMA Certificates were transferred thereto at
the direction of
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
Certificate Interest Initial Class Notional
Rate: Variable Amount of the Class A-X-2
Certificates: $_____________
Cut-off Date:
November 1, 1995 Initial Certificate Notional
Amount of this Certificate:
Closing Date: $____________
November 21, 1995
First Distribution Date:
December 26, 1995
Cusip No. ___________
Certificate No. A-X-2-______
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
A-6-1
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"). THE FOLLOWING
INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S. FEDERAL
INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE. THE
ISSUE DATE OF THIS CERTIFICATE IS NOVEMBER 21, 1995. ASSUMING THAT THE MORTGAGE
LOANS PREPAY AT AN ASSUMED RATE OF PREPAYMENT USED SOLELY FOR THE PURPOSES OF
APPLYING THE OID RULES TO THE CERTIFICATES EQUAL TO A CPR (AS DEFINED IN THE
PROSPECTUS DATED NOVEMBER 13, 1995 AND THE PROSPECTUS SUPPLEMENT DATED NOVEMBER
15, 1995 RELATING TO THIS CERTIFICATE) OF 0% (THE "PREPAYMENT ASSUMPTION"),
THIS CERTIFICATE HAS BEEN ISSUED WITH NO MORE THAN $_________ OF OID PER
$__________ OF INITIAL CERTIFICATE NOTIONAL AMOUNT, THE YIELD TO MATURITY IS
____% PER ANNUM, AND THE AMOUNT OF OID ATTRIBUTABLE TO THE INITIAL ACCRUAL
PERIOD IS NO MORE THAN $_________ PER $__________ OF INITIAL CERTIFICATE
NOTIONAL AMOUNT, COMPUTED UNDER THE EXACT METHOD. NO REPRESENTATION IS MADE
THAT THE MORTGAGE LOANS WILL PREPAY AT A RATE BASED ON THE PREPAYMENT
ASSUMPTION OR AT ANY OTHER RATE.
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF CS FIRST
BOSTON MORTGAGE SECURITIES CORP., GREYSTONE FUNDING CORPORATION, GREYSTONE
SERVICING CORPORATION, INC. OR THE TRUSTEE REFERRED TO BELOW, OR OF ANY OF
THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED OR INSURED BY ANY
GOVERNMENT AGENCY OR INSTRUMENTALITY.
THIS CERTIFIES THAT ______________ is the registered owner of a
beneficial interest in the Trust Fund, which was created pursuant to the
Pooling and Servicing Agreement, dated as of November 1, 1995 (the
"Agreement"), among CS First Boston Mortgage Securities Corp. as depositor (the
"Depositor", which term includes any successor entity under the Agreement),
Greystone Servicing Corporation, Inc. as master servicer (the "Master
Servicer", which term includes any successor entity under the Agreement),
Greystone Funding Corporation as seller (the "Seller", which term includes any
successor entity under the Agreement) and LaSalle National Bank as trustee (the
"Trustee", which term includes any successor entity under the Agreement). This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the Agreement, and nothing herein shall be deemed inconsistent with
that meaning. If the terms hereof are inconsistent with the Agreement, the
Agreement shall control.
This Certificate is one of a duly authorized issue of
certificates of CS First Boston Mortgage Securities Corp., designated as its
Mortgage Pass-Through Certificates, Series 1995-FHA1 (the "Certificates"),
which is comprised of the following eleven classes (each, a "Class"): the Class
A-1, Class A-2, Class A-3, Class A-4, Class A-X-1, Class A-X-2, Class A-X-3 and
Class A-X-4, Class B, Class R-I and Class R-II Certificates. Reference is
hereby made to the
A-6-2
Agreement for a statement of the respective rights thereunder of the Depositor,
the Seller, the Master Servicer, the Trustee and the Holders of each Class of
the Certificates and the terms upon which the Certificates are authenticated
and delivered. This Certificate represents an interest in the Trust Fund,
which Trust Fund consists of, among other things, (i) the Mortgage Assets and
all payments under and proceeds of such Mortgage Assets (other than any
Retained Yield) received after the Cut-off Date (exclusive of any payment of or
relating to principal and interest due on the FHA Loans on or before the Cut-
off Date), together with all documents included in the related Mortgage Files
and Servicing Files for the Mortgage Loans; (ii) the FHA Mortgage Insurance in
respect of the Mortgage Loans, together with all FHA Insurance Benefits (other
than any Retained Yield) derived therefrom; (iii) such funds or assets (other
than any Retained Yield) as from time to time are deposited in the Distribution
Account and/or the Collection Account; (iv) any insurance policies with respect
to the Mortgage Loans; and (v) all proceeds of the conversion, voluntary or
involuntary, of any of the foregoing into cash or other liquid property.
This Class A-X-2 Certificate represents a Percentage Interest
in the related Class equal to the initial Certificate Notional Amount hereof
divided by the Initial Class Notional Amount of the Class A-X-2 Certificates,
both as set forth above.
The Trustee shall distribute from the Distribution Account, to
the extent of available funds, on the 25th day of each calendar month or, if
such 25th day is not a Business Day, the Business Day immediately following
such 25th day (each, a "Distribution Date"), commencing in December, 1995, to
the Person in whose name this Certificate is registered at the close of
business on the last Business Day of the month immediately preceding the month
of such distribution (each, a "Record Date"), interest and Prepayment Premiums
in an amount equal to the product of the Percentage Interest evidenced by this
Certificate and that portion of the Available Distribution Amount and
Prepayment Premiums that are allocated to distributions on the related Class of
Certificates on such Distribution Date.
Not later than each Distribution Date, the Trustee will send to
each Certificateholder a statement containing information relating to the
Mortgage Assets and payments made to Certificateholders.
Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Holder hereof entitled thereto as such
address appears in the Certificate Register or, if such Holder holds one or
more Interest-Only Certificates with an initial Certificate Notional Amount of
at least $10,000,000, by wire transfer in immediately available funds to the
account of such Certificateholder designated in writing to the Trustee at least
five Business Days prior to the applicable Record Date. Notwithstanding the
above, the final distribution on this Certificate will be made after due notice
of the pendency of such final distribution and only upon presentation and
surrender of this Certificate at the office or agency designated in such
notice.
The Agreement permits, with certain exceptions as therein
provided, the amendment thereof by the Depositor, the Master Servicer, the
Seller and the Trustee with the
A-6-3
consent of the Holders of Certificates entitled to, in the aggregate, not less
than 66-2/3% of the Voting Rights of all the Certificates affected by any such
amendments, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Agreement or for the purpose
of modifying in any manner the rights of the Holders of the Certificates;
provided, however, that no such amendment may (i) reduce in any manner the
amount of, delay the timing of or change the manner in which payments received
on Mortgage Assets are required to be distributed in respect of any Certificate
without the consent of the Holder of such Certificate; (ii) modify the
amendment provisions of the Agreement without the consent of all the
Certificateholders; or (iii) modify the servicing standard set forth in the
Agreement pursuant to which the Master Servicer shall service and administer
the Mortgage Loans. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. Under certain limited circumstances set forth
therein, the Agreement may be amended by the parties thereto without the
consent of any Holder.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable on the
Certificate Register upon surrender of this Certificate for registration of
transfer at the office or agency of the Trustee designated therefor, duly
endorsed by, or accompanied by a written instrument of transfer in a form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
interest in the Trust Fund, will be issued to the designated transferee or
transferees.
The Class A-X-2 Certificates will be issued in fully registered
form in minimum denominations of $1,000,000 initial Certificate Notional Amount
and in integral multiples of $1 in excess of such amount. As provided in the
Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates of the same Class
in authorized denominations and evidencing a like aggregate Certificate
Notional Balance, as requested by the Holder surrendering the same.
No service charge will be made for such registrations of
transfers or exchanges, but the Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the person in whose name
this Certificate is registered as the owner hereof for all purposes, and
neither the Trustee nor any such agent thereof shall be affected by notice to
the contrary.
The obligations and responsibilities of the Depositor, the
Master Servicer and the Trustee created by the Agreement will terminate upon
the earliest of (i) the purchase by the Master Servicer, at its election, of
all the Mortgage Assets remaining in the Trust Fund and the corresponding
distribution to Certificateholders of all amounts required to be distributed to
them, which repurchase right the Master Servicer may exercise at its sole and
exclusive election if the aggregate Stated Principal Balance of the Mortgage
Pool at the time of the repurchase is less than 5% of the aggregate Cut-off
Date Balance of the Mortgage Pool; (ii) the maturity or other
A-6-4
liquidation (or any advance with respect thereto) of the last Mortgage Asset
remaining in the Trust Fund and the corresponding distribution to
Certificateholders of all amounts required to be distributed to them; or (iii)
the mutual agreement of the parties to the Agreement and the Certificateholders
as to such termination.
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid or
obligatory for any purpose.
A-6-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed under its corporate seal.
LASALLE NATIONAL BANK,
as Trustee
By:__________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-X-2 Certificates referred to in the within-mentioned
Agreement.
Date:
LASALLE NATIONAL BANK,
as Trustee
By:______________________________
Authorized Officer
A-6-6
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sell(s), assign(s) and
transfer(s) unto ___________________________________________________________
___________________________________________________ (Please print or typewrite
name and address, including postal zip code, of assignee) the undivided
interest in the Trust Fund evidenced by the within Certificate and hereby
authorize(s) the transfer of registration of such interest to the assignee on
the Certificate Register.
I (we) further direct the Trustee to issue a new Certificate of the
same Class and of a like initial Certificate Notional Amount and undivided
interest in the Trust Fund to the above-named assignee and to deliver such
Certificate to the following address ________________________________________
_____________________________________________________________________________
Dated: _______________, ____
Social Security or ______________________________
other Tax Identification Signature by or on behalf of
No. of Assignee: assignor (signature must be signed
as registered)
_____________________________ _______________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for the information
of the Trustee:
Distribution shall be made by check mailed to ________________
______________________________________________________________________________,
or if the aggregate initial Certificate Notional Amount of Interest-Only
Certificates held by the Holder is at least $10,000,000 and the Trustee shall
have received appropriate wiring instructions in accordance with the Agreement,
by wire transfer in immediately available funds to _______________ for the
account of ________________, account number ______________. This information
is provided by the assignee named above, or its agent.
A-6-7
EXHIBIT A-7
FORM OF CLASS A-X-3 CERTIFICATE
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-FHA1, CLASS A-X-3
Evidencing an undivided interest in a trust fund (the "Trust Fund") whose
assets consist primarily of a pool (the "Mortgage Pool") of fixed-rate, level
payment, fully-amortizing mortgage loans (the "Mortgage Loans") insured by the
Federal Housing Administration (the "FHA") of the United States Department of
Housing and Urban Development ("HUD") under certain sections of the National
Housing Act of 1934, as amended (the "Housing Act") and mortgage pass-through
certificates (the "GNMA Certificates") guaranteed by the Government National
Mortgage Association ("GNMA") that are backed by fixed rate, level payment,
fully-amortizing mortgage loans (the "Underlying Loans" and together with the
Mortgage Loans, the "FHA Loans") insured by the FHA. The Trust Fund was formed
and the Mortgage Loans and the GNMA Certificates were transferred thereto at
the direction of
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
Certificate Interest Initial Class Notional
Rate: Variable Amount of the Class A-X-3
Certificates: $_____________
Cut-off Date:
November 1, 1995 Initial Certificate Notional
Amount of this Certificate:
Closing Date: $____________
November 21, 1995
First Distribution Date:
December 26, 1995
Cusip No. ___________
Certificate No. A-X-3-______
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
A-7-1
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"). THE FOLLOWING
INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S. FEDERAL
INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE. THE
ISSUE DATE OF THIS CERTIFICATE IS NOVEMBER 21, 1995. ASSUMING THAT THE MORTGAGE
LOANS PREPAY AT AN ASSUMED RATE OF PREPAYMENT USED SOLELY FOR THE PURPOSES OF
APPLYING THE OID RULES TO THE CERTIFICATES EQUAL TO A CPR (AS DEFINED IN THE
PROSPECTUS DATED NOVEMBER 13, 1995 AND THE PROSPECTUS SUPPLEMENT DATED NOVEMBER
15, 1995 RELATING TO THIS CERTIFICATE) OF 0% (THE "PREPAYMENT ASSUMPTION"),
THIS CERTIFICATE HAS BEEN ISSUED WITH NO MORE THAN $_________ OF OID PER
$__________ OF INITIAL CERTIFICATE NOTIONAL AMOUNT, THE YIELD TO MATURITY IS
____% PER ANNUM, AND THE AMOUNT OF OID ATTRIBUTABLE TO THE INITIAL ACCRUAL
PERIOD IS NO MORE THAN $_________ PER $__________ OF INITIAL CERTIFICATE
NOTIONAL AMOUNT, COMPUTED UNDER THE EXACT METHOD. NO REPRESENTATION IS MADE
THAT THE MORTGAGE LOANS WILL PREPAY AT A RATE BASED ON THE PREPAYMENT
ASSUMPTION OR AT ANY OTHER RATE.
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF CS FIRST
BOSTON MORTGAGE SECURITIES CORP., GREYSTONE FUNDING CORPORATION, GREYSTONE
SERVICING CORPORATION, INC. OR THE TRUSTEE REFERRED TO BELOW, OR OF ANY OF
THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED OR INSURED BY ANY
GOVERNMENT AGENCY OR INSTRUMENTALITY.
THIS CERTIFIES THAT ______________ is the registered owner of a
beneficial interest in the Trust Fund, which was created pursuant to the
Pooling and Servicing Agreement, dated as of November 1, 1995 (the
"Agreement"), among CS First Boston Mortgage Securities Corp. as depositor (the
"Depositor", which term includes any successor entity under the Agreement),
Greystone Servicing Corporation, Inc. as master servicer (the "Master
Servicer", which term includes any successor entity under the Agreement),
Greystone Funding Corporation as seller (the "Seller", which term includes any
successor entity under the Agreement) and LaSalle National Bank as trustee (the
"Trustee", which term includes any successor entity under the Agreement). This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the Agreement, and nothing herein shall be deemed inconsistent with
that meaning. If the terms hereof are inconsistent with the Agreement, the
Agreement shall control.
This Certificate is one of a duly authorized issue of
certificates of CS First Boston Mortgage Securities Corp., designated as its
Mortgage Pass-Through Certificates, Series 1995-FHA1 (the "Certificates"),
which is comprised of the following eleven classes (each, a "Class"): the Class
A-1, Class A-2, Class A-3, Class A-4, Class A-X-1, Class A-X-2, Class A-X-3 and
Class A-X-4, Class B, Class R-I and Class R-II Certificates. Reference is
hereby made to the
A-7-2
Agreement for a statement of the respective rights thereunder of the Depositor,
the Seller, the Master Servicer, the Trustee and the Holders of each Class of
the Certificates and the terms upon which the Certificates are authenticated
and delivered. This Certificate represents an interest in the Trust Fund,
which Trust Fund consists of, among other things, (i) the Mortgage Assets and
all payments under and proceeds of such Mortgage Assets (other than any
Retained Yield) received after the Cut-off Date (exclusive of any payment of or
relating to principal and interest due on the FHA Loans on or before the Cut-
off Date), together with all documents included in the related Mortgage Files
and Servicing Files for the Mortgage Loans; (ii) the FHA Mortgage Insurance in
respect of the Mortgage Loans, together with all FHA Insurance Benefits (other
than any Retained Yield) derived therefrom; (iii) such funds or assets (other
than any Retained Yield) as from time to time are deposited in the Distribution
Account and/or the Collection Account; (iv) any insurance policies with respect
to the Mortgage Loans; and (v) all proceeds of the conversion, voluntary or
involuntary, of any of the foregoing into cash or other liquid property.
This Class A-X-3 Certificate represents a Percentage Interest
in the related Class equal to the initial Certificate Notional Amount hereof
divided by the Initial Class Notional Amount of the Class A-X-3 Certificates,
both as set forth above.
The Trustee shall distribute from the Distribution Account, to
the extent of available funds, on the 25th day of each calendar month or, if
such 25th day is not a Business Day, the Business Day immediately following
such 25th day (each, a "Distribution Date"), commencing in December, 1995, to
the Person in whose name this Certificate is registered at the close of
business on the last Business Day of the month immediately preceding the month
of such distribution (each, a "Record Date"), interest and Prepayment Premiums
in an amount equal to the product of the Percentage Interest evidenced by this
Certificate and that portion of the Available Distribution Amount and
Prepayment Premiums that are allocated to distributions on the related Class of
Certificates on such Distribution Date.
Not later than each Distribution Date, the Trustee will send to
each Certificateholder a statement containing information relating to the
Mortgage Assets and payments made to Certificateholders.
Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Holder hereof entitled thereto as such
address appears in the Certificate Register or, if such Holder holds one or
more Interest-Only Certificates with an initial Certificate Notional Amount of
at least $10,000,000, by wire transfer in immediately available funds to the
account of such Certificateholder designated in writing to the Trustee at least
five Business Days prior to the applicable Record Date. Notwithstanding the
above, the final distribution on this Certificate will be made after due notice
of the pendency of such final distribution and only upon presentation and
surrender of this Certificate at the office or agency designated in such
notice.
The Agreement permits, with certain exceptions as therein
provided, the amendment thereof by the Depositor, the Master Servicer, the
Seller and the Trustee with the
A-7-3
consent of the Holders of Certificates entitled to, in the aggregate, not less
than 66-2/3% of the Voting Rights of all the Certificates affected by any such
amendments, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Agreement or for the purpose
of modifying in any manner the rights of the Holders of the Certificates;
provided, however, that no such amendment may (i) reduce in any manner the
amount of, delay the timing of or change the manner in which payments received
on Mortgage Assets are required to be distributed in respect of any Certificate
without the consent of the Holder of such Certificate; (ii) modify the
amendment provisions of the Agreement without the consent of all the
Certificateholders; or (iii) modify the servicing standard set forth in the
Agreement pursuant to which the Master Servicer shall service and administer
the Mortgage Loans. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. Under certain limited circumstances set forth
therein, the Agreement may be amended by the parties thereto without the
consent of any Holder.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable on the
Certificate Register upon surrender of this Certificate for registration of
transfer at the office or agency of the Trustee designated therefor, duly
endorsed by, or accompanied by a written instrument of transfer in a form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
interest in the Trust Fund, will be issued to the designated transferee or
transferees.
The Class A-X-3 Certificates will be issued in fully registered
form in minimum denominations of $1,000,000 initial Certificate Notional Amount
and in integral multiples of $1 in excess of such amount. As provided in the
Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates of the same Class
in authorized denominations and evidencing a like aggregate Certificate
Notional Balance, as requested by the Holder surrendering the same.
No service charge will be made for such registrations of
transfers or exchanges, but the Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the person in whose name
this Certificate is registered as the owner hereof for all purposes, and
neither the Trustee nor any such agent thereof shall be affected by notice to
the contrary.
The obligations and responsibilities of the Depositor, the
Master Servicer and the Trustee created by the Agreement will terminate upon
the earliest of (i) the purchase by the Master Servicer, at its election, of
all the Mortgage Assets remaining in the Trust Fund and the corresponding
distribution to Certificateholders of all amounts required to be distributed to
them, which repurchase right the Master Servicer may exercise at its sole and
exclusive election if the aggregate Stated Principal Balance of the Mortgage
Pool at the time of the repurchase is less than 5% of the aggregate Cut-off
Date Balance of the Mortgage Pool; (ii) the maturity or other
A-7-4
liquidation (or any advance with respect thereto) of the last Mortgage Asset
remaining in the Trust Fund and the corresponding distribution to
Certificateholders of all amounts required to be distributed to them; or (iii)
the mutual agreement of the parties to the Agreement and the Certificateholders
as to such termination.
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid or
obligatory for any purpose.
A-7-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed under its corporate seal.
LASALLE NATIONAL BANK,
as Trustee
By:__________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-X-3 Certificates referred to in the within-mentioned
Agreement.
Date:
LASALLE NATIONAL BANK,
as Trustee
By:______________________________
Authorized Officer
A-7-6
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sell(s), assign(s) and
transfer(s) unto _____________________________________________________________
____________________________________________________ (Please print or typewrite
name and address, including postal zip code, of assignee) the undivided
interest in the Trust Fund evidenced by the within Certificate and hereby
authorize(s) the transfer of registration of such interest to the assignee on
the Certificate Register.
I (we) further direct the Trustee to issue a new Certificate of the
same Class and of a like initial Certificate Notional Amount and undivided
interest in the Trust Fund to the above-named assignee and to deliver such
Certificate to the following address _________________________________________
_______________________________________________________________________________
Dated: ________________, ____
Social Security or ______________________________
other Tax Identification Signature by or on behalf of
No. of Assignee: assignor (signature must be signed
as registered)
_____________________________ _______________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for the information
of the Trustee:
Distribution shall be made by check mailed to _________________
______________________________________________________________________________,
or if the aggregate initial Certificate Notional Amount of Interest-Only
Certificates held by the Holder is at least $10,000,000 and the Trustee shall
have received appropriate wiring instructions in accordance with the Agreement,
by wire transfer in immediately available funds to _______________ for the
account of ________________, account number ______________. This information
is provided by the assignee named above, or its agent.
A-7-7
EXHIBIT A-8
FORM OF CLASS A-X-4 CERTIFICATE
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-FHA1, CLASS A-X-4
Evidencing an undivided interest in a trust fund (the "Trust Fund") whose
assets consist primarily of a pool (the "Mortgage Pool") of fixed-rate, level
payment, fully-amortizing mortgage loans (the "Mortgage Loans") insured by the
Federal Housing Administration (the "FHA") of the United States Department of
Housing and Urban Development ("HUD") under certain sections of the National
Housing Act of 1934, as amended (the "Housing Act") and mortgage pass-through
certificates (the "GNMA Certificates") guaranteed by the Government National
Mortgage Association ("GNMA") that are backed by fixed rate, level payment,
fully-amortizing mortgage loans (the "Underlying Loans" and together with the
Mortgage Loans, the "FHA Loans") insured by the FHA. The Trust Fund was formed
and the Mortgage Loans and the GNMA Certificates were transferred thereto at
the direction of
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
Certificate Interest Initial Class Notional
Rate: Variable Amount of the Class A-X-4
Certificates: $_____________
Cut-off Date:
November 1, 1995 Initial Certificate Notional
Amount of this Certificate:
Closing Date: $____________
November 21, 1995
First Distribution Date:
December 26, 1995
Cusip No. ___________
Certificate No. A-X-4-______
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
A-8-1
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"). THE FOLLOWING
INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S. FEDERAL
INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE. THE
ISSUE DATE OF THIS CERTIFICATE IS NOVEMBER 21, 1995. ASSUMING THAT THE MORTGAGE
LOANS PREPAY AT AN ASSUMED RATE OF PREPAYMENT USED SOLELY FOR THE PURPOSES OF
APPLYING THE OID RULES TO THE CERTIFICATES EQUAL TO A CPR (AS DEFINED IN THE
PROSPECTUS DATED NOVEMBER 13, 1995 AND THE PROSPECTUS SUPPLEMENT DATED NOVEMBER
15, 1995 RELATING TO THIS CERTIFICATE) OF 0% (THE "PREPAYMENT ASSUMPTION"),
THIS CERTIFICATE HAS BEEN ISSUED WITH NO MORE THAN $_________ OF OID PER
$__________ OF INITIAL CERTIFICATE NOTIONAL AMOUNT, THE YIELD TO MATURITY IS
____% PER ANNUM, AND THE AMOUNT OF OID ATTRIBUTABLE TO THE INITIAL ACCRUAL
PERIOD IS NO MORE THAN $_________ PER $__________ OF INITIAL CERTIFICATE
NOTIONAL AMOUNT, COMPUTED UNDER THE EXACT METHOD. NO REPRESENTATION IS MADE
THAT THE MORTGAGE LOANS WILL PREPAY AT A RATE BASED ON THE PREPAYMENT
ASSUMPTION OR AT ANY OTHER RATE.
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF CS FIRST
BOSTON MORTGAGE SECURITIES CORP., GREYSTONE FUNDING CORPORATION, GREYSTONE
SERVICING CORPORATION, INC. OR THE TRUSTEE REFERRED TO BELOW, OR OF ANY OF
THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED OR INSURED BY ANY
GOVERNMENT AGENCY OR INSTRUMENTALITY.
THIS CERTIFIES THAT ______________ is the registered owner of a
beneficial interest in the Trust Fund, which was created pursuant to the
Pooling and Servicing Agreement, dated as of November 1, 1995 (the
"Agreement"), among CS First Boston Mortgage Securities Corp. as depositor (the
"Depositor", which term includes any successor entity under the Agreement),
Greystone Servicing Corporation, Inc. as master servicer (the "Master
Servicer", which term includes any successor entity under the Agreement),
Greystone Funding Corporation as seller (the "Seller", which term includes any
successor entity under the Agreement) and LaSalle National Bank as trustee (the
"Trustee", which term includes any successor entity under the Agreement). This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the Agreement, and nothing herein shall be deemed inconsistent with
that meaning. If the terms hereof are inconsistent with the Agreement, the
Agreement shall control.
This Certificate is one of a duly authorized issue of
certificates of CS First Boston Mortgage Securities Corp., designated as its
Mortgage Pass-Through Certificates, Series 1995-FHA1 (the "Certificates"),
which is comprised of the following eleven classes (each, a "Class"): the Class
A-1, Class A-2, Class A-3, Class A-4, Class A-X-1, Class A-X-2, Class A-X-3 and
Class A-X-4, Class B, Class R-I and Class R-II Certificates. Reference is
hereby made to the
A-8-2
Agreement for a statement of the respective rights thereunder of the Depositor,
the Seller, the Master Servicer, the Trustee and the Holders of each Class of
the Certificates and the terms upon which the Certificates are authenticated
and delivered. This Certificate represents an interest in the Trust Fund,
which Trust Fund consists of, among other things, (i) the Mortgage Assets and
all payments under and proceeds of such Mortgage Assets (other than any
Retained Yield) received after the Cut-off Date (exclusive of any payment of or
relating to principal and interest due on the FHA Loans on or before the Cut-
off Date), together with all documents included in the related Mortgage Files
and Servicing Files for the Mortgage Loans; (ii) the FHA Mortgage Insurance in
respect of the Mortgage Loans, together with all FHA Insurance Benefits (other
than any Retained Yield) derived therefrom; (iii) such funds or assets (other
than any Retained Yield) as from time to time are deposited in the Distribution
Account and/or the Collection Account; (iv) any insurance policies with respect
to the Mortgage Loans; and (v) all proceeds of the conversion, voluntary or
involuntary, of any of the foregoing into cash or other liquid property.
This Class A-X-4 Certificate represents a Percentage Interest
in the related Class equal to the initial Certificate Notional Amount hereof
divided by the Initial Class Notional Amount of the Class A-X-4 Certificates,
both as set forth above.
The Trustee shall distribute from the Distribution Account, to
the extent of available funds, on the 25th day of each calendar month or, if
such 25th day is not a Business Day, the Business Day immediately following
such 25th day (each, a "Distribution Date"), commencing in December, 1995, to
the Person in whose name this Certificate is registered at the close of
business on the last Business Day of the month immediately preceding the month
of such distribution (each, a "Record Date"), interest and Prepayment Premiums
in an amount equal to the product of the Percentage Interest evidenced by this
Certificate and that portion of the Available Distribution Amount and
Prepayment Premiums that are allocated to distributions on the related Class of
Certificates on such Distribution Date.
Not later than each Distribution Date, the Trustee will send to
each Certificateholder a statement containing information relating to the
Mortgage Assets and payments made to Certificateholders.
Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Holder hereof entitled thereto as such
address appears in the Certificate Register or, if such Holder holds one or
more Interest-Only Certificates with an initial Certificate Notional Amount of
at least $10,000,000, by wire transfer in immediately available funds to the
account of such Certificateholder designated in writing to the Trustee at least
five Business Days prior to the applicable Record Date. Notwithstanding the
above, the final distribution on this Certificate will be made after due notice
of the pendency of such final distribution and only upon presentation and
surrender of this Certificate at the office or agency designated in such
notice.
The Agreement permits, with certain exceptions as therein
provided, the amendment thereof by the Depositor, the Master Servicer, the
Seller and the Trustee with the
A-8-3
consent of the Holders of Certificates entitled to, in the aggregate, not less
than 66-2/3% of the Voting Rights of all the Certificates affected by any such
amendments, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Agreement or for the purpose
of modifying in any manner the rights of the Holders of the Certificates;
provided, however, that no such amendment may (i) reduce in any manner the
amount of, delay the timing of or change the manner in which payments received
on Mortgage Assets are required to be distributed in respect of any Certificate
without the consent of the Holder of such Certificate; (ii) modify the
amendment provisions of the Agreement without the consent of all the
Certificateholders; or (iii) modify the servicing standard set forth in the
Agreement pursuant to which the Master Servicer shall service and administer
the Mortgage Loans. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. Under certain limited circumstances set forth
therein, the Agreement may be amended by the parties thereto without the
consent of any Holder.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable on the
Certificate Register upon surrender of this Certificate for registration of
transfer at the office or agency of the Trustee designated therefor, duly
endorsed by, or accompanied by a written instrument of transfer in a form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
interest in the Trust Fund, will be issued to the designated transferee or
transferees.
The Class A-X-4 Certificates will be issued in fully registered
form in minimum denominations of $1,000,000 initial Certificate Notional Amount
and in integral multiples of $1 in excess of such amount. As provided in the
Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates of the same Class
in authorized denominations and evidencing a like aggregate Certificate
Notional Balance, as requested by the Holder surrendering the same.
No service charge will be made for such registrations of
transfers or exchanges, but the Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the person in whose name
this Certificate is registered as the owner hereof for all purposes, and
neither the Trustee nor any such agent thereof shall be affected by notice to
the contrary.
The obligations and responsibilities of the Depositor, the
Master Servicer and the Trustee created by the Agreement will terminate upon
the earliest of (i) the purchase by the Master Servicer, at its election, of
all the Mortgage Assets remaining in the Trust Fund and the corresponding
distribution to Certificateholders of all amounts required to be distributed to
them, which repurchase right the Master Servicer may exercise at its sole and
exclusive election if the aggregate Stated Principal Balance of the Mortgage
Pool at the time of the repurchase is less than 5% of the aggregate Cut-off
Date Balance of the Mortgage Pool; (ii) the maturity or other
A-8-4
liquidation (or any advance with respect thereto) of the last Mortgage Asset
remaining in the Trust Fund and the corresponding distribution to
Certificateholders of all amounts required to be distributed to them; or (iii)
the mutual agreement of the parties to the Agreement and the Certificateholders
as to such termination.
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid or
obligatory for any purpose.
A-8-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed under its corporate seal.
LASALLE NATIONAL BANK,
as Trustee
By:__________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-X-4 Certificates referred to in the within-mentioned
Agreement.
Date:
LASALLE NATIONAL BANK,
as Trustee
By:______________________________
Authorized Officer
A-8-6
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sell(s), assign(s) and
transfer(s) unto ____________________________________________________________
____________________________________________________ (Please print or typewrite
name and address, including postal zip code, of assignee) the undivided
interest in the Trust Fund evidenced by the within Certificate and hereby
authorize(s) the transfer of registration of such interest to the assignee on
the Certificate Register.
I (we) further direct the Trustee to issue a new Certificate of the
same Class and of a like initial Certificate Notional Amount and undivided
interest in the Trust Fund to the above-named assignee and to deliver such
Certificate to the following address _________________________________________
______________________________________________________________________________
Dated: _______________, ____
Social Security or ______________________________
other Tax Identification Signature by or on behalf of
No. of Assignee: assignor (signature must be signed
as registered)
_____________________________ _______________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for the information
of the Trustee:
Distribution shall be made by check mailed to _________________
______________________________________________________________________________,
or if the aggregate initial Certificate Notional Amount of Interest-Only
Certificates held by the Holder is at least $10,000,000 and the Trustee shall
have received appropriate wiring instructions in accordance with the Agreement,
by wire transfer in immediately available funds to _______________ for the
account of ________________, account number ______________. This information
is provided by the assignee named above, or its agent.
A-8-7
EXHIBIT A-9
FORM OF CLASS B CERTIFICATE
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-FHA1, CLASS B
Evidencing an undivided interest in a trust fund (the "Trust Fund") whose
assets consist primarily of a pool (the "Mortgage Pool") of fixed-rate, level
payment, fully-amortizing mortgage loans (the "Mortgage Loans") insured by the
Federal Housing Administration (the "FHA") of the United States Department of
Housing and Urban Development ("HUD") under certain sections of the National
Housing Act of 1934, as amended (the "Housing Act") and mortgage pass-through
certificates (the "GNMA Certificates") guaranteed by the Government National
Mortgage Association ("GNMA") that are backed by fixed rate, level payment,
fully-amortizing mortgage loans (the "Underlying Loans" and together with the
Mortgage Loans, the "FHA Loans") insured by the FHA. The Trust Fund was formed
and the Mortgage Loans and the GNMA Certificates were transferred thereto at
the direction of
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
Certificate Interest Initial Class Principal
Rate: Variable Balance of the Class B
Certificates: $_____________
Cut-off Date:
November 1, 1995 Initial Certificate Principal
Balance of this Certificate:
Closing Date: $____________
November 21, 1995
First Distribution Date:
December 26, 1995
Cusip No. ___________
Certificate No. B-______
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT"
A-9-1
AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
CODE. THE FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF
APPLYING THE U.S. FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO
THIS CERTIFICATE. THE ISSUE DATE OF THIS CERTIFICATE IS NOVEMBER 21, 1995.
ASSUMING THAT THE LOANS PREPAY AT AN ASSUMED RATE OF PREPAYMENT USED SOLELY FOR
THE PURPOSES OF APPLYING THE OID RULES TO THE CERTIFICATES EQUAL TO A CPR (AS
DEFINED IN THE PROSPECTUS DATED NOVEMBER 13, 1995 AND THE PROSPECTUS SUPPLEMENT
DATED NOVEMBER 15, 1995 RELATING TO THIS CERTIFICATE) OF 0% (THE "PREPAYMENT
ASSUMPTION"), THIS CERTIFICATE HAS BEEN ISSUED WITH NO MORE THAN $_________ OF
OID PER $__________ OF INITIAL CERTIFICATE NOTIONAL AMOUNT, THE YIELD TO
MATURITY IS ____% PER ANNUM, AND THE AMOUNT OF OID ATTRIBUTABLE TO THE INITIAL
ACCRUAL PERIOD IS NO MORE THAN $_________ PER $__________ OF INITIAL
CERTIFICATE NOTIONAL AMOUNT, COMPUTED UNDER THE EXACT METHOD. NO
REPRESENTATION IS MADE THAT THE LOANS WILL PREPAY AT A RATE BASED ON THE
PREPAYMENT ASSUMPTION OR AT ANY OTHER RATE.
THIS CLASS B CERTIFICATE IS SUBORDINATED TO THE OTHER CLASSES OF CERTIFICATES
OF THE SAME SERIES TO THE EXTENT PROVIDED IN THE POOLING AND SERVICING
AGREEMENT DESCRIBED HEREIN.
NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO AN EMPLOYEE BENEFIT PLAN OR
OTHER RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA"), OR THE CODE, OR TO ANY PERSON WHO IS
DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE ON BEHALF OF, AS NAMED
FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS OF ANY SUCH EMPLOYEE BENEFIT PLAN
OR OTHER RETIREMENT ARRANGEMENT, WILL BE REGISTERED EXCEPT IN COMPLIANCE WITH
THE PROCEDURES DESCRIBED HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 AS AMENDED (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH
REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT
REQUIRE SUCH REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE
PROVISIONS OF SECTION 6.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF CS FIRST
BOSTON MORTGAGE SECURITIES CORP., GREYSTONE FUNDING CORPORATION, GREYSTONE
SERVICING CORPORATION, INC., OR THE TRUSTEE REFERRED TO BELOW, OR OF ANY OF
THEIR AFFILIATES. THIS CERTIFICATE IS
A-9-2
NOT GUARANTEED OR INSURED BY ANY GOVERNMENT AGENCY OR INSTRUMENTALITY.
THIS CERTIFIES THAT ________________ is the registered owner of
a beneficial interest in the Trust Fund, which was created pursuant to the
Pooling and Servicing Agreement, dated as of November 1, 1995 (the
"Agreement"), among CS First Boston Mortgage Securities Corp. as depositor (the
"Depositor", which term includes any successor entity under the Agreement),
Greystone Servicing Corporation, Inc. as master servicer (the "Master
Servicer", which term includes any successor entity under the Agreement),
Greystone Funding Corporation as seller (the "Seller", which term includes any
successor entity under the Agreement) and LaSalle National Bank as trustee (the
"Trustee", which term includes any successor entity under the Agreement). This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the Agreement, and nothing herein shall be deemed inconsistent with
that meaning. If the terms hereof are inconsistent with the Agreement, the
Agreement shall control.
This Certificate is one of a duly authorized issue of
certificates of CS First Boston Mortgage Securities Corp., designated as its
Mortgage Pass-Through Certificates, Series 1995-FHA1 (the "Certificates"),
which is comprised of the following eleven classes (each, a "Class"): the Class
A-1, Class A-2, Class A-3, Class A-4, Class A-X-1, Class A-X-2, Class A-X-3 and
Class A-X-4, Class B, Class R-I and Class R-II Certificates. Reference is
hereby made to the Agreement for a statement of the respective rights
thereunder of the Depositor, the Seller, the Master Servicer, the Trustee and
the Holders of each Class of the Certificates and the terms upon which the
Certificates are authenticated and delivered. This Certificate represents an
interest in the Trust Fund, which Trust Fund consists of, among other things,
(i) the Mortgage Assets and all payments under and proceeds of such Mortgage
Assets (other than any Retained Yield) received after the Cut-off Date
(exclusive of any payments of or relating to principal and interest due on the
FHA Loans on or before the Cut-off Date), together with all documents included
in the related Mortgage Files and Servicing Files for the Mortgage Loans; (ii)
the FHA Mortgage Insurance in respect of the Mortgage Loans, together with all
FHA Insurance Benefits (other than any Retained Yield) derived therefrom; (iii)
such funds or assets (other than any Retained Yield) as from time to time are
deposited in the Distribution Account and/or the Collection Account; (iv) any
insurance policies with respect to the Mortgage Loans; and (v) all proceeds of
the conversion, voluntary or involuntary, of any of the foregoing into cash or
other liquid property.
This Class B Certificate represents a Percentage Interest in
the related class equal to the initial Certificate Principal Balance hereof
divided by the Initial Class Principal Balance of the Class B Certificates,
both as set forth above.
The Trustee shall distribute from the Distribution Account, to
the extent of available funds, on the 25th day of each calendar month or, if
such 25th day is not a Business Day, the Business Day immediately following
such 25th day (each, a "Distribution Date"),
A-9-3
commencing in December, 1995, to the Person in whose name this Certificate is
registered at the close of business on the last Business Day of the month
immediately preceding the month of such distribution (each, a "Record Date"),
interest, principal and Prepayment Premiums in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and that portion of
the Available Distribution Amount and Prepayment Premiums that are allocated to
distributions on the related Class of Certificates on such Distribution Date.
Not later than each Distribution Date, the Trustee will send to
each Certificateholder a statement containing information relating to the
Mortgage Assets and payments made to Certificateholders.
Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Holder hereof entitled thereto as such
address appears in the Certificate Register or, if such Holder holds one or
more Certificates with an aggregate initial Certificate Principal Balance of at
least $2,000,000, by wire transfer in immediately available funds to the
account of such Certificateholder designated in writing to the Trustee at least
five Business Days prior to the applicable Record Date. Notwithstanding the
above, the final distribution on this Certificate will be made after due notice
of the pendency of such final distribution and only upon presentation and
surrender of this Certificate at the office or agency designated in such
notice.
The Agreement permits, with certain exceptions as therein
provided, the amendment thereof by the Depositor, the Master Servicer, the
Seller and the Trustee with the consent of the Holders of Certificates entitled
to, in the aggregate, not less than 66-2/3% of the Voting Rights of all the
Certificates affected by any such amendments, for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
the Agreement or for the purpose of modifying in any manner the rights of the
Holders of the Certificates; provided, however, that no such amendment may (i)
reduce in any manner the amount of, delay the timing of or change the manner in
which payments received on Mortgage Assets are required to be distributed in
respect of any Certificate without the consent of the Holder of such
Certificate; (ii) modify the amendment provisions of the Agreement without the
consent of all the Certificateholders; or (iii) modify the servicing standard
set forth in the Agreement pursuant to which the Master Servicer shall service
and administer the Mortgage Loans. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. Under certain limited circumstances set
forth therein, the Agreement may be amended by the parties thereto without the
consent of any Holder.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable on the
Certificate Register upon surrender of this Certificate for registration of
transfer at the office or agency of the Trustee designated therefor, duly
endorsed by, or accompanied by a written instrument of transfer in a form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized
A-9-4
denominations and evidencing the same aggregate interest in the Trust Fund,
will be issued to the designated transferee or transferees.
No transfer of this Certificate or any interest herein shall be
made to any employee benefit plan that is subject to ERISA or the Code, or a
trustee of such plan, unless the prospective Transferee provides the Trustee
with a certification in the form attached to the Agreement as Exhibit E or an
Opinion of Counsel which establishes to the reasonable satisfaction of the
Depositor and the Trustee that the purchase and holding of this Certificate or
any interest herein by or on behalf of such employee benefit plan would not
result in the assets of the Trust Fund being deemed "plan assets" and subject
to the fiduciary responsibility provisions of ERISA or the prohibited
transaction provisions of the Code (or comparable provisions of any subsequent
enactments), would not constitute or result in a prohibited transaction under
Section 406 of ERISA or Section 4975 of the Code, and would not subject the
Depositor or the Trustee to any obligation or liability (including liabilities
under ERISA or Section 4975 of the Code) in addition to those undertaken in the
Agreement or any other liability. If no such certification in the form
attached to the Agreement as Exhibit E and no such Opinion of Counsel are so
delivered, the Trustee shall require that such prospective Transferee certify
to the Trustee in writing the facts establishing that such Transferee is not
such an employee benefit plan.
No transfer of this Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration or qualification. In the event that a transfer of this
Certificate is to be made without registration under the Securities Act, the
Trustee shall require, in order to assure compliance with such laws: (i) if
such transfer is purportedly being made based on Rule 144A, that the
Certificateholder desiring to effect the transfer and the prospective
Transferee each certify to the Trustee in writing in the forms attached to the
Agreement as Exhibit D-1 and Exhibit D-2, respectively, the facts surrounding
the transfer; and (ii) in all other cases, that it and the Depositor receive an
Opinion of Counsel reasonably satisfactory to the Trustee and the Depositor
that such transfer may be made without such registration, which Opinion of
Counsel shall not be an expense of the Depositor, the Trustee or the Trust
Fund. Neither the Depositor nor the Trustee is obligated to register or
qualify this Certificate under the Securities Act or any other securities law
or to take any action not otherwise required under the Agreement to permit the
transfer of this Certificate without registration or qualification. Any Holder
hereof desiring to effect a transfer hereof shall indemnify the Trustee and the
Depositor against any liability that may result if the transfer is not so
exempt, or is not made in accordance with federal and state laws.
The Class B Certificates will be issued in fully registered
form in minimum denominations of $25,000 initial Certificate Principal Balance
and in integral multiples of $1 in excess of such amount. As provided in the
Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates of the same Class
in authorized denominations and evidencing a like aggregate Certificate
Principal Balance, as requested by the Holder surrendering the same.
A-9-5
No service charge will be made for such registrations of
transfers or exchanges, but the Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the person in whose name
this Certificate is registered as the owner hereof for all purposes, and
neither the Trustee nor any such agent thereof shall be affected by notice to
the contrary.
The obligations and responsibilities of the Depositor, the
Master Servicer, the Seller and the Trustee created by the Agreement will
terminate upon the earliest of (i) the purchase by the Master Servicer, at its
election, of all the Mortgage Assets remaining in the Trust Fund and the
corresponding distribution to Certificateholders of all amounts required to be
distributed to them, which repurchase right the Master Servicer may exercise at
its sole and exclusive election if the aggregate Stated Principal Balance of
the Mortgage Pool at the time of the repurchase is less than 5% of the
aggregate Cut-off Date Balance of the Mortgage Pool; (ii) the maturity or other
liquidation (or any advance with respect thereto) of the last Mortgage Asset
remaining in the Trust Fund and the corresponding distribution to
Certificateholders of all amounts required to be distributed to them; or (iii)
the mutual agreement of the parties to the Agreement and the Certificateholders
as to such termination.
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid or
obligatory for any purpose.
A-9-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed under its corporate seal.
LASALLE NATIONAL BANK,
as Trustee
By:__________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class B Certificates referred to in the within-mentioned
Agreement.
Date:
LASALLE NATIONAL BANK,
as Trustee
By:______________________________
Authorized Officer
A-9-7
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sell(s), assign(s) and
transfer(s) unto ____________________________________________________________
____________________________________________________ (Please print or typewrite
name and address, including postal zip code, of assignee) the undivided
interest in the Trust Fund evidenced by the within Certificate and hereby
authorize(s) the transfer of registration of such interest to the assignee on
the Certificate Register.
I (we) further direct the Trustee to issue a new Certificate of the
same Class and of a like initial Certificate Principal Balance and undivided
interest in the Trust Fund to the above-named assignee and to deliver such
Certificate to the following address ________________________________________
_____________________________________________________________________________
Dated: ________________, ____
Social Security or ______________________________
other Tax Identification Signature by or on behalf of
No. of Assignee: assignor (signature must be signed
as registered)
_____________________________ _______________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for the information
of the Trustee:
Distribution shall be made by check mailed to _________________
______________________________________________________________________________,
or if the aggregate initial Certificate Principal Balance of all Certificates
held by the Holder is at least $2,000,000 and the Trustee shall have received
appropriate wiring instructions in accordance with the Agreement, by wire
transfer in immediately available funds to _______________ for the account of
________________, account number ______________. This information is provided
by the assignee named above, or its agent.
A-9-8
EXHIBIT A-10
FORM OF CLASS R-I CERTIFICATE
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
MORTGAGE PASS-THROUGH CERTIFICATE,
Evidencing an undivided interest in a trust fund (the "Trust Fund") whose
assets consist primarily of a pool (the "Mortgage Pool") of fixed-rate, level
payment, fully-amortizing mortgage loans (the "Mortgage Loans") insured by the
Federal Housing Administration (the "FHA") of the United States Department of
Housing and Urban Development ("HUD") under certain sections of the National
Housing Act of 1934, as amended (the "Housing Act") and mortgage pass-through
certificates (the "GNMA Certificates") guaranteed by the Government National
Mortgage Association ("GNMA") that are backed by fixed rate, level payment,
fully-amortizing mortgage loans (the "Underlying Loans" and together with the
Mortgage Loans, the "FHA Loans") insured by the FHA. The Trust Fund was formed
and the Mortgage Loans and the GNMA Certificates were transferred thereto at
the direction of
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
Certificate Interest Percentage Interest in
Rate: N/A the Class R-I Certificates
evidenced by this Certificate
Cut-off Date: ______%
November 1, 1995
Initial Certificate Principal
Closing Date: Principal Balance of this
November 21, 1995 Certificate: $0
First Distribution Date:
December 26, 1995
Cusip No. ___________
Certificate No. R-I-______
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
A-10-1
THE INTERNAL REVENUE CODE OF 1986 (THE "CODE"). CONSEQUENTLY, TRANSFER OF THIS
CERTIFICATE IS SUBJECT TO THE TAX RELATED TRANSFER RESTRICTIONS DESCRIBED
HEREIN.
THIS CLASS R-I CERTIFICATE IS SUBORDINATED TO THE OTHER CLASSES OF CERTIFICATES
OF THE SAME SERIES TO THE EXTENT PROVIDED IN THE POOLING AND SERVICING
AGREEMENT DESCRIBED HEREIN.
NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO AN EMPLOYEE BENEFIT PLAN OR
OTHER RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA"), OR THE CODE, OR TO ANY PERSON WHO IS
DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE ON BEHALF OF, AS NAMED
FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS OF ANY SUCH EMPLOYEE BENEFIT PLAN
OR OTHER RETIREMENT ARRANGEMENT, WILL BE REGISTERED EXCEPT IN COMPLIANCE WITH
THE PROCEDURES DESCRIBED HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 AS AMENDED (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH
REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT
REQUIRE SUCH REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE
PROVISIONS OF SECTION 6.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF CS FIRST
BOSTON MORTGAGE SECURITIES CORP., GREYSTONE FUNDING CORPORATION, GREYSTONE
SERVICING CORPORATION, INC. OR THE TRUSTEE REFERRED TO BELOW, OR OF ANY OF
THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED OR INSURED BY ANY
GOVERNMENT AGENCY OR INSTRUMENTALITY.
THIS CERTIFIES THAT _______________ is the registered owner of
a beneficial interest in the Trust Fund, which was created pursuant to the
Pooling and Servicing Agreement, dated as of November 1, 1995 (the
"Agreement"), among CS First Boston Mortgage Securities Corp. as depositor (the
"Depositor", which term includes any successor entity under the Agreement),
Greystone Servicing Corporation, Inc. as master servicer (the "Master
Servicer", which term includes any successor entity under the Agreement),
Greystone Funding Corporation as seller (the "Seller", which term includes any
successor entity under the Agreement) and LaSalle National Bank as trustee (the
"Trustee", which term includes any successor entity under the Agreement). This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the
A-10-2
Agreement, and nothing herein shall be deemed inconsistent with that meaning.
If the terms hereof are inconsistent with the Agreement, the Agreement shall
control.
This Certificate is one of a duly authorized issue of
certificates of CS First Boston Mortgage Securities Corp., designated as its
Mortgage Pass-Through Certificates, Series 1995-FHA1 (the "Certificates"),
which is comprised of the following eleven classes (each, a "Class"): the Class
A-1, Class A-2, Class A-3, Class A-4, Class A-X-1, Class A-X-2, Class A-X-3 and
Class A-X-4, Class B, Class R-I and Class R-II Certificates. Reference is
hereby made to the Agreement for a statement of the respective rights
thereunder of the Depositor, the Seller, the Master Servicer, the Trustee and
the Holders of each Class of the Certificates and the terms upon which the
Certificates are authenticated and delivered. This Certificate represents an
interest in the Trust Fund, which Trust Fund consists of, among other things,
(i) the Mortgage Assets and all payments under and proceeds of such Mortgage
Assets (other than any Retained Yield) received after the Cut-off Date
(exclusive of any payment of or relating to principal and interest due on the
FHA Loans on or before the Cut-off Date), together with all documents included
in the related Mortgage Files and Servicing Files for the Mortgage Loans; (ii)
the FHA Mortgage Insurance in respect of the Mortgage Loans, together with all
FHA Insurance Benefits (other than any Retained Yield) derived therefrom; (iii)
such funds or assets (other than any Retained Yield) as from time to time are
deposited in the Distribution Account and/or the Collection Account; (iv) any
insurance policies with respect to the Mortgage Loans; and (v) all proceeds of
the conversion, voluntary or involuntary, of any of the foregoing into cash or
other liquid property.
The Trustee shall distribute from the Distribution Account, to
the extent of available funds, on the 25th day of each calendar month or, if
such 25th day is not a Business Day, the Business Day immediately following
such 25th day (each, a "Distribution Date"), commencing in December, 1995, to
the Person in whose name this Certificate is registered at the close of
business on the last Business Day of the month immediately preceding the month
of such distribution (each, a "Record Date"), a distribution in an amount equal
to the product of the Percentage Interest evidenced by this Certificate (as set
forth above) and that portion of the Available Distribution Amount, if any,
that is allocated to distributions on the related Class of Certificates on such
Distribution Date.
Not later than each Distribution Date, the Trustee will send to
each Certificateholder a statement containing information relating to the
Mortgage Assets and payments made to Certificateholders.
Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Holder hereof entitled thereto as such
address appears in the Certificate Register. Notwithstanding the above, the
final distribution on this Certificate will be made after due notice of the
pendency of such final distribution and only upon presentation and surrender of
this Certificate at the office or agency designated in such notice.
The Agreement permits, with certain exceptions as therein
provided, the amendment thereof by the Depositor, the Master Servicer, the
Seller and the Trustee with the
A-10-3
consent of the Holders of Certificates entitled to, in the aggregate, not less
than 66-2/3% of the Voting Rights of all the Certificates affected by any such
amendments, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Agreement or for the purpose
of modifying in any manner the rights of the Holders of the Certificates;
provided, however, that no such amendment may (i) reduce in any manner the
amount of, delay the timing of or change the manner in which payments received
on Mortgage Assets are required to be distributed in respect of any Certificate
without the consent of the Holder of such Certificate; (ii) modify the
amendment provisions of the Agreement without the consent of all the
Certificateholders; or (iii) modify the servicing standard set forth in the
Agreement pursuant to which the Master Servicer shall service and administer
the Mortgage Loans. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. Under certain limited circumstances set forth
therein, the Agreement may be amended by the parties thereto without the
consent of any Holder.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable on the
Certificate Register upon surrender of this Certificate for registration of
transfer at the office or agency of the Trustee designated therefor, duly
endorsed by, or accompanied by a written instrument of transfer in a form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
interest in the Trust Fund will be issued to the designated transferee or
transferees.
No transfer of this Certificate or any interest herein shall be
made to any employee benefit plan that is subject to ERISA or the Code, or a
trustee of such plan, unless the prospective Transferee provides the Trustee
with a certification in the form attached to the Agreement as Exhibit E or an
Opinion of Counsel which establishes to the reasonable satisfaction of the
Depositor and the Trustee that the purchase and holding of this Certificate or
any interest herein by or on behalf of such employee benefit plan would not
result in the assets of the Trust Fund being deemed "plan assets" and subject
to the fiduciary responsibility provisions of ERISA or the prohibited
transaction provisions of the Code (or comparable provisions of any subsequent
enactments), would not constitute or result in a prohibited transaction under
Section 406 of ERISA or Section 4975 of the Code, and would not subject the
Depositor or the Trustee to any obligation or liability (including liabilities
under ERISA or Section 4975 of the Code) in addition to those undertaken in the
Agreement or any other liability. If no such certification in the form
attached to the Agreement as Exhibit E and no such Opinion of Counsel are so
delivered, the Trustee shall require that such prospective Transferee certify
to the Trustee in writing the facts establishing that such Transferee is not
such an employee benefit plan.
No transfer of this Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not
A-10-4
require such registration or qualification. In the event that a transfer of
this Certificate is to be made without registration under the Securities Act,
the Trustee shall require, in order to assure compliance with such laws: (i)
if such transfer is purportedly being made based on Rule 144A, that the
Certificateholder desiring to effect the transfer and the prospective
Transferee each certify to the Trustee in writing in the forms attached to the
Agreement as Exhibit D-1 and Exhibit D-2, respectively, the facts surrounding
the transfer; and (ii) in all other cases, that it and the Depositor receive an
Opinion of Counsel reasonably satisfactory to the Trustee and the Depositor
that such transfer may be made without such registration, which Opinion of
Counsel shall not be an expense of the Depositor, the Trustee or the Trust
Fund. Neither the Depositor nor the Trustee is obligated to register or
qualify this Certificate under the Securities Act or any other securities law
or to take any action not otherwise required under the Agreement to permit the
transfer of this Certificate without registration or qualification. Any Holder
hereof desiring to effect a transfer hereof shall indemnify the Trustee and the
Depositor against any liability that may result if the transfer is not so
exempt, or is not made in accordance with federal and state laws.
In addition to the foregoing and notwithstanding anything to
the contrary contained herein or in the Agreement, this Certificate may not be
owned, pledged or Transferred, directly or indirectly, by or to a Disqualified
Organization.
Prior to and as a condition of the registration of any
Transfer, sale or other disposition of this Certificate, (i) the proposed
Transferee, including the initial Holder of this Certificate, shall deliver to
the Trustee a Transferee Affidavit and Agreement, in substantially the form
attached to the Agreement as Exhibit F-1, representing and warranting, among
other things, that such Transferee is not a non-U.S. Person, that such
Transferee is other than a Disqualified Organization, that it is not acquiring
its Ownership Interest in this Certificate as a nominee, trustee or agent for
any Person who is not other than a Disqualified Organization, that for so long
as it retains its Ownership Interest in this Certificate, it will endeavor to
remain a Permitted Transferee, and that it has reviewed the provisions of
Section 6.02(g) of the Agreement and agrees to be bound by them, and (ii) the
proposed Transferor shall deliver to the Trustee a certificate, in
substantially the form attached to the Agreement as Exhibit F-2, representing
and warranting, among other things, that no purpose of the proposed Transfer is
to allow such Holder to impede the assessment or collection of tax.
Notwithstanding the delivery of a Transferee Affidavit and Agreement, if the
Trustee has actual knowledge that the proposed Transferee is not a Permitted
Transferee, no Transfer of an Ownership Interest in this Certificate to such
proposed Transferee shall be effected. Each Person holding or acquiring any
Ownership Interest in this Certificate agrees, by holding or acquiring such
Ownership Interest, to require a Transferee Affidavit and Agreement from any
other Person to whom such Person attempts to Transfer its Ownership Interest
and to provide a certificate in the form attached to the Agreement as Exhibit
F-2 and to obtain the express written consent of the Depositor prior to any
Transfer of such Ownership Interest, which consent may be withheld in the
Depositor's sole discretion.
The Class R-I Certificates will be issued in fully registered
form only, without coupons, in minimum denominations representing percentage
interests specified in the
A-10-5
Agreement. As provided in the Agreement and subject to certain limitations
therein set forth, this Certificate is exchangeable for one or more new
Certificates of the same Class in authorized denominations and evidencing a
like aggregate Certificate Principal Balance, as requested by the Holder
surrendering the same.
No service charge will be made for such registrations of
transfers or exchanges, but the Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the person in whose name
this Certificate is registered as the owner hereof for all purposes, and
neither the Trustee nor any such agent thereof shall be affected by notice to
the contrary.
The obligations and responsibilities of the Depositor, the
Master Servicer, the Seller and the Trustee created by the Agreement will
terminate upon the earliest of (i) the purchase by the Master Servicer, at its
election, of all the Mortgage Assets remaining in the Trust Fund and the
corresponding distribution to Certificateholders of all amounts required to be
distributed to them, which repurchase right the Master Servicer may exercise at
its sole and exclusive election if the aggregate Stated Principal Balance of
the Mortgage Pool at the time of the repurchase is less than 5% of the
aggregate Cut-off Date Balance of the Mortgage Pool; (ii) the maturity or other
liquidation (or any advance with respect thereto) of the last Mortgage Asset
remaining in the Trust Fund and the corresponding distribution to
Certificateholders of all amounts required to be distributed to them; or (iii)
the mutual agreement of the parties to the Agreement and the Certificateholders
as to such termination.
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid or
obligatory for any purpose.
A-10-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed under its corporate seal.
LASALLE NATIONAL BANK,
as Trustee
By:__________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class R-I Certificates referred to in the within-mentioned
Agreement.
Date:
LASALLE NATIONAL BANK,
as Trustee
By:______________________________
Authorized Officer
A-10-7
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sell(s), assign(s) and
transfer(s) unto ____________________________________________________________
____________________________________________________ (Please print or typewrite
name and address, including postal zip code, of assignee) the undivided
interest in the Trust Fund evidenced by the within Certificate and hereby
authorize(s) the transfer of registration of such interest to the assignee on
the Certificate Register.
I (we) further direct the Trustee to issue a new Certificate of the
same Class and of a like Percentage Interest and undivided interest in the
Trust Fund to the above-named assignee and to deliver such Certificate to the
following address _____________________________________________________________
_______________________________________________________________________________
Dated: _______________, ____
Social Security or ______________________________
other Tax Identification Signature by or on behalf of
No. of Assignee: assignor (signature must be signed
as registered)
_____________________________ _______________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for the information
of the Trustee:
Distribution shall be made by check mailed to _________________
______________________________________________________________________________.
This information is provided by the assignee named above, or its agent.
A-10-8
EXHIBIT A-11
FORM OF CLASS R-II CERTIFICATE
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
MORTGAGE PASS-THROUGH CERTIFICATE,
Evidencing an undivided interest in a trust fund (the "Trust Fund") whose
assets consist primarily of a pool (the "Mortgage Pool") of fixed-rate, level
payment, fully-amortizing mortgage loans (the "Mortgage Loans") insured by the
Federal Housing Administration (the "FHA") of the United States Department of
Housing and Urban Development ("HUD") under certain sections of the National
Housing Act of 1934, as amended (the "Housing Act") and mortgage pass-through
certificates (the "GNMA Certificates") guaranteed by the Government National
Mortgage Association ("GNMA") that are backed by fixed rate, level payment,
fully-amortizing mortgage loans (the "Underlying Loans" and together with the
Mortgage Loans, the "FHA Loans") insured by the FHA. The Trust Fund was formed
and the Mortgage Loans the GNMA Certificates were transferred thereto at the
direction of
CS FIRST BOSTON MORTGAGE SECURITIES CORP.
Certificate Interest Percentage Interest in
Rate: N/A the Class R-II Certificates
evidenced by this Certificate
Cut-off Date: ______%
November 1, 1995
Initial Certificate Principal
Closing Date: Principal Balance of this
November 21, 1995 Certificate: $0
First Distribution Date:
December 26, 1995
Cusip No. ___________
Certificate No. R-II-______
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
A-11-1
THE INTERNAL REVENUE CODE OF 1986 (THE "CODE"). CONSEQUENTLY, TRANSFER OF THIS
CERTIFICATE IS SUBJECT TO THE TAX RELATED TRANSFER RESTRICTIONS DESCRIBED
HEREIN.
THIS CLASS R-II CERTIFICATE IS SUBORDINATED TO THE OTHER CLASSES OF
CERTIFICATES OF THE SAME SERIES TO THE EXTENT PROVIDED IN THE POOLING AND
SERVICING AGREEMENT DESCRIBED HEREIN.
NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO AN EMPLOYEE BENEFIT PLAN OR
OTHER RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA"), OR THE CODE, OR TO ANY PERSON WHO IS
DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE ON BEHALF OF, AS NAMED
FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS OF ANY SUCH EMPLOYEE BENEFIT PLAN
OR OTHER RETIREMENT ARRANGEMENT, WILL BE REGISTERED EXCEPT IN COMPLIANCE WITH
THE PROCEDURES DESCRIBED HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 AS AMENDED (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH
REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT
REQUIRE SUCH REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE
PROVISIONS OF SECTION 6.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF CS FIRST
BOSTON MORTGAGE SECURITIES CORP., GREYSTONE FUNDING CORPORATION, GREYSTONE
SERVICING CORPORATION, INC. OR THE TRUSTEE REFERRED TO BELOW, OR OF ANY OF
THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED OR INSURED BY ANY
GOVERNMENT AGENCY OR INSTRUMENTALITY.
THIS CERTIFIES THAT _______________ is the registered owner of
a beneficial interest in the Trust Fund, which was created pursuant to the
Pooling and Servicing Agreement, dated as of November 1, 1995 (the
"Agreement"), among CS First Boston Mortgage Securities Corp. as depositor (the
"Depositor", which term includes any successor entity under the Agreement),
Greystone Servicing Corporation, Inc. as master servicer (the "Master
Servicer", which term includes any successor entity under the Agreement),
Greystone Funding Corporation as seller (the "Seller", which term includes any
successor entity under the Agreement) and LaSalle National Bank as trustee (the
"Trustee", which term includes any successor entity under the Agreement). This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Any term used herein that is defined in the Agreement shall have the meaning
assigned in the
A-11-2
Agreement, and nothing herein shall be deemed inconsistent with that meaning.
If the terms hereof are inconsistent with the Agreement, the Agreement shall
control.
This Certificate is one of a duly authorized issue of
certificates of CS First Boston Mortgage Securities Corp., designated as its
Mortgage Pass-Through Certificates, Series 1995-FHA1 (the "Certificates"),
which is comprised of the following eleven classes (each, a "Class"): the Class
A-1, Class A-2, Class A-3, Class A-4, Class A-X-1, Class A-X-2, Class A-X-3 and
Class A-X-4, Class B, Class R-I and Class R-II Certificates. Reference is
hereby made to the Agreement for a statement of the respective rights
thereunder of the Depositor, the Seller, the Master Servicer, the Trustee and
the Holders of each Class of the Certificates and the terms upon which the
Certificates are authenticated and delivered. This Certificate represents an
interest in the Trust Fund, which Trust Fund consists of, among other things,
(i) the Mortgage Assets and all payments under and proceeds of such Mortgage
Assets (other than any Retained Yield) received after the Cut-off Date
(exclusive of any payment of or relating to principal and interest due on the
FHA Loans on or before the Cut-off Date), together with all documents included
in the related Mortgage Files and Servicing Files for the Mortgage Loans; (ii)
the FHA Mortgage Insurance in respect of the Mortgage Loans, together with all
FHA Insurance Benefits (other than any Retained Yield) derived therefrom; (iii)
such funds or assets (other than any Retained Yield) as from time to time are
deposited in the Distribution Account and/or the Collection Account; (iv) any
insurance policies with respect to the Mortgage Loans; and (v) all proceeds of
the conversion, voluntary or involuntary, of any of the foregoing into cash or
other liquid property.
The Trustee shall distribute from the Distribution Account, to
the extent of available funds, on the 25th day of each calendar month or, if
such 25th day is not a Business Day, the Business Day immediately following
such 25th day (each, a "Distribution Date"), commencing in December, 1995, to
the Person in whose name this Certificate is registered at the close of
business on the last Business Day of the month immediately preceding the month
of such distribution (each, a "Record Date"), a distribution in an amount equal
to the product of the Percentage Interest evidenced by this Certificate (as set
forth above) and that portion of the Available Distribution Amount, if any,
that is allocated to distributions on the related Class of Certificates on such
Distribution Date.
Not later than each Distribution Date, the Trustee will send to
each Certificateholder a statement containing information relating to the
Mortgage Assets and payments made to Certificateholders.
Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Holder hereof entitled thereto as such
address appears in the Certificate Register. Notwithstanding the above, the
final distribution on this Certificate will be made after due notice of the
pendency of such final distribution and only upon presentation and surrender of
this Certificate at the office or agency designated in such notice.
The Agreement permits, with certain exceptions as therein
provided, the amendment thereof by the Depositor, the Master Servicer, the
Seller and the Trustee with the
A-11-3
consent of the Holders of Certificates entitled to, in the aggregate, not less
than 66-2/3% of the Voting Rights of all the Certificates affected by any such
amendments, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Agreement or for the purpose
of modifying in any manner the rights of the Holders of the Certificates;
provided, however, that no such amendment may (i) reduce in any manner the
amount of, delay the timing of or change the manner in which payments received
on Mortgage Assets are required to be distributed in respect of any Certificate
without the consent of the Holder of such Certificate; (ii) modify the
amendment provisions of the Agreement without the consent of all the
Certificateholders; or (iii) modify the servicing standard set forth in the
Agreement pursuant to which the Master Servicer shall service and administer
the Mortgage Loans. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. Under certain limited circumstances set forth
therein, the Agreement may be amended by the parties thereto without the
consent of any Holder.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable on the
Certificate Register upon surrender of this Certificate for registration of
transfer at the office or agency of the Trustee designated therefor, duly
endorsed by, or accompanied by a written instrument of transfer in a form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
interest in the Trust Fund will be issued to the designated transferee or
transferees.
No transfer of this Certificate or any interest herein shall be
made to any employee benefit plan that is subject to ERISA or the Code, or a
trustee of such plan, unless the prospective Transferee provides the Trustee
with a certification in the form attached to the Agreement as Exhibit E or an
Opinion of Counsel which establishes to the reasonable satisfaction of the
Depositor and the Trustee that the purchase and holding of this Certificate or
any interest herein by or on behalf of such employee benefit plan would not
result in the assets of the Trust Fund being deemed "plan assets" and subject
to the fiduciary responsibility provisions of ERISA or the prohibited
transaction provisions of the Code (or comparable provisions of any subsequent
enactments), would not constitute or result in a prohibited transaction under
Section 406 of ERISA or Section 4975 of the Code, and would not subject the
Depositor or the Trustee to any obligation or liability (including liabilities
under ERISA or Section 4975 of the Code) in addition to those undertaken in the
Agreement or any other liability. If no such certification in the form
attached to the Agreement as Exhibit E and no such Opinion of Counsel are so
delivered, the Trustee shall require that such prospective Transferee certify
to the Trustee in writing the facts establishing that such Transferee is not
such an employee benefit plan.
No transfer of this Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not
A-11-4
require such registration or qualification. In the event that a transfer of
this Certificate is to be made without registration under the Securities Act,
the Trustee shall require, in order to assure compliance with such laws: (i)
if such transfer is purportedly being made based on Rule 144A, that the
Certificateholder desiring to effect the transfer and the prospective
Transferee each certify to the Trustee in writing in the forms attached to the
Agreement as Exhibit D-1 and Exhibit D-2, respectively, the facts surrounding
the transfer; and (ii) in all other cases, that it and the Depositor receive an
Opinion of Counsel reasonably satisfactory to the Trustee and the Depositor
that such transfer may be made without such registration, which Opinion of
Counsel shall not be an expense of the Depositor, the Trustee or the Trust
Fund. Neither the Depositor nor the Trustee is obligated to register or
qualify this Certificate under the Securities Act or any other securities law
or to take any action not otherwise required under the Agreement to permit the
transfer of this Certificate without registration or qualification. Any Holder
hereof desiring to effect a transfer hereof shall indemnify the Trustee and the
Depositor against any liability that may result if the transfer is not so
exempt, or is not made in accordance with federal and state laws.
In addition to the foregoing and notwithstanding anything to
the contrary contained herein or in the Agreement, this Certificate may not be
owned, pledged or Transferred, directly or indirectly, by or to a Disqualified
Organization.
Prior to and as a condition of the registration of any
Transfer, sale or other disposition of this Certificate, (i) the proposed
Transferee, including the initial Holder of this Certificate, shall deliver to
the Trustee a Transferee Affidavit and Agreement, in substantially the form
attached to the Agreement as Exhibit F-1, representing and warranting, among
other things, that such Transferee is not a non-U.S. Person, that such
Transferee is other than a Disqualified Organization, that it is not acquiring
its Ownership Interest in this Certificate as a nominee, trustee or agent for
any Person who is not other than a Disqualified Organization, that for so long
as it retains its Ownership Interest in this Certificate, it will endeavor to
remain a Permitted Transferee, and that it has reviewed the provisions of
Section 6.02(g) of the Agreement and agrees to substantially be bound by them,
and (ii) the proposed Transferor shall deliver to the Trustee a certificate,
substantially in the form attached to the Agreement as Exhibit F-2,
representing and warranting, among other things, that no purpose of the
proposed Transfer is to allow such Holder to impede the assessment or
collection of tax. Notwithstanding the delivery of a Transferee Affidavit and
Agreement, if the Trustee has actual knowledge that the proposed Transferee is
not a Permitted Transferee, no Transfer of an Ownership Interest in this
Certificate to such proposed Transferee shall be effected. Each Person holding
or acquiring any Ownership Interest in this Certificate agrees, by holding or
acquiring such Ownership Interest, to require a Transferee Affidavit and
Agreement from any other Person to whom such Person attempts to Transfer its
Ownership Interest and to provide a certificate in the form attached to the
Agreement as Exhibit F-2 and to obtain the express written consent of the
Depositor prior to any Transfer of such Ownership Interest, which consent may
be withheld in the Depositor's sole discretion.
The Class R-II Certificates will be issued in fully registered
form only, without coupons, in minimum denominations representing percentage
interests specified in the
A-11-5
Agreement. As provided in the Agreement and subject to certain limitations
therein set forth, this Certificate is exchangeable for one or more new
Certificates of the same Class in authorized denominations and evidencing a
like aggregate Certificate Principal Balance, as requested by the Holder
surrendering the same.
No service charge will be made for such registrations of
transfers or exchanges, but the Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the person in whose name
this Certificate is registered as the owner hereof for all purposes, and
neither the Trustee nor any such agent thereof shall be affected by notice to
the contrary.
The obligations and responsibilities of the Depositor, the
Master Servicer, the Seller and the Trustee created by the Agreement will
terminate upon the earliest of (i) the purchase by the Master Servicer, at its
election, of all the Mortgage Assets remaining in the Trust Fund and the
corresponding distribution to Certificateholders of all amounts required to be
distributed to them, which repurchase right the Master Servicer may exercise at
its sole and exclusive election if the aggregate Stated Principal Balance of
the Mortgage Pool at the time of the repurchase is less than 5% of the
aggregate Cut-off Date Balance of the Mortgage Pool; (ii) the maturity or other
liquidation (or any advance with respect thereto) of the last Mortgage Asset
remaining in the Trust Fund and the corresponding distribution to
Certificateholders of all amounts required to be distributed to them; or (iii)
the mutual agreement of the parties to the Agreement and the Certificateholders
as to such termination.
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid or
obligatory for any purpose.
A-11-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed under its corporate seal.
LASALLE NATIONAL BANK,
as Trustee
By:__________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class R-II Certificates referred to in the within-mentioned
Agreement.
Date:
LASALLE NATIONAL BANK,
as Trustee
By:______________________________
Authorized Officer
A-11-7
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sell(s), assign(s) and
transfer(s) unto ____________________________________________________________
____________________________________________________ (Please print or typewrite
name and address, including postal zip code, of assignee) the undivided
interest in the Trust Fund evidenced by the within Certificate and hereby
authorize(s) the transfer of registration of such interest to the assignee on
the Certificate Register.
I (we) further direct the Trustee to issue a new Certificate of the
same Class and of a like Percentage Interest and undivided interest in the
Trust Fund to the above-named assignee and to deliver such Certificate to the
following address ____________________________________________________________
______________________________________________________________________________
Dated: _________________, ____
Social Security or ______________________________
other Tax Identification Signature by or on behalf of
No. of Assignee: assignor (signature must be signed
as registered)
_____________________________ ______________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for the information
of the Trustee:
Distribution shall be made by check mailed to _________________
______________________________________________________________________________.
This information is provided by the assignee named above, or its agent.
A-11-8
<PAGE>
APPENDIX B
Schedule of Mortgage Assets
<TABLE>
<CAPTION>
MORTGAGE MORTGAGED SECTION OF GNMA ORIGINAL
ASSET PROPERTY HOUSING POOL PRINCIPAL CUT-OFF DATE LIEN
TYPE TYPE ACT NUMBER BALANCE BALANCE POSITION
-------- --------- ---------- ------ ------------- ------------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
1 FHA Multi 223(f) N/AP $ 1,300,000.00 $ 687,794.61 First
2 FHA Multi 223(f) N/AP 750,000.00 727,009.64 First
3 FHA Multi 223(f) N/AP 1,479,800.00 1,425,794.65 First
4 FHA Multi 221(d)(4) N/AP 6,710,289.78 6,570,016.73 First
5 FHA Multi 223(f) N/AP 1,450,000.00 1,395,009.74 First
6 FHA Multi 223(f) N/AP 1,850,000.00 1,758,190.14 First
7 FHA Multi 223(f) N/AP 9,000,000.00 8,547,205.14 First
8 FHA Nursing 232 N/AP 2,616,600.00 2,587,838.61 First
9 FHA Multi 223(f) N/AP 3,023,000.00 2,903,058.61 First
10 FHA Nursing 232 N/AP 2,394,800.00 2,374,540.07 First
11 FHA Multi 223(f) N/AP 5,800,000.00 5,518,940.02 First
12 FHA Multi 223(f) N/AP 1,260,000.00 1,187,942.13 First
13 FHA Multi 223(f) N/AP 892,500.00 805,575.60 First
14 FHA Multi 223(f) N/AP 1,559,700.00 1,481,155.24 First
15 FHA Nursing 232 N/AP 2,749,500.00 2,720,636.20 First
16 FHA Nursing 232 N/AP 1,326,100.00 1,255,233.22 First
17 FHA Multi 223(f) N/AP 5,100,000.00 4,941,072.71 First
18 FHA Multi 223(f) N/AP 4,460,000.00 4,240,192.27 First
19 FHA Multi 221(d)(4) N/AP 6,417,900.00 6,229,836.54 First
20 FHA Multi 223(f) N/AP 1,315,000.00 1,265,129.66 First
21 FHA Multi 223(f) N/AP 1,458,600.00 1,410,078.50 First
22 FHA Multi 223(f) N/AP 5,000,000.00 4,760,175.00 First
23 FHA Nursing 232 N/AP 3,557,500.00 3,510,558.73 First
24 FHA Multi 223(f) N/AP 1,605,000.00 1,521,492.49 First
25 FHA Multi 223(f) N/AP 1,102,500.00 1,048,252.80 First
26 FHA Multi 223(f) N/AP 2,310,000.00 2,233,428.55 First
**27 FHA Multi 223(f) N/AP 27,200,000.00 25,905,089.01 First
28 FHA Multi 223(f) N/AP 7,800,000.00 7,442,627.84 First
29 FHA Multi 223(f) N/AP 8,373,500.00 7,888,267.50 First
30 FHA Nursing 223(f) N/AP 3,333,600.00 3,323,886.98 First
31 FHA Nursing 232 N/AP 2,279,600.00 2,251,992.77 First
32 FHA Multi 223(f) N/AP 3,000,000.00 2,879,188.48 First
33 FHA Multi 223(f) N/AP 2,400,000.00 2,323,978.85 First
34 FHA Multi 223(f) N/AP 4,200,000.00 4,007,679.40 First
35 FHA Multi 223(f) N/AP 3,700,000.00 3,593,221.83 First
</TABLE>
(RESTUBBED TABLE CONTINUED FROM ABOVE)
<TABLE>
<CAPTION>
REMAINING
NET STATED TERM TO RETAINED
MORTGAGE ASSET SERVICING FIRST MATURITY STATED DEBENTURE YIELD
RATE RATE FEE RATE DUE DATE DATE MATURITY RATE RATE
-------- ------- --------- -------- ---------- --------- --------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 10.250% 10.045% 0.175% 07-01-88 06-01-2000 55 (mos) 9.125% 0.000%
2 10.250 10.045 0.175 11-01-88 10-01-2023 335 9.375 0.000
3 10.250 10.045 0.175 12-01-87 11-01-2022 324 9.000 0.000
4 10.000 9.820 0.150 02-01-87 01-01-2027 374 13.375 3.375
5 10.000 9.795 0.175 01-01-88 12-01-2022 325 9.000 0.000
6 9.750 9.545 0.175 10-01-86 09-01-2021 310 8.250 0.000
7 9.750 9.545 0.175 09-01-86 08-01-2021 309 10.250 0.500
8 11.500 10.170 1.300 02-01-91 01-01-2031 422 9.000 0.000
9 10.000 9.795 0.175 10-01-87 09-01-2022 322 9.000 0.000
10 11.000 10.170 0.800 04-01-91 03-01-2031 424 9.000 0.000
11 10.000 9.795 0.175 08-01-86 07-01-2021 308 10.250 0.250
12 9.250 9.045 0.175 07-01-86 06-01-2021 307 10.250 1.000
13 10.000 9.795 0.175 01-01-88 12-01-2013 217 9.000 0.000
14 9.000 8.795 0.175 08-01-87 07-01-2022 320 8.000 0.000
15 11.750 11.420 0.300 07-01-89 06-01-2029 403 9.375 0.000
16 11.500 10.170 1.300 06-01-91 05-01-2031 426 9.000 0.000
17 10.250 10.045 0.175 10-01-88 09-01-2023 334 9.375 0.000
18 10.250 10.045 0.175 03-01-86 02-01-2021 303 11.125 0.875
19 8.625 8.295 0.300 10-01-88 09-01-2028 394 10.250 1.625
20 10.000 9.795 0.175 01-01-88 12-01-2022 325 9.000 0.000
21 10.750 10.545 0.175 11-01-87 10-01-2022 323 9.000 0.000
22 10.250 10.045 0.175 05-01-86 04-01-2021 305 11.125 0.875
23 11.500 11.170 0.300 10-01-88 09-01-2028 394 9.125 0.000
24 9.250 9.045 0.175 02-01-87 01-01-2022 314 8.250 0.000
25 9.250 9.045 0.175 06-01-87 05-01-2022 318 8.000 0.000
26 10.500 10.295 0.175 03-01-88 02-01-2023 327 9.125 0.000
**27 9.750 9.545 0.175 01-01-87 12-01-2021 313 8.250 0.000
28 8.750 8.545 0.175 06-01-88 05-01-2023 330 9.125 0.375
29 9.250 9.045 0.175 06-01-86 05-01-2021 306 10.250 1.000
30 10.500 10.170 0.300 12-01-94 11-01-2029 408 7.750 0.000
31 11.750 11.420 0.300 11-01-88 10-01-2028 395 9.125 0.000
32 10.000 9.795 0.175 09-01-87 08-01-2022 321 9.000 0.000
33 10.250 10.045 0.175 09-01-88 08-01-2023 333 9.375 0.000
34 9.250 9.045 0.175 11-01-87 10-01-2022 323 9.000 0.000
35 9.750 9.545 0.175 09-01-89 08-01-2024 345 9.250 0.000
</TABLE>
<PAGE>
APPENDIX B (CONTINUED)
<TABLE>
<CAPTION>
MORTGAGE MORTGAGED SECTION OF GNMA ORIGINAL
ASSET PROPERTY HOUSING POOL PRINCIPAL CUT-OFF DATE LIEN
TYPE TYPE ACT NUMBER BALANCE BALANCE POSITION
<S> <C> <C> <C> <C> <C> <C> <C>
36 FHA Multi 241(f) N/AP $ 2,448,400.00 $ 2,445,053.25 Second
37 GNMA Multi 223(f) 288449 1,198,100.00 1,152,036.75 First
38 GNMA Multi 221(d)(4) 171544 1,095,450.00 1,068,434.95 First
39 GNMA Multi 223(f) 234766 4,238,500.00 4,061,184.01 First
40 GNMA Multi 241(f) 394101 2,143,700.00 2,136,498.60 Second
41 GNMA Multi 241(f) 378980 2,129,800.00 2,127,383.53 Second
42 GNMA Multi 223(f) 263583 1,550,000.00 1,502,487.39 First
43 GNMA Multi 223(f) 252672 3,385,200.00 3,266,309.54 First
44 GNMA Multi 221(d)(4) 202324 1,015,820.00 992,550.06 First
45 GNMA Multi 223(f) 266737 2,674,500.00 2,605,702.23 First
46 GNMA Multi 223(f) 266732 3,009,000.00 2,914,283.36 First
47 GNMA Multi 221(d)(4) 253026 2,087,827.00 2,052,526.03 First
48 GNMA Multi 223(f) 168414 828,500.00 796,863.97 First
49 GNMA Multi 223(f) 280886 9,079,800.00 8,873,391.54 First
50 GNMA Multi 221(d)(4) 212891 2,903,908.00 2,826,565.29 First
--------------- --------------
$178,563,994.78 $171,543,360.76
=============== ==============
</TABLE>
(RESTUBBED TABLE CONTINUED FROM ABOVE)
<TABLE>
<CAPTION>
REMAINING
NET STATED TERM TO RETAINED
MORTGAGE ASSET SERVICING FIRST MATURITY STATED DEBENTURE YIELD
RATE RATE FEE RATE DUE DATE DATE MATURITY RATE RATE
<S> <C> <C> <C> <C> <C> <C> <C> <C>
36 9.500% 9.295% 0.175% 06-01-95 05-01-2033 450 (mos) 8.375% 0.000%
37 10.250 9.970 0.250 04-01-90 03-15-2020 293 N/AP 0.000
38 9.750 9.470 0.250 12-01-87 11-15-2027 385 N/AP 0.000
39 9.750 9.470 0.250 10-01-87 09-15-2022 323 N/AP 0.000
40 8.500 8.220 0.250 11-01-94 10-15-2034 468 N/AP 0.000
41 9.500 9.345 0.125 07-01-95 06-15-2033 452 N/AP 0.000
42 10.250 9.970 0.250 11-01-88 10-15-2023 336 N/AP 0.000
43 9.250 8.970 0.250 04-01-89 03-15-2024 341 N/AP 0.000
44 9.750 9.470 0.250 07-01-88 01-15-2028 387 N/AP 0.000
45 10.500 10.220 0.250 06-01-89 05-15-2024 343 N/AP 0.000
46 9.750 9.470 0.250 04-01-89 03-15-2024 341 N/AP 0.000
47 10.000 9.720 0.250 03-01-89 02-15-2029 400 N/AP 0.000
48 10.250 9.970 0.250 09-01-87 08-15-2022 322 N/AP 0.000
49 9.250 8.970 0.250 03-01-91 02-15-2026 364 N/AP 0.000
50 9.250 8.970 0.250 04-01-88 01-15-2028 387 N/AP 0.000
</TABLE>
- ------------
FHA = FHA Loan
GNMA = GNMA Certificate.
Multi = Multifamily Property
Nursing = Nursing Facility
N/AP = Not Applicable
** Referred to herein as the Salem Harbour Loan. See "DESCRIPTION OF THE
MORTGAGE POOL -- The Salem Harbour Loan" in this Prospectus Supplement.
<PAGE>
APPENDIX B (CONTINUED)
<TABLE>
<CAPTION>
ANNUAL DEBT
PREPAYMENT/LOCK-OUT TERMS LOCATION SERVICE (1)
------------------------------------- ------------------ -----------
<S> <C> <C> <C>
1. Prepayable with no penalty East St. Louis, IL $ 188,692
2. Prepayable with no penalty Baltimore, OH 79,097
3. Prepayable with no penalty Barberton, OH 156,064
4. Locked to 10/31/99; Nashville, TN 688,756
thereafter prepayable with no penalty
5. Prepayable with no penalty Savannah, GA 149,583
6. Prepayable with no penalty Chestnut Hill, PA 186,611
7. Prepayable with no penalty Alexandria, VA 907,837
8. Locked to 2/1/2001; thereafter Muskogee, OK 304,033
prepayable with no penalty
9. Prepayable with no penalty Atlanta, GA 311,855
10. Locked to 11/1/2000; thereafter Bethany, OK 266,770
prepayable with no penalty
11. Prepayable with no penalty Silver Springs, MD 598,332
12. Prepayable with no penalty Hyattsville, MD 121,375
13. Prepayable with no penalty Detroit, MI 96,495
14. Prepayable with no penalty Wilmington, NC 146,735
15. Locked to 7/1/1999; thereafter Enid, OK 326,101
prepayable with no penalty
16. Locked to 6/1/2001; thereafter Oklahoma City, OK 154,085
prepayable with no penalty
17. Prepayable with no penalty Detroit, MI 537,860
18. Prepayable with no penalty Gaithersburg, MD 470,364
19. Locked to April 30, 2000; thereafter Johnson City, TN 571,925
prepayable with no penalty
20. Prepayable with no penalty Orange Park, FL 135,656
21. Prepayable with no penalty Cleveland, OH 160,592
22. Prepayable with no penalty Irving, TX 527,313
23. Locked to 10/1/1998; thereafter Bethany, OK 413,360
prepayable with no penalty
24. Prepayable with no penalty Vineland, NJ 154,609
25. Prepayable with no penalty Venice, FL 106,203
26. Prepayable with no penalty Evansville, IN 248,963
**27. Prepayable with no penalty Andalusia, PA 2,743,684
28. Prepayable with no penalty Chicago, IL 716,380
29. Prepayable with no penalty Philadelphia, PA 806,614
30. Locked to 5/1/1999; thereafter Yukon, OK 359,282
prepayable with no penalty
31. Locked to 11/1/1998; thereafter Elk City, OK 270,369
prepayable with no penalty
32. Prepayable with no penalty Bowling Green, KY 309,482
33. Prepayable with no penalty Chamblee, GA 253,110
</TABLE>
(RESTUBBED TABLE CONTINUED FROM ABOVE)
<TABLE>
<CAPTION>
CUT-OFF DATE
DEBT SERVICE DATE OF
NOI COVERAGE RATIO NOI(2)
----------- -------------- ----------
<S> <C> <C> <C>
1. $ 191,287 1.01x 12/31/94
2. 78,678 0.99 12/31/94
3. 165,976 1.06 12/31/94
4. 1,068,286 1.55 12/31/94
5. 137,092 0.92 12/31/94
6. 171,339 0.92 12/31/94
7. 970,210 1.07 12/31/94
8. 330,075 1.09 12/31/94
9. 157,562 0.51 12/31/94
10. 395,926 1.48 12/31/94
11. 768,049 1.28 12/31/94
12. 66,630 0.55 12/31/94
13. 126,434 1.31 12/31/94
14. 139,005 0.95 12/31/94
15. 449,604 1.38 12/31/94
16. 432,406 2.81 12/31/94
17. 876,967 1.63 12/31/94
18. 411,652 0.88 12/31/94
19. 672,368 1.18 12/31/94
20. 149,833 1.10 12/31/94
21. 43,362 0.27 12/31/94
22. 494,154 0.94 12/31/94
23. N/A N/A N/A
24. 175,158 1.13 12/31/94
25. 109,821 1.03 12/31/94
26. 370,232 1.49 12/31/94
**27. 2,453,239 0.89 12/31/94
28. 807,711 1.13 12/31/94
29. 890,267 1.10 12/31/94
30. 334,495 0.93 12/31/94
31. 228,313 0.84 12/31/94
32. 404,682 1.31 12/31/94
33. 318,929 1.26x 12/31/94
</TABLE>
<PAGE>
APPENDIX B (CONTINUED)
<TABLE>
<CAPTION>
ANNUAL DEBT
PREPAYMENT/LOCK-OUT TERMS LOCATION SERVICE (1)
------------------------------------------- ------------------- ------------
<S> <C> <C> <C>
34. Prepayable with no penalty Augusta, GA $404,583
35. Prepayable with no penalty Chamblee, GA 373,222
36. Locked until May 1, 2000; thereafter 5% Baltimore, MD 239,160(3)
prepayment penalty declining 1% per year
37. Prepayable with no penalty Oklahoma City, OK 128,834
38. Locked to 8/26/96; Auburn, AL 109,049
thereafter prepayable with no penalty
39. Prepayable with no penalty Las Vegas, NV 427,541
40. Locked to 9/27/99; Sacramento, CA 188,584(3)
thereafter, 5% prepayment penalty
declining 1% per year
(interest to month end)
41. Locked to June 1, 2005; Kentwood, MI 208,039(3)
thereafter prepayable with no penalty
(interest to end of month)
42. Prepayable with no penalty Coralville, IA 163,467
43. Prepayable with no penalty Corpus Christi, TX 326,094
44. 10% prepayment penalty to 7/1/94; 7%, 5%, Las Vegas, NV 101,122
3%, 1% to 7/1/98; thereafter prepayable
with no penalty
45. Prepayable with no penalty Joplin, MO 288,247
46. Prepayable with no penalty Cedar Falls, IA 303,516
47. 5% prepayment penalty to 10/1/96; Miami, FL 212,744
thereafter declining 1% per year
48. Prepayable with no penalty Charlottesville, VA 298,301
49. Locked to 2/1/96; thereafter prepayable Indianapolis, IN 874,651
with no penalty (interest to end of month)
50. Penalty of 5% to 5/1/96; 3% to 5/1/97; 1% Tulsa, OK 275,521
to 5/1/98; none thereafter
</TABLE>
(RESTUBBED TABLE CONTINUED FROM ABOVE)
<TABLE>
<CAPTION>
CUT-OFF DATE
DEBT SERVICE DATE OF
NOI COVERAGE RATIO NOI(2)
------------ -------------- ----------
<S> <C> <C> <C>
34. $ 452,969 1.12 12/31/94
35. 481,741 1.29 12/31/94
36. 398,547(3) 1.19(3) N/AP
37. 76,014 0.59 12/31/94
38. N/A N/A N/A
39. N/A N/A N/A
40. 329,356(3) 1.27(3) N/AP
41. 323,796(3) 1.13(3) N/AP
42. 235,274 1.44 12/31/94
43. N/A N/A N/A
44. N/A N/A N/A
45. 476,388 1.65 12/31/94
46. 452,403 1.49 12/31/94
47. N/A N/A N/A
48. 384,376 1.29 12/31/94
49. 1,238,174 1.42 12/31/94
50. N/A N/A N/A
</TABLE>
- ------------
N/A = Not Available.
N/AP = Not Applicable
FOOTNOTES
(1) Excludes Mortgage Insurance Premiums.
(2) Last day of fiscal year for which NOI was being calculated.
(3) Second Mortgage Loans: Annual Debt Service is for second mortgage only;
NOI is pro forma; loans were originated in July 1995 (Kentwood
Apartments), June 1995 (Woodington Gardens), October 1994 (Florin Meadows
I); Cut-off Date Debt Service Coverage Ratio was calculated combining the
annual debt service for the related first mortgage loan with the Annual
Debt Service for such second Mortgage Loan.
** Referred to herein as the Salem Harbour Loan. See "DESCRIPTION OF THE
MORTGAGE POOL--The Salem Harbour Loan" in this Prospectus Supplement.
The FHA may override certain Lockout and prepayment penalties in certain
circumstances. See "FHA MORTGAGE INSURANCE PROGRAMS--Prepayments and
Lock-outs" in this Prospectus Supplement.
EXHIBIT C
FORM OF CERTIFICATION OF TRUSTEE
__________ ____, 19____
CS First Boston Mortgage Securities Corp.
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
Greystone Funding Corporation
98 Alexandria Pike
Warrenton, Virginia 22186
Greystone Servicing Corporation, Inc.
98 Alexandria Pike
Warrenton, Virginia 22186
Re: Pooling and Servicing Agreement ("Pooling and Servicing
Agreement") relating to CS First Boston Mortgage Securities
Corp. Mortgage Pass-Through Certificates, Series 1995-FHA1
Ladies and Gentlemen:
In accordance with the provisions of Section 2.02 of the above-
referenced Pooling and Servicing Agreement the undersigned, as Trustee, hereby
certifies that, as to each Mortgage Loan listed in the Mortgage Asset Schedule,
it has reviewed the Mortgage File and has determined that (i) all documents
described in Section 2.01 of the Pooling and Servicing Agreement (subject to
those exceptions listed in the Schedule of Exceptions) are in its possession,
(ii) such documents have been reviewed by it and have not been mutilated,
damaged, defaced, torn or otherwise physically altered and such documents relate
to such Mortgage Loan, (iii) based on its examination and only as to the
foregoing documents, the information set forth in items (v), (viii), (xi), (xii)
and (xvii) of the second sentence of the definition of "Mortgage Asset Schedule"
respecting such Mortgage Loan accurately reflects the information contained in
the documents in the Mortgage File, and (iv) the related Mortgage Note has a
final endorsement from the FHA. The Trustee has made no independent examination
of any documents contained in each Mortgage File beyond the review specifically
required in the above-referenced Pooling and Servicing Agreement. The Trustee
makes no representations as to: (i) the validity, legality, sufficiency,
enforceability or genuineness of any of the documents contained in each Mortgage
File, or (ii) the collectibility, insurability, effectiveness or suitability of
any such Mortgage Loan.
Capitalized terms used herein without definition have the meanings
ascribed to them in the Pooling and Servicing Agreement.
LASALLE NATIONAL BANK, as Trustee
By:________________________________
Name:
Title:
2
EXHIBIT D-1
FORM OF TRANSFEROR REPRESENTATION LETTER
__________ ____, 19____
CS First Boston Mortgage Securities Corp.
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
LaSalle National Bank
135 South LaSalle Street
Suite 200
Chicago, Illinois 60603-4107
Re: CS First Boston Mortgage Securities Corp.
Mortgage Pass-Through Certificates, Series 1995-FHA1
Class [B] [R-I] [R-II] [, having an initial Certificate
Principal Balance as of November 21, 1995 (the "Closing
Date") of $___________] [evidencing a ____% Percentage
Interest in the related Class]
Ladies and Gentlemen:
Reference is made to the sale by __________ (the "Transferor")
to _____________ (the "Transferee") of the captioned mortgage pass-through
certificates (the "Certificates"), issued pursuant to the Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), dated as of November 1, 1995
among CS First Boston Mortgage Securities Corp. as depositor (the "Depositor"),
Greystone Funding Corporation as seller (the "Seller"), Greystone Servicing
Corporation, Inc. as master servicer (the "Master Servicer") and LaSalle
National Bank as trustee (the "Trustee"). All terms used herein and not
otherwise defined shall have the meanings set forth in the Pooling and Servicing
Agreement. The Transferor hereby certifies, represents and warrants to, and
covenants with, the Depositor and the Trustee that:
1. The Transferor is the lawful owner of the Certificates
with the full right to transfer such Certificates free from any and all claims
and encumbrances whatsoever.
2. Neither the Transferor nor anyone acting on its behalf
has (a) offered, pledged, sold, disposed of or otherwise transferred any
Certificate, any interest in any Certificate or any other similar security to
any person in any manner, (b) has solicited any offer to buy or to accept a
pledge, disposition or other transfer of any Certificate, any interest in any
Certificate or any other similar security from any person in any manner, (c) has
otherwise approached or negotiated with respect to any Certificate, any interest
in any Certificate or any other similar security with any person in any manner,
(d) has made any
general solicitation by means of general advertising or in any other manner, or
(e) has taken any other action, that (as to any of (a) through (e) above) would
constitute a distribution of the Certificates under the Securities Act of 1933
(the "Act"), would render the disposition of any Certificate a violation of
Section 5 of the Act or any state securities law, or would require registration
or qualification pursuant thereto.
Very truly yours,
_______________________
(Transferor)
By:
Name:
Title:
2
EXHIBIT D-2
FORM OF TRANSFEREE REPRESENTATION LETTER
__________ ____, 19____
CS First Boston Mortgage Securities Corp.
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
CS First Boston Corporation
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
LaSalle National Bank
135 South LaSalle Street
Suite 200
Chicago, Illinois 60603-4107
Re: CS First Boston Mortgage Securities Corp.
Mortgage Pass-Through Certificate, Series 1995-
FHA1, Class [B] [R-I] [R-II], [having an initial
principal amount as of November 21, 1995 (the
"Issue Date") of $__________] [evidencing a
____% percentage interest in the Class to which
it belongs]
Dear Sirs:
This letter is delivered to you in connection with the transfer
by _________________ (the "Transferor") to _________________ (the "Transferee")
of the captioned Certificate (the "Certificate"), issued pursuant to a Pooling
and Servicing Agreement (the "Pooling and Servicing Agreement"), dated as of
November 1, 1995, among CS First Boston Mortgage Securities Corp. as depositor,
Greystone Servicing Corporation, Inc. as master servicer, Greystone Funding
Corporation as seller and LaSalle National Bank as trustee. All terms used
herein and not otherwise defined shall have the respective meanings set forth in
the Pooling and Servicing Agreement. The Transferor hereby certifies,
represents and warrants to you, as Trustee, that:
1. The Transferee is a "qualified institutional buyer" as
that term is defined in Rule 144A ("Rule 144A") under the Securities Act of 1933
(the "Securities Act") and has completed one of the forms of certification to
that effect attached hereto as Annex 1 and Annex 2. The Transferee is aware
that the sale to it is being made in reliance on Rule 144A. The Transferee is
acquiring the Certificate for its own account or for the account of a qualified
institutional buyer, and understands that such Certificate may be resold,
pledged or transferred only (a) to a person reasonably believed to be a
qualified institutional buyer that purchases for its
own account or for the account of a qualified institutional buyer to whom notice
is given that the resale, pledge or transfer is being made in reliance on Rule
144A, or (b) pursuant to another exemption from registration under the
Securities Act.
2. The Transferee has been furnished with all information
regarding (a) the Certificate and distributions thereon, (b) the nature,
performance and servicing of the Mortgage Loans, (c) the Pooling and Servicing
Agreement and (d) any credit enhancement mechanism associated with the
Certificate, that it has requested.
Very truly yours,
______________________
(Transferee)
By:
Name:
Title:
2
ANNEX 1 TO EXHIBIT D-2
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees Other Than Registered Investment Companies]
The undersigned hereby certifies as follows to [name of
Transferor] (the "Transferor"), [name of Trustee], as Trustee and the Depositor
with respect to the multiclass pass-through certificate (the "Certificate")
described in the Transferee Certificate to which this certification relates and
to which this certification is an Annex:
1. As indicated below, the undersigned is the chief financial
officer, a person fulfilling an equivalent function, or other executive officer
of the entity purchasing the Certificate (the "Transferee").
2. The Transferee is a "qualified institutional buyer" as that
term is defined in Rule 144A under the Securities Act of 1933 ("Rule 144A")
because (i) the Transferee owned and/or invested on a discretionary basis
$______________________1 in securities (other than the excluded securities
referred to below) as of the end of the Transferee's most recent fiscal year
(such amount being calculated in accordance with Rule 144A) and (ii) the
Transferee satisfies the criteria in the category marked below.
___ Corporation, etc. The Transferee is a corporation (other than a
bank, savings and loan association or similar institution), Massachusetts or
similar business trust, partnership, or any organization described in Section
501(c)(3) of the Internal Revenue Code of 1986.
___ Bank. The Transferee (a) is a national bank or a banking
institution organized under the laws of any State, U.S. territory or the
District of Columbia, the business of which is substantially confined to banking
and is supervised by the State or territorial banking commission or similar
official or is a foreign bank or equivalent institution, and (b) has an audited
net worth of at least $25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto, as of a date not more than 16
months preceding the date of sale of the Certificate in the case of a U.S. bank,
and not more than 18 months preceding such date of sale for a foreign bank or
equivalent institution.
- ---------------
1. Transferee must own and/or invest on a discretionary basis at least
$100,000,000 in securities unless Transferee is a dealer, and, in that case,
Transferee must own and/or invest on a discretionary basis at least
$10,000,000 in securities.
1
___ Savings and Loan. The Transferee (a) is a savings and loan
association, building and loan association, cooperative bank, homestead
association or similar institution, which is supervised and examined by a State
or Federal authority having supervision over any such institutions, or is a
foreign savings and loan association or equivalent institution and (b) has an
audited net worth of at least $25,000,000 as demonstrated in its latest annual
financial statements, a copy of which is attached hereto, as of a date not more
than 16 months preceding the date of sale of the Certificate in the case of a
U.S. savings and loan association, and not more than 18 months preceding such
date of sale for a foreign savings and loan association or equivalent
institution.
___ Broker-dealer. The Transferee is a dealer registered pursuant
to Section 15 of the Securities Exchange Act of 1934.
___ Insurance Company. The Transferee is an insurance company whose
primary and predominant business activity is the writing of insurance or the
reinsuring of risks underwritten by insurance companies and which is subject to
supervision by the insurance commissioner or a similar official or agency of a
State, U.S. territory or the District of Columbia.
___ State or Local Plan. The Transferee is a plan established and
maintained by a State, its political subdivisions, or any agency or
instrumentality of the State or its political subdivisions, for the benefit of
its employees.
___ ERISA Plan. The Transferee is an employee benefit plan within
the meaning of Title I of the Employee Retirement Income Security Act of 1974.
___ Investment Adviser. The Transferee is an investment advisor
registered under the Investment Advisers Act of 1940.
___ Other. (Please supply a brief description of the entity and a
cross-reference to the paragraph and subparagraph under subsection (a)(1) of
Rule 144A pursuant to which it qualifies. Note that registered investment
companies should complete Annex 2 rather than this Annex 1.)
3. The term "securities" as used herein does not include
(i) securities of issuers that are affiliated with the Transferee, (ii)
securities that are part of an unsold allotment to or subscription by the
Transferee, if the Transferee is a dealer, (iii) bank deposit notes and
certificates of deposit, (iv) loan participations, (v) repurchase agreements,
(vi) securities owned but subject to a repurchase agreement and (vii) currency,
interest rate and commodity swaps. For purposes of determining the aggregate
amount of securities owned and/or invested on a discretionary basis by the
Transferee, the Transferee did not include any of the securities referred to in
this paragraph.
2
4. For purposes of determining the aggregate amount of
securities owned and/or invested on a discretionary basis by the Transferee, the
Transferee used the cost of such securities to the Transferee, unless the
Transferee reports its securities holdings in its financial statements on the
basis of their market value, and no current information with respect to the cost
of those securities has been published, in which case the securities were valued
at market. Further, in determining such aggregate amount, the Transferee may
have included securities owned by subsidiaries of the Transferee, but only if
such subsidiaries are consolidated with the Transferee in its financial
statements prepared in accordance with generally accepted accounting principles
and if the investments of such subsidiaries are managed under the Transferee's
direction. However, such securities were not included if the Transferee is a
majority-owned, consolidated subsidiary of another enterprise and the Transferee
is not itself a reporting company under the Securities Exchange Act of 1934.
5. The Transferee acknowledges that it is familiar with
Rule 144A and understands that the Transferor and other parties related to the
Certificate are relying and will continue to rely on the statements made herein
because one or more sales to the Transferee may be in reliance on Rule 144A.
___ ___ Will the Transferee be purchasing the Certificate
Yes No only for the Transferee's own account?
6. If the answer to the foregoing question is "no", then in
each case where the Transferee is purchasing for an account other than its own,
such account belongs to a third party that is itself a "qualified institutional
buyer" within the meaning of Rule 144A, and the "qualified institutional buyer"
status of such third party has been established by the Transferee through one or
more of the appropriate methods contemplated by Rule 144A.
7. The Transferee will notify each of the parties to which
this certification is made of any changes in the information and conclusions
herein. Until such notice is given, the Transferee's purchase of the
Certificate will constitute a reaffirmation of this certification as of the date
of such purchase. In addition, if the Transferee is a bank or savings and loan
as provided above, the Transferee agrees that it will furnish to such parties
any updated annual financial statements that become available on or before the
date of such purchase, promptly after they become available.
Print Name of Transferee
By:
Name:
Title:
Date:
3
ANNEX 2 TO EXHIBIT D-2
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees That Are Registered Investment Companies]
The undersigned hereby certifies as follows to [name of
Transferor] (the "Transferor"), [name of Trustee], as Trustee and the Depositor
with respect to the multiclass pass-through certificate (the "Certificate")
described in the Transferee Certificate to which this certification relates and
to which this certification is an Annex:
1. As indicated below, the undersigned is the chief
financial officer, a person fulfilling an equivalent function, or other
executive officer of the entity purchasing the Certificate (the "Transferee")
or, if the Transferee is a "qualified institutional buyer" as that term is
defined in Rule 144A under the Securities Act of 1933 ("Rule 144A") because the
Transferee is part of a Family of Investment Companies (as defined below), is an
executive officer of the investment adviser (the "Adviser").
2. The Transferee is a "qualified institutional buyer" as
defined in Rule 144A because (i) the Transferee is an investment company
registered under the Investment Company Act of 1940, and (ii) as marked below,
the Transferee alone owned and/or invested on a discretionary basis, or the
Transferee's Family of Investment Companies owned, at least $100,000,000 in
securities (other than the excluded securities referred to below) as of the end
of the Transferee's most recent fiscal year. For purposes of determining the
amount of securities owned by the Transferee or the Transferee's Family of
Investment Companies, the cost of such securities was used, unless the
Transferee or any member of the Transferee's Family of Investment Companies, as
the case may be, reports its securities holdings in its financial statements on
the basis of their market value, and no current information with respect to the
cost of those securities has been published, in which case the securities of
such entity were valued at market.
____ The Transferee owned and/or invested on a discretionary basis
$___________________ in securities (other than the excluded
securities referred to below) as of the end of the Transferee's
most recent fiscal year (such amount being calculated in
accordance with Rule 144A).
____ The Transferee is part of a Family of Investment Companies which
owned in the aggregate $______________ in securities (other than
the excluded securities referred to below) as of the end of the
Transferee's most recent fiscal year (such amount being
calculated in accordance with Rule 144A).
3. The term "Family of Investment Companies" as used herein
means two or more registered investment companies (or series thereof) that have
the same investment adviser or investment advisers that are affiliated (by
virtue of being majority
1
owned subsidiaries of the same parent or because one investment adviser is a
majority owned subsidiary of the other).
4. The term "securities" as used herein does not include
(i) securities of issuers that are affiliated with the Transferee or are part of
the Transferee's Family of Investment Companies, (ii) bank deposit notes and
certificates of deposit, (iii) loan participations, (iv) repurchase agreements,
(v) securities owned but subject to a repurchase agreement and (vi) currency,
interest rate and commodity swaps. For purposes of determining the aggregate
amount of securities owned and/or invested on a discretionary basis by the
Transferee, or owned by the Transferee's Family of Investment Companies, the
securities referred to in this paragraph were excluded.
5. The Transferee is familiar with Rule 144A and
understands that the parties to which this certification is being made are
relying and will continue to rely on the statements made herein because one or
more sales to the Transferee will be in reliance on Rule 144A.
____ ____ Will the Transferee be purchasing the Certificate
Yes No only for the Transferee's own account?
6. If the answer to the foregoing question is "no", then in
each case where the Transferee is purchasing for an account other than its own,
such account belongs to a third party that is itself a "qualified institutional
buyer" within the meaning of Rule 144A, and the "qualified institutional buyer"
status of such third party has been established by the Transferee through one or
more of the appropriate methods contemplated by Rule 144A.
2
7. The undersigned will notify the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice, the Transferee's purchase of the Certificate will constitute
a reaffirmation of this certification by the undersigned as of the date of such
purchase.
Print Name of Transferee or Adviser
By:
Name:
Title:
IF AN ADVISER:
Print Name of Transferee
Date:
3
EXHIBIT E
FORM OF INVESTMENT LETTER
CS First Boston Mortgage Securities Corp.
Mortgage Pass-Through Certificates
Series 1995-FHA1, Class ___, Class ____ and Class ____
The undersigned (the "Buyer"), intends to purchase the
securities described above (the "Securities").
Reference is made to the Pooling and Servicing Agreement, dated
as of November 1, 1995, by and among CS First Boston Mortgage Securities Corp.
as depositor (the "Depositor"), Greystone Funding Corporation as seller (the
"Seller"), Greystone Servicing Corporation, Inc. as master servicer (the "Master
Servicer") and LaSalle National Bank as trustee (the "Trustee").
The Buyer warrants and represents to, and covenants with, the
Trustee and the Depositor that either (a) the Buyer is not an employee benefit
plan within the meaning of Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA") ("Plan"), or a plan within the
meaning of Section 4975(e)(1) of the Internal Revenue Code of 1986 ("Code")
(also a "Plan") and the Buyer is not directly or indirectly purchasing the
Securities on behalf of, as investment manager of, as named fiduciary of, as
trustee of, or with assets of a Plan, or (b) the Buyer's purchase of the
Securities will not (i) result in a prohibited transaction under Section 406 of
ERISA or Section 4975 of the Code or (ii) cause the assets of the Trust Fund to
be subject to the fiduciary responsibility provisions of ERISA.
IN WITNESS WHEREOF, the Buyer has executed this document as of
the date set forth below.
[NAME OF INVESTOR]
By:
Name:
Title:
2
EXHIBIT F-1
FORM OF INVESTOR TRANSFER AFFIDAVIT AND AGREEMENT
STATE OF )
: ss.:
COUNTY OF )
[NAME OF OFFICER], being first duly sworn, deposes and says:
1. That he is [Title of Officer] of [Name of Transferee], a
[savings institution] [corporation] duly organized and existing under the laws
of [the State of ______________] [the United States] (the "Transferee"), which
entity is acquiring record or beneficial ownership of the CS First Boston
Mortgage Securities Corp. Mortgage Pass-Through Certificates, Series 1995-FHA1,
Class R-[I][II] (the "Residual Certificates") on behalf of which he makes this
affidavit and agreement.
2. That the Transferee (i) is not and will not be a
"disqualified organization" as of [date of transfer] within the meaning of
Section 860E(e)(5) of the Internal Revenue Code of 1986, as amended (the
"Code"), (ii) will endeavor to remain a Permitted Transferee for so long as it
retains its ownership interest in the Residual Certificate, and (iii) is
acquiring the Residual Certificates for its own account or for the account of
another person from which it has received an affidavit and agreement in
substantially the same form as this affidavit and agreement. A "Permitted
Transferee" is any person other than a "disqualified organization". (For this
purpose, a "disqualified organization" means the United States, any state or
political subdivision thereof, any agency or instrumentality of any of the
foregoing (other than an instrumentality all of the activities of which are
subject to tax and, except for the Federal Home Loan Mortgage Corporation, a
majority of whose board of directors is not selected by any such governmental
entity) or any foreign government, international organization or any agency or
instrumentality of such foreign government or organization, any rural electric
or telephone cooperative, or any organization (other than certain farmers'
cooperatives) that is generally exempt from federal income tax unless such
organization is subject to the tax on unrelated business taxable income).
3. That the Transferee is aware (i) of the tax that would
be imposed on transfers of Residual Certificates to disqualified organizations
under the Code; (ii) that such tax would be on the transferor, or, if such
transfer is through an agent (which person includes a broker, nominee or
middleman) for a "disqualified organization", on the agent; (iii) that the
person otherwise liable for the tax shall be relieved of liability for the tax
if the transferee furnishes to such person an affidavit that the transferee is a
Permitted Transferee and, at the time of transfer, such person does not have
actual knowledge that the affidavit is false; and (iv) that the Residual
Certificates may be "noneconomic residual interests" within the meaning of
Treasury regulations promulgated pursuant to the Code and that the transferor of
a noneconomic residual interest will remain liable for any taxes due with
respect to the income on such residual interest if a significant purpose of the
transfer was to enable the transferor to impede the assessment or collection of
tax.
4. That the Transferee is aware of the tax imposed on a
"pass-through entity" holding Residual Certificates if at any time during the
taxable year of the pass-through entity a "disqualified organization" is the
record holder of an interest in such entity. (For this purpose, a "pass through
entity" includes a regulated investment company, a real estate investment trust
or common trust fund, a partnership, trust or estate, and certain cooperatives.)
5. That the Transferee is aware that the Trustee will not
register the Transfer of any Residual Certificates unless the transferee, or the
transferee's agent, delivers to it, among other things, an affidavit and
agreement in substantially the same form as this affidavit and agreement. The
Transferee expressly agrees that it will not consummate any such transfer if it
knows or believes that any of the representations contained in such affidavit
and agreement are false.
6. That the Transferee has reviewed the restrictions set
forth on the face of the Residual Certificates and the provisions of Section
6.02 of the Pooling and Servicing Agreement under which the Residual
Certificates were issued. The Transferee acknowledges that the transfer of the
Residual Certificates is subject to the approval of the Depositor, which
approval shall be at its sole discretion. The Transferee expressly agrees to be
bound by and to comply with such restrictions and provisions.
7. That the Transferee consents to any additional
restrictions or arrangements that shall be deemed necessary upon advice of
counsel to constitute a reasonable arrangement to ensure that the Residual
Certificates will only be owned, directly or indirectly, by a Permitted
Transferee.
8. That the Transferee's Taxpayer Identification Number is
______________.
9. That the Transferee is a citizen or resident of the
United States, a corporation, partnership or other entity created or organized
in, or under the laws of, the United States or any political subdivision
thereof, or an estate or trust whose income from sources without the United
States is includable in gross income for United States federal income tax
purposes regardless of its connection with the conduct of a trade or business
within the United States.
10. That no purpose of the Transferee relating to the
purchase of the Residual Certificates by the Transferee is or will be to impede
the assessment or collection of tax.
11. That the Transferee has no present knowledge or
expectation that it will be unable to pay any United States taxes owed by it so
long as the Residual Certificates remain outstanding.
12. That the Transferee has no present knowledge or
expectation that it will become insolvent or subject to a bankruptcy proceeding
for so long as the Residual Certificates remain outstanding.
2
13. That no purpose of the Transferee relating to any sale
of the Residual Certificate by the Transferee will be to impede the assessment
or collection of tax.
14. The Transferee hereby agrees to cooperate with the
Trustee and to take any action required of it by the Code or Treasury
regulations thereunder (whether now or hereafter promulgated) in order to create
or maintain the REMIC status of the Trust Fund.
15. The Transferee hereby agrees that it will not take any
action that could endanger the REMIC status of any portion of the Trust Fund or
result in the imposition of tax on the Trust Fund unless counsel acceptable to
the Trustee has provided to the Trustee, at the Transferee's expense, an opinion
that such action will not result in the loss of such REMIC status or the
imposition of such tax, as applicable.
3
IN WITNESS WHEREOF, the Transferee has caused this instrument to
be executed on its behalf, pursuant to the authority of its Board of Directors,
by its [Title of Officer] and its corporate seal to be hereunto attached,
attested by its [Assistant] Secretary, this ____ day of __________, ____.
[NAME OF TRANSFEREE]
By:
[Name of Officer]
[Title of Officer]
[Corporate Seal]
ATTEST:
[Assistant] Secretary
Personally appeared before me the above-named [Name of Officer],
known or proved to me to be the same person who executed the foregoing
instrument and to be the [Title of Officer] of the Transferee, and acknowledged
to me that he executed the same as his free act and deed and the free act and
deed of the Transferee.
Subscribed and sworn before me this ____ day of __________,
____.
NOTARY PUBLIC
COUNTY OF
STATE OF
My Commission expires the ____ day of
__________, 19____.
4
EXHIBIT F-2
FORM OF TRANSFER CERTIFICATE
__________ ____, 19____
CS First Boston Mortgage Securities Corp.
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
LaSalle National Bank
135 South LaSalle Street
Suite 200
Chicago, Illinois 60603-4107
Re: CS First Boston Mortgage Securities Corp.
Mortgage Pass-Through Certificates,
Series 1995-FHA1, Class [R-I] [R-II], evidencing
a ___% Percentage Interest in the related Class
Ladies and Gentlemen:
This letter is delivered to you in connection with the transfer
by _______________ (the "Seller") to __________________________________ (the
"Purchaser") of the captioned mortgage pass-through certificates (the
"Certificates"), pursuant to Section 6.02 of the Pooling and Servicing Agreement
(the "Pooling and Servicing Agreement"), dated as of November 1, 1995, among CS
First Boston Mortgage Securities Corp. as depositor (the "Depositor"), Greystone
Funding Corporation as seller, Greystone Servicing Corporation, Inc. as master
servicer and LaSalle National Bank, as trustee (the "Trustee"). All terms used
herein and not otherwise defined shall have the meanings set forth in the
Pooling and Servicing Agreement. The Seller hereby certifies, represents and
warrants to, and covenants with, the Depositor and the Trustee that:
1. No purpose of the Seller relating to sale of the
Certificates by the Seller to the Purchaser is or will be to enable the Seller
to impede the assessment or collection of any tax.
2. The Seller understands that the Purchaser has delivered
to the Trustee a transfer affidavit and agreement in the form attached to the
Pooling and Servicing Agreement as Exhibit F-1. The Seller does not know or
believe that any representation contained therein is false.
3. The Seller has no actual knowledge that the proposed
Transferee is not a Permitted Transferee.
4. The Seller has no actual knowledge that the Purchaser
would be unwilling or unable to pay taxes due on its share of the taxable income
attributable to the Certificates.
5. The Seller has conducted a reasonable investigation of
the financial condition of the Purchaser and, as a result of the investigation,
found that the Purchaser has historically paid its debts as they came due, and
found no significant evidence to indicate that the Purchaser will not continue
to pay its debts as they come due in the future.
6. The Purchaser has represented to the Seller that, if the
Certificates constitute a noneconomic residual interest, it (i) understands that
as holder of a noneconomic residual interest it may incur tax liabilities in
excess of any cash flows generated by the interest, and (ii) intends to pay
taxes associated with its holding of the Certificates as they become due.
Very truly yours,
(Seller)
By:
Name:
Title:
2
EXHIBIT H
FORM OF LOST NOTE AFFIDAVIT AND INDEMNITY
STATE OF )
: ss.:
COUNTY OF )
Greystone Funding Corporation, a Georgia corporation (the
"Seller"), and Greystone Servicing Corporation, Inc. (the "Master Servicer"), by
their undersigned authorized representatives, hereby certify:
1. Pursuant to the Pooling and Servicing Agreement, dated
as of November 1, 1995 (the "Pooling and Servicing Agreement"), among CS First
Boston Mortgage Securities Corp. as depositor, the Master Servicer as master
servicer, the Seller as seller and LaSalle National Bank as trustee, the Seller
and the Master Servicer are granting all of their right, title and interest in
and to the Mortgage Loan identified below to the Trustee. Terms used but not
defined herein have the respective meanings assigned to them in the Pooling and
Servicing Agreement.
FHA Project No:
Project Name:
Location:
Original Principal Amount:
Original Mortgage Note Date:
Maturity Date:
2. The Seller is the beneficial owner of and the Master
Servicer holds legal title to the indebtedness evidenced by the original
Mortgage Note.
3. After diligent search, the Seller and the Master
Servicer have been unable to locate the original Mortgage Note and believe it to
be lost or misplaced.
4. A true, complete and correct photocopy of the original
Mortgage Note is attached hereto.
5. If at any time the Seller or the Master Servicer locates
the original Mortgage Note, such party shall endorse such original Mortgage Note
in blank for transfer to the Trustee and shall promptly deliver the original
Mortgage Note, so endorsed, to the Trustee or its designee.
6. The Seller hereby indemnifies and holds harmless the
Trustee, the Certificateholders and the Depositor and their respective
successors and assigns against any losses, costs, or charges whatsoever,
including attorney's fees, which may be sustained by
the Trustee, the Certificateholders or the Depositor as a result of the loss of
the original Mortgage Note.
7. This Lost Note Affidavit and Indemnity shall inure to
the benefit of the Trustee, the Certificateholders, the Depositor and their
respective successors and permitted assigns.
GREYSTONE FUNDING CORPORATION
By:
Name:
Title:
GREYSTONE SERVICING CORPORATION, INC.
By:
Name:
Title:
Subscribed and Sworn to before me
this ____ day of November, 1995
_______________________________
Notary Public
2
EXHIBIT I
FORM OF HUD INDEMNITY
FHA Project No.
Project Name:
Location:
INDEMNIFICATION
WHEREAS, by Assignment dated __________________ and filed for record in
the Office of the _____________________, _____________________, County,
____________ on _____________________ in Volume _______, Page ______,
_________________________ assigned a Mortgage and Mortgage Note dated
________________ on the captioned property, both real and personal, located in
___________________________, to the Secretary of Housing and Urban Development
(Secretary), his successors and assigns, in exchange for the payment of mortgage
insurance benefits; and
WHEREAS, pursuant to the terms of the contract of mortgage insurance
between the parties, payments of the insurance benefits was conditional upon,
inter alia, the assignment to the Secretary of a valid first [second] lien on
the _______________ property; and
WHEREAS, _______________________ has failed to submit to the Secretary
the original Mortgage Note given by _______________ to _______________________.
NOW, THEREFORE, in order to induce the Secretary to (1) waive the
requirements for the assignment of the original Mortgage Note secured by a valid
first [second] mortgage on the property and (2) make full and final settlement
of ______________'s claim for insurance benefits, and in consideration of the
balance of the insurance benefits remaining unpaid on this claims,
_________________ agrees to indemnify and hold harmless the Secretary and
his/her successors and assigns against any loss, costs, or charges whatsoever,
including attorney's fees, which may be sustained by the Secretary as a result
of the loss of the original Note.
(Name of Assigning Mortgagee)
By:
----------------------------
Name:
Title:
Attest:______________________
Name:
Title:
EXHIBIT J
SCHEDULE OF PAST DUE OR UNPAID TAX AND ASSESSMENT OBLIGATIONS
<TABLE>
<CAPTION>
Party in
Whose Nature of Lien
Project Asset # per Favor the Past Due Amount Past Recordation Recording Lien
Name Exhibit B Lien Exists Amount Due ($) Date Information Priority
- ---- ----------- ----------- ---------- ---------- ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Alta Sita 1 Village of Wastewater 58,386.13 11/11/90 Book 2800 Subordinate
Sauget Treatment plus costs Page 1384 to Mortgate
Assessment Doc #
A01044568
Alta Sita 1 Village of Wastewater 79,425.60 06/14/93 Book 2920 Subordinate
Sauget Treatment plus costs Page 833 to Mortgate
Assessment Doc #
A01172777
</TABLE>
MORTGAGE ASSET PURCHASE AGREEMENT
This Mortgage Asset Purchase Agreement (this "Agreement"), dated
and effective as of November 15, 1995, is made by and among Greystone Funding
Corporation (the "Seller"), Greystone Servicing Corporation, Inc. (the "Master
Servicer") and CS First Boston Mortgage Securities Corp. (the "Depositor").
The Depositor intends to create a trust fund (the "Trust Fund"),
the beneficial ownership of which will be evidenced by the Depositor's Mortgage
Pass-Through Certificates, Series 1995-FHA1 (the "Certificates"). The Seller,
the Master Servicer and the Depositor each intends for the Seller and the Master
Servicer to convey to LaSalle National Bank, as trustee for the Trust Fund (the
"Trustee"), (i) certain fixed-rate, level payment, fully-amortizing mortgage
loans (the "Mortgage Loans") insured by the Federal Housing Administration (the
"FHA") of the United States Department of Housing and Urban Development ("HUD")
under certain sections of the National Housing Act of 1934, as amended (the
"Housing Act"), and secured by liens on multifamily rental or cooperative
housing developments (collectively, "Multifamily Properties") or nursing homes,
intermediate care facilities, board and care homes or other nursing facilities
(collectively, "Nursing Facilities") and (ii) certain securities (the "GNMA
Certificates" and collectively with the Mortgage Loans, the "Mortgage Assets")
guaranteed by the Government National Mortgage Association ("GNMA") and backed
by fixed-rate, level payment, fully-amortizing mortgage loans (the "Underlying
Loans" and collectively with the Mortgage Loans, the "FHA Loans") insured by the
FHA and secured by liens on Multifamily Properties or Nursing Facilities. The
Trust Fund will be created, the Mortgage Assets will be conveyed and the
Certificates will be issued pursuant to a Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement"), to be dated as of November 1, 1995 (the
"Cut-off Date"), among the Depositor, the Master Servicer, the Seller and the
Trustee. Capitalized terms used but not defined herein have the respective
meanings set forth in the Pooling and Servicing Agreement.
Now, therefore, in consideration of the premises and the mutual
agreements set forth herein, the parties agree as follows:
SECTION 1. Agreement to Sell and Assign the Mortgage Assets
and enter into the Pooling and Servicing Agreement.
(a) At the direction of the Depositor, in accordance with
the terms and conditions of the Pooling and Servicing Agreement, the Seller and
the Master Servicer agree to sell and assign to the Trustee without recourse for
the benefit of the Certificateholders all the right, title and interest of the
Seller and the Master Servicer in and to the Mortgage Assets identified on the
schedule annexed hereto as Exhibit A, as such schedule may be amended from time
to time pursuant to the terms hereof (the "Mortgage Asset Schedule") (exclusive
of the right to receive any Retained Yield in respect of any FHA Debentures
which may be acquired as part of the Trust Fund). The Mortgage Assets will have
an aggregate principal balance (the "Initial Pool Balance") as of the close of
business on the Cut-off Date, after giving effect to any payments due on or
before such date whether or not received, and subject to a variance of plus or
minus 5%, of $171,543,361. The sale and assignment of the Mortgage Assets shall
take
-2-
place on November 21, 1995 or such other date as shall be mutually acceptable
to the parties hereto (the "Closing Date"). The consideration for the Seller's
and the Master Servicer's conveyance of the Mortgage Assets to the Trustee for
the benefit of the Certificateholders shall consist of (A) a cash amount equal
to $179,769,224, together with interest accrued on each Mortgage Asset at the
related Net Asset Rate for the period from and including November 1, 1995 up to
but not including the Closing Date (which cash amount shall be paid to the
Seller by or on behalf of the Depositor by wire transfer in immediately
available funds on the Closing Date), and (B) those Classes of Certificates
designated as the Class R-I and Class R-II Certificates (collectively, the
"Residual Certificates") (which Certificates shall be delivered to the Seller
by or on behalf of the Depositor on the Closing Date, registered in such names
and authorized denominations as the Seller may request at least three Business
Days prior to the Closing Date).
(b) The Trustee shall be entitled to receive all scheduled
payments of principal and interest due after the Cut-off Date, and all other
recoveries of principal and interest collected after the Cut-off Date (other
than in respect of principal and interest on the FHA Loans due on or before the
Cut-off Date and other than Retained Yield in respect of any Mortgage Loan
assigned to the FHA (an "FHA Assigned Mortgage Loan") and/or any FHA Debentures
acquired as part of the Trust Fund). All scheduled payments of principal and
interest due on the FHA Loans on or before the Cut-off Date but collected (and,
in the case of an Underlying Loan, passed through on the related GNMA
Certificate) after the Cut-off Date, and all recoveries of Retained Yield in
respect of any FHA Debentures acquired as part of the Trust Fund, shall belong
to, and be promptly remitted to, the Seller.
(c) In connection with the transactions contemplated by
this Agreement, the Seller and the Master Servicer each hereby agrees to
execute and deliver the Pooling and Servicing Agreement, substantially in the
form attached hereto as Exhibit B, with such changes and modifications as the
parties hereto may agree or as may be requested by the Trustee or as may be
required by Standard & Poor's Ratings Services ("S&P") in connection with
rating certain Classes of the Certificates.
SECTION 2. Examination of Mortgage Files and Due Diligence
Review. The Seller and the Master Servicer have delivered to the Depositor
magnetic tapes acceptable to the Depositor which contain such information about
the Mortgage Assets, the Underlying Loans and the Multifamily Properties and
Nursing Facilities securing the Mortgage Loans and the Underlying Loans (such
properties, the "Mortgaged Properties") as has been requested by the Depositor,
and shall otherwise continue to cooperate fully with the Depositor in its
examination of the credit files, underwriting documentation and Mortgage Files
for the Mortgage Loans and its general due diligence review of the Mortgage
Assets, the Seller and the Master Servicer. If the Depositor identifies any
Mortgage Assets that, in its sole reasonable discretion, do not conform to its
requirements, including, but not limited to, the Mortgage Loan document
delivery requirements as are set forth in Section 2.01 of the Pooling and
Servicing Agreement and are described in the Prospectus dated November 13, 1995
(the "Basic Prospectus") and the Prospectus Supplement dated November 15, 1995
(the "Prospectus Supplement"; together with the Basic Prospectus, the
"Prospectus") that describe the Class A-1, Class A-2, Class A-3, Class
-3-
A-4, Class A-X-1, Class A-X-2, Class A-X-3 and Class A-X-4 Certificates
(collectively, the "Publicly Offered Certificates") and are used in connection
with a public offering thereof, or for any other reason decides, in its sole
reasonable discretion, to exclude any Mortgage Asset from this transaction,
then the Depositor shall inform the Seller of the reasons for the exclusion of
any Mortgage Asset from this transaction, and such Mortgage Asset shall be
deleted from the Mortgage Asset Schedule. The Depositor may, at its option and
without notice to the Seller, accept all or part of the Mortgage Assets without
conducting any partial or complete examination. The fact that the Depositor
has conducted or has failed to conduct any partial or complete examination of
the Mortgage Files for the Mortgage Loans or other general due diligence review
of the Mortgage Assets, the Seller or the Master Servicer shall not in any
manner impair or otherwise adversely affect the Depositor's, the Trustee's
and/or the Certificateholders' rights and remedies hereunder or under the
Pooling and Servicing Agreement or otherwise at law or in equity.
On or prior to the Closing Date, the Seller and the Master Servicer
shall allow representatives of the Depositor and CS First Boston Corporation
(the "Underwriter") to examine and audit all books, records and files
pertaining to the Mortgage Assets. Such examinations and audits shall take
place at one or more offices of the Seller and/or the Master Servicer during
normal business hours and shall not be conducted in a manner that is disruptive
to Seller's or Master Servicer's normal business operations. In the course of
such examinations and audits, the Seller and the Master Servicer shall make
available to such representatives of the Depositor and the Underwriter,
reasonably adequate facilities, as well as the assistance of a sufficient
number of knowledgeable and responsible individuals who are familiar with the
Mortgage Assets and the terms of this Agreement and the Pooling and Servicing
Agreement, and the Master Servicer and the Seller shall cooperate fully with
any such reasonable examination and audit in all respects. On or prior to the
Closing Date, the Master Servicer and the Seller agree to provide the Depositor
and the Underwriter with all material information regarding the respective
financial conditions thereof and the Master Servicer's servicing capabilities,
and to provide access to knowledgeable financial, accounting and servicing
officers for the purpose of answering questions with respect to the Master
Servicer's and the Seller's respective financial conditions, the Master
Servicer's and the Seller's respective financial statements as provided to the
Depositor and/or the Underwriter, the Master Servicer's servicing capabilities
or other relevant developments affecting the Master Servicer and/or the Seller.
SECTION 3. Representations, Warranties and Covenants of the
Seller and the Master Servicer.
(a) The Master Servicer hereby represents and warrants to,
and covenants with, the Depositor, as of the date hereof, that:
(i) the Master Servicer is a corporation, duly
organized, validly existing and in good standing under the laws
of the State of Georgia;
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(ii) the Master Servicer has the full corporate
power and authority to enter into and consummate the
transactions contemplated by this Agreement and the Pooling and
Servicing Agreement and has duly authorized by all necessary
corporate action on the part of the Master Servicer the
execution, delivery and performance of this Agreement and the
Pooling and Servicing Agreement; and, assuming the due
authorization, execution and delivery of this Agreement and the
Pooling and Servicing Agreement by the other parties hereto and
thereto, this Agreement constitutes, and the Pooling and
Servicing Agreement will constitute, a legal, valid and binding
obligation of the Master Servicer, enforceable against the
Master Servicer in accordance with its respective terms, except
that (A) such enforceability may be limited by bankruptcy,
insolvency, moratorium, receivership and other similar laws
relating to creditors' rights generally and (B) the remedy of
specific performance and injunctive and other forms of
equitable relief may be subject to the equitable defenses and
to the discretion of the court before which any proceeding
therefor may be brought;
(iii) the execution and delivery by the Master
Servicer of this Agreement and the Pooling and Servicing
Agreement, the consummation of any other of the transactions
herein or therein contemplated, and the fulfillment of or
compliance with the terms hereof and thereof, are in the
ordinary course of business of the Master Servicer and will not
(A) result in a material breach of any term or provision of the
organizational documents of the Master Servicer or (B)
materially conflict with, result in a material breach,
violation or acceleration of, or result in a material default
under, the terms of any other material agreement or instrument
to which the Master Servicer is a party or by which it may be
bound, or any statute, order or regulation applicable to the
Master Servicer of any court, regulatory body, administrative
agency or governmental body having jurisdiction over the Master
Servicer; and the Master Servicer is not a party to, bound by,
or in breach or violation of any indenture or other agreement
or instrument, or subject to or in violation of any statute,
order or regulation of any court, regulatory body,
administrative agency or governmental body having jurisdiction
over it, which materially and adversely affects, or, in the
Master Servicer's good faith and reasonable judgment, would in
the future materially and adversely affect, (X) the ability of
the Master Servicer to perform its obligations under this
Agreement or the Pooling and Servicing Agreement or (Y) the
business, operations, financial condition, properties or assets
of the Master Servicer;
(iv) no litigation is pending or, to the best of the
Master Servicer's knowledge, threatened against the Master
Servicer that would adversely affect the execution, delivery or
enforceability of this Agreement or the ability of the Master
Servicer to perform any of its obligations hereunder or under
the Pooling and Servicing Agreement in accordance with the
terms hereof or thereof;
(v) no written information, certificate of an
officer, statement furnished in writing or written report
delivered to the Depositor, any affiliate of the Depositor or
the Trustee and prepared by the Master Servicer pursuant to
this Agreement or in connection with the transactions
contemplated by this Agreement contains any untrue
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statement of a material fact or omits to state a material fact
necessary to make the information, certificate, statement or
report not misleading;
(vi) 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 Pooling and Servicing Agreement or the consummation of the
transactions contemplated hereby or thereby, or if any such
consent, approval, authorization or order is required, the
Master Servicer has, or prior to the Closing Date will have,
obtained the same;
(vii) the Master Servicer is an FHA-Approved
Mortgagee; and
(viii) The "Greystone Information" (as defined in
Section 6(a) hereof) set forth in the Prospectus and in the
Private Placement Memorandum dated November 15, 1995 (including
all exhibits thereto, the "Memorandum") that describes the
Class B Certificates, does not contain any untrue statement of
a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(b) The Seller hereby represents and warrants to, and
covenants with, the Depositor, as of the date hereof, that:
(i) the Seller is a corporation, duly organized,
validly existing and in good standing under the laws of the
Commonwealth of Virginia;
(ii) the Seller has the full corporate power and
authority to transfer the Mortgage Assets, and to execute,
deliver and perform, and to enter into and consummate the
transactions contemplated by this Agreement and the Pooling and
Servicing Agreement and has duly authorized by all necessary
corporate action on the part of the Seller the execution,
delivery and performance of this Agreement and the Pooling and
Servicing Agreement; and, assuming the due authorization,
execution and delivery of this Agreement and the Pooling and
Servicing Agreement by the other parties hereto and thereto,
this Agreement constitutes, and the Pooling and Servicing
Agreement will constitute, a legal, valid and binding
obligation of the Seller, enforceable against the Seller in
accordance with its respective terms, except that (A) such
enforceability may be limited by bankruptcy, insolvency,
moratorium, receivership and other similar laws relating to
creditors' rights generally and (B) the remedy of specific
performance and injunctive and other forms of equitable relief
may be subject to the equitable defenses and to the discretion
of the court before which any proceeding therefor may be
brought;
(iii) the execution and delivery by the Seller of
this Agreement and the Pooling and Servicing Agreement, the
transfer of the Mortgage Assets by the Seller, the consummation
of any other of the transactions contemplated herein or in the
Pooling and Servicing Agreement, and the fulfillment of or
compliance with the terms hereof and of
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the Pooling and Servicing Agreement, are in the ordinary course
of business of the Seller and will not (A) result in a material
breach of any term or provision of the organizational documents
of the Seller or (B) materially conflict with, result in a
material breach, violation or acceleration of, or result in a
material default under, the terms of any other material
agreement or instrument to which the Seller is a party or by
which it may be bound, or any statute, order or regulation
applicable to the Seller of any court, regulatory body,
administrative agency or governmental body having jurisdiction
over the Seller; and the Seller is not a party to, bound by, or
in breach or violation of any indenture or other agreement or
instrument, or subject to or in violation of any statute, order
or regulation of any court, regulatory body, administrative
agency or governmental body having jurisdiction over it, which
materially and adversely affects, or, in the Seller's good
faith and reasonable judgment, would in the future materially
and adversely affect, (X) the ability of the Seller to perform
its obligations under this Agreement or the Pooling and
Servicing Agreement or (Y) the business, operations, financial
condition, properties or assets of the Seller;
(iv) no litigation is pending or, to the best of the
Seller's knowledge, threatened against the Seller that would
adversely affect the execution, delivery or enforceability of
this Agreement or the ability of the Seller to transfer the
Mortgage Assets or to perform in all material respects any of
its other obligations hereunder or under the Pooling and
Servicing Agreement in accordance with the terms hereof or
thereof;
(v) no written information, certificate of an
officer, statement furnished in writing or written report
delivered to the Depositor, any affiliate of the Depositor or
the Trustee and prepared by the Seller pursuant to this
Agreement or in connection with the transactions contemplated
by this Agreement contains any untrue statement of a material
fact or omits to state a material fact necessary to make the
information, certificate, statement or report not misleading;
(vi) no consent, approval, authorization or order of
any court or governmental agency or body is required for the
execution, delivery and performance by the Seller of, or
compliance by the Seller with, this Agreement or the Pooling
and Servicing Agreement or the consummation of the transactions
contemplated hereby or thereby, or if any such consent,
approval, authorization or order is required, the Seller has,
or prior to the Closing Date will have, obtained the same;
(vii) the consummation of the transactions
contemplated by this Agreement and the Pooling and Servicing
Agreement are not subject to the bulk transfer or any similar
statutory provisions in effect in any applicable jurisdiction;
(viii) The Seller is acquiring the Residual
Certificates for its own account for investment and not with a
view to or for sale or transfer in connection with any
distribution thereof in any manner that would violate the
Securities Act of 1933, as amended (the "1933 Act"), or any
applicable state securities laws;
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(ix) The Seller understands that the Residual
Certificates have not and will not be registered under the 1933
Act or registered or qualified under any applicable state
securities laws, neither the Depositor nor the Trustee is
obligated so to register or qualify such Certificates, and such
Certificates may only be transferred by the Seller either (A)
to "qualified institutional buyers" within the meaning of Rule
144A under the 1933 Act ("QIBs") and only if the Trustee has
received the requisite certifications from the Seller and the
prospective transferee substantially in the forms attached to
the Pooling and Servicing Agreement or (B) pursuant to another
exemption from registration under the 1933 Act and only if the
Depositor and the Trustee have received an opinion of counsel
satisfactory to the Depositor and the Trustee that such
transfer may be made without such registration;
(x) The Seller will not sell or otherwise transfer
any portion of its interest in either Class of Residual
Certificates except in compliance with the provisions of the
Pooling and Servicing Agreement, which provisions it has
carefully reviewed;
(xi) Neither the Seller nor anyone acting on its
behalf has (A) offered, pledged, sold, disposed of or otherwise
transferred any Residual Certificate, any interest in any
Residual Certificate or any other similar security to any
person in any manner, (B) solicited any offer to buy or to
accept a pledge, disposition or other transfer of any Residual
Certificate, any interest in any Residual Certificate or any
other similar security from any person in any manner, (C)
otherwise approached or negotiated with respect to any Residual
Certificate, any interest in any Residual Certificate or any
other similar security with any person in any manner, (D) made
any general solicitation by means of general advertising or in
any other manner, or (E) taken any other action, that (in the
case of any of the acts described in clauses (A) through (E)
above) would constitute a distribution of the Residual
Certificates under the 1933 Act, or would render the
disposition of any Residual Certificate a violation of Section
5 of the 1933 Act or any state securities law or require
registration or qualification pursuant thereto. The Seller
will not act, nor has it authorized or will it authorize any
person to act, in any manner set forth in the foregoing
sentence with respect to the Residual Certificates;
(xii) The Seller has been furnished with all
information regarding (A) the Depositor, (B) the Residual
Certificates, (C) the Pooling and Servicing Agreement and (D)
all related matters, that it has requested;
(xiii) The Seller is an "accredited investor" as
defined in Rule 501(a) under the 1933 Act. The Seller has such
knowledge and experience in financial and business matters as
to be capable of evaluating the merits and risks of an
investment in the Residual Certificates; the Seller has sought
such accounting, legal and tax advice as it has considered
necessary to make an informed investment decision; and the
Seller is able to bear the economic risks of such an
investment;
(xiv) The Seller is not (A) a "Plan", defined as any
employee benefit plan or other retirement arrangement,
including individual retirement accounts and
-8-
annuities, Keogh plans and collective investment funds and
separate accounts in which such plans, accounts or arrangements
are invested, that is subject to the Employee Retirement Income
Security Act of 1974, as amended, or Section 4975 of the
Internal Revenue Code of 1986, as amended, or (B) any person
who is directly or indirectly acquiring the Residual
Certificates on behalf of, as named fiduciary of, as trustee
of, or with assets of a Plan; and
(xv) The "Greystone Information" (as defined in
Section 6(a) hereof) set forth in the Prospectus and the
Memorandum does not contain any untrue statement of a material
fact or omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances
under which they were made, not misleading.
SECTION 4. Closing. The closing of the sale of the
Mortgage Assets (the "Closing") shall be held at the offices of Thacher
Proffitt & Wood, Two World Trade Center, New York, New York 10048 at 10:00
A.M., New York time, on the Closing Date.
The Closing shall be subject to each of the following
conditions:
(a) All of the representations and warranties of the Seller
and the Master Servicer set forth in this Agreement and/or the Pooling and
Servicing Agreement shall be true and correct in all material respects as of
the Closing Date;
(b) All documents specified in Section 5 of this Agreement
(the "Closing Documents"), in such forms as are agreed upon and acceptable to
the Depositor, shall be duly executed and delivered by all signatories as
required pursuant to the respective terms thereof;
(c) All other terms and conditions of this Agreement and
the Pooling and Servicing Agreement required to be complied with on or before
the Closing Date shall have been complied with and the Seller and the Master
Servicer shall have the ability to comply with all terms and conditions and
perform all duties and obligations required to be complied with or performed
after the Closing Date;
(d) The Publicly Offered Certificates shall have been
assigned by S&P the ratings set forth in the Prospectus Supplement;
(e) The Seller shall have paid all fees and expenses
payable by it to the Depositor or otherwise pursuant to this Agreement; and
(f) the Seller shall be ready, willing and able to purchase
the Class A-X-1, Class A-X-2, Class A-X-3 and Class A-X-4 Certificates from the
Underwriter for $10,076,154, together with accrued interest thereon at the
respective Certificate Interest Rates from the Cut-off Date to but not
including the Closing Date.
All parties hereto agree to act in good faith and use their
best efforts to perform their respective obligations hereunder in a manner that
will enable the Seller to convey the
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Mortgage Assets on the Closing Date. If any of the foregoing conditions shall
not have been satisfied in all material respects as and when required under
this Agreement, other than by reason of a material breach of any covenants or
agreements contained herein on the part of the Depositor, or if the Master
Servicer or the Seller is in material breach of any covenants or agreements
contained herein, then the Depositor shall be entitled to terminate this
Agreement (exclusive of any payment or reimbursement obligations of the Master
Servicer and/or the Seller hereunder), cancel all of its obligations hereunder
and pursue any other right or remedy available at law or in equity.
SECTION 5. Closing Documents. The Closing Documents shall
consist of the following:
(a) This Agreement and the Pooling and Servicing Agreement
duly executed and delivered by the Master Servicer and the Seller;
(b) A Certificate of the Seller, executed by a duly
authorized officer of the Seller and dated the Closing Date, and upon which the
Depositor and the Underwriter may rely, to the effect that: (i) the
representations and warranties of the Seller in this Agreement and in the
Pooling and Servicing Agreement are true and correct in all material respects
at and as of the Closing Date with the same effect as if made on such date; and
(ii) the Seller has, in all material respects, complied with all the agreements
and satisfied all the conditions on its part that are required under this
Agreement or the Pooling and Servicing Agreement to be performed or satisfied
at or prior to the Closing Date;
(c) An Officer's Certificate from an officer of the Seller,
in his or her individual capacity, dated the Closing Date, and upon which the
Depositor and the Underwriter may rely, to the effect that each individual who,
as an officer or representative of the Seller, signed this Agreement, the
Pooling and Servicing Agreement or any other document or certificate delivered
on or before the Closing Date in connection with the transactions contemplated
herein or therein, was at the respective times of such signing and delivery,
and is as of the Closing Date, duly elected or appointed, qualified and acting
as such officer or representative, and the signatures of such persons appearing
on such documents and certificates are their genuine signatures;
(d) A Certificate of the Master Servicer, executed by a
duly authorized officer of the Master Servicer and dated the Closing Date, and
upon which the Depositor and the Underwriter may rely, to the effect that: (i)
the representations and warranties of the Master Servicer in this Agreement and
in the Pooling and Servicing Agreement are true and correct in all material
respects at and as of the Closing Date with the same effect as if made on such
date; and (ii) the Master Servicer has, in all material respects, complied with
all the agreements and satisfied all the conditions on its part that are
required under this Agreement or the Pooling and Servicing Agreement to be
performed or satisfied at or prior to the Closing Date;
(e) An Officer's Certificate from an officer of the Master
Servicer, in his or her individual capacity, dated the Closing Date, and upon
which the Depositor and the
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Underwriter may rely, to the effect that each individual who, as an officer or
representative of the Master Servicer, signed this Agreement, the Pooling and
Servicing Agreement or any other document or certificate delivered on or before
the Closing Date in connection with the transactions contemplated herein or
therein, was at the respective times of such signing and delivery, and is as of
the Closing Date, duly elected or appointed, qualified and acting as such
officer or representative, and the signatures of such persons appearing on such
documents and certificates are their genuine signatures;
(f) The resolutions of the board of directors of the Seller
and any requisite shareholder consent authorizing the Seller's entering into
the transactions contemplated by this Agreement, the certificate of
incorporation and by-laws of the Seller as in effect on the Closing Date, and a
certificate of good standing of the Seller issued by the Secretary of State of
Virginia not earlier than thirty (30) days prior to the Closing Date;
(g) The resolutions of the board of directors of the Master
Servicer and any requisite shareholder consent authorizing the Master
Servicer's entering into the transactions contemplated by this Agreement, the
certificate of incorporation and by-laws of the Master Servicer as in effect on
the Closing Date, and a certificate of good standing of the Master Servicer
issued by the Secretary of State of Georgia not earlier than thirty (30) days
prior to the Closing Date;
(h) One or more letters from a firm of certified public
accountants acceptable to the Depositor and the Seller, dated the date hereof,
to the effect that they have performed certain specified procedures as a result
of which they determined that certain information of an accounting, financial
or statistical nature constituting part of Greystone's Information (as defined
in Section 6(a) below) in the Prospectus and the Memorandum agrees with the
records of the Seller and the Master Servicer;
(i) Such written opinion or opinions of Ballard Spahr
Andrews & Ingersoll, counsel for the Seller and the Master Servicer, as may be
required by the Depositor and its counsel with respect to matters relating to
the Seller, the Master Servicer, this Agreement and the Pooling and Servicing
Agreement, in form and substance acceptable to the Depositor and its counsel,
with any modifications required by S&P, dated the Closing Date and addressed to
the Depositor, the Underwriter and S&P, together with such other written
opinions as may be required by the S&P;
(j) A Transfer Affidavit and Agreement (in the form of
Exhibit F-1 to the Pooling and Servicing Agreement), executed by a duly
authorized officer of the Seller and dated the Closing Date, and upon which the
Depositor and the Trustee may rely, relating to the transfer of the Residual
Certificates to the Seller; and
(k) Such further certificates, opinions and documents as
the Depositor may reasonably request.
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SECTION 6. Indemnification.
(a) The Seller and the Master Servicer agree to be jointly
and severally liable to indemnify and hold harmless the Depositor, the
Underwriter, their respective officers and directors, and each person, if any,
who controls the Depositor or the Underwriter within the meaning of either
Section 15 of the 1933 Act or Section 20 of the Securities Exchange Act of
1934, as amended (the "1934 Act"), against any and all losses, claims, damages
or liabilities, joint or several, to which they or any of them may become
subject under the 1933 Act, the 1934 Act or other federal or state statutory
law or regulation, at common law or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based in whole or in part, directly or indirectly, upon any untrue statement or
alleged untrue statement of a material fact set forth in the Prospectus
Supplement in the second paragraph on the cover page thereof, under the
captions "SUMMARY OF TERMS--Description of the Certificates "(other than the
second paragraph thereof), "--Seller", "--Master Servicer", "--The Mortgage
Assets", "--FHA Insurance and GNMA Guaranty" (other than information contained
therein regarding specific terms of the Pooling and Servicing Agreement), "--
Retained Yield" and "-Servicing Fees", "RISK FACTORS--The Mortgage Assets",
"DESCRIPTION OF THE MORTGAGE POOL", "FHA MORTGAGE INSURANCE PROGRAMS", "GNMA
MORTGAGE-BACKED SECURITIES PROGRAM", "GREYSTONE FUNDING CORPORATION" and
"SERVICING OF THE MORTGAGE LOANS--The Master Servicer" "--Master Servicer
Compensation and Payment of Expenses", and "--Sub-Servicers" or in Appendix A
thereto or elsewhere in the Prospectus Supplement with respect to specific
characteristics of the Mortgage Assets, the Mortgage Loans, the Mortgaged
Properties, the Seller and/or the Master Servicer (collectively, the "Greystone
Information"), or arise out of or are based upon any omission or alleged
omission to state in the Greystone Information a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances in which they were made, not misleading. The Seller and the
Master Servicer further agree to be jointly and severally liable to indemnify
and hold harmless the Depositor, the Underwriter, their respective officers and
directors, and each person, if any, who controls the Depositor or the
Underwriter within the meaning of either Section 15 of the 1933 Act or Section
20 of the 1934 Act, to the same extent as the foregoing indemnity with
reference to the inclusion of information in the Memorandum or any amendment
thereof or supplement thereto substantially identical to that included in the
Prospectus Supplement with respect to the Greystone Information (all such
substantially identical information included in the Memorandum also being
referred to herein as the "Greystone Information"). This indemnity agreement
will be in addition to any liability which the Seller or the Master Servicer
may otherwise have.
(b) Promptly after receipt by any person entitled to
indemnification under this Section 6 (an "indemnified party") of notice of the
commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against the Seller and/or the Master Servicer
(collectively, the "indemnifying party") under this Section 6, notify the
indemnifying party in writing of the commencement thereof, but the omission so
to notify the indemnifying party will not relieve it from any liability that it
may have to any indemnified party otherwise than under this Section 6. In case
any such action is brought against any indemnified party and it notifies the
indemnifying party of the commencement thereof, the indemnifying party
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will be entitled to participate therein, and to the extent that it may elect by
written notice delivered to the indemnified party promptly after receiving the
aforesaid notice from such indemnified party, to assume the defense thereof,
with counsel satisfactory to such indemnified party; provided, however, that if
the defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party or parties shall have reasonably
concluded that there may be legal defenses available to it or them and/or other
indemnified parties that are different from or additional to those available to
the indemnifying party, the indemnified party or parties shall have the right
to select separate counsel to assert such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party
or parties. Upon receipt of notice from the indemnifying party to such
indemnified party of its election so to assume the defense of such action and
approval by the indemnified party of counsel, the indemnifying party will not
be liable for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof, unless (i) the
indemnified party shall have employed separate counsel in connection with the
assertion of legal defenses in accordance with the proviso to the preceding
sentence (it being understood, however, that the indemnifying party shall not
be liable for the expenses of more than one separate counsel, approved by the
Depositor, representing all the indemnified parties under Section 6(a) who are
parties to such action), (ii) the indemnifying party shall not have employed
counsel satisfactory to the indemnified party to represent the indemnified
party within a reasonable time after notice of commencement of the action or
(iii) the indemnifying party has authorized the employment of counsel for the
indemnified party at the expense of the indemnifying party; and except that, if
clause (i) or (iii) is applicable, such liability shall only be in respect of
the counsel referred to in such clause (i) or (iii).
(c) If the indemnification provided for in this Section 6
is unavailable to an indemnified party under Section 6(a) hereof or
insufficient in respect of any losses, claims, damages or liabilities referred
to therein, then the indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities,
in such proportion as is appropriate to reflect the relative fault of the
indemnified and indemnifying parties in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative fault of the
indemnified and indemnifying parties shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by such parties.
(d) The Depositor, the Seller and the Master Servicer agree
that it would not be just and equitable if contribution pursuant to Section
6(c) were determined by pro rata allocation or by any other method of
allocation that does not take account of the considerations referred to in
Section 6(c) above. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages and liabilities referred to in this
Section 6 shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim,
except where the indemnified party is required to bear such expenses pursuant
to this Section 6, which expenses the indemnifying party shall pay as and when
incurred, at the request
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of the indemnified party, to the extent that the indemnifying party will be
ultimately obligated to pay such expenses. If any expenses so paid by the
indemnifying party are subsequently determined not to be required to be borne
by the indemnifying party hereunder, the party that received such payment shall
promptly refund the amount so paid to the party which made such payment. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the 1933 Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation.
(e) The indemnity and contribution agreements contained in
this Section 6 shall remain operative and in full force and effect regardless
of (i) any termination of this Agreement, (ii) any investigation made by the
Depositor, the Underwriter, any of their respective directors or officers, or
any person controlling the Depositor or the Underwriter, and (iii) conveyance
of and payment for the Mortgage Assets.
SECTION 7. Costs. The Seller shall pay (or shall reimburse
the Depositor to the extent that the Depositor has paid) the aggregate of the
following amounts: (i) the costs and expenses of printing (or otherwise
reproducing) and delivering a final Prospectus and Memorandum relating to the
Certificates; (ii) the initial fees, costs and expenses of the Trustee
(including reasonable attorneys' fees); (iii) a fee of $175,000 in connection
with the registration of the Publicly Offered Certificates under the 1933 Act;
(iv) the fees charged by S&P to rate the Publicly Offered Certificates; (v) the
expense of recording any assignment of Mortgage or assignment of Assignment of
Leases; (vi) the fees (up to $165,000) and disbursements of Thacher Proffitt &
Wood, as counsel to the Depositor, and the fees (up to $10,000) and
disbursements of Milbank, Tweed, Hadley & McCloy, as special counsel to the
Depositor; (vii) the cost of obtaining a "comfort letter or letters" from a
firm of certified public accountants selected by the Depositor with respect to
numerical information in respect of the Mortgage Assets and Certificates
included in the Prospectus and Memorandum; and (viii) miscellaneous expenses
not to exceed $20,000. All other costs and expenses in connection with the
transactions contemplated hereunder shall be borne by the party incurring such
expense.
SECTION 8. Notices. All demands, notices and communications
hereunder shall be in writing and shall be deemed to have been duly given if
personally delivered to or mailed, by registered mail, postage prepaid, or
transmitted by telex or telegraph and confirmed by a similar mailed writing:
if to the Depositor, addressed to the Depositor at 55 East 52nd Street, New
York, New York 10055, Attention: President, or to such other address as may
hereafter be furnished to the Seller and the Master Servicer in writing by the
Depositor; if to the Seller, addressed to the Seller at Greystone Funding
Corporation, 98 Alexandria Pike, Warrenton, Virginia 22186, Attention: Ms.
Julie J. DeLimba with a copy to Greystone & Co., Inc., 152 West 57th Street,
60th Floor, New York, New York 10019, Attention: Mr. Mark Jarrell, or to such
address as the Seller may designate in writing to the Depositor; and if to the
Master Servicer, addressed to the Master Servicer at Greystone Servicing
Corporation, Inc., 98 Alexandria Pike, Warrenton, Virginia 22186, Attention:
Ms. Julie J. DeLimba with a copy to Greystone & Co., Inc., 152 West 57th
Street, 60th Floor, New York, New York 10019, Attention: Mr. Mark Jarrell, or
to such address as the Master Servicer may designate in writing to the
Depositor.
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SECTION 9. Representations, Warranties and Agreements to
Survive Delivery. All representations, warranties and agreements contained in
this Agreement, incorporated herein by reference or contained in the
certificates of officers of the Seller and the Master Servicer submitted
pursuant hereto or in connection with the transactions contemplated hereby,
shall remain operative and in full force and effect and shall survive delivery
of the Mortgage Assets by the Seller to the Trustee. To the extent not
expressly contradicted by the terms hereof, the provisions of the letter
agreement dated October 13, 1995 from the Underwriter to Greystone & Co., Inc.
shall survive the execution of this Agreement.
SECTION 10. Severability of Provisions. Any part, provision,
representation, warranty or covenant of this Agreement that is prohibited or
which is held to be void or unenforceable shall be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof. Any part, provision, representation, warranty or covenant
of this Agreement that is prohibited or unenforceable or is held to be void or
unenforceable in any particular jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any particular jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent
permitted by applicable law, the parties hereto waive any provision of law
which prohibits or renders void or unenforceable any provision hereof.
SECTION 11. Counterparts. This Agreement may be executed in
any number of counterparts, each of which shall be an original, but which
together shall constitute one and the same agreement.
SECTION 12. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS,
DUTIES, OBLIGATIONS AND RESPONSIBILITIES OF THE PARTIES HERETO SHALL BE
GOVERNED IN ACCORDANCE WITH THE INTERNAL LAWS AND DECISIONS OF NEW YORK. THE
PARTIES HERETO INTEND THAT THE PROVISIONS OF SECTION 5-1401 OF THE NEW YORK
GENERAL OBLIGATIONS LAW SHALL APPLY TO THIS AGREEMENT.
SECTION 13. Further Assurances. The Seller, the Master
Servicer and the Depositor agree to execute and deliver such instruments and
take such further actions as the other party may, from time to time, reasonably
request in order to effectuate the purposes and to carry out the terms of this
Agreement.
SECTION 14. Successors and Assigns. The rights and obligations
of the Seller and the Master Servicer under this Agreement shall not be
assigned by the Seller or the Master Servicer, as the case may be, without the
prior written consent of the Depositor, except that any person into which the
Seller or the Master Servicer may be merged or consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Seller or
the Master Servicer is a party, or any person succeeding to all or
substantially all of the business of the Seller and the Master Servicer, shall
be the successor to the Seller or the Master Servicer, as the case may be,
hereunder. The Depositor has the right to assign its interest under this
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Agreement, in whole or in part, as may be required to effect the purposes of
the Pooling and Servicing Agreement, and the assignee shall, to the extent of
such assignment, succeed to the rights and obligations hereunder of the
Depositor. Subject to the foregoing, this Agreement shall bind and inure to
the benefit of and be enforceable by the Seller, the Master Servicer and the
Depositor, and their permitted successors and assigns, and the officers,
directors and controlling persons referred to in Section 6.
SECTION 15. Amendments. No term or provision of this Agreement
may be waived or modified unless such waiver or modification is in writing and
signed by a duly authorized officer of the party against whom such waiver or
modification is sought to be enforced.
IN WITNESS WHEREOF, the Seller, the Master Servicer and the Depositor
have caused their names to be signed hereto by their respective duly authorized
officers as of the date first above written.
SELLER
GREYSTONE FUNDING CORPORATION
By: /s/ Stephen Rosenberg
-----------------------------------
Name: Stephen Rosenberg
Title: President
MASTER SERVICER
GREYSTONE SERVICING CORPORATION, INC.
By: /s/ Stephen Rosenberg
-----------------------------------
Name: Stephen Rosenberg
Title: President
DEPOSITOR
CS FIRST BOSTON MORTGAGE SECURITIES
CORP.
By: /s/ David Gertner
-----------------------------------
Name: David Gertner
Title: Vice President
