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: February 28, 1996
(Date of earliest event reported)
Commission File No. 33-72966
The Prudential Home Mortgage Securities Company, Inc.
Delaware 43-1490160
(State of Incorporation) (I.R.S. Employer Identification No.)
5325 Spectrum Drive, Frederick, Maryland 21701
Address of principal executive offices (Zip Code)
(301) 846-8199
Registrant's Telephone Number, including area code
Former name, former address and former fiscal year, if changed since last report
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ITEM 5. Other Events
On February 28, 1996, The Prudential Home Mortgage Securities
Company, Inc., a Delaware corporation (the "Registrant"), sold Mortgage
Pass-Through Certificates, Series 1996-3, Class A, Class AP, Class M, Class B-1
and Class B-2 (the "Offered Certificates"), having an aggregate original
principal balance of $123,623,672.74. The Offered Certificates were issued
pursuant to a Pooling and Servicing Agreement, dated as of February 28, 1996,
among the Registrant, Securitized Asset Services Corporation, as master servicer
(the "Master Servicer" or "SASCOR"), First Bank National Association, as trust
administrator and Firstar Trust Company, as trustee (the "Agreement"), a copy of
which is filed as an exhibit hereto. Mortgage Pass-Through Certificates, Series
1996-3, Class B-3, Class B-4 and Class B-5 Certificates, having an aggregate
initial principal balance of $1,249,241.61 (the "Private Certificates" and,
together with the Offered Certificates, the "Certificates"), were also issued
pursuant to the Agreement.
As of the date of initial issuance, the Offered Certificates
evidenced an approximate 99% undivided interest in a trust fund (the "Trust
Estate"), consisting principally of a pool of fixed interest rate, conventional,
monthly pay, fully-amortizing, one-to four-family residential first mortgage
loans, other than the Fixed Retained Yield (as defined in the Agreement), which
may include loans secured by shares issued by cooperative housing corporations,
originated in connection with the relocation of employees by various corporate
employers participating in the relocation program of The Prudential Home
Mortgage Company, Inc. and of employees of various non-participant employees.
The remaining undivided interests in the Trust Estate are evidenced by the
Private Certificates, distributions on which are subordinated to distributions
on the Offered Certificates.
Interest on the Offered Certificates (other than the Class AP
Certificates) will be distributed on each Distribution Date (as defined in the
Agreement). Monthly distributions in reduction of the principal balance of the
Offered Certificates will be allocated to the Subclasses of Class A
Certificates, Class AP Certificates, Class M Certificates, Class B-1
Certificates and Class B-2 Certificates in accordance with the priorities set
forth in the Agreement. Distributions of interest and in reduction of principal
balance on any Distribution Date will be made to the extent that the Pool
Distribution Amount is sufficient therefor.
An election will be made to treat the Trust Estate as a REMIC for
federal income tax purposes (the "REMIC"). The Class A-1, Class A-2, Class A-3,
Class A-4, Class A-5, Class AP, Class M, Class B-1, Class B-2, Class B-3, Class
B-4 and Class B-5 Certificates will be treated as "regular interests" in the
REMIC and the Class A-R Certificate will be treated as the "residual interest"
in the REMIC.
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ITEM 7. Financial Statements and Exhibits
(c) Exhibits
Item 601(a)
of Regulation S-K
Exhibit No. Description
(EX-4) Pooling and Servicing Agreement,
dated as of February 28, 1996, among
The Prudential Home Mortgage
Securities Company, Inc.,
Securitized Asset Services
Corporation, First Bank National
Association, as trust administrator
and Firstar Trust Company, as
trustee.
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Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
THE PRUDENTIAL HOME MORTGAGE
SECURITIES COMPANY, INC.
February 28, 1996
/S/ B. David Bialzak
B. David Bialzak
Vice President
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INDEX TO EXHIBITS
Paper (P) or
Exhibit No. Description Electronic (E)
(EX-4) Pooling and Servicing E
Agreement, dated as of February 28, 1996
among The Prudential Home Mortgage
Securities Company, Inc., Securitized
Asset Services Corporation, First Bank
National Association, as trust
administrator and Firstar Trust Company,
as trustee.
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THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC.
(Seller)
and
SECURITIZED ASSET SERVICES CORPORATION
(Master Servicer)
and
FIRSTAR TRUST COMPANY
(Trustee)
and
FIRST BANK NATIONAL ASSOCIATION
(Trust Administrator)
POOLING AND SERVICING AGREEMENT
Dated as of February 28, 1996
$124,872,914.35
Mortgage Pass-Through Certificates
Series 1996-3
-----------------------------------------------------------------
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This Pooling and Servicing Agreement, dated as of February 28,
1996, executed by THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC., as
Seller, SECURITIZED ASSET SERVICES CORPORATION, as Master Servicer, FIRST BANK
NATIONAL ASSOCIATION, as Trust Administrator and FIRSTAR TRUST COMPANY, as
Trustee.
WITNESSETH THAT:
In consideration of the mutual agreements herein contained, the
Seller, the Master Servicer, the Trust Administrator and the Trustee agree as
follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. Whenever used herein, the following
words and phrases, unless the context otherwise requires, shall have the
meanings specified in this Article.
Accepted Master Servicing Practices: Accepted Master Servicing
Practices shall consist of the customary and usual master servicing practices of
prudent master servicing institutions which service mortgage loans of the same
type as the Mortgage Loans in the jurisdictions in which the related Mortgaged
Properties are located, regardless of the date upon which the related Mortgage
Loans were originated.
Adjusted Pool Amount: With respect to any Distribution Date, the
Cut-Off Date Aggregate Principal Balance of the Mortgage Loans minus the sum of
(i) all amounts in respect of principal received in respect of the Mortgage
Loans (including, without limitation, amounts received as Monthly Payments,
Periodic Advances, Liquidation Proceeds, Principal Prepayments, Substitution
Principal Amounts and Net REO Proceeds) and distributed to Holders of the
Certificates on such Distribution Date and all prior Distribution Dates and (ii)
the principal portion of all Realized Losses (other than Debt Service
Reductions) incurred on the Mortgage Loans from the Cut-Off Date through the end
of the month preceding such Distribution Date.
Adjusted Pool Amount (Class AP Portion): With respect to any
Distribution Date, the sum of the amounts, calculated as follows, with respect
to all Outstanding Mortgage Loans: the product of (i) the Class AP Fraction for
each such Mortgage Loan and (ii) the remainder of (A) the Cut-Off Date Principal
Balance of such Mortgage Loan minus (B) the sum of (x) all amounts in respect of
principal received in respect of such Mortgage Loan (including, without
limitation, amounts received as Monthly Payments, Periodic Advances, Liquidation
Proceeds, Principal Prepayments, Substitution Principal Amounts and Net REO
Proceeds) and distributed to Holders of the Certificates on such Distribution
Date and all prior Distribution Dates and (y) the principal portion of any
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Realized Loss (other than a Debt Service Reduction) incurred on such Mortgage
Loan from the Cut-Off Date through the end of the month preceding such
Distribution Date.
Adjusted Principal Balance: As to any Distribution Date and the
Class M Certificates or any Class B Subclass, the greater of (A) zero and (B)
(i) the principal balance of such Class or Subclass with respect to such
Distribution Date minus (ii) the Adjustment Amount for such Distribution Date
less, with respect to the Class M Certificates, the Class B Principal Balance
and, with respect to any Class B Subclass, the Class B Subclass Principal
Balances for any Class B Subclasses with higher numerical designations.
Adjustment Amount: For any Distribution Date, the difference
between (A) the sum of the Class A Principal Balance, Class AP Principal
Balance, Class M Principal Balance and Class B Principal Balance as of the
related Determination Date and (B) the sum of (i) the sum of the Class A
Principal Balance, Class AP Principal Balance, Class M Principal Balance and
Class B Principal Balance as of the Determination Date succeeding such
Distribution Date, (ii) the principal portion of Excess Special Hazard Losses,
Excess Fraud Losses and Excess Bankruptcy Losses allocated to the Certificates
with respect to such Distribution Date and (iii) the aggregate amount that would
have been distributed to all Classes as principal in accordance with Section
4.01(a) for such Distribution Date without regard to the provisos in the
definitions of Class M Optimal Principal Amount, Class B-1 Optimal Principal
Amount, Class B-2 Optimal Principal Amount, Class B-3 Optimal Principal Amount,
Class B-4 Optimal Principal Amount and Class B-5 Optimal Principal Amount.
Aggregate Current Bankruptcy Losses: With respect to any
Distribution Date, the sum of all Bankruptcy Losses incurred on any of the
Mortgage Loans in the month preceding the month of such Distribution Date.
Aggregate Current Fraud Losses: With respect to any Distribution
Date, the sum of all Fraud Losses incurred on any of the Mortgage Loans in the
month preceding the month of such Distribution Date.
Aggregate Current Special Hazard Losses: With respect to any
Distribution Date, the sum of all Special Hazard Losses incurred on any of the
Mortgage Loans in the month preceding the month of such Distribution Date.
Aggregate Foreclosure Profits: As to any Distribution Date, the
aggregate amount of Foreclosure Profits with respect to all of the Mortgage
Loans.
Agreement: This Pooling and Servicing Agreement and all
amendments and supplements hereto.
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Amount Held for Future Distribution: As to any Distribution Date,
the total of the amounts held in the Custodial P&I Accounts or Master Servicer
Custodial Account on account of (a)(i) with respect to any Exhibit F-2 Mortgage
Loans, Principal Prepayments received in the month of such Distribution Date and
all related payments of interest on such Principal Prepayments, (ii) with
respect to any Exhibit F-1 Mortgage Loans, Principal Prepayments and all related
payments of interest received on or after the Determination Date occurring in
the month of such Distribution Date, (iii) Liquidation Proceeds (other than
Partial Liquidation Proceeds) received in the month of such Distribution Date,
(iv) with respect to any Exhibit F-2 Mortgage Loans, Partial Liquidation
Proceeds (other than with respect to Mortgage Loans which became Liquidated
Loans in the month prior to the month of such Distribution Date), (v) with
respect to any Exhibit F-1 Mortgage Loans, Partial Liquidation Proceeds received
on or after the Determination Date occurring in the month of such Distribution
Date and (vi) amounts received from the Seller pursuant to Section 2.02 or
Section 2.03 in the month of such Distribution Date and (b) payments which
represent early receipt of scheduled payments of principal and interest due on a
date or dates subsequent to the related Due Date.
Authenticating Agent: Any authenticating agent appointed by the
Trust Administrator pursuant to Section 8.11. There shall initially be no
Authenticating Agent for the Certificates.
Bankruptcy Code: The Bankruptcy Code of 1978, as amended.
Bankruptcy Loss: With respect to any Mortgage Loan, a Deficient
Valuation or Debt Service Reduction; provided, however, that a Bankruptcy Loss
shall not be deemed a Bankruptcy Loss hereunder so long as the applicable
Servicer has notified the Master Servicer and the Trust Administrator in writing
that such Servicer is diligently pursuing any remedies that may exist in
connection with the representations and warranties made regarding the related
Mortgage Loan and either (A) the related Mortgage Loan is not in default with
regard to payments due thereunder or (B) delinquent payments of principal and
interest under the related Mortgage Loan and any premiums on any applicable
primary hazard insurance policy and any related escrow payments in respect of
such Mortgage Loan are being advanced on a current basis by such Servicer
without giving effect to any Debt Service Reduction.
Bankruptcy Loss Amount: As of any Distribution Date prior to the
first anniversary of the Cut-Off Date, the Bankruptcy Loss Amount will equal
$100,000.00 minus the aggregate amount of Bankruptcy Losses allocated solely to
the Class B Certificates or, following the reduction of the Class B Principal
Balance to zero, solely to the Class M Certificates in accordance with Section
4.02(a) since the Cut-Off Date. As of any Distribution Date on or after the
first anniversary of the Cut-Off Date, an amount equal to (1) the lesser of (a)
the Bankruptcy Loss Amount calculated as of the close of business on the
Business Day immediately preceding the most recent anniversary of the Cut-Off
Date coinciding with or preceding such Distribution Date (the "Relevant
Anniversary") and (b) such lesser amount which, as determined on the Relevant
Anniversary will not cause any rated Certificates to be placed on credit review
status (other than for possible upgrading) by either Rating Agency minus (2) the
aggregate amount of Bankruptcy Losses allocated solely to the Class B
Certificates or, following the reduction of the Class B Principal Balance to
zero, solely to the Class M Certificates in accordance with Section 4.02(a)
since the Relevant Anniversary. On and after the Cross-Over Date the Bankruptcy
Loss Amount shall be zero.
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Beneficial Owner: With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Book-Entry Certificate, as reflected
on the books of the Clearing Agency, or on the books of a Person maintaining an
account with such Clearing Agency (directly or as an indirect participant, in
accordance with the rules of such Clearing Agency), as the case may be.
Book-Entry Certificate: Any of the Class A-1 Certificates, Class
A-2 Certificates, Class A-3 Certificates, Class A-4 Certificates or Class A-5
Certificates, beneficial ownership and transfers of which shall be evidenced by,
and made through, book entries by the Clearing Agency as described in Section
5.01(b).
Business Day: Any day other than (i) a Saturday or a Sunday, or
(ii) a legal holiday in the City of New York, State of Maryland, State of
Minnesota, State of Missouri or State of Wisconsin or (iii) a day on which
banking institutions in the City of New York, or the State of Maryland, State of
Minnesota, State of Missouri or State of Wisconsin are authorized or obligated
by law or executive order to be closed.
Certificate: Any one of the Class A Certificates, Class AP
Certificates, Class M Certificates or Class B Certificates.
Certificate Register and Certificate Registrar: Respectively, the
register maintained pursuant to and the registrar provided for in Section 5.02.
The initial Certificate Registrar is the Trust Administrator.
Certificateholder or Holder: The Person in whose name a
Certificate is registered in the Certificate Register, except that, solely for
the purposes of the taking of any action under Articles VII or VIII, any
Certificate registered in the name of the Master Servicer, a Servicer or any
affiliate thereof shall be deemed not to be outstanding and the Voting Interest
evidenced thereby shall not be taken into account in determining whether the
requisite percentage of Certificates necessary to effect any such action has
been obtained.
Class: All certificates whose form is identical except for (i)
variations in the Percentage Interest evidenced thereby and (ii) in the case of
the Class A Certificates and Class B Certificates, variations in Subclass
designation and other Subclass characteristics.
Class A Certificate: Any one of the Class A-1 Certificates, Class
A-2 Certificates, Class A-3 Certificates, Class A-4 Certificates, Class A-5
Certificates or Class A-R Certificate.
Class A Certificateholder: The registered holder of a Class A
Certificate.
Class A Distribution Amount: As to any Distribution Date, the
aggregate amount distributable to the Subclasses of Class A Certificates
pursuant to Paragraphs first, second and third clause (A) of Section 4.01(a) on
such Distribution Date.
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Class A Fixed Pass-Through Rate: As to any Distribution Date, the
rate per annum set forth in Section 11.01.
Class A Interest Accrual Amount: As to any Distribution Date, the
sum of the Class A Subclass Interest Accrual Amounts with respect to such
Distribution Date.
Class A Loss Denominator: As to any Determination Date, an amount
equal to the sum of the Class A Subclass Principal Balances of the Class A
Subclasses.
Class A Optimal Amount: As to any Distribution Date, the sum for
such Distribution Date of (i) the Class A Interest Accrual Amount, (ii) the sum
of the Class A Subclass Unpaid Interest Shortfalls for each Class A Subclass and
(iii) the Class A Optimal Principal Amount.
Class A Optimal Principal Amount: As to any Distribution Date, an
amount equal to the sum, as to each Outstanding Mortgage Loan, of the product of
(x) the Classes A/M/B Fraction with respect to such Mortgage Loan, and (y) the
sum of:
(i) the Class A Percentage of (A) the principal portion of the
Monthly Payment due on the Due Date occurring in the month of such
Distribution Date on such Mortgage Loan, less (B) if the Bankruptcy Loss
Amount has been reduced to zero, the principal portion of any Debt
Service Reduction with respect to such Mortgage Loan;
(ii) the Class A Prepayment Percentage of the Scheduled Principal
Balance of each Mortgage Loan that was repurchased by the Seller during
such preceding month pursuant to Section 2.02 or 2.03, net of any
unreimbursed Periodic Advances in respect of principal previously made
by the Servicer, Master Servicer or Trust Administrator with respect to
such Mortgage Loan;
(iii) the Class A Prepayment Percentage of (a) the aggregate Net
Liquidation Proceeds (other than, with respect to an Exhibit F-1
Mortgage Loan, Net Partial Liquidation Proceeds) of any such Mortgage
Loan that became a Liquidated Loan in the month preceding the month of
such Distribution Date (excluding the portion thereof, if any,
constituting Net Foreclosure Profits) less the sum of (A) any
unreimbursed Periodic Advances in respect of principal previously made
by the Servicer, the Master Servicer or the Trust Administrator with
respect to such Liquidated Loan and (B) the portion of the Net
Liquidation Proceeds allocable to interest and (b) with respect to an
Exhibit F-1 Mortgage Loan, the aggregate Net Partial Liquidation
Proceeds on any such Mortgage Loan received by PHMC, as Servicer, during
the related Partial Liquidation Receipt Period, less the sum of (A) the
amounts allocable to principal of any unreimbursed Periodic Advances
previously made by PHMC, as Servicer, the Master Servicer or the Trust
Administrator and (B) the portion of the Net Partial Liquidation
Proceeds allocable to interest;
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(iv) the Class A Prepayment Percentage of the Scheduled Principal
Balance of such Mortgage Loan if such Mortgage Loan was the subject of a
Prepayment in Full (a) during the month preceding the month in which
such Distribution Date occurs with respect to any Exhibit F-2 Mortgage
Loan or (b) during the period from and including the Determination Date
in the month preceding the month of such Distribution Date up to (but
not including) the Determination Date occurring in the month of such
Distribution Date with respect to any Exhibit F-1 Mortgage Loan;
(v) the Class A Prepayment Percentage of all partial principal
prepayments (a) received with respect to any Exhibit F-2 Mortgage Loan
during the month preceding the month in which such Distribution Date
occurs and (b) received with respect to any Exhibit F-1 Mortgage Loan on
or after the Determination Date occurring in the month preceding the
month in which such Distribution Date occurs and prior to the
Determination Date occurring in the month in which such Distribution
Date occurs; and
(vi) the Class A Percentage of the difference between the unpaid
principal balance of such Mortgage Loan substituted for a defective
Mortgage Loan during the month preceding the month in which such
Distribution Date occurs and the unpaid principal balance of such
defective Mortgage Loan, less the amount allocable to the principal
portion of any unreimbursed Periodic Advances previously made by the
Servicer, the Master Servicer or the Trust Administrator in respect of
such defective Mortgage Loan.
Class A Percentage: As to any Distribution Date occurring on or
prior to the Cross-Over Date, the lesser of (i) 100% and (ii) the percentage
obtained by dividing the Class A Principal Balance (determined as of the
Determination Date preceding such Distribution Date) by the Pool Balance
(Classes A/M/B Portion). As to any Distribution Date occurring subsequent to the
Cross-Over Date, 100% or such lesser percentage which will cause the Class A
Principal Balance to decline to zero following the distribution made on such
Distribution Date.
Class A Prepayment Percentage: As to any Distribution Date to and
including the Distribution Date in February 2001, 100%. As to any Distribution
Date subsequent to February 2001 to and including the Distribution Date in
February 2002, the Class A Percentage as of such Distribution Date plus 70% of
the Subordinated Percentage as of such Distribution Date. As to any Distribution
Date subsequent to February 2002 to and including the Distribution Date in
February 2003, the Class A Percentage as of such Distribution Date plus 60% of
the Subordinated Percentage as of such Distribution Date. As to any Distribution
Date subsequent to February 2003 to and including the Distribution Date in
February 2004, the Class A Percentage as of such Distribution Date plus 40% of
the Subordinated Percentage as of such Distribution Date. As to any Distribution
Date subsequent to February 2004 to and including the Distribution Date in
February 2005, the Class A Percentage as of such Distribution Date plus 20% of
the Subordinated Percentage as of such Distribution Date. As to any Distribution
Date subsequent to February 2005, the Class A Percentage as of such Distribution
Date. The foregoing is subject to the following: (i) if the aggregate
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distribution to Holders of Class A Certificates on any Distribution Date of the
Class A Prepayment Percentage provided above of (a) Principal Prepayments
distributable on such Distribution Date, (b) the principal portion of Net
Partial Liquidation Proceeds (other than Net Partial Liquidation Proceeds with
respect to Exhibit F-1 Mortgage Loans) (excluding any amount constituting Net
Foreclosure Profits) of each Mortgage Loan which became a Liquidated Loan during
the month preceding the month of such Distribution Date or (c) with respect to
Exhibit F-1 Mortgage Loans, Net Partial Liquidation Proceeds received during the
Partial Liquidation Receipt Period, would reduce the Class A Principal Balance
below zero, the Class A Prepayment Percentage for such Distribution Date shall
be the percentage necessary to bring the Class A Principal Balance to zero and
thereafter the Class A Prepayment Percentage shall be zero and (ii) if the Class
A Percentage as of any Distribution Date is greater than the Original Class A
Percentage, the Class A Prepayment Percentage for such Distribution Date shall
be 100%. Notwithstanding the foregoing, with respect to any Distribution Date on
which the following criteria are not met, the reduction of the Class A
Prepayment Percentage described in the second through sixth sentences of this
definition of Class A Prepayment Percentage shall not be applicable with respect
to such Distribution Date. In such event, the Class A Prepayment Percentage for
such Distribution Date will be determined in accordance with the applicable
provision, as set forth in the first through fifth sentences above, which was
actually used to determine the Class A Prepayment Percentage for the
Distribution Date occurring in the February preceding such Distribution Date (it
being understood that for the purposes of the determination of the Class A
Prepayment Percentage for the current Distribution Date, the current Class A
Percentage and Subordinated Percentage shall be utilized). In order for the
reduction referred to in the second through sixth sentences to be applicable,
with respect to any Distribution Date (a) the average outstanding principal
balance on such Distribution Date and for the preceding five Distribution Dates
on the Mortgage Loans that were delinquent 60 days or more (including for this
purpose any payments due with respect to Mortgage Loans in foreclosure and REO
Mortgage Loans) must be less than 50% of the sum of the current Class M
Principal Balance and the current Class B Principal Balance and (b) cumulative
Realized Losses shall not exceed (1) 30% of the Original Subordinated Principal
Balance if such Distribution Date occurs between and including March 2001 and
February 2002, (2) 35% of the Original Subordinated Principal Balance if such
Distribution Date occurs between and including March 2002 and February 2003, (3)
40% of the Original Subordinated Principal Balance if such Distribution Date
occurs between and including March 2003 and February 2004, (4) 45% of the
Original Subordinated Principal Balance if such Distribution Date occurs between
and including March 2004 and February 2005, and (5) 50% of the Original
Subordinated Principal Balance if such Distribution Date occurs during or after
March 2005. With respect to any Distribution Date on which the Class A
Prepayment Percentage is reduced below the Class A Prepayment Percentage for the
prior Distribution Date, the Master Servicer shall certify to the Trust
Administrator, based upon information provided by each Servicer as to the
Mortgage Loans serviced by it that the criteria set forth in the preceding
sentence are met.
Class A Principal Balance: As of any date, an amount equal to the
sum of the Class A Subclass Principal Balances for the Class A-1 Certificates,
Class A-2 Certificates, Class A-3 Certificates, Class A-4 Certificates, Class
A-5 Certificates and Class A-R Certificate.
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Class A Principal Distribution Amount: As to any Distribution
Date, the aggregate amount distributed in respect of the Class A Subclasses
pursuant to Paragraph third clause (A) of Section 4.01(a).
Class A Subclass: Any of the Subclasses of Class A Certificates
consisting of the Class A-1 Certificates, Class A-2 Certificates, Class A-3
Certificates, Class A-4 Certificates, Class A-5 Certificates and Class A-R
Certificate.
Class A Subclass Distribution Amount: As to any Distribution Date
and any Class A Subclass, the amount distributable to such Class A Subclass
pursuant to Paragraphs first, second and third clause (A) of Section 4.01(a).
Class A Subclass Interest Accrual Amount: As to any Distribution
Date and any Class A Subclass, (i) the product of (a) 1/12th of the Class A
Subclass Pass-Through Rate for such Class A Subclass and (b) the Class A
Subclass Principal Balance of such Class A Subclass as of the Determination Date
preceding such Distribution Date minus (ii) the Class A Subclass Interest
Percentage of such Class A Subclass of (x) any Non-Supported Interest Shortfall
allocated to the Class A Certificates with respect to such Distribution Date,
(y) the interest portion of any Excess Special Hazard Losses, Excess Fraud
Losses and Excess Bankruptcy Losses allocated to the Class A Certificates with
respect to such Distribution Date pursuant to Section 4.02(e) and (z) the
interest portion of any Realized Losses (other than Excess Special Hazard
Losses, Excess Fraud Losses and Excess Bankruptcy Losses) allocated to the Class
A Certificates on or after the Cross-Over Date pursuant to Section 4.02(e).
Class A Subclass Interest Percentage: As to any Distribution Date
and any Class A Subclass, the percentage calculated by dividing the Class A
Subclass Interest Accrual Amount of such Class A Subclass (determined without
regard to clause (ii) of the definition thereof) by the Class A Interest Accrual
Amount (determined without regard to clause (ii) of the definition of each Class
A Subclass Interest Accrual Amount).
Class A Subclass Interest Shortfall Amount: As to any
Distribution Date and any Subclass of Class A Certificates, any amount by which
the Class A Subclass Interest Accrual Amount of such Class A Subclass with
respect to such Distribution Date exceeds the amount distributed in respect of
such Class A Subclass on such Distribution Date pursuant to Paragraph first of
Section 4.01(a).
Class A Subclass Loss Percentage: As to any Determination Date
and any Subclass of Class A Certificates then outstanding, the percentage
calculated by dividing the Class A Subclass Principal Balance of such Subclass
by the Class A Loss Denominator (determined without regard to any Class A
Subclass Principal Balance of any Subclass of Class A Certificates not then
outstanding), in each case determined as of the preceding Determination Date.
Class A Subclass Pass-Through Rate: As to each Class A Subclass,
the Class A Fixed Pass-Through Rate.
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Class A Subclass Principal Balance: As of the first Determination
Date and as to any Class A Subclass, the Original Class A Subclass Principal
Balance of such Class A Subclass. As of any subsequent Determination Date prior
to the Cross-Over Date and as to any Class A Subclass the Original Class A
Subclass Principal Balance of such Class A Subclass less the sum of (a) all
amounts previously distributed in respect of such Class A Subclass on prior
Distribution Dates (A) pursuant to Paragraph third clause (A) of Section 4.01(a)
and (B) as a result of a Principal Adjustment and (b) all amounts previously
allocated to such Class A Subclass with respect to prior Distribution Dates
pursuant to Section 4.02(b). After the Cross-Over Date, each Class A Subclass
Principal Balance will also be reduced on each Determination Date by an amount
equal to the product of the Class A Subclass Loss Percentage of such Class A
Subclass and the excess, if any, of (i) the Class A Principal Balance for such
Determination Date without regard to this sentence over (ii) the difference
between (A) the Adjusted Pool Amount for the preceding Distribution Date and (B)
the Adjusted Pool Amount (Class AP Portion) for the preceding Distribution Date.
Class A Subclass Shortfall Percentage: As to any Distribution
Date and Class A Subclass, the percentage calculated by dividing the Class A
Subclass Unpaid Interest Shortfall for such Class A Subclass by the Class A
Unpaid Interest Shortfall, in each case determined as of the day preceding the
applicable Distribution Date.
Class A Subclass Unpaid Interest Shortfall: As to any
Distribution Date and Class A Subclass, the amount, if any, by which the
aggregate of the Class A Subclass Interest Shortfall Amounts for such Class A
Subclass for prior Distribution Dates is in excess of the amounts distributed in
respect of such Class A Subclass on prior Distribution Dates pursuant to
Paragraph second of Section 4.01(a).
Class A Unpaid Interest Shortfall: As to any Distribution Date,
an amount equal to the sum of the Class A Subclass Unpaid Interest Shortfalls
for all the Class A Subclasses.
Class A Voting Interest: The product of (i) the then applicable
Class A Percentage and (ii) the Classes A/M/B Voting Interest.
Class A-1 Certificate: Any one of the Certificates executed by
the Trust Administrator and authenticated by the Trust Administrator or the
Authenticating Agent in substantially the form set forth in Exhibit A-1 and
Exhibit D hereto.
Class A-1 Certificateholder: The registered holder of a Class A-1
Certificate.
Class A-2 Certificate: Any one of the Certificates executed by
the Trust Administrator and authenticated by the Trust Administrator or the
Authenticating Agent in substantially the form set forth in Exhibit A-2 and
Exhibit D hereto.
Class A-2 Certificateholder: The registered holder of a Class A-2
Certificate.
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Class A-3 Certificate: Any one of the Certificates executed by
the Trust Administrator and authenticated by the Trust Administrator or the
Authenticating Agent in substantially the form set forth in Exhibit A-3 and
Exhibit D hereto.
Class A-3 Certificateholder: The registered holder of a Class A-3
Certificate.
Class A-4 Certificate: Any one of the Certificates executed by
the Trust Administrator and authenticated by the Trust Administrator or the
Authenticating Agent in substantially the form set forth in Exhibit A-4 and
Exhibit D hereto.
Class A-4 Certificateholder: The registered holder of a Class A-4
Certificate.
Class A-5 Certificate: Any one of the Certificates executed by
the Trust Administrator and authenticated by the Trust Administrator or the
Authenticating Agent in substantially the form set forth in Exhibit A-5 and
Exhibit D hereto.
Class A-5 Certificateholder: The registered holder of a Class A-5
Certificate.
Class A-5 Percentage: The Class A Subclass Principal Balance of
the Class A-5 Certificates divided by the Pool Balance (Classes A/M/B Portion).
Class A-5 Prepayment Shift Percentage for any Distribution Date
will be the percentage indicated below:
Distribution Date Occurring In Class A-5 Prepayment Shift
Percentage
March 1996 through February 2001................... 0%
March 2001 through February 2002................... 30%
March 2002 through February 2003................... 40%
March 2003 through February 2004................... 60%
March 2004 through February 2005................... 80%
March 2005 and thereafter.......................... 100%
Class A-5 Priority Amount: For any Distribution Date, the lesser
of (i) the Class A Subclass Principal Balance of the Class A-5 Certificates and
(ii) the sum of (A) the product of (1) the Class A-5 Percentage and (2) the
Scheduled Principal Amount and (B) the product of (1) the Class A-5 Percentage,
(2) the Class A-5 Prepayment Shift Percentage, and (3) the Unscheduled Principal
Amount.
Class A-R Certificate: The Certificate executed by the Trust
Administrator and authenticated by the Trust Administrator or the Authenticating
Agent in substantially the form set forth in Exhibit A-R and Exhibit D hereto.
Class A-R Certificateholder: The registered holder of the Class
A-R Certificate.
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Class AP Certificate: Any one of the Certificates executed by the
Trust Administrator and authenticated by the Trust Administrator or the
Authenticating Agent in substantially the form set forth in Exhibit C and
Exhibit D hereto.
Class AP Certificateholder: The registered holder of a Class AP
Certificate.
Class AP Deferred Amount: For any Distribution Date prior to the
Cross-Over Date, the difference between (A) the sum of (i) the amount by which
the sum of the Class AP Optimal Principal Amounts for all prior Distribution
Dates exceeded the amounts distributed on the Class AP Certificates on such
prior Distribution Dates pursuant to Paragraph third clause (B) of Section
4.01(a) and (ii) the sum of the product for each Discount Mortgage Loan which
became a Liquidated Loan in any month preceding the month of the current
Distribution Date of (a) the Class AP Fraction for such Discount Mortgage Loan
and (b) an amount equal to the principal portion of Realized Losses (other than
Bankruptcy Losses due to Debt Service Reductions) incurred with respect to such
Mortgage Loan other than Excess Special Hazard Losses, Excess Fraud Losses and
Excess Bankruptcy Losses and (B) amounts distributed on the Class AP
Certificates on prior Distribution Dates pursuant to Paragraph fourth of Section
4.01(a). On or after the Cross-Over Date, the Class AP Deferred Amount will be
zero. No interest will accrue on any Class AP Deferred Amount.
Class AP Distribution Amount: As to any Distribution Date, the
aggregate amount distributable to the Class AP Certificates pursuant to
Paragraphs third clause (B) and fourth of Section 4.01(a) on such Distribution
Date.
Class AP Fraction: With respect to any Discount Mortgage Loan,
the difference between 1.0 and the Classes A/M/B Fraction for such Mortgage
Loan; with respect to any other Mortgage Loan, zero.
Class AP Optimal Principal Amount: As to any Distribution Date,
an amount equal to the sum as to each Outstanding Mortgage Loan, of the product
of (x) the Class AP Fraction with respect to such Mortgage Loan and (y) the sum
of:
(i) (A) the principal portion of the Monthly Payment due on the
Due Date occurring in the month of such Distribution Date on such
Mortgage Loan, less (B) if the Bankruptcy Loss Amount has been reduced
to zero, the principal portion of any Debt Service Reduction with
respect to such Mortgage Loan;
(ii) the Scheduled Principal Balance of each Mortgage Loan that
was repurchased by the Seller during such preceding month pursuant to
Section 2.02 or 2.03, net of any unreimbursed Periodic Advances in
respect of principal previously made by the Servicer, Master Servicer or
Trust Administrator with respect to such Mortgage Loan;
(iii) (a) the aggregate Net Liquidation Proceeds (other than,
with respect to an Exhibit F-1 Mortgage Loan, Net Partial Liquidation
Proceeds) of any such Mortgage Loan that became a Liquidated Loan in the
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<PAGE>
month preceding the month of such Distribution Date (excluding the
portion thereof, if any, constituting Net Foreclosure Profits) less the
sum of (A) any unreimbursed Periodic Advances in respect of principal
previously made by the Servicer, Master Servicer or Trust Administrator
with respect to such Liquidated Loan and (B) the portion of the Net
Liquidation Proceeds allocable to interest and (b) with respect to an
Exhibit F-1 Mortgage Loan, the aggregate Net Partial Liquidation
Proceeds on any such Mortgage Loan received by PHMC, as Servicer, during
the related Partial Liquidation Receipt Period, less the sum of (A) the
amounts allocable to principal of any unreimbursed Periodic Advances
previously made by PHMC, as Servicer, the Master Servicer or the Trust
Administrator and (B) the portion of the Net Partial Liquidation
Proceeds allocable to interest;
(iv) the Scheduled Principal Balance of such Mortgage Loan if
such Mortgage Loan was the subject of a Prepayment in Full (a) during
the month preceding the month in which such Distribution Date occurs
with respect to any Exhibit F-2 Mortgage Loan or (b) during the period
from and including the Determination Date in the month preceding the
month of such Distribution Date up to (but not including) the
Determination Date occurring in the month of such Distribution Date with
respect to any Exhibit F-1 Mortgage Loan;
(v) all partial principal prepayments (a) received with respect
to any Exhibit F-2 Mortgage Loan during the month preceding the month in
which such Distribution Date occurs and (b) received with respect to any
Exhibit F-1 Mortgage Loan on or after the Determination Date occurring
in the month preceding the month in which such Distribution Date occurs
and prior to the Determination Date occurring in the month in which such
Distribution Date occurs; and
(vi) the difference between the unpaid principal balance of such
Mortgage Loan substituted for a defective Mortgage Loan during the month
preceding the month in which such Distribution Date occurs and the
unpaid principal balance of such defective Mortgage Loan, less the
amount allocable to the principal portion of any unreimbursed Periodic
Advances previously made by the Servicer, the Master Servicer or the
Trust Administrator in respect of such defective Mortgage Loan.
Class AP Principal Balance: As to the first Determination Date,
the Original Class AP Principal Balance. As of any subsequent Determination Date
prior to the Cross-Over Date, the Original Class AP Principal Balance less the
sum of (a) all amounts previously distributed in respect of the Class AP
Certificates on prior Distribution Dates pursuant to Paragraphs third clause (B)
and fourth of Section 4.01(a) and (b) the Realized Losses previously allocated
to the Class AP Certificates pursuant to Section 4.02(b). On or after the
Cross-Over Date, the Class AP Principal Balance will also be reduced on each
Determination Date by an amount equal to the difference, if any, between the
Class AP Principal Balance as of such Determination Date and the Adjusted Pool
Amount (Class AP Portion) as of the preceding Distribution Date.
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<PAGE>
Class B Certificate: Any one of the Class B-1 Certificates, Class
B-2 Certificates, Class B-3 Certificates, Class B-4 Certificates or Class B-5
Certificates.
Class B Certificateholder: The registered holder of a Class B
Certificate.
Class B Interest Accrual Amount: As to any Distribution Date, the
sum of the Class B Subclass Interest Accrual Amounts with respect to such
Distribution Date.
Class B Pass-Through Rate: As to any Distribution Date, 6.75% per
annum.
Class B Principal Balance: As of any date, an amount equal to the
sum of the Class B-1 Principal Balance, Class B-2 Principal Balance, Class B-3
Principal Balance, Class B-4 Principal Balance and Class B-5 Principal Balance.
Class B Subclass: Any of the Class B-1 Certificates, Class B-2
Certificates, Class B-3 Certificates, Class B-4 Certificates or Class B-5
Certificates.
Class B Subclass Distribution Amount: Any of the Class B-1, Class
B-2, Class B-3, Class B-4 or Class B-5 Distribution Amounts.
Class B Subclass Interest Accrual Amount: As to any Distribution
Date and any Class B Subclass, an amount equal to (i) the product of 1/12th of
the Class B Pass-Through Rate and the Class B Subclass Principal Balance of such
Class B Subclass as of the Determination Date preceding such Distribution Date
minus (ii) the Class B Subclass Interest Percentage of such Class B Subclass of
(x) any Non-Supported Interest Shortfall allocated to the Class B Certificates
with respect to such Distribution Date and (y) the interest portion of any
Excess Special Hazard Losses, Excess Fraud Losses and Excess Bankruptcy Losses
allocated to the Class B Certificates with respect to such Distribution Date
pursuant to Section 4.02(e).
Class B Subclass Interest Percentage: As to any Distribution Date
and any Class B Subclass, the percentage calculated by dividing the Class B
Subclass Interest Accrual Amount of such Class B Subclass (determined without
regard to clause (ii) of the definition thereof) by the Class B Interest Accrual
Amount (determined without regard to clause (ii) of the definition of each Class
B Subclass Interest Accrual Amount).
Class B Subclass Interest Shortfall Amount: Any of the Class B-1
Interest Shortfall Amount, Class B-2 Interest Shortfall Amount, Class B-3
Interest Shortfall Amount, Class B-4 Interest Shortfall Amount or Class B-5
Interest Shortfall Amount.
Class B Subclass Loss Percentage: As to any Determination Date
and any Class B Subclass then-outstanding, the percentage calculated by dividing
the Class B Subclass Principal Balance of such Class B Subclass by the Class B
Principal Balance (determined without regard to any Class B Subclass Principal
Balance of any Class B Subclass not then outstanding), in each case determined
as of the preceding Determination Date.
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<PAGE>
Class B Subclass Percentage: Any one of the Class B-1 Percentage,
Class B-2 Percentage, Class B-3 Percentage, Class B-4 Percentage or Class B-5
Percentage.
Class B Subclass Prepayment Percentage: Any of the Class B-1
Prepayment Percentage, Class B-2 Prepayment Percentage, Class B-3 Prepayment
Percentage, Class B-4 Prepayment Percentage or Class B-5 Prepayment Percentage.
Class B Subclass Principal Balance: Any of the Class B-1
Principal Balance, Class B-2 Principal Balance, Class B-3 Principal Balance,
Class B-4 Principal Balance or Class B-5 Principal Balance.
Class B Subclass Unpaid Interest Shortfall: Any of the Class B-1
Unpaid Interest Shortfall, Class B-2 Unpaid Interest Shortfall, Class B-3 Unpaid
Interest Shortfall, Class B-4 Unpaid Interest Shortfall or Class B-5 Unpaid
Interest Shortfall.
Class B-1 Certificate: Any one of the Certificates executed by
the Trust Administrator and authenticated by the Trust Administrator or the
Authenticating Agent in substantially the form set forth in Exhibit B-1 and
Exhibit D hereto.
Class B-1 Certificateholder: The registered holder of a Class B-1
Certificate.
Class B-1 Distribution Amount: As to any Distribution Date, any
amount distributable to the Holders of the Class B-1 Certificates pursuant to
Paragraphs eighth, ninth and tenth of Section 4.01(a).
Class B-1 Interest Shortfall Amount: As to any Distribution Date,
any amount by which the Class B Subclass Interest Accrual Amount of the Class
B-1 Certificates with respect to such Distribution Date exceeds the amount
distributed in respect of the Class B-1 Certificates on such Distribution Date
pursuant to Paragraph eighth of Section 4.01(a).
Class B-1 Optimal Principal Amount: As to any Distribution Date,
an amount equal to the sum, as to each Outstanding Mortgage Loan, of the product
of (x) the Classes A/M/B Fraction with respect to such Mortgage Loan and (y) the
sum of:
(i) the Class B-1 Percentage of (A) the principal portion of the
Monthly Payment due on the Due Date occurring in the month of such
Distribution Date on such Mortgage Loan, less (B) if the Bankruptcy Loss
Amount has been reduced to zero, the principal portion of any Debt
Service Reduction with respect to such Mortgage Loan;
(ii) the Class B-1 Prepayment Percentage of the Scheduled
Principal Balance of each Mortgage Loan that was repurchased by the
Seller during such preceding month pursuant to Section 2.02 or 2.03, net
of any unreimbursed Periodic Advances in respect of principal previously
made by the Servicer, Master Servicer or Trust Administrator with
respect to such Mortgage Loan;
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<PAGE>
(iii) the Class B-1 Prepayment Percentage of (a) the aggregate
Net Liquidation Proceeds (other than, with respect to an Exhibit F-1
Mortgage Loan, Net Partial Liquidation Proceeds) of any such Mortgage
Loan that became a Liquidated Loan in the month preceding the month of
such Distribution Date (excluding the portion thereof, if any,
constituting Net Foreclosure Profits) less the sum of (A) any
unreimbursed Periodic Advances in respect of principal previously made
by the Servicer, the Master Servicer or the Trust Administrator with
respect to such Liquidated Loan and (B) the portion of the Net
Liquidation Proceeds allocable to interest and (b) with respect to an
Exhibit F-1 Mortgage Loan, the aggregate Net Partial Liquidation
Proceeds on any such Mortgage Loan received by PHMC, as Servicer, during
the related Partial Liquidation Receipt Period, less the sum of (A) the
amounts allocable to principal of any unreimbursed Periodic Advances
previously made by PHMC, as Servicer, the Master Servicer or the Trust
Administrator and (B) the portion of the Net Partial Liquidation
Proceeds allocable to interest;
(iv) the Class B-1 Prepayment Percentage of the Scheduled
Principal Balance of such Mortgage Loan if such Mortgage Loan was the
subject of a Prepayment in Full (a) during the month preceding the month
in which such Distribution Date occurs with respect to any Exhibit F-2
Mortgage Loan or (b) during the period from and including the
Determination Date in the month preceding the month of such Distribution
Date up to (but not including) the Determination Date occurring in the
month of such Distribution Date with respect to any Exhibit F-1 Mortgage
Loan;
(v) the Class B-1 Prepayment Percentage of all partial principal
prepayments (a) received with respect to any Exhibit F-2 Mortgage Loan
during the month preceding the month in which such Distribution Date
occurs and (b) received with respect to any Exhibit F-1 Mortgage Loan on
or after the Determination Date occurring in the month preceding the
month in which such Distribution Date occurs and prior to the
Determination Date occurring in the month in which such Distribution
Date occurs; and
(vi) the Class B-1 Prepayment Percentage of the difference
between the unpaid principal balance of such Mortgage Loan substituted
for a defective Mortgage Loan during the month preceding the month in
which such Distribution Date occurs and the unpaid principal balance of
such defective Mortgage Loan, less the amount allocable to the principal
portion of any unreimbursed Periodic Advances previously made by the
Servicer, the Master Servicer or the Trust Administrator in respect of
such defective Mortgage Loan;
provided, however, that if an Optimal Adjustment Event occurs with respect to
such Subclass and such Distribution Date, the Class B-1 Optimal Principal Amount
will equal the lesser of (A) the Class B-1 Optimal Principal Amount calculated
as described in the preceding provisions and (B) the Adjusted Principal Balance
for the Class B-1 Certificates.
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<PAGE>
Class B-1 Percentage: As to any Distribution Date, except as set
forth in the next sentence, the percentage calculated by multiplying (i) the
Subordinated Percentage by (ii) a fraction, the numerator of which is the Class
B-1 Principal Balance (determined as of the Determination Date preceding such
Distribution Date) and the denominator of which is the sum of the Class M
Principal Balance and the Class B Subclass Principal Balances of the Class B
Subclasses eligible to receive principal distributions for such Distribution
Date in accordance with the provisions of Section 4.01(d). Except as set forth
in Section 4.01(d)(ii), in the event that the Class B-1 Certificates are not
eligible to receive distributions of principal in accordance with Section
4.01(d)(i), the Class B-1 Percentage for such Distribution Date will be zero.
Class B-1 Prepayment Percentage: As to any Distribution Date,
except as set forth in the next sentence, the percentage calculated by
multiplying (i) the Subordinated Prepayment Percentage by (ii) a fraction, the
numerator of which is the Class B-1 Principal Balance (determined as of the
Determination Date preceding such Distribution Date) and the denominator of
which is the sum of the Class M Principal Balance and the Class B Subclass
Principal Balances of the Class B Subclasses eligible to receive principal
distributions for such Distribution Date in accordance with the provisions of
Section 4.01(d). Except as set forth in Section 4.01(d)(ii), in the event that
the Class B-1 Certificates are not eligible to receive distributions of
principal in accordance with Section 4.01(d)(i), the Class B-1 Percentage for
such Distribution Date will be zero.
Class B-1 Principal Balance: As to the first Determination Date,
the Original Class B-1 Principal Balance. As of any subsequent Determination
Date, the lesser of (i) the Original Class B-1 Principal Balance less the sum of
(a) all amounts previously distributed in respect of the Class B-1 Certificates
on prior Distribution Dates (A) pursuant to Paragraph tenth of Section 4.01(a)
and (B) as a result of a Principal Adjustment and (b) the Realized Losses
previously allocated to the Class B-1 Certificates pursuant to Section 4.02(b)
and (ii) the Adjusted Pool Amount as of the preceding Distribution Date less the
sum of the Class A Principal Balance, the Class AP Principal Balance and the
Class M Principal Balance as of such Determination Date.
Class B-1 Unpaid Interest Shortfall: As to any Distribution Date,
the amount, if any, by which the aggregate of the Class B-1 Interest Shortfall
Amounts for prior Distribution Dates is in excess of the amounts distributed in
respect of the Class B-1 Certificates on prior Distribution Dates pursuant to
Paragraph ninth of Section 4.01(a).
Class B-2 Certificate: Any one of the Certificates executed by
the Trust Administrator and authenticated by the Trust Administrator or the
Authenticating Agent in substantially the form set forth in Exhibit B-2 and
Exhibit D hereto.
Class B-2 Certificateholder: The registered holder of a Class B-2
Certificate.
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Class B-2 Distribution Amount: As to any Distribution Date, any
amount distributable to the Holders of the Class B-2 Certificates pursuant to
Paragraphs eleventh, twelfth and thirteenth of Section 4.01(a).
Class B-2 Interest Shortfall Amount: As to any Distribution Date,
any amount by which the Class B Subclass Interest Accrual Amount of the Class
B-2 Certificates with respect to such Distribution Date exceeds the amount
distributed in respect of the Class B-2 Certificates on such Distribution Date
pursuant to Paragraph eleventh of Section 4.01(a).
Class B-2 Optimal Principal Amount: As to any Distribution Date,
an amount equal to the sum, as to each Outstanding Mortgage Loan, of the product
of (x) the Classes A/M/B Fraction with respect to such Mortgage Loan and (y) the
sum of:
(i) the Class B-2 Percentage of (A) the principal portion of the
Monthly Payment due on the Due Date occurring in the month of such
Distribution Date on such Mortgage Loan, less (B) if the Bankruptcy Loss
Amount has been reduced to zero, the principal portion of any Debt
Service Reduction with respect to such Mortgage Loan;
(ii) the Class B-2 Prepayment Percentage of the Scheduled
Principal Balance of each Mortgage Loan that was repurchased by the
Seller during such preceding month pursuant to Section 2.02 or 2.03, net
of any unreimbursed Periodic Advances in respect of principal previously
made by the Servicer, Master Servicer or Trust Administrator with
respect to such Mortgage Loan;
(iii) the Class B-2 Prepayment Percentage of (a) the aggregate
Net Liquidation Proceeds (other than, with respect to an Exhibit F-1
Mortgage Loan, Net Partial Liquidation Proceeds) of any such Mortgage
Loan that became a Liquidated Loan in the month preceding the month of
such Distribution Date (excluding the portion thereof, if any,
constituting Net Foreclosure Profits) less the sum of (A) any
unreimbursed Periodic Advances in respect of principal previously made
by the Servicer, the Master Servicer or the Trust Administrator with
respect to such Liquidated Loan and (B) the portion of the Net
Liquidation Proceeds allocable to interest and (b) with respect to an
Exhibit F-1 Mortgage Loan, the aggregate Net Partial Liquidation
Proceeds on any such Mortgage Loan received by PHMC, as Servicer, during
the related Partial Liquidation Receipt Period, less the sum of (A) the
amounts allocable to principal of any unreimbursed Periodic Advances
previously made by PHMC, as Servicer, the Master Servicer or the Trust
Administrator and (B) the portion of the Net Partial Liquidation
Proceeds allocable to interest;
(iv) the Class B-2 Prepayment Percentage of the Scheduled
Principal Balance of such Mortgage Loan if such Mortgage Loan was the
subject of a Prepayment in Full (a) during the month preceding the month
in which such Distribution Date occurs with respect to any Exhibit F-2
Mortgage Loan or (b) during the period from and including the
Determination Date in the month preceding the month of such Distribution
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<PAGE>
Date up to (but not including) the Determination Date occurring in the
month of such Distribution Date with respect to any Exhibit F-1 Mortgage
Loan;
(v) the Class B-2 Prepayment Percentage of all partial principal
prepayments (a) received with respect to any Exhibit F-2 Mortgage Loan
during the month preceding the month in which such Distribution Date
occurs and (b) received with respect to any Exhibit F-1 Mortgage Loan on
or after the Determination Date occurring in the month preceding the
month in which such Distribution Date occurs and prior to the
Determination Date occurring in the month in which such Distribution
Date occurs; and
(vi) the Class B-2 Prepayment Percentage of the difference
between the unpaid principal balance of such Mortgage Loan substituted
for a defective Mortgage Loan during the month preceding the month in
which such Distribution Date occurs and the unpaid principal balance of
such defective Mortgage Loan, less the amount allocable to the principal
portion of any unreimbursed Periodic Advances previously made by the
Servicer, the Master Servicer or the Trust Administrator in respect of
such defective Mortgage Loan;
provided, however, that if an Optimal Adjustment Event occurs with respect to
such Subclass and such Distribution Date, the Class B-2 Optimal Principal Amount
will equal the lesser of (A) the Class B-2 Optimal Principal Amount calculated
as described in the preceding provisions and (B) the Adjusted Principal Balance
for the Class B-2 Certificates.
Class B-2 Percentage: As to any Distribution Date, except as set
forth in the next sentence, the percentage calculated by multiplying (i) the
Subordinated Percentage by (ii) a fraction, the numerator of which is the Class
B-2 Principal Balance (determined as of the Determination Date preceding such
Distribution Date) and the denominator of which is the sum of the Class M
Principal Balance and the Class B Subclass Principal Balances of the Class B
Subclasses eligible to receive principal distributions for such Distribution
Date in accordance with the provisions of Section 4.01(d). Except as set forth
in Section 4.01(d)(ii), in the event that the Class B-2 Certificates are not
eligible to receive distributions of principal in accordance with Section
4.01(d)(i), the Class B-2 Percentage for such Distribution Date will be zero.
Class B-2 Prepayment Percentage: As to any Distribution Date,
except as set forth in the next sentence, the percentage calculated by
multiplying (i) the Subordinated Prepayment Percentage by (ii) a fraction, the
numerator of which is the Class B-2 Principal Balance (determined as of the
Determination Date preceding such Distribution Date) and the denominator of
which is the sum of the Class M Principal Balance and the Class B Subclass
Principal Balances of the Class B Subclasses eligible to receive principal
distributions for such Distribution Date in accordance with the provisions of
Section 4.01(d). Except as set forth in Section 4.01(d)(ii), in the event that
the Class B-2 Certificates are not eligible to receive distributions of
principal in accordance with Section 4.01(d)(i), the Class B-2 Prepayment
Percentage for such Distribution Date will be zero.
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<PAGE>
Class B-2 Principal Balance: As to the first Determination Date,
the Original Class B-2 Principal Balance. As of any subsequent Determination
Date, the lesser of (i) the Original Class B-2 Principal Balance less the sum of
(a) all amounts previously distributed in respect of the Class B-2 Certificates
on prior Distribution Dates (A) pursuant to Paragraph thirteenth of Section
4.01(a) and (B) as a result of a Principal Adjustment and (b) the Realized
Losses previously allocated to the Class B-2 Certificates pursuant to Section
4.02(b) and (ii) the Adjusted Pool Amount as of the preceding Distribution Date
less the sum of the Class A Principal Balance, the Class AP Principal Balance,
the Class M Principal Balance and the Class B-1 Principal Balance as of such
Determination Date.
Class B-2 Unpaid Interest Shortfall: As to any Distribution Date,
the amount, if any, by which the aggregate of the Class B-2 Interest Shortfall
Amounts for prior Distribution Dates is in excess of the amounts distributed in
respect of the Class B-2 Certificates on prior Distribution Dates pursuant to
Paragraph twelfth of Section 4.01(a).
Class B-3 Certificate: Any one of the Certificates executed by
the Trust Administrator and authenticated by the Trust Administrator or the
Authenticating Agent in substantially the form set forth in Exhibit B-3 and
Exhibit D hereto.
Class B-3 Certificateholder: The registered holder of a Class B-3
Certificate.
Class B-3 Distribution Amount: As to any Distribution Date, any
amount distributable to the Holders of the Class B-3 Certificates pursuant to
Paragraphs fourteenth, fifteenth and sixteenth of Section 4.01(a).
Class B-3 Interest Shortfall Amount: As to any Distribution Date,
any amount by which the Class B Subclass Interest Accrual Amount of the Class
B-3 Certificates with respect to such Distribution Date exceeds the amount
distributed in respect of the Class B-3 Certificates on such Distribution Date
pursuant to Paragraph fourteenth of Section 4.01(a).
Class B-3 Optimal Principal Amount: As to any Distribution Date,
an amount equal to the sum, as to each Outstanding Mortgage Loan, of the product
of (x) the Classes A/M/B Fraction with respect to such Mortgage Loan and (y) the
sum of:
(i) the Class B-3 Percentage of (A) the principal portion of the
Monthly Payment due on the Due Date occurring in the month of such
Distribution Date on such Mortgage Loan, less (B) if the Bankruptcy Loss
Amount has been reduced to zero, the principal portion of any Debt
Service Reduction with respect to such Mortgage Loan;
(ii) the Class B-3 Prepayment Percentage of the Scheduled
Principal Balance of each Mortgage Loan that was repurchased by the
Seller during such preceding month pursuant to Section 2.02 or 2.03, net
of any unreimbursed Periodic Advances in respect of principal previously
made by the Servicer, Master Servicer or Trust Administrator with
respect to such Mortgage Loan;
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<PAGE>
(iii) the Class B-3 Prepayment Percentage of (a) the aggregate
Net Liquidation Proceeds (other than, with respect to an Exhibit F-1
Mortgage Loan, Net Partial Liquidation Proceeds) of any such Mortgage
Loan that became a Liquidated Loan in the month preceding the month of
such Distribution Date (excluding the portion thereof, if any,
constituting Net Foreclosure Profits) less the sum of (A) any
unreimbursed Periodic Advances in respect of principal previously made
by the Servicer, the Master Servicer or the Trust Administrator with
respect to such Liquidated Loan and (B) the portion of the Net
Liquidation Proceeds allocable to interest and (b) with respect to an
Exhibit F-1 Mortgage Loan, the aggregate Net Partial Liquidation
Proceeds on any such Mortgage Loan received by PHMC, as Servicer, during
the related Partial Liquidation Receipt Period, less the sum of (A) the
amounts allocable to principal of any unreimbursed Periodic Advances
previously made by PHMC, as Servicer, the Master Servicer or the Trust
Administrator and (B) the portion of the Net Partial Liquidation
Proceeds allocable to interest;
(iv) the Class B-3 Prepayment Percentage of the Scheduled
Principal Balance of such Mortgage Loan if such Mortgage Loan was the
subject of a Prepayment in Full (a) during the month preceding the month
in which such Distribution Date occurs with respect to any Exhibit F-2
Mortgage Loan or (b) during the period from and including the
Determination Date in the month preceding the month of such Distribution
Date up to (but not including) the Determination Date occurring in the
month of such Distribution Date with respect to any Exhibit F-1 Mortgage
Loan;
(v) the Class B-3 Prepayment Percentage of all partial principal
prepayments (a) received with respect to any Exhibit F-2 Mortgage Loan
during the month preceding the month in which such Distribution Date
occurs and (b) received with respect to any Exhibit F-1 Mortgage Loan on
or after the Determination Date occurring in the month preceding the
month in which such Distribution Date occurs and prior to the
Determination Date occurring in the month in which such Distribution
Date occurs; and
(vi) the Class B-3 Prepayment Percentage of the difference
between the unpaid principal balance of such Mortgage Loan substituted
for a defective Mortgage Loan during the month preceding the month in
which such Distribution Date occurs and the unpaid principal balance of
such defective Mortgage Loan, less the amount allocable to the principal
portion of any unreimbursed Periodic Advances previously made by the
Servicer, the Master Servicer or the Trust Administrator in respect of
such defective Mortgage Loan;
provided, however, that if an Optimal Adjustment Event occurs with respect to
such Subclass and such Distribution Date, the Class B-3 Optimal Principal Amount
will equal the lesser of (A) the Class B-3 Optimal Principal Amount calculated
as described in the preceding provisions and (B) the Adjusted Principal Balance
for the Class B-3 Certificates.
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<PAGE>
Class B-3 Percentage: As to any Distribution Date, except as set
forth in the next sentence, the percentage calculated by multiplying (i) the
Subordinated Percentage by (ii) a fraction, the numerator of which is the Class
B-3 Principal Balance (determined as of the Determination Date preceding such
Distribution Date) and the denominator of which is the sum of the Class M
Principal Balance and the Class B Subclass Principal Balances of the Class B
Subclasses eligible to receive principal distributions for such Distribution
Date in accordance with the provisions of Section 4.01(d). Except as set forth
in Section 4.01(d)(ii), in the event that the Class B-3 Certificates are not
eligible to receive distributions of principal in accordance with Section
4.01(d)(i), the Class B-3 Percentage for such Distribution Date will be zero.
Class B-3 Prepayment Percentage: As to any Distribution Date,
except as set forth in the next sentence, the percentage calculated by
multiplying (i) the Subordinated Prepayment Percentage by (ii) a fraction, the
numerator of which is the Class B-3 Principal Balance (determined as of the
Determination Date preceding such Distribution Date) and the denominator of
which is the sum of the Class M Principal Balance and the Class B Subclass
Principal Balances of the Class B Subclasses eligible to receive principal
distributions for such Distribution Date in accordance with the provisions of
Section 4.01(d). Except as set forth in Section 4.01(d)(ii), in the event that
the Class B-3 Certificates are not eligible to receive distributions of
principal in accordance with Section 4.01(d)(i), the Class B-3 Prepayment
Percentage for such Distribution Date will be zero.
Class B-3 Principal Balance: As to the first Determination Date,
the Original Class B-3 Principal Balance. As of any subsequent Determination
Date, the lesser of (i) the Original Class B-3 Principal Balance less the sum of
(a) all amounts previously distributed in respect of the Class B-3 Certificates
on prior Distribution Dates (A) pursuant to Paragraph sixteenth of Section
4.01(a) and (B) as a result of a Principal Adjustment and (b) the Realized
Losses previously allocated to the Class B-3 Certificates pursuant to Section
4.02(b) and (ii) the Adjusted Pool Amount as of the preceding Distribution Date
less the sum of the Class A Principal Balance, the Class AP Principal Balance,
the Class M Principal Balance, the Class B-1 Principal Balance and the Class B-2
Principal Balance as of such Determination Date.
Class B-3 Unpaid Interest Shortfall: As to any Distribution Date,
the amount, if any, by which the aggregate of the Class B-3 Interest Shortfall
Amounts for prior Distribution Dates is in excess of the amounts distributed in
respect of the Class B-3 Certificates on prior Distribution Dates pursuant to
Paragraph fifteenth of Section 4.01(a).
Class B-4 Certificate: Any one of the Certificates executed by
the Trust Administrator and authenticated by the Trust Administrator or the
Authenticating Agent in substantially the form set forth in Exhibit B-4 and
Exhibit D hereto.
Class B-4 Certificateholder: The registered holder of a Class B-4
Certificate.
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Class B-4 Distribution Amount: As to any Distribution Date, any
amount distributable to the Holders of the Class B-4 Certificates pursuant to
Paragraphs seventeenth, eighteenth and nineteenth of Section 4.01(a).
Class B-4 Interest Shortfall Amount: As to any Distribution Date,
any amount by which the Class B Subclass Interest Accrual Amount of the Class
B-4 Certificates with respect to such Distribution Date exceeds the amount
distributed in respect of the Class B-4 Certificates on such Distribution Date
pursuant to Paragraph seventeenth of Section 4.01(a).
Class B-4 Optimal Principal Amount: As to any Distribution Date,
an amount equal to the sum, as to each Outstanding Mortgage Loan, of the product
of (x) the Classes A/M/B Fraction with respect to such Mortgage Loan and (y) the
sum of:
(i) the Class B-4 Percentage of (A) the principal portion of the
Monthly Payment due on the Due Date occurring in the month of such
Distribution Date on such Mortgage Loan, less (B) if the Bankruptcy Loss
Amount has been reduced to zero, the principal portion of any Debt
Service Reduction with respect to such Mortgage Loan;
(ii) the Class B-4 Prepayment Percentage of the Scheduled
Principal Balance of each Mortgage Loan that was repurchased by the
Seller during such preceding month pursuant to Section 2.02 or 2.03, net
of any unreimbursed Periodic Advances in respect of principal previously
made by the Servicer, Master Servicer or Trust Administrator with
respect to such Mortgage Loan;
(iii) the Class B-4 Prepayment Percentage of (a) the aggregate
Net Liquidation Proceeds (other than, with respect to an Exhibit F-1
Mortgage Loan, Net Partial Liquidation Proceeds) of any such Mortgage
Loan that became a Liquidated Loan in the month preceding the month of
such Distribution Date (excluding the portion thereof, if any,
constituting Net Foreclosure Profits) less the sum of (A) any
unreimbursed Periodic Advances in respect of principal previously made
by the Servicer, the Master Servicer or the Trust Administrator with
respect to such Liquidated Loan and (B) the portion of the Net
Liquidation Proceeds allocable to interest and (b) with respect to an
Exhibit F-1 Mortgage Loan, the aggregate Net Partial Liquidation
Proceeds on any such Mortgage Loan received by PHMC, as Servicer, during
the related Partial Liquidation Receipt Period, less the sum of (A) the
amounts allocable to principal of any unreimbursed Periodic Advances
previously made by PHMC, as Servicer, the Master Servicer or the Trust
Administrator and (B) the portion of the Net Partial Liquidation
Proceeds allocable to interest;
(iv) the Class B-4 Prepayment Percentage of the Scheduled
Principal Balance of such Mortgage Loan if such Mortgage Loan was the
subject of a Prepayment in Full (a) during the month preceding the month
in which such Distribution Date occurs with respect to any Exhibit F-2
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<PAGE>
Mortgage Loan or (b) during the period from and including the
Determination Date in the month preceding the month of such Distribution
Date up to (but not including) the Determination Date occurring in the
month of such Distribution Date with respect to any Exhibit F-1 Mortgage
Loan;
(v) the Class B-4 Prepayment Percentage of all partial principal
prepayments (a) received with respect to any Exhibit F-2 Mortgage Loan
during the month preceding the month in which such Distribution Date
occurs and (b) received with respect to any Exhibit F-1 Mortgage Loan on
or after the Determination Date occurring in the month preceding the
month in which such Distribution Date occurs and prior to the
Determination Date occurring in the month in which such Distribution
Date occurs; and
(vi) the Class B-4 Prepayment Percentage of the difference
between the unpaid principal balance of such Mortgage Loan substituted
for a defective Mortgage Loan during the month preceding the month in
which such Distribution Date occurs and the unpaid principal balance of
such defective Mortgage Loan, less the amount allocable to the principal
portion of any unreimbursed Periodic Advances previously made by the
Servicer, the Master Servicer or the Trust Administrator in respect of
such defective Mortgage Loan;
provided, however, that if an Optimal Adjustment Event occurs with respect to
such Subclass and such Distribution Date, the Class B-4 Optimal Principal Amount
will equal the lesser of (A) the Class B-4 Optimal Principal Amount calculated
as described in the preceding provisions and (B) the Adjusted Principal Balance
for the Class B-4 Certificates.
Class B-4 Percentage: As to any Distribution Date, except as set
forth in the next sentence, the percentage calculated by multiplying (i) the
Subordinated Percentage by (ii) a fraction, the numerator of which is the Class
B-4 Principal Balance (determined as of the Determination Date preceding such
Distribution Date) and the denominator of which is the sum of the Class M
Principal Balance and the Class B Subclass Principal Balances of the Class B
Subclasses eligible to receive principal distributions for such Distribution
Date in accordance with the provisions of Section 4.01(d). Except as set forth
in Section 4.01(d)(ii), in the event that the Class B-4 Certificates are not
eligible to receive distributions of principal in accordance with Section
4.01(d)(i), the Class B-4 Percentage for such Distribution Date will be zero.
Class B-4 Prepayment Percentage: As to any Distribution Date,
except as set forth in the next sentence, the percentage calculated by
multiplying (i) the Subordinated Prepayment Percentage by (ii) a fraction, the
numerator of which is the Class B-4 Principal Balance (determined as of the
Determination Date preceding such Distribution Date) and the denominator of
which is the sum of the Class M Principal Balance and the Class B Subclass
Principal Balances of the Class B Subclasses eligible to receive principal
distributions for such Distribution Date in accordance with the provisions of
Section 4.01(d). Except as set forth in Section 4.01(d)(ii), in the event that
the Class B-4 Certificates are not eligible to receive distributions of
principal in accordance with Section 4.01(d)(i), the Class B-4 Prepayment
Percentage for such Distribution Date will be zero.
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<PAGE>
Class B-4 Principal Balance: As to the first Determination Date,
the Original Class B-4 Principal Balance. As of any subsequent Determination
Date, the lesser of (i) the Original Class B-4 Principal Balance less the sum of
(a) all amounts previously distributed in respect of the Class B-4 Certificates
on prior Distribution Dates (A) pursuant to Paragraph nineteenth of Section
4.01(a) and (B) as a result of a Principal Adjustment and (b) the Realized
Losses previously allocated to the Class B-4 Certificates pursuant to Section
4.02(b) and (ii) the Adjusted Pool Amount as of the preceding Distribution Date
less the sum of the Class A Principal Balance, the Class AP Principal Balance,
the Class M Principal Balance, the Class B-1 Principal Balance, the Class B-2
Principal Balance and the Class B-3 Principal Balance as of such Determination
Date.
Class B-4 Unpaid Interest Shortfall: As to any Distribution Date,
the amount, if any, by which the aggregate of the Class B-4 Interest Shortfall
Amounts for prior Distribution Dates is in excess of the amounts distributed in
respect of the Class B-4 Certificates on prior Distribution Dates pursuant to
Paragraph eighteenth of Section 4.01(a).
Class B-5 Certificate: Any one of the Certificates executed by
the Trust Administrator and authenticated by the Trust Administrator or the
Authenticating Agent in substantially the form set forth in Exhibit B-5 and
Exhibit D hereto.
Class B-5 Certificateholder: The registered holder of a Class B-5
Certificate.
Class B-5 Distribution Amount: As to any Distribution Date, any
amount distributable to the Holders of the Class B-5 Certificates pursuant to
Paragraphs twentieth, twenty-first, and twenty-second of Section 4.01(a).
Class B-5 Interest Shortfall Amount: As to any Distribution Date,
any amount by which the Class B Subclass Interest Accrual Amount of the Class
B-5 Certificates with respect to such Distribution Date exceeds the amount
distributed in respect of the Class B-5 Certificates on such Distribution Date
pursuant to Paragraph twentieth of Section 4.01(a).
Class B-5 Optimal Principal Amount: As to any Distribution Date,
an amount equal to the sum, as to each Outstanding Mortgage Loan, of the product
of (x) the Classes A/M/B Fraction with respect to such Mortgage Loan and (y) the
sum of:
(i) the Class B-5 Percentage of (A) the principal portion of the
Monthly Payment due on the Due Date occurring in the month of such
Distribution Date on such Mortgage Loan, less (B) if the Bankruptcy Loss
Amount has been reduced to zero, the principal portion of any Debt
Service Reduction with respect to such Mortgage Loan;
(ii) the Class B-5 Prepayment Percentage of the Scheduled
Principal Balance of each Mortgage Loan that was repurchased by the
Seller during such preceding month pursuant to Section 2.02 or 2.03, net
of any unreimbursed Periodic Advances in respect of principal previously
made by the Servicer, Master Servicer or Trust Administrator with
respect to such Mortgage Loan;
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<PAGE>
(iii) the Class B-5 Prepayment Percentage of (a) the aggregate
Net Liquidation Proceeds (other than, with respect to an Exhibit F-1
Mortgage Loan, Net Partial Liquidation Proceeds) of any such Mortgage
Loan that became a Liquidated Loan in the month preceding the month of
such Distribution Date (excluding the portion thereof, if any,
constituting Net Foreclosure Profits) less the sum of (A) any
unreimbursed Periodic Advances in respect of principal previously made
by the Servicer, the Master Servicer or the Trust Administrator with
respect to such Liquidated Loan and (B) the portion of the Net
Liquidation Proceeds allocable to interest and (b) with respect to an
Exhibit F-1 Mortgage Loan, the aggregate Net Partial Liquidation
Proceeds on any such Mortgage Loan received by PHMC, as Servicer, during
the related Partial Liquidation Receipt Period, less the sum of (A) the
amounts allocable to principal of any unreimbursed Periodic Advances
previously made by PHMC, as Servicer, the Master Servicer or the Trust
Administrator and (B) the portion of the Net Partial Liquidation
Proceeds allocable to interest;
(iv) the Class B-5 Prepayment Percentage of the Scheduled
Principal Balance of such Mortgage Loan if such Mortgage Loan was the
subject of a Prepayment in Full (a) during the month preceding the month
in which such Distribution Date occurs with respect to any Exhibit F-2
Mortgage Loan or (b) during the period from and including the
Determination Date in the month preceding the month of such Distribution
Date up to (but not including) the Determination Date occurring in the
month of such Distribution Date with respect to any Exhibit F-1 Mortgage
Loan;
(v) the Class B-5 Prepayment Percentage of all partial principal
prepayments (a) received with respect to any Exhibit F-2 Mortgage Loan
during the month preceding the month in which such Distribution Date
occurs and (b) received with respect to any Exhibit F-1 Mortgage Loan on
or after the Determination Date occurring in the month preceding the
month in which such Distribution Date occurs and prior to the
Determination Date occurring in the month in which such Distribution
Date occurs; and
(vi) the Class B-5 Prepayment Percentage of the difference
between the unpaid principal balance of such Mortgage Loan substituted
for a defective Mortgage Loan during the month preceding the month in
which such Distribution Date occurs and the unpaid principal balance of
such defective Mortgage Loan, less the amount allocable to the principal
portion of any unreimbursed Periodic Advances previously made by the
Servicer, the Master Servicer or the Trust Administrator in respect of
such defective Mortgage Loan;
provided, however, that if an Optimal Adjustment Event occurs with respect to
such Subclass and such Distribution Date, the Class B-5 Optimal Principal Amount
will equal the lesser of (A) the Class B-5 Optimal Principal Amount calculated
as described in the preceding provisions and (B) the Adjusted Principal Balance
for the Class B-5 Certificates.
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<PAGE>
Class B-5 Percentage: As to any Distribution Date, except as set
forth in the next sentence, the percentage calculated by multiplying (i) the
Subordinated Percentage by (ii) a fraction, the numerator of which is the Class
B-5 Principal Balance (determined as of the Determination Date preceding such
Distribution Date) and the denominator of which is the sum of the Class M
Principal Balance and the Class B Subclass Principal Balances of the Class B
Subclasses eligible to receive principal distributions for such Distribution
Date in accordance with the provisions of Section 4.01(d). Except as set forth
in Section 4.01(d)(ii), in the event that the Class B-5 Certificates are not
eligible to receive distributions of principal in accordance with Section
4.01(d)(i), the Class B-5 Percentage for such Distribution Date will be zero.
Class B-5 Prepayment Percentage: As to any Distribution Date,
except as set forth in the next sentence, the percentage calculated by
multiplying (i) the Subordinated Prepayment Percentage by (ii) a fraction, the
numerator of which is the Class B-5 Principal Balance (determined as of the
Determination Date preceding such Distribution Date) and the denominator of
which is the sum of the Class M Principal Balance and the Class B Subclass
Principal Balances of the Class B Subclasses eligible to receive principal
distributions for such Distribution Date in accordance with the provisions of
Section 4.01(d). Except as set forth in Section 4.01(d)(ii), in the event that
the Class B-5 Certificates are not eligible to receive distributions of
principal in accordance with Section 4.01(d)(i), the Class B-5 Prepayment
Percentage for such Distribution Date will be zero.
Class B-5 Principal Balance: As to the first Determination Date,
the Original Class B-5 Principal Balance. As of any subsequent Determination
Date, the lesser of (i) the Original Class B-5 Principal Balance less the sum of
(a) all amounts previously distributed in respect of the Class B-5 Certificates
on prior Distribution Dates pursuant to Paragraph twenty-second of Section
4.01(a) and (b) the Realized Losses previously allocated to the Class B-5
Certificates pursuant to Section 4.02(b) and (ii) the Adjusted Pool Amount as of
the preceding Distribution Date less the sum of the Class A Principal Balance,
the Class AP Principal Balance, the Class M Principal Balance, the Class B-1
Principal Balance, the Class B-2 Principal Balance, the Class B-3 Principal
Balance and the Class B-4 Principal Balance as of such Determination Date.
Class B-5 Unpaid Interest Shortfall: As to any Distribution Date,
the amount, if any, by which the aggregate of the Class B-5 Interest Shortfall
Amounts for prior Distribution Dates is in excess of the amounts distributed in
respect of the Class B-5 Certificates on prior Distribution Dates pursuant to
Paragraph twenty-first of Section 4.01(a).
Class M Certificate: Any one of the Certificates executed by the
Trust Administrator and authenticated by the Trust Administrator or the
Authenticating Agent in substantially the form set forth in Exhibit C and
Exhibit D hereto.
Class M Certificateholder: The registered holder of a Class M
Certificate.
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<PAGE>
Class M Distribution Amount: As to any Distribution Date, the
aggregate amount distributable to the Class M Certificates pursuant to
Paragraphs fifth, sixth, and seventh of Section 4.01(a) on such Distribution
Date.
Class M Interest Accrual Amount: As to any Distribution Date, an
amount equal to (i) the product of 1/12th of the Class M Pass-Through Rate and
the Class M Principal Balance as of the Determination Date preceding such
Distribution Date minus (ii) (x) any Non-Supported Interest Shortfall allocated
to the Class M Certificates with respect to such Distribution Date and (y) the
interest portion of any Excess Special Hazard Losses, Excess Fraud Losses and
Excess Bankruptcy Losses allocated to the Class M Certificates with respect to
such Distribution Date pursuant to Section 4.02(e).
Class M Interest Shortfall Amount: As to any Distribution Date,
any amount by which the Class M Interest Accrual Amount with respect to such
Distribution Date exceeds the amount distributed in respect of the Class M
Certificates pursuant to Paragraph fifth of Section 4.01(a).
Class M Optimal Principal Amount: As to any Distribution Date, an
amount equal to the sum, as to each Outstanding Mortgage Loan, of the product of
(x) the Classes A/M/B Fraction with respect to such Mortgage Loan and (y) the
sum of:
(i) the Class M Percentage of (A) the principal portion of the
Monthly Payment due on the Due Date occurring in the month of such
Distribution Date on such Mortgage Loan, less (B) if the Bankruptcy Loss
Amount has been reduced to zero, the principal portion of any Debt
Service Reduction with respect to such Mortgage Loan;
(ii) the Class M Prepayment Percentage of the Scheduled Principal
Balance of each Mortgage Loan that was repurchased by the Seller during
such preceding month pursuant to Section 2.02 or 2.03, net of any
unreimbursed Periodic Advances in respect of principal previously made
by the Servicer, Master Servicer or Trust Administrator with respect to
such Mortgage Loan;
(iii) the Class M Prepayment Percentage of (a) the aggregate Net
Liquidation Proceeds (other than, with respect to an Exhibit F-1
Mortgage Loan, Net Partial Liquidation Proceeds) of any such Mortgage
Loan that became a Liquidated Loan in the month preceding the month of
such Distribution Date (excluding the portion thereof, if any,
constituting Net Foreclosure Profits) less the sum of (A) any
unreimbursed Periodic Advances in respect of principal previously made
by the Servicer, the Master Servicer or the Trust Administrator with
respect to such Liquidated Loan and (B) the portion of the Net
Liquidation Proceeds allocable to interest and (b) with respect to an
Exhibit F-1 Mortgage Loan, the aggregate Net Partial Liquidation
Proceeds on any such Mortgage Loan received by PHMC, as Servicer, during
the related Partial Liquidation Receipt Period, less the sum of (A) the
amounts allocable to principal of any unreimbursed Periodic Advances
previously made by PHMC, as Servicer, the Master Servicer or the Trust
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<PAGE>
Administrator and (B) the portion of the Net Partial Liquidation
Proceeds allocable to interest;
(iv) the Class M Prepayment Percentage of the Scheduled Principal
Balance of such Mortgage Loan if such Mortgage Loan was the subject of a
Prepayment in Full (a) during the month preceding the month in which
such Distribution Date occurs with respect to any Exhibit F-2 Mortgage
Loan or (b) during the period from and including the Determination Date
in the month preceding the month of such Distribution Date up to (but
not including) the Determination Date occurring in the month of such
Distribution Date with respect to any Exhibit F-1 Mortgage Loan;
(v) the Class M Prepayment Percentage of all partial principal
prepayments (a) received with respect to any Exhibit F-2 Mortgage Loan
during the month preceding the month in which such Distribution Date
occurs and (b) received with respect to any Exhibit F-1 Mortgage Loan on
or after the Determination Date occurring in the month preceding the
month in which such Distribution Date occurs and prior to the
Determination Date occurring in the month in which such Distribution
Date occurs; and
(vi) the Class M Prepayment Percentage of the difference between
the unpaid principal balance of such Mortgage Loan substituted for a
defective Mortgage Loan during the month preceding the month in which
such Distribution Date occurs and the unpaid principal balance of such
defective Mortgage Loan, less the amount allocable to the principal
portion of any unreimbursed Periodic Advances previously made by the
Servicer, the Master Servicer or the Trust Administrator in respect of
such defective Mortgage Loan.
provided, however, that if an Optimal Adjustment Event occurs with respect to
such Class and such Distribution Date, the Class M Optimal Principal Amount will
equal the lesser of (A) the Class M Optimal Principal Amount calculated as
described in the preceding provisions and (B) the Adjusted Principal Balance for
the Class M Certificates.
Class M Pass-Through Rate: As to any Distribution Date, 6.75% per
annum.
Class M Percentage: As to any Distribution Date, the percentage
calculated by multiplying the Subordinated Percentage by either (a) if the Class
B Certificates are eligible to receive principal distributions for such
Distribution Date in accordance with the provisions of Section 4.01(d), a
fraction, the numerator of which is the Class M Principal Balance (determined as
of the Determination Date preceding such Distribution Date) and the denominator
of which is the sum of the Class M Principal Balance and the Class B Subclass
Principal Balances of the Class B Subclasses eligible to receive principal
distributions for such Distribution Date in accordance with the provisions of
Section 4.01(d) or (b) except as set forth in Section 4.01(d)(ii), if the Class
B Certificates are not eligible to receive principal distributions for such
Distribution Date in accordance with the provisions of Section 4.01(d)(i), one.
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<PAGE>
Class M Prepayment Percentage: As to any Distribution Date, the
percentage calculated by multiplying the Subordinated Prepayment Percentage by
either (a) if the Class B Certificates are eligible to receive principal
distributions for such Distribution Date in accordance with the provisions of
Section 4.01(d), a fraction, the numerator of which is the Class M Principal
Balance (determined as of the Determination Date preceding such Distribution
Date) and the denominator of which is the sum of the Class M Principal Balance
and the Class B Subclass Principal Balances of the Class B Subclasses eligible
to receive principal distributions for such Distribution Date in accordance with
the provisions of Section 4.01(d) or (b) except as set forth in Section
4.01(d)(ii), if the Class B Certificates are not eligible to receive principal
distributions for such Distribution Date in accordance with the provisions of
Section 4.01(d)(i), one.
Class M Principal Balance: As to the first Determination Date,
the Original Class M Principal Balance. As of any subsequent Determination Date,
the lesser of (i) the Original Class M Principal Balance less the sum of (a) all
amounts previously distributed in respect of the Class M Certificates on prior
Distribution Dates (A) pursuant to Paragraph seventh of Section 4.01(a) and (B)
as a result of a Principal Adjustment and (b) the Realized Losses previously
allocated to the Class M Certificates pursuant to Section 4.02(b) and (ii) the
Adjusted Pool Amount as of the preceding Distribution Date less the sum of the
Class A Principal Balance and the Class AP Principal Balance as of such
Determination Date.
Class M Unpaid Interest Shortfall: As to any Distribution Date,
the amount, if any, by which the aggregate of the Class M Interest Shortfall
Amounts for prior Distribution Dates is in excess of the amounts distributed in
respect of the Class M Certificates on prior Distribution Dates pursuant to
Paragraph sixth of Section 4.01(a).
Classes A/M/B Fraction: With respect to any Mortgage Loan, the
quotient obtained by dividing the Net Mortgage Interest Rate for such Mortgage
Loan by 6.75%.
Classes A/M/B Voting Interest: The ratio obtained by dividing the
Pool Balance (Classes A/M/B Portion) by the sum of the Pool Balance (Classes
A/M/B Portion) and the Pool Balance (Class AP Portion).
Clearing Agency: An organization registered as a "clearing
agency" pursuant to Section 17A of the Securities Exchange Act of 1934, as
amended. The initial Clearing Agency shall be The Depository Trust Company.
Clearing Agency Participant: A broker, dealer, bank, financial
institution or other Person for whom a Clearing Agency effects book-entry
transfers of securities deposited with the Clearing Agency.
Closing Date: The date of initial issuance of the Certificates,
as set forth in Section 11.24.
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Code: The Internal Revenue Code of 1986, as it may be amended
from time to time, any successor statutes thereto, and applicable U.S.
Department of the Treasury temporary or final regulations promulgated
thereunder.
Co-op Shares: Shares issued by private non-profit housing
corporations.
Corporate Trust Office: The principal office of the Trust
Administrator or the Trustee, as the case may be, at which at any particular
time its corporate trust business shall be administered, which office, with
respect to the Trust Administrator, at the date of the execution of this
instrument is located at 180 East Fifth Street, St. Paul, Minnesota 55101 and,
with respect to the Trustee, at the date of the execution of this instrument is
located at 615 East Michigan Street, Lewis Center, 4th Floor, Milwaukee,
Wisconsin 53202.
Countrywide Servicing Agreement: The servicing agreement among
PHMC, Securitized Asset Services Corporation and Countrywide Funding Corporation
dated as of October 10, 1994.
Cross-Over Date: The first Distribution Date with respect to
which the Class A Percentage (determined pursuant to clause (ii) of the
definition thereof) equals or exceeds 100%.
Current Class A Interest Distribution Amount: As to any
Distribution Date, the amount distributed in respect of the Class A Subclasses
pursuant to Paragraph first of Section 4.01(a) on such Distribution Date.
Current Class B Interest Distribution Amount: As to any
Distribution Date, the amount distributed in respect of the Class B Certificates
pursuant to Paragraphs eighth, eleventh, fourteenth, seventeenth and twentieth
of Section 4.01(a) on such Distribution Date.
Current Class B-1 Fractional Interest: As to any Distribution
Date subsequent to the first Distribution Date, the percentage obtained by
dividing the sum of the Class B Subclass Principal Balances of the Class B-2,
Class B-3, Class B-4 and Class B-5 Certificates by the sum of the Class A
Principal Balance, the Class M Principal Balance and the Class B Principal
Balance. As to the first Distribution Date, the Original Class B-1 Fractional
Interest.
Current Class B-2 Fractional Interest: As to any Distribution
Date subsequent to the first Distribution Date, the percentage obtained by
dividing the sum of the Class B Subclass Principal Balances of the Class B-3,
Class B-4 and Class B-5 Certificates by the sum of the Class A Principal
Balance, the Class M Principal Balance and the Class B Principal Balance. As to
the first Distribution Date, the Original Class B-2 Fractional Interest.
Current Class B-3 Fractional Interest: As to any Distribution
Date subsequent to the first Distribution Date, the percentage obtained by
dividing the Class B Subclass Principal Balances of the Class B-4 and Class B-5
Certificates by the sum of the Class A Principal Balance, the Class M Principal
Balance and the Class B Principal Balance. As to the first Distribution Date,
the Original Class B-3 Fractional Interest.
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<PAGE>
Current Class B-4 Fractional Interest: As to any Distribution
Date subsequent to the first Distribution Date, the percentage obtained by
dividing the Class B Subclass Principal Balance of the Class B-5 Certificates by
the sum of the Class A Principal Balance, the Class M Principal Balance and the
Class B Principal Balance. As to the first Distribution Date, the Original Class
B-4 Fractional Interest.
Current Class M Fractional Interest: As to any Distribution Date
subsequent to the first Distribution Date, the percentage obtained by dividing
the Class B Principal Balance by the sum of the Class A Principal Balance, the
Class M Principal Balance and the Class B Principal Balance. As to the first
Distribution Date, the Original Class M Fractional Interest.
Current Class M Interest Distribution Amount: As to any
Distribution Date, the amount distributed in respect of the Class M Certificates
pursuant to Paragraph fifth of Section 4.01(a) on such Distribution Date.
Curtailment: Any Principal Prepayment made by a Mortgagor which
is not a Prepayment in Full.
Curtailment Interest Shortfall: On any Distribution Date, the
amount of interest, if any, that would have accrued on the amount of any
Curtailment with respect to an Exhibit F-2 Mortgage Loan that was received
during the month preceding the month in which such Distribution Date occurs at
the Net Mortgage Interest Rate for such Mortgage Loan from the date of
application by the related Servicer of such Curtailment through the last day of
the month in which it was received. On any Distribution Date which occurs on or
after the Cross-Over Date, with respect to any Exhibit F-1 Mortgage Loan, the
amount of interest, if any, that would have accrued on the amount of any
Curtailment with respect to a Mortgage Loan that was received on or after the
Determination Date in the month preceding the month in which such Distribution
Date occurs but prior to the first day of the month in which such Distribution
Date occurs at the Net Mortgage Interest Rate for such Mortgage Loan from the
date of application of such Curtailment through the last day of the month in
which received.
Custodial Agreement: The Custodial Agreement, if any, from time
to time in effect between the Custodian named therein, a Servicer and the Trust
Administrator, substantially in the form of Exhibit E hereto, as the same may be
amended or modified from time to time in accordance with the terms thereof.
Custodial P&I Account: The Custodial P&I Account, as defined in
each of the Servicing Agreements, with respect to the Mortgage Loans. In
determining whether the Custodial P&I Account under any Servicing Agreement is
"acceptable" to the Master Servicer (as may be required by the definition of
"Eligible Account" contained in the Servicing Agreements relating to six of the
Servicers), the Master Servicer shall require that any such account shall be
acceptable to each of the Rating Agencies.
Custodian: Initially, the Trust Administrator, and thereafter the
Custodian, if any, hereafter appointed by the Trust Administrator pursuant to
Section 8.13, or its successor in interest under the Custodial Agreement. The
Custodian may (but need not) be the Trustee, the Trust Administrator or any
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Person directly or indirectly controlling or controlled by or under common
control of either of them. Neither a Servicer, nor the Seller nor the Master
Servicer nor any Person directly or indirectly controlling or controlled by or
under common control with any such Person may be appointed Custodian.
Cut-Off Date: The first day of the month of initial issuance of
the Certificates as set forth in Section 11.02.
Cut-Off Date Aggregate Principal Balance: The aggregate of the
Cut-Off Date Principal Balances of the Mortgage Loans is as set forth in Section
11.03.
Cut-Off Date Principal Balance: As to each Mortgage Loan, its
unpaid principal balance as of the close of business on the Cut-Off Date (but
without giving effect to any Principal Prepayments received or applied on the
Cut-Off Date), reduced by all payments of principal due on or before the Cut-Off
Date and not paid, and increased by scheduled monthly payments of principal due
after the Cut-Off Date but received by the related Servicer on or before the
Cut-Off Date.
DCR: Duff & Phelps Credit Rating Co., or its successor in
interest.
Debt Service Reduction: With respect to any Mortgage Loan, a
reduction in the scheduled Monthly Payment for such Mortgage Loan by a court of
competent jurisdiction in a proceeding under the Bankruptcy Code, except such a
reduction constituting a Deficient Valuation.
Deficient Valuation: With respect to any Mortgage Loan, a
valuation by a court of competent jurisdiction of the Mortgaged Property in an
amount less than the then-outstanding indebtedness under the Mortgage Loan, or
any reduction in the amount of principal to be paid in connection with any
scheduled Monthly Payment that results in a permanent forgiveness of principal,
which valuation or reduction results from a proceeding under the Bankruptcy
Code.
Definitive Certificates: As defined in Section 5.07.
Denomination: The amount, if any, specified on the face of each
Certificate representing the principal portion of the Cut-Off Date Aggregate
Principal Balance evidenced by such Certificate.
Determination Date: The 17th day of the month in which the
related Distribution Date occurs, or if such 17th day is not a Business Day, the
Business Day preceding such 17th day.
Discount Mortgage Loan: A Mortgage Loan with a Net Mortgage
Interest Rate of less than 6.75%.
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Distribution Date: The 25th day of any month, beginning in the
month following the month of initial issuance of the Certificates, or if such
25th day is not a Business Day, the Business Day following such 25th day.
Due Date: With respect to any Mortgage Loan, the day of the month
in which the Monthly Payment on such Mortgage Loan is scheduled to be paid.
Eligible Account: One or more accounts (i) that are maintained
with a depository institution whose long-term debt obligations (or, in the case
of a depository institution which is part of a holding company structure, the
long-term debt obligations of such holding company) at the time of deposit
therein are rated at least "AA" (or the equivalent) by each of the Rating
Agencies, (ii) the deposits in which are fully insured by the FDIC through
either the Bank Insurance Fund or the Savings Association Insurance Fund, (iii)
the deposits in which are insured by the FDIC through either the Bank Insurance
Fund or the Savings Association Insurance Fund (to the limit established by the
FDIC) and the uninsured deposits in which accounts are otherwise secured, as
evidenced by an Opinion of Counsel delivered to the Trust Administrator, such
that the Trust Administrator, on behalf of the Certificateholders has a claim
with respect to the funds in such accounts or a perfected first security
interest against any collateral securing such funds that is superior to claims
of any other depositors or creditors of the depository institution with which
such accounts are maintained, (iv) that are trust accounts maintained with the
trust department of a federal or state chartered depository institution or trust
company acting in its fiduciary capacity or (v) such other account that is
acceptable to each of the Rating Agencies and would not cause the Trust Estate
to fail to qualify as a REMIC or result in the imposition of any federal tax on
the REMIC.
Eligible Investments: At any time, any one or more of the
following obligations and securities which shall mature not later than the
Business Day preceding the Distribution Date next succeeding the date of such
investment, provided that such investments continue to qualify as "cash flow
investments" as defined in Code Section 860G(a)(6):
(i) obligations of the United States of America or any agency
thereof, provided such obligations are backed by the full faith and
credit of the United States of America;
(ii) general obligations of or obligations guaranteed by any
state of the United States of America or the District of Columbia
receiving the highest short-term or highest long-term rating of each
Rating Agency, or such lower rating as would not result in the
downgrading or withdrawal of the rating then assigned to any of the
Certificates by either Rating Agency or result in any of such rated
Certificates being placed on credit review status (other than for
possible upgrading) by either Rating Agency;
(iii) commercial or finance company paper which is then rated in
the highest long-term commercial or finance company paper rating
category of each Rating Agency or the highest short-term rating category
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of each Rating Agency, or such lower rating category as would not result
in the downgrading or withdrawal of the rating then assigned to any of
the Certificates by either Rating Agency or result in any of such rated
Certificates being placed on credit review status (other than for
possible upgrading) by either Rating Agency;
(iv) certificates of deposit, demand or time deposits, federal
funds or banker's acceptances issued by any depository institution or
trust company incorporated under the laws of the United States or of any
state thereof and subject to supervision and examination by federal
and/or state banking authorities, provided that the commercial paper
and/or 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 debt obligations of such holding
company) are then rated in the highest short-term or the highest
long-term rating category for such securities of each of the Rating
Agencies, or such lower rating categories as would not result in the
downgrading or withdrawal of the rating then assigned to any of the
Certificates by either Rating Agency or result in any of such rated
Certificates being placed on credit review status (other than for
possible upgrading) by either Rating Agency;
(v) guaranteed reinvestment agreements issued by any bank,
insurance company or other corporation acceptable to each Rating Agency
at the time of the issuance of such agreements;
(vi) repurchase agreements on obligations with respect to any
security described in clauses (i) or (ii) above or any other security
issued or guaranteed by an agency or instrumentality of the United
States of America, in either case entered into with a depository
institution or trust company (acting as principal) described in (iv)
above;
(vii) securities (other than stripped bonds or stripped coupon
securities) bearing interest or sold at a discount issued by any
corporation incorporated under the laws of the United States of America
or any state thereof which, at the time of such investment or
contractual commitment providing for such investment, are then rated in
the highest short-term or the highest long-term rating category by each
Rating Agency, or in such lower rating category as would not result in
the downgrading or withdrawal of the rating then assigned to any of the
Certificates by either Rating Agency or result in any of such rated
Certificates being placed on credit review status (other than for
possible upgrading) by either Rating Agency; and
(viii) such other investments acceptable to each Rating Agency as
would not result in the downgrading of the rating then assigned to the
Certificates by either Rating Agency or result in any of such rated
Certificates being placed on credit review status (other than for
possible upgrading) by either Rating Agency.
In no event shall an instrument be an Eligible Investment if such
instrument evidences either (i) a right to receive only interest payments with
respect to the obligations underlying such instrument, or (ii) both principal
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and interest payments derived from obligations underlying such instrument and
the interest and principal payments with respect to such instrument provide a
yield to maturity at the date of investment of greater than 120% of the yield to
maturity at par of such underlying obligations.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA Plan: Any Person which is an employee benefit plan within
the meaning of Section 3(3) of ERISA.
ERISA Prohibited Holder: As defined in Section 5.02(d).
Errors and Omissions Policy: As defined in each of the Servicing
Agreements.
Event of Default: Any of the events specified in Section 7.01.
Excess Bankruptcy Loss: With respect to any Distribution Date and
any Mortgage Loan as to which a Bankruptcy Loss is realized in the month
preceding the month of such Distribution Date, (i) if the Aggregate Current
Bankruptcy Losses with respect to such Distribution Date exceed the
then-applicable Bankruptcy Loss Amount, then the portion of such Bankruptcy Loss
represented by the ratio of (a) the excess of the Aggregate Current Bankruptcy
Losses over the then-applicable Bankruptcy Loss Amount, divided by (b) the
Aggregate Current Bankruptcy Losses or (ii) if the Aggregate Current Bankruptcy
Losses with respect to such Distribution Date are less than or equal to the
then-applicable Bankruptcy Loss Amount, then zero. In addition, any Bankruptcy
Loss occurring with respect to a Mortgage Loan on or after the Cross-Over Date
will be an Excess Bankruptcy Loss.
Excess Fraud Loss: With respect to any Distribution Date and any
Mortgage Loan as to which a Fraud Loss is realized in the month preceding the
month of such Distribution Date, (i) if the Aggregate Current Fraud Losses with
respect to such Distribution Date exceed the then-applicable Fraud Loss Amount,
then the portion of such Fraud Loss represented by the ratio of (a) the excess
of the Aggregate Current Fraud Losses over the then-applicable Fraud Loss
Amount, divided by (b) the Aggregate Current Fraud Losses, or (ii) if the
Aggregate Current Fraud Losses with respect to such Distribution Date are less
than or equal to the then-applicable Fraud Loss Amount, then zero. In addition,
any Fraud Loss occurring with respect to a Mortgage Loan on or after the
Cross-Over Date will be an Excess Fraud Loss.
Excess Special Hazard Loss: With respect to any Distribution Date
and any Mortgage Loan as to which a Special Hazard Loss is realized in the month
preceding the month of such Distribution Date, (i) if the Aggregate Current
Special Hazard Losses with respect to such Distribution Date exceed the
then-applicable Special Hazard Loss Amount, then the portion of such Special
Hazard Loss represented by the ratio of (a) the excess of the Aggregate Current
Special Hazard Losses over the then-applicable Special Hazard Loss Amount,
divided by (b) the Aggregate Current Special Hazard Losses, or (ii) if the
Aggregate Current Special Hazard Losses with respect to such Distribution Date
are less than or equal to the then-applicable Special Hazard Loss Amount, then
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zero. In addition, any Special Hazard Loss occurring with respect to a Mortgage
Loan on or after the Cross-Over Date will be an Excess Special Hazard Loss.
Exhibit F-1 Mortgage Loan: Any of the Mortgage Loans identified
in Exhibit F-1 hereto, as such Exhibit may be amended from time to time in
connection with a substitution pursuant to Section 2.02, which Mortgage Loan is
serviced under the PHMC Servicing Agreement.
Exhibit F-2 Mortgage Loan: Any of the Mortgage Loans identified
in Exhibit F-2 hereto, as such Exhibit may be amended from time to time in
connection with a substitution pursuant to Section 2.02, which Mortgage Loan is
serviced under an Other Servicing Agreement.
FDIC: The Federal Deposit Insurance Corporation or any successor
thereto.
FHLMC: The Federal Home Loan Mortgage Corporation or any
successor thereto.
Fidelity Bond: As defined in each of the Servicing Agreements.
Final Distribution Date: The Distribution Date on which the final
distribution in respect of the Certificates is made pursuant to Section 9.01.
Fitch: Fitch Investors Service, L.P., or its successor in
interest.
Fixed Retained Yield: The fixed percentage of interest on each
Mortgage Loan with a Mortgage Interest Rate greater than the sum of (a) 6.75%,
(b) the Servicing Fee Rate and (c) the Master Servicing Fee Rate, which will be
determined on a loan by loan basis and will equal the Mortgage Interest Rate on
each Mortgage Loan minus the sum of (a), (b) and (c), which is not assigned to
and not part of the Trust Estate.
Fixed Retained Yield Rate: With respect to each Mortgage Loan, a
per annum rate equal to the greater of (a) zero and (b) the Mortgage Interest
Rate on such Mortgage Loan minus the sum of (i) 6.75%, (ii) the Servicing Fee
Rate and (iii) the Master Servicing Fee Rate.
FNMA: The Federal National Mortgage Association or any successor
thereto.
Foreclosure Profits: As to any Distribution Date, the excess, if
any, of (i) Net Liquidation Proceeds (other than Net Partial Liquidation
Proceeds with respect to Exhibit F-1 Mortgage Loans) in respect of each Mortgage
Loan that became a Liquidated Loan during the month preceding the month in which
such Distribution Date occurs over (ii) the sum of the unpaid principal balance
of each such Liquidated Loan plus accrued and unpaid interest at the applicable
Mortgage Interest Rate on the unpaid principal balance thereof from the Due Date
to which interest was last paid by the Mortgagor (or, in the case of a
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Liquidated Loan that had been an REO Mortgage Loan, from the Due Date to which
interest was last deemed to have been paid) to the first day of the month
following the month in which such Mortgage Loan became a Liquidated Loan.
Fraud Loss: A Liquidated Loan Loss as to which there was fraud in
the origination of such Mortgage Loan.
Fraud Loss Amount: As of any Distribution Date after the Cut-Off
Date an amount equal to: (X) prior to the first anniversary of the Cut-Off Date
an amount equal to $2,497,707.01 minus the aggregate amount of Fraud Losses
allocated solely to the Class B Certificates or, following the reduction of the
Class B Principal Balance to zero, solely to the Class M Certificates in
accordance with Section 4.02(a) since the Cut-Off Date, and (Y) from the first
through fifth anniversary of the Cut-Off Date, an amount equal to (1) the lesser
of (a) the Fraud Loss Amount as of the most recent anniversary of the Cut-Off
Date and (b) 1.00% of the aggregate outstanding principal balance of all of the
Mortgage Loans as of the most recent anniversary of the Cut-Off Date minus (2)
the Fraud Losses allocated solely to the Class B Certificates or, following the
reduction of the Class B Principal Balance to zero, solely to the Class M
Certificates in accordance with Section 4.02(a) since the most recent
anniversary of the Cut-Off Date. On and after the Cross-Over Date or after the
fifth anniversary of the Cut-Off Date the Fraud Loss Amount shall be zero.
Holder: See "Certificateholder."
Independent: When used with respect to any specified Person, such
Person who (i) is in fact independent of the Seller, the Master Servicer and any
Servicer, (ii) does not have any direct financial interest or any material
indirect financial interest in the Seller or the Master Servicer or any Servicer
or in an affiliate of either, and (iii) is not connected with the Seller, the
Master Servicer or any Servicer as an officer, employee, promoter, underwriter,
trustee, partner, director or person performing similar functions.
Insurance Policy: Any insurance or performance bond relating to a
Mortgage Loan or the Mortgage Loans, including any hazard insurance, special
hazard insurance, flood insurance, primary mortgage insurance, mortgagor
bankruptcy bond or title insurance.
Insurance Proceeds: Proceeds paid by any insurer pursuant to any
Insurance Policy covering a Mortgage Loan.
Insured Expenses: Expenses covered by any Insurance Policy
covering a Mortgage Loan.
Liquidated Loan: A Mortgage Loan with respect to which the
related Mortgaged Property has been acquired, liquidated or foreclosed and with
respect to which the applicable Servicer determines that all Liquidation
Proceeds which it expects to recover have been recovered.
Liquidated Loan Loss: With respect to any Distribution Date, the
aggregate of the amount of losses with respect to each Mortgage Loan which
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became a Liquidated Loan prior to the Due Date preceding such Distribution Date,
equal to the excess of (i) the unpaid principal balance of each such Liquidated
Loan, plus accrued interest thereon in accordance with the amortization schedule
at the time applicable thereto at the applicable Net Mortgage Interest Rate from
the Due Date as to which interest was last paid with respect thereto through the
last day of the month in which such Mortgage Loan became a Liquidated Loan, over
(ii) Net Liquidation Proceeds (other than Net Partial Liquidation Proceeds with
respect to Exhibit F-1 Mortgage Loans) with respect to such Liquidated Loan.
Liquidation Expenses: Expenses incurred by a Servicer in
connection with the liquidation of any defaulted Mortgage Loan or property
acquired in respect thereof (including, without limitation, legal fees and
expenses, committee or referee fees, and, if applicable, brokerage commissions
and conveyance taxes), any unreimbursed advances expended by such Servicer
pursuant to its Servicing Agreement or the Master Servicer or Trust
Administrator pursuant hereto respecting the related Mortgage Loan, including
any unreimbursed advances for real property taxes or for property restoration or
preservation of the related Mortgaged Property. Liquidation Expenses shall not
include any previously incurred expenses in respect of an REO Mortgage Loan
which have been netted against related REO Proceeds.
Liquidation Proceeds: Amounts received by a Servicer (including
Insurance Proceeds) in connection with the liquidation of defaulted Mortgage
Loans or property acquired in respect thereof, whether through foreclosure, sale
or otherwise, including payments in connection with such Mortgage Loans received
from the Mortgagor, other than amounts required to be paid to the Mortgagor
pursuant to the terms of the applicable Mortgage or to be applied otherwise
pursuant to law.
Loan-to-Value Ratio: The ratio, expressed as a percentage, the
numerator of which is the principal balance of a particular Mortgage Loan at
origination and the denominator of which is the lesser of (x) the appraised
value of the related Mortgaged Property determined in the appraisal used by the
originator at the time of origination of such Mortgage Loan, and (y) if the
Mortgage is originated in connection with a sale of the Mortgaged Property, the
sale price for such Mortgaged Property.
Master Servicer: Securitized Asset Services Corporation, or its
successor in interest hereunder.
Master Servicer Custodial Account: The trust account established
and maintained by the Master Servicer in the name of the Master Servicer on
behalf of the Trustee pursuant to Section 3.01. The Master Servicer Custodial
Account shall be an Eligible Account.
Master Servicing Fee: With respect to any Mortgage Loan and any
Distribution Date, the fee payable monthly to the Master Servicer pursuant to
Section 6.05 equal to a fixed percentage (expressed as a per annum rate) of the
unpaid principal balance of such Mortgage Loan.
Master Servicing Fee Rate: As set forth in Section 11.11.
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Monthly Payment: As to any Mortgage Loan (including any REO
Mortgage Loan) and any Due Date, the payment of principal and interest due
thereon in accordance with the amortization schedule at the time applicable
thereto (after adjustment for any Curtailments and Deficient Valuations
occurring prior to such Due Date but before any adjustment to such amortization
schedule, other than for Deficient Valuations, by reason of any bankruptcy or
similar proceeding or any moratorium or similar waiver or grace period).
Monthly Servicing Compensation: As defined in each of the Other
Servicing Agreements.
Moody's: Moody's Investors Service, Inc., or its successor in
interest.
Mortgage: The mortgage, deed of trust or other instrument
creating a first lien on Mortgaged Property securing a Mortgage Note together
with any Mortgage Loan Rider, if applicable.
Mortgage Interest Rate: As to any Mortgage Loan, the per annum
rate at which interest accrues on the unpaid principal balance thereof as set
forth in the related Mortgage Note, which rate is as indicated on the Mortgage
Loan Schedule.
Mortgage Loan Rider: The standard FNMA/FHLMC riders to the
Mortgage Note and/or Mortgage riders required when the Mortgaged Property is a
condominium unit or a unit in a planned unit development.
Mortgage Loan Schedule: The list of the Mortgage Loans
transferred to the Trust Administrator on the Closing Date as part of the Trust
Estate and attached hereto as Exhibits F-1 and F-2, which list may be amended
following the Closing Date upon conveyance of a substitute Mortgage Loan
pursuant to Section 2.02 or 2.03 and which list shall set forth at a minimum the
following information of the close of business on the Cut-Off Date (or, with
respect to substitute Mortgage Loans, as of the close of business on the day of
substitution) as to each Mortgage Loan:
(i) the Mortgage Loan identifying number;
(ii) the city, state and zip code of the Mortgaged Property;
(iii) the type of property;
(iv) the Mortgage Interest Rate;
(v) the Net Mortgage Interest Rate;
(vi) the Monthly Payment;
(vii) the original number of months to maturity;
(viii) the scheduled maturity date;
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(ix) the Cut-Off Date Principal Balance;
(x) the Loan-to-Value Ratio at origination;
(xi) whether such Mortgage Loan is a Subsidy Loan;
(xii) whether such Mortgage Loan is covered by primary mortgage
insurance;
(xiii) the Servicing Fee Rate;
(xiv) the Master Servicing Fee;
(xv) Fixed Retained Yield, if applicable;
(xvi) for Mortgage Loans identified on Exhibit F-2, the name of
the Servicer with respect thereto; and
(xvii) for the Mortgage Loans identified on Exhibit F-2, the name
of the PHMC Loan Seller with respect thereto, if applicable.
Such schedule may consist of multiple reports that collectively
set forth all of the information required.
Mortgage Loans: Each of the mortgage loans transferred and
assigned to the Trust Administrator on the Closing Date pursuant to Section 2.01
and any mortgage loans substituted therefor pursuant to Section 2.02 or 2.03, in
each case as from time to time are included in the Trust Estate as identified in
the Mortgage Loan Schedule.
Mortgage Note: The note or other evidence of indebtedness
evidencing the indebtedness of a Mortgagor under a Mortgage Loan together with
any related Mortgage Loan Riders, if applicable.
Mortgaged Property: The property subject to a Mortgage, which may
include Co-op Shares or residential long-term leases.
Mortgagor: The obligor on a Mortgage Note.
Net Foreclosure Profits: As to any Distribution Date, the amount,
if any, by which (i) Aggregate Foreclosure Profits with respect to such
Distribution Date exceed (ii) Liquidated Loan Losses with respect to such
Distribution Date.
Net Liquidation Proceeds: As to any Liquidated Loan, Liquidation
Proceeds net of Liquidation Expenses. For all purposes of this Agreement, Net
Liquidation Proceeds shall be allocated first to accrued and unpaid interest on
the related Mortgage Loan and then to the unpaid principal balance thereof.
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Net Mortgage Interest Rate: With respect to each Mortgage Loan, a
rate equal to (i) the Mortgage Interest Rate on such Mortgage Loan minus (ii)
the sum of (a) the Servicing Fee Rate, as set forth on Exhibits F-1 or F-2 with
respect to such Mortgage Loan, (b) the Master Servicing Fee Rate, as set forth
in Section 11.11 with respect to such Mortgage Loan and (c) the Fixed Retained
Yield Rate, if any, with respect to such Mortgage Loan. Any regular monthly
computation of interest at such rate shall be based upon annual interest at such
rate on the applicable amount divided by twelve.
Net Partial Liquidation Proceeds: With respect to Exhibit F-1
Mortgage Loans, Partial Liquidation Proceeds with respect to a Mortgage Loan net
of unreimbursed Liquidation Expenses incurred with respect to such Mortgage
Loan. For all purposes of this Agreement, Net Partial Liquidation Proceeds shall
be allocated first to accrued and unpaid interest on the related Mortgage Loan
and then to the unpaid principal balance thereof.
Net REO Proceeds: As to any REO Mortgage Loan, REO Proceeds net
of any related expenses of the Servicer.
Non-permitted Foreign Holder: As defined in Section 5.02(d).
Nonrecoverable Advance: Any portion of a Periodic Advance
previously made or proposed to be made in respect of a Mortgage Loan which has
not been previously reimbursed to the Servicer, the Master Servicer or the Trust
Administrator, as the case may be, and which the Servicer or the Master Servicer
or the Trust Administrator determines will not, or in the case of a proposed
Periodic Advance would not, be ultimately recoverable from Liquidation Proceeds
or other recoveries in respect of the related Mortgage Loan. The determination
by the Servicer, the Master Servicer or the Trust Administrator (i) that it has
made a Nonrecoverable Advance or (ii) that any proposed Periodic Advance, if
made, would constitute a Nonrecoverable Advance, shall be evidenced by an
Officer's Certificate of the Servicer delivered to the Master Servicer for
redelivery to the Trustee or, in the case of a Master Servicer or Trust
Administrator determination, an Officer's Certificate of the Master Servicer or
the Trust Administrator delivered to the Trustee, in each case detailing the
reasons for such determination.
Non-Supported Interest Shortfall: With respect to any
Distribution Date, the sum of (i) the excess, if any, of the aggregate
Prepayment Interest Shortfall on the Exhibit F-1 Mortgage Loans over the
aggregate Servicing Fee owed under the PHMC Servicing Agreement with respect to
such Distribution Date and (ii) the excess, if any, of the aggregate Prepayment
Interest Shortfall and Curtailment Interest Shortfall on the Exhibit F-2
Mortgage Loans serviced under each of the respective Other Servicing Agreements
over the aggregate Monthly Servicing Compensation (or in the case of the
Countrywide Servicing Agreement, the aggregate Servicing Fee) payable under the
related Other Servicing Agreements with respect to such Distribution Date. With
respect to each Distribution Date occurring on or after the Cross-Over Date, the
Non-Supported Interest Shortfall as determined pursuant to clause (i) of the
preceding sentence shall be increased by the Curtailment Interest Shortfall and
the Partial Liquidation Interest Shortfall, if any, for such Distribution Date.
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Non-U.S. Person: As defined in Section 4.01(g).
Officers' Certificate: With respect to any Person, a certificate
signed by the Chairman of the Board, the President or a Vice President, and by
the Treasurer, the Secretary or one of the Assistant Treasurers or Assistant
Secretaries of such Person (or, in the case of a Person which is not a
corporation, signed by the person or persons having like responsibilities), and
delivered to the Trustee or the Trust Administrator, as the case may be.
Opinion of Counsel: A written opinion of counsel, who may be
outside or salaried counsel for the Seller, a Servicer or the Master Servicer,
or any affiliate of the Seller, a Servicer or the Master Servicer, acceptable to
the Trustee if such opinion is to be delivered to the Trustee, or acceptable to
the Trust Administrator if such opinion is to be delivered to the Trust
Administrator; provided, however, that with respect to REMIC matters, matters
relating to the determination of Eligible Accounts or matters relating to
transfers of Certificates, such counsel shall be Independent.
Optimal Adjustment Event: With respect to the Class M
Certificates or any Class B Subclass and any Distribution Date, an Optimal
Adjustment Event will occur with respect to such Class or Subclass if: (i) the
principal balance of such Class or Subclass on the Determination Date succeeding
such Distribution Date would have been reduced to zero (regardless of whether
such principal balance was reduced to zero as a result of principal distribution
or the allocation of Realized Losses) and (ii) any Class A Subclass Principal
Balance or Class AP Principal Balance would be subject to further reduction as a
result of the third sentence of the definition of Class A Subclass Principal
Balance or Class AP Principal Balance or, with respect to any Class B Subclass,
the Class M Principal Balance or the Class B Subclass Principal Balance of a
Class B Subclass with a lower numerical designation would be reduced with
respect to such Distribution Date as a result of the application of clause (ii)
of the definition of Class M Principal Balance, Class B-1 Principal Balance,
Class B-2 Principal Balance, Class B-3 Principal Balance, Class B-4 Principal
Balance or Class B-5 Principal Balance.
Original Class A Percentage: The Class A Percentage as of the
Cut-Off Date, as set forth in Section 11.04.
Original Class A Principal Balance: The sum of the Original Class
A Subclass Principal Balances of each Class A Subclass, as set forth in Section
11.06.
Original Class A Subclass Principal Balance: Any of the Original
Class A Subclass Principal Balances as set forth in Section 11.05.
Original Class AP Principal Balance: The Original Class AP
Principal Balance, as set forth in Section 11.07.
Original Class B Principal Balance: The sum of the Original Class
B-1 Principal Balance, Original Class B-2 Principal Balance, Original Class B-3
Principal Balance, Original Class B-4 Principal Balance and Original Class B-5
Principal Balance, as set forth in Section 11.17.
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Original Class B-1 Percentage: The Class B-1 Percentage as of the
Cut-Off Date, as set forth in Section 11.12.
Original Class B-2 Percentage: The Class B-2 Percentage as of the
Cut-Off Date, as set forth in Section 11.13.
Original Class B-3 Percentage: The Class B-3 Percentage as of the
Cut-Off Date, as set forth in Section 11.14.
Original Class B-4 Percentage: The Class B-4 Percentage as of the
Cut-Off Date, as set forth in Section 11.15.
Original Class B-5 Percentage: The Class B-5 Percentage as of the
Cut-Off Date, as set forth in Section 11.16.
Original Class B-1 Principal Balance: The Class B-1 Principal
Balance as of the Cut-Off Date, as set forth in Section 11.18.
Original Class B-2 Principal Balance: The Class B-2 Principal
Balance as of the Cut-Off Date, as set forth in Section 11.18.
Original Class B-3 Principal Balance: The Class B-3 Principal
Balance as of the Cut-Off Date, as set forth in Section 11.18.
Original Class B-4 Principal Balance: The Class B-4 Principal
Balance as of the Cut-Off Date, as set forth in Section 11.18.
Original Class B-5 Principal Balance: The Class B-5 Principal
Balance as of the Cut-Off Date, as set forth in Section 11.18.
Original Class B-1 Fractional Interest: As to the first
Distribution Date, the percentage obtained by dividing the sum of the Original
Class B-2 Principal Balance, the Original Class B-3 Principal Balance, the
Original Class B-4 Principal Balance and the Original Class B-5 Principal
Balance by the sum of the Original Class A Principal Balance, the Original Class
M Principal Balance and the Original Class B Principal Balance. The Original
Class B-1 Fractional Interest is specified in Section 11.19.
Original Class B-2 Fractional Interest: As to the first
Distribution Date, the percentage obtained by dividing the sum of the Original
Class B-3 Principal Balance, the Original Class B-4 Principal Balance and the
Original Class B-5 Principal Balance by the sum of the Original Class A
Principal Balance, the Original Class M Principal Balance and the Original Class
B Principal Balance. The Original Class B-2 Fractional Interest is specified in
Section 11.20.
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Original Class B-3 Fractional Interest: As to the first
Distribution Date, the percentage obtained by dividing the sum of the Original
Class B-4 Principal Balance and the Original Class B-5 Principal Balance by the
sum of the Original Class A Principal Balance, the Original Class M Principal
Balance and the Original Class B Principal Balance. The Original Class B-3
Fractional Interest is specified in Section 11.21.
Original Class B-4 Fractional Interest: As to the first
Distribution Date, the percentage obtained by dividing the Original Class B-5
Principal Balance by the sum of the Original Class A Principal Balance, the
Original Class M Principal Balance and the Original Class B Principal Balance.
The Original Class B-4 Fractional Interest is specified in Section 11.22.
Original Class M Fractional Interest: As to the first
Distribution Date, the percentage obtained by dividing the Original Class B
Principal Balance by the sum of the Original Class A Principal Balance, the
Original Class M Principal Balance and the Original Class B Principal Balance.
The Original Class M Fractional Interest is specified in Section 11.10.
Original Class M Percentage: The Class M Percentage as of the
Cut-Off Date, as set forth in Section 11.08.
Original Class M Principal Balance: The Class M Principal Balance
as of the Cut-Off Date, as set forth in Section 11.09.
Original Subordinated Percentage: The Subordinated Percentage as
of the Cut-Off Date, as set forth in Section 11.23.
Original Subordinated Principal Balance: The sum of the Original
Class M Principal Balance and the Original Class B Principal Balance.
Other Servicer: Any of the Servicers other than PHMC.
Other Servicing Agreements: The Servicing Agreements other than
the PHMC Servicing Agreement.
Outstanding Mortgage Loan: As to any Due Date, a Mortgage Loan
(including an REO Mortgage Loan) which was not the subject of a Prepayment in
Full prior to such Due Date, which did not become a Liquidated Loan prior to
such Due Date and which was not repurchased by the Seller prior to such Due Date
pursuant to Section 2.02 or 2.03.
Owner Mortgage Loan File: A file maintained by the Trust
Administrator (or the Custodian, if any) for each Mortgage Loan that contains
the documents specified in the Servicing Agreements under their respective
"Owner Mortgage Loan File" definition or similar definition and/or other
provisions requiring delivery of specified documents to the owner of the
Mortgage Loan in connection with the purchase thereof, and any additional
documents required to be added to the Owner Mortgage Loan File pursuant to this
Agreement.
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Partial Liquidation Interest Shortfall: On any Distribution Date
which occurs on or after the Cross-Over Date, and with respect to the Exhibit
F-1 Mortgage Loans, the amount of interest, if any, that would have accrued on
the amount of any Partial Liquidation Proceeds with respect to a Mortgage Loan
that was received on or after the Determination Date in the month preceding the
month in which such Distribution Date occurs but prior to the first day of the
month in which such Distribution Date occurs at the Net Mortgage Interest Rate
for such Mortgage Loan from the date of application of such Partial Liquidation
Proceeds through the last day of the month in which received.
Partial Liquidation Proceeds: Liquidation Proceeds received prior
to the month in which the related Mortgage Loan became a Liquidated Loan.
Partial Liquidation Receipt Period: As to any Distribution Date
and any Exhibit F-1 Mortgage Loan, the period from and including the
Determination Date occurring in the month preceding the month of such
Distribution Date (or, in the case of the first Distribution Date, from and
including the Cut-Off Date) to but not including the Determination Date
occurring in the month of such Distribution Date.
Paying Agent: The Person authorized on behalf of the Trust
Administrator, as agent for the Master Servicer, to make distributions to
Certificateholders with respect to the Certificates and to forward to
Certificateholders the periodic and annual statements required by Section 4.04.
The Paying Agent may be any Person directly or indirectly controlling or
controlled by or under common control with the Master Servicer and may be the
Trustee or the Trust Administrator. The initial Paying Agent is appointed in
Section 4.03(a).
Payment Account: The account maintained pursuant to Section
4.03(b).
Percentage Interest: With respect to a Class A Certificate, the
undivided percentage interest obtained by dividing the original principal
balance of such Certificate by the aggregate original principal balance of all
Certificates of such Class A Subclass. With respect to a Class AP Certificate,
the undivided percentage interest obtained by dividing the original principal
balance of such Certificate by the aggregate original principal balance of all
Certificates of such Class. With respect to a Class M Certificate, the undivided
percentage interest obtained by dividing the original principal balance of such
Certificate by the aggregate original principal balance of all Certificates of
such Class. With respect to a Class B Certificate, the undivided percentage
interest obtained by dividing the original principal balance of such Certificate
by the aggregate original principal balance of all Certificates of such Class B
Subclass.
Periodic Advance: The aggregate of the advances required to be
made by a Servicer on any Distribution Date pursuant to its Servicing Agreement
or by the Master Servicer or the Trust Administrator hereunder, the amount of
any such advances being equal to the total of all Monthly Payments (adjusted, in
each case (i) in respect of interest, to the applicable Mortgage Interest Rate
less the applicable Servicing Fee in the case of Periodic Advances made by a
Servicer and to the applicable Net Mortgage Interest Rate in the case of
Periodic Advances made by the Master Servicer or Trust Administrator and (ii) by
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the amount of any related Debt Service Reductions or reductions in the amount of
interest collectable from the Mortgagor pursuant to the Soldiers' and Sailors'
Civil Relief Act of 1940, as amended, or similar legislation or regulations then
in effect) on the Mortgage Loans, that (x) were delinquent as of the close of
business on the related Determination Date, (y) were not the subject of a
previous Periodic Advance by such Servicer or of a Periodic Advance by the
Master Servicer or the Trust Administrator, as the case may be and (z) have not
been determined by the Master Servicer, such Servicer or Trust Administrator to
be Nonrecoverable Advances.
Person: Any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
PHMC: The Prudential Home Mortgage Company, Inc.
PHMC Loan Sellers: The entities listed on the Mortgage Loan
Schedule, from which PHMC purchased the Mortgage Loans.
PHMC Servicing Agreement: The Servicing Agreement providing for
the servicing of the Exhibit F-1 Mortgage Loans initially by PHMC.
Plan: As defined in Section 5.02(c).
Pool Balance (Classes A/M/B Portion): As of any Distribution
Date, the sum of the amounts for each Mortgage Loan that is an Outstanding
Mortgage Loan of the product of (i) the Classes A/M/B Fraction for such Mortgage
Loan and (ii) the Scheduled Principal Balance of such Mortgage Loan.
Pool Balance (Class AP Portion): As of any Distribution Date, the
sum of the amounts for each Mortgage Loan that is an Outstanding Mortgage Loan
of the product of (i) the Class AP Fraction for such Mortgage Loan and (ii) the
Scheduled Principal Balance of such Mortgage Loan.
Pool Distribution Amount: As of any Distribution Date, the funds
eligible for distribution to the Holders of the Certificates on such
Distribution Date, which shall be the sum of (i) all previously undistributed
payments or other receipts on account of principal and interest on or in respect
of the Mortgage Loans (including, without limitation, Principal Prepayments, Net
REO Proceeds, Insurance Proceeds, Liquidation Proceeds, the proceeds of any
repurchase of a Mortgage Loan by the Seller and any Substitution Principal
Amount) received by the Master Servicer on or prior to the Remittance Date in
the month of such Distribution Date, (ii) all Periodic Advances made by a
Servicer pursuant to the related Servicing Agreement or Periodic Advances made
by the Master Servicer or the Trust Administrator pursuant to Section 3.03 and
(iii) all other amounts required to be placed in the Master Servicer Custodial
Account by the Servicer on or before the Remittance Date or by the Master
Servicer or the Trust Administrator on or prior to the Distribution Date, but
excluding the following:
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(a) amounts received as late payments of principal or interest
and respecting which the Master Servicer or the Trust Administrator has made one
or more unreimbursed Periodic Advances;
(b) the portion of Net Liquidation Proceeds used to reimburse any
unreimbursed Periodic Advances by the Master Servicer or the Trust
Administrator;
(c) those portions of each payment of interest on a particular
Mortgage Loan which represent (i) the Fixed Retained Yield, if any, and (ii) the
Master Servicing Fee;
(d) the Amount Held for Future Distribution;
(e) that portion of Liquidation Proceeds, Insurance Proceeds and
REO Proceeds which represents any unpaid Master Servicing Fee;
(f) all income from Eligible Investments that is held in the
Master Servicer Custodial Account for the account of the Master Servicer;
(g) all other amounts permitted to be withdrawn from the Master
Servicer Custodial Account in respect of the Mortgage Loans, to the extent not
covered by clauses (a) through (f) above, or not required to be deposited in the
Master Servicer Custodial Account under this Agreement;
(h) Net Foreclosure Profits; and
(i) the amount of any recoveries in respect of principal which
had previously been allocated as a loss to one or more Classes or Subclasses of
Certificates pursuant to Section 4.02.
Pool Scheduled Principal Balance: As to any Distribution Date,
the aggregate Scheduled Principal Balances of all Mortgage Loans that were
Outstanding Mortgage Loans on the Due Date in the month preceding the month of
such Distribution Date.
Prepayment In Full: With respect to any Mortgage Loan, a payment
consisting of a Principal Prepayment in the amount of the outstanding principal
balance of such loan and resulting in the full satisfaction of such obligation.
Prepayment Interest Shortfall: On any Distribution Date, the
amount of interest, if any, that would have accrued on any Mortgage Loan which
was the subject of a Prepayment in Full at the Net Mortgage Interest Rate for
such Mortgage Loan from the date of its Prepayment in Full, through the last day
of the month in which such Prepayment in Full occurred.
Principal Adjustment: In the event that the Class M Optimal
Principal Amount, Class B-1 Optimal Principal Amount, Class B-2 Optimal
Principal Amount, Class B-3 Optimal Principal Amount, Class B-4 Optimal
Principal Amount or Class B-5 Optimal Principal Amount is calculated in
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accordance with the proviso in such definition with respect to any Distribution
Date, the Principal Adjustment for the Class M Certificates or such Class B
Subclass shall equal the difference between (i) the amount that would have been
distributed to such Class or Subclass as principal in accordance with Section
4.01(a) for such Distribution Date, calculated without regard to such proviso
and assuming there are no Principal Adjustments for such Distribution Date and
(ii) the Adjusted Principal Balance for such Subclass.
Principal Prepayment: Any Mortgagor payment or other recovery of
principal on a Mortgage Loan which is received in advance of its Due Date and is
not accompanied by an amount representing scheduled interest for any period
subsequent to the date of prepayment, including, without limitation, all
proceeds received from any condemnation award or proceeds in lieu of
condemnation other than that portion of such proceeds released to the Mortgagor
in accordance with the terms of the Mortgage or Prudent Servicing Practices.
Prohibited Transaction Tax: Any tax imposed under Section 860F of
the Code.
Prudent Servicing Practices: The standard of care set forth in
each Servicing Agreement.
Rating Agency: Any nationally recognized statistical credit
rating agency, or its successor, that rated one or more Classes of the
Certificates at the request of the Seller at the time of the initial issuance of
the Certificates. The Rating Agencies for the Class A Certificates, Class AP
Certificates, the Class M Certificates, the Class B-1 Certificates and the Class
B-2 Certificates are DCR and S&P. The Rating Agency for the Class B-3 and Class
B-4 Certificates is S&P. If any such agency or a successor is no longer in
existence, "Rating Agency" shall be such statistical credit rating agency, or
other comparable Person, designated by the Seller, notice of which designation
shall be given to the Trustee, the Trust Administrator and the Master Servicer.
References herein to the highest short-term rating category of a Rating Agency
shall mean A-1+ in the case of DCR, A-1+ in the case of S&P and in the case of
any other Rating Agency shall mean its equivalent of such ratings. References
herein to the highest long-term rating categories of a Rating Agency shall mean
AAA and in the case of any other Rating Agency shall mean its equivalent of such
rating without any plus or minus.
Realized Losses: With respect to any Distribution Date, (i)
Liquidated Loan Losses (including Special Hazard Losses and Fraud Losses) and
(ii) Bankruptcy Losses incurred in the month preceding the month of such
Distribution Date.
Record Date: The last Business Day of the month preceding the
month of the related Distribution Date.
Relevant Anniversary: See "Bankruptcy Loss Amount."
REMIC: A "real estate mortgage investment conduit" as defined in
Code Section 860D.
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REMIC Provisions: Provisions of the federal income tax law
relating to REMICs, which appear at Sections 860A through 860G of Part IV of
Subchapter M of Chapter 1 of Subtitle A of the Code, and related provisions, and
U.S. Department of the Treasury temporary, proposed or final regulations
promulgated thereunder, as the foregoing are in effect (with respect to proposed
regulations, are proposed to be in effect) from time to time.
Remittance Date: The 18th day of each month or, if such day is
not a Business Day, the preceding Business Day.
REO Mortgage Loan: Any Mortgage Loan which is not a Liquidated
Loan and as to which the indebtedness evidenced by the related Mortgage Note is
discharged and the related Mortgaged Property is held as part of the Trust
Estate.
REO Proceeds: Proceeds received in respect of any REO Mortgage
Loan (including, without limitation, proceeds from the rental of the related
Mortgaged Property).
Request for Release: A request for release in substantially the
form attached as Exhibit G hereto.
Responsible Officer: When used with respect to the Trustee or the
Trust Administrator, the Chairman or Vice-Chairman of the Board of Directors or
Trustees, the Chairman or Vice-Chairman of the Executive or Standing Committee
of the Board of Directors or Trustees, the President, the Chairman of the
Committee on Trust Matters, any Vice President, the Secretary, any Assistant
Secretary, the Treasurer, any Assistant Treasurer, the Cashier, any Assistant
Cashier, any Trust Officer or Assistant Trust Officer, the Controller and any
Assistant Controller or any other officer of the Trustee or the Trust
Administrator, as the case may be, customarily performing functions similar to
those performed by any of the above-designated officers and also, with respect
to a particular matter, any other officer to whom such matter is referred
because of such officer's knowledge of and familiarity with the particular
subject.
Rule 144A: Rule 144A promulgated under the Securities Act of
1933, as amended.
S&P: Standard & Poor's, or its successor in interest.
Scheduled Principal Amount: The sum for each outstanding Mortgage
Loan (including each defaulted Mortgage Loan, other than a Liquidated Loan, with
respect to which the related Mortgaged Property has been acquired by the Trust
Estate) of the product of (A) the Classes A/M/B Fraction for such Mortgage Loan
and (B) the sum of the amounts described in clauses y(i) and y(vi) of the
definition of Class A Optimal Principal Amount, but without that amount being
multiplied by the Class A Percentage.
Scheduled Principal Balance: As to any Mortgage Loan and
Distribution Date, the principal balance of such Mortgage Loan as of the Due
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Date in the month preceding the month of such Distribution Date as specified in
the amortization schedule at the time relating thereto (before any adjustment to
such amortization schedule by reason of any bankruptcy (other than Deficient
Valuations) or similar proceeding or any moratorium or similar waiver or grace
period) after giving effect to (A) Principal Prepayments received prior to such
Due Date, (B) Deficient Valuations incurred prior to such Due Date, (C) with
respect to an Exhibit F-1 Mortgage Loan, any Curtailments and Net Partial
Liquidation Proceeds applied by the Servicer in reduction of the unpaid
principal balance of such Mortgage Loan as of such Due Date, (D) the payment of
principal due on such Due Date and irrespective of any delinquency in payment by
the related Mortgagor and (E), with respect to an Exhibit F-1 Mortgage Loan, any
Principal Prepayments in Full received prior to the Determination Date in the
month of such Due Date. Accordingly, the Scheduled Principal Balance of a
Mortgage Loan which becomes a Liquidated Loan prior to such Due Date shall be
zero.
Seller: The Prudential Home Mortgage Securities Company, Inc., or
its successor in interest.
Senior Optimal Amount: As to any Distribution Date, the sum for
such Distribution Date of (a) the Class A Optimal Amount and (b) the Class AP
Optimal Principal Amount.
Servicer Mortgage Loan File: As defined in each of the Servicing
Agreements.
Servicers: Each of PHMC, Bank of Hawaii, Barnett Mortgage
Company, Countrywide Funding Corporation, FBS Mortgage Corporation, First Town
Mortgage Corporation and National City Mortgage Company, as Servicer under the
related Servicing Agreement.
Servicing Agreements: Each of the Servicing Agreements executed
with respect to a portion of the Mortgage Loans by one of the Servicers, which
agreements are attached hereto, collectively, as Exhibit L.
Servicing Fee: With respect to any Servicer, as defined in its
Servicing Agreement.
Servicing Fee Rate: With respect to a Mortgage Loan, as set forth
on Exhibits F-1 or F-2.
Servicing Officer: Any officer of a Servicer involved in, or
responsible for, the administration and servicing of the Mortgage Loans.
Similar Law: As defined in Section 5.02(e).
Single Certificate: A Certificate of any Class or Subclass that
evidences the smallest permissible Denomination for such Class or Subclass, as
set forth in Section 11.27.
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Special Hazard Loss: (i) A Liquidated Loan Loss suffered by a
Mortgaged Property on account of direct physical loss, exclusive of (a) any loss
covered by a hazard policy or a flood insurance policy maintained in respect of
such Mortgaged Property pursuant to a Servicing Agreement and (b) any loss
caused by or resulting from:
(1) normal wear and tear;
(2) infidelity, conversion or other dishonest act on the part of
the Trustee or the Trust Administrator, the Servicer or any of their agents or
employees; or
(3) errors in design, faulty workmanship or faulty materials,
unless the collapse of the property or a part thereof ensues;
or (ii) any Liquidated Loan Loss suffered by the Trust Estate
arising from or related to the presence or suspected presence of hazardous
wastes or hazardous substances on a Mortgaged Property unless such loss to a
Mortgaged Property is covered by a hazard policy or a flood insurance policy
maintained in respect of such Mortgaged Property pursuant to a Servicing
Agreement.
Special Hazard Loss Amount: As of any Distribution Date, an
amount equal to $1,987,480.00 minus the sum of (i) the aggregate amount of
Special Hazard Losses allocated solely to the Class B Certificates in accordance
with Section 4.02(a) and (ii) the Special Hazard Adjustment Amount (as defined
below) as most recently calculated. For each anniversary of the Cut-Off Date,
the Special Hazard Adjustment Amount shall be calculated and shall be equal to
the amount, if any, by which the amount calculated in accordance with the
preceding sentence (without giving effect to the deduction of the Special Hazard
Adjustment Amount for such anniversary) exceeds the greater of (A) the product
of the Special Hazard Percentage for such anniversary multiplied by the
outstanding principal balance of all the Mortgage Loans on the Distribution Date
immediately preceding such anniversary, (B) twice the outstanding principal
balance of the Mortgage Loan in the Trust Estate which has the largest
outstanding principal balance on the Distribution Date immediately preceding
such anniversary and (C) that which is necessary to maintain the original
ratings on the Certificates, other than the Class B-5 Certificates, as evidenced
by letters to that effect delivered by Rating Agencies to the Master Servicer
and the Trust Administrator. On and or after the Cross-Over Date, the Special
Hazard Loss Amount shall be zero.
Special Hazard Percentage: As of each anniversary of the Cut-Off
Date, the greater of (i) 1.00% and (ii) the largest percentage obtained by
dividing the aggregate outstanding principal balance (as of the immediately
preceding Distribution Date) of the Mortgage Loans secured by Mortgaged
Properties located in a single, five-digit zip code area in the State of
California by the outstanding principal balance of all the Mortgage Loans as of
the immediately preceding Distribution Date.
Startup Day: As defined in Section 2.05.
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Subclass: Each subdivision of the Class A Certificates,
denominated respectively as Class A-1, Class A-2, Class A-3, Class A-4, Class
A-5 and Class A-R and each subdivision of the Class B Certificates, denominated
respectively as Class B-1, Class B-2, Class B-3, Class B-4 and Class B-5.
Subordinated Percentage: As to any Distribution Date, the
percentage which is the difference between 100% and the Class A Percentage for
such date.
Subordinated Prepayment Percentage: As to any Distribution Date,
the percentage which is the difference between 100% and the Class A Prepayment
Percentage for such date.
Subsidy Loan: Any Mortgage Loan subject to a temporary interest
subsidy agreement pursuant to which the monthly interest payments made by the
related Mortgagor will be less than the scheduled monthly interest payments on
such Mortgage Loan, with the resulting difference in interest payments being
provided by the employer of the Mortgagor. Each Subsidy Loan will be identified
as such in the Mortgage Loan Schedule.
Substitution Principal Amount: With respect to any Mortgage Loan
substituted in accordance with Section 2.02 or pursuant to Section 2.03, the
excess of (x) the unpaid principal balance of the Mortgage Loan which is
substituted for over (y) the unpaid principal balance of the substitute Mortgage
Loan, each balance being determined as of the date of substitution.
Trust Administrator: First Bank National Association, a national
banking association, or any successor trust administrator appointed as herein
provided.
Trust Estate: The corpus of the trust created by this Agreement,
consisting of the Mortgage Loans, other than any Fixed Retained Yield, such
amounts as may be held from time to time in the Master Servicer Custodial
Account, other than any Fixed Retained Yield and the rights of the Trust
Administrator, on behalf of the Trustee, to receive the proceeds of all
insurance policies and performance bonds, if any, required to be maintained
hereunder or under the related Servicing Agreement, property which secured a
Mortgage Loan and which has been acquired by foreclosure or deed in lieu of
foreclosure.
Trustee: Firstar Trust Company, or any successor trustee
appointed as herein provided.
Unscheduled Principal Amount: The sum for each outstanding
Mortgage Loan (including each defaulted Mortgage Loan, other than a Liquidated
Loan, with respect to which the related Mortgaged Property has been acquired by
the Trust Estate) of the product of (A) the Classes A/M/B Fraction for such
Mortgage Loan and (B) the sum of the amounts described in clauses y(ii), y(iii),
y(iv) and y(v) of the definition of Class A Optimal Principal Amount, but
without that amount being multiplied by the Class A Prepayment Percentage.
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Voting Interest: With respect to any provisions hereof providing
for the action, consent or approval of the Holders of all Certificates
evidencing specified Voting Interests in the Trust Estate, (a) the Holders of
the Class A Certificates will collectively be entitled to the Class A Voting
Interest, (b) the Holders of the Class AP Certificates will collectively be
entitled to a percentage of the aggregate Voting Interest represented by all
Certificates equal to the percentage obtained by dividing the Pool Balance
(Class AP Portion) by the sum of the Pool Balance (Classes A/M/B Portion) and
the Pool Balance (Class AP Portion), (c) the Holders of the Class M Certificates
will collectively be entitled to the then applicable percentage of the aggregate
Voting Interest represented by all Certificates equal to the product of (i) the
ratio obtained by dividing the Class M Principal Balance by the sum of the Class
A Principal Balance, the Class M Principal Balance and the Class B Principal
Balance and (ii) the Classes A/M/B Voting Interest and (d) the Holders of the
Class B Certificates will collectively be entitled to the balance of the
aggregate Voting Interest represented by all Series 1996-3 Certificates. The
aggregate Voting Interests of each Subclass of Class A Certificates on any date
will be equal to the product of (a) the Class A Voting Interest on such date and
(b) the fraction obtained by dividing the Class A Subclass Principal Balance of
such Subclass on such date by the Class A Principal Balance on such date. The
aggregate Voting Interests of each Subclass of Class B Certificates will equal
such Subclass' pro rata portion of the Voting Interest allocated to the Class B
Certificates based on such Subclass' outstanding principal balance. Each
Certificateholder of a Class or Subclass will have a Voting Interest equal to
the product of the Voting Interest to which such Class or Subclass is
collectively entitled and the Percentage Interest in such Class or Subclass
represented by such Holder's Certificates. With respect to any provisions hereof
providing for action, consent or approval of each Class or Subclass of
Certificates or specified Classes or Subclasses of Certificates, each
Certificateholder of a Class or Subclass will have a Voting Interest in such
Class or Subclass equal to such Holder's Percentage Interest in such Class or
Subclass.
Weighted Average Net Mortgage Interest Rate: As to any
Distribution Date, a rate per annum equal to the average, expressed as a
percentage of the Net Mortgage Interest Rates of all Mortgage Loans that were
Outstanding Mortgage Loans as of the Due Date in the month preceding the month
of such Distribution Date, weighted on the basis of the respective Scheduled
Principal Balances of such Mortgage Loans.
Section 1.02. Acts of Holders.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Agreement to be given or taken
by Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent duly
appointed in writing. Except as herein otherwise expressly provided, such action
shall become effective when such instrument or instruments are delivered to the
Trustee and the Trust Administrator. Proof of execution of any such instrument
or of a writing appointing any such agent shall be sufficient for any purpose of
this Agreement and conclusive in favor of the Trustee and the Trust
Administrator, if made in the manner provided in this Section 1.02. The Trustee
shall promptly notify the Master Servicer in writing of the receipt of any such
instrument or writing.
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(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. When such
execution is by a signer acting in a capacity other than his or her individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his or her authority. The fact and date of the execution of any such
instrument or writing, or the authority of the individual executing the same,
may also be proved in any other manner which the Trustee deems sufficient.
(c) The ownership of Certificates (whether or not such
Certificates shall be overdue and notwithstanding any notation of ownership or
other writing thereon made by anyone other than the Trustee, Trust Administrator
and the Authenticating Agent) shall be proved by the Certificate Register, and
neither the Trustee, the Trust Administrator, the Seller nor the Master Servicer
shall be affected by any notice to the contrary.
(d) Any request, demand, authorization, direction, notice,
consent, waiver or other action of the Holder of any Certificate shall bind
every future Holder of the same Certificate and the Holder of every Certificate
issued upon the registration of transfer thereof or in exchange therefor or in
lieu thereof in respect of anything done, omitted or suffered to be done by the
Trustee, the Trust Administrator, the Seller or the Master Servicer in reliance
thereon, whether or not notation of such action is made upon such Certificate.
Section 1.03. Effect of Headings and Table of Contents. The
Article and Section headings in this Agreement and the Table of Contents are for
convenience of reference only and shall not affect the interpretation or
construction of this Agreement.
Section 1.04. Benefits of Agreement. Nothing in this Agreement or
in the Certificates, express or implied, shall give to any Person, other than
the parties to this Agreement and their successors hereunder, the Holders of the
Certificates, any benefit or any legal or equitable right, power, remedy or
claim under this Agreement.
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ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF THE CERTIFICATES
Section 2.01. Conveyance of Mortgage Loans. The Seller,
concurrently with the execution and delivery hereof, does hereby assign to the
Trust Administrator, on behalf of the Trustee, without recourse all the right,
title and interest of the Seller in and to (a) the Trust Estate, including all
interest (other than the portion, if any, representing the Fixed Retained Yield)
and principal received by the Seller on or with respect to the Mortgage Loans
after the Cut-Off Date (and including scheduled payments of principal and
interest due after the Cut-Off Date but received by the Seller on or before the
Cut-Off Date and Principal Prepayments received or applied on the Cut-Off Date,
but not including payments of principal and interest due on the Mortgage Loans
on or before the Cut-Off Date), (b) the Insurance Policies, (c) the obligations
of the Servicers under the Servicing Agreements with respect to the Mortgage
Loans and (d) proceeds of all the foregoing.
In connection with such assignment, the Seller shall, with
respect to each Mortgage Loan, deliver, or cause to be delivered, to the Trust
Administrator, as initial custodian, on or before the Closing Date, an Owner
Mortgage Loan File. If any lease, Mortgage, assignment of a Mortgage to the
Trust Administrator or any prior assignment is in the process of being recorded
on the Closing Date, the Seller shall deliver a copy thereof, certified by PHMC
or the applicable PHMC Loan Seller to be a true and complete copy of the
document sent for recording, and the Seller shall use its best efforts to cause
each such original recorded document or certified copy thereof to be delivered
to the Trust Administrator promptly following its recordation. The Seller shall
also cause to be delivered to the Trust Administrator any other original
mortgage loan document to be included in the Owner Mortgage Loan File if a copy
thereof has been delivered.
In lieu of recording an assignment of any Mortgage the Seller
may, to the extent set forth in any Servicing Agreement, deliver or cause to be
delivered to the Trust Administrator the assignment of the Mortgage Loan from
the Seller to the Trust Administrator in a form suitable for recordation,
together with an Opinion of Counsel (of which S&P will be an addressee or with
respect to which S&P shall be delivered a reliance letter) to the effect that
recording is not required to protect the Trustee's right, title and interest in
and to the related Mortgage Loan or, in case a court should recharacterize the
sale of the Mortgage Loans as a financing, to perfect a first priority security
interest in favor of the Trustee in the related Mortgage Loan. In the event that
the Master Servicer receives notice that recording is required to protect the
right, title and interest of the Trustee in and to any such Mortgage Loan for
which recordation of an assignment has not previously been required, the Master
Servicer shall promptly notify the Trust Administrator and the Trust
Administrator shall within five Business Days (or such other reasonable period
of time mutually agreed upon by the Master Servicer and the Trust Administrator)
of its receipt of such notice
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deliver each previously unrecorded assignment to the related Servicer for
recordation.
Section 2.02. Acceptance by Trust Administrator. The Trust
Administrator acknowledges receipt of the Mortgage Notes, the Mortgages, the
assignments and other documents referred to in Section 2.01 above and declares
that it holds and will hold such documents and the other documents constituting
a part of the Owner Mortgage Loan Files delivered to it in trust, upon the
trusts herein set forth, for the use and benefit of all present and future
Certificateholders. The Trust Administrator agrees, for the benefit of
Certificateholders, to review each Owner Mortgage Loan File within 45 days after
execution of this Agreement in order to ascertain that all required documents
set forth in Section 2.01 have been executed and received and appear regular on
their face, and that such documents relate to the Mortgage Loans identified in
the Mortgage Loan Schedule, and in so doing the Trust Administrator may rely on
the purported due execution and genuineness of any such document and on the
purported genuineness of any signature thereon. If within such 45 day period the
Trust Administrator finds any document constituting a part of an Owner Mortgage
Loan File not to have been executed or received or to be unrelated to the
Mortgage Loans identified in the Mortgage Loan Schedule or not to appear regular
on its face, the Trust Administrator shall promptly notify the Seller, which
shall have a period of 60 days after such notice within which to correct or cure
any such defect. The Seller hereby covenants and agrees that, if any material
defect is not so corrected or cured, the Seller will, not later than 60 days
after the Trust Administrator's notice to it referred to above respecting such
defect, either (i) repurchase the related Mortgage Loan or any property acquired
in respect thereof from the Trustee at a price equal to (a) 100% of the unpaid
principal balance of such Mortgage Loan plus (b) accrued interest at the
Mortgage Interest Rate less any Fixed Retained Yield of such Mortgage Loan
through the last day of the month in which such repurchase takes place or (ii)
if within two years of the Startup Day, or such other period permitted by the
REMIC Provisions, substitute for any Mortgage Loan to which such material defect
relates, a new mortgage loan (a "substitute Mortgage Loan") having such
characteristics so that the representations and warranties of the Seller set
forth in Section 2.03(b) hereof (other than Section 2.03(b)(i)) would not have
been incorrect had such substitute Mortgage Loan originally been a Mortgage
Loan. In no event shall any substitute Mortgage Loan have an unpaid principal
balance, as of the date of substitution, greater than the Scheduled Principal
Balance (reduced by the scheduled payment of principal due on the Due Date in
the month of substitution) of the Mortgage Loan for which it is substituted. In
addition, such substitute Mortgage Loan shall have a Loan-to-Value Ratio less
than or equal to and a Mortgage Interest Rate equal to that of the Mortgage Loan
for which it is substituted.
In the case of a repurchased Mortgage Loan or property, the
purchase price shall be deposited by the Seller in the Master Servicer Custodial
Account maintained by the Master Servicer pursuant to Section 3.02. In the case
of a substitute Mortgage Loan, the Owner Mortgage Loan File relating thereto
shall be delivered to the Trust Administrator and the Substitution Principal
Amount, together with (i) interest on such Substitution Principal Amount at the
applicable Net Mortgage Interest Rate to the following Due Date of such Mortgage
Loan which is being substituted for and (ii) an amount equal to the aggregate
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amount of unreimbursed Periodic Advances in respect of interest previously made
by the Servicer, Master Servicer or Trust Administrator with respect to such
Mortgage Loan, shall be deposited in the Master Servicer Custodial Account. The
Monthly Payment on the substitute Mortgage Loan for the Due Date in the month of
substitution shall not be part of the Trust Estate. Upon receipt by the Trust
Administrator of written notification of any such deposit signed by an officer
of the Seller, or the new Owner Mortgage Loan File, as the case may be, the
Trust Administrator shall release to the Seller the related Owner Mortgage Loan
File and shall execute and deliver such instrument of transfer or assignment, in
each case without recourse, as shall be necessary to vest in the Seller legal
and beneficial ownership of such substituted or repurchased Mortgage Loan or
property. It is understood and agreed that the obligation of the Seller to
substitute a new Mortgage Loan for or repurchase any Mortgage Loan or property
as to which such a material defect in a constituent document exists shall
constitute the sole remedy respecting such defect available to the
Certificateholders, the Trust Administrator on behalf of the Trustee or the
Trustee on behalf of the Certificateholders. The failure of the Trust
Administrator to give any notice contemplated herein within forty-five (45) days
after the execution of this Agreement shall not affect or relieve the Seller's
obligation to repurchase any Mortgage Loan pursuant to this Section 2.02.
The Trust Administrator may, concurrently with the execution and
delivery hereof or at any time thereafter, enter into a Custodial Agreement
substantially in the form of Exhibit E hereto pursuant to which the Trust
Administrator appoints a Custodian to hold the Mortgage Notes, the Mortgages,
the assignments and other documents related to the Mortgage Loans received by
the Trust Administrator, as agent for the Trust Administrator, in trust for the
benefit of all present and future Certificateholders, which may provide, among
other things, that the Custodian shall conduct the review of such documents
required under the first paragraph of this Section 2.02.
Section 2.03. Representations and Warranties of the Master
Servicer and the Seller. (a) The Master Servicer hereby represents and warrants
to the Trustee and the Trust Administrator for the benefit of Certificateholders
that, as of the date of execution of this Agreement:
(i) The Master Servicer is a corporation duly formed and validly
existing under the laws of the State of New Jersey;
(ii) The execution and delivery of this Agreement by the Master
Servicer and its performance and compliance with the terms of this Agreement
will not violate the Master Servicer's corporate charter or by-laws or
constitute a default (or an event which, with notice or lapse of time, or both,
would constitute a default) under, or result in the breach of, any material
contract, agreement or other instrument to which the Master Servicer is a party
or which may be applicable to the Servicer or any of its assets;
(iii) This Agreement, assuming due authorization, execution and
delivery by the Trustee, the Trust Administrator and the Seller, constitutes a
valid, legal and binding obligation of the Master Servicer, enforceable against
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it in accordance with the terms hereof subject to applicable bankruptcy,
insolvency, reorganization, moratorium and other laws affecting the enforcement
of creditors' rights generally and to general principles of equity, regardless
of whether such enforcement is considered in a proceeding in equity or at law;
(iv) The Master Servicer is not in default with respect to any
order or decree of any court or any order, regulation or demand of any federal,
state, municipal or governmental agency, which default might have consequences
that would materially and adversely affect the condition (financial or other) or
operations of the Master Servicer or its properties or might have consequences
that would affect its performance hereunder; and
(v) No litigation is pending or, to the best of the Master
Servicer's knowledge, threatened against the Master Servicer which would
prohibit its entering into this Agreement or performing its obligations under
this Agreement.
It is understood and agreed that the representations and
warranties set forth in this Section 2.03(a) shall survive delivery of the
respective Owner Mortgage Loan Files to the Trust Administrator or the
Custodian.
(b) The Seller hereby represents and warrants to the Trustee and
the Trust Administrator for the benefit of Certificateholders that, as of the
date of execution of this Agreement, with respect to the Mortgage Loans, or each
Mortgage Loan, as the case may be:
(i) The information set forth in the Mortgage Loan Schedule was
true and correct in all material respects at the date or dates
respecting which such information is furnished as specified in the
Mortgage Loan Schedule;
(ii) Immediately prior to the transfer and assignment contemplated
herein, the Seller was the sole owner and holder of the Mortgage Loan
free and clear of any and all liens, pledges, charges or security
interests of any nature and has full right and authority to sell and
assign the same;
(iii) The Mortgage is a valid, subsisting and enforceable first
lien on the property therein described, and the Mortgaged Property is
free and clear of all encumbrances and liens having priority over the
first lien of the Mortgage except for liens for real estate taxes and
special assessments not yet due and payable and liens or interests
arising under or as a result of any federal, state or local law,
regulation or ordinance relating to hazardous wastes or hazardous
substances, and, if the related Mortgaged Property is a condominium
unit, any lien for common charges permitted by statute or homeowners
association fees; and if the Mortgaged Property consists of shares of a
cooperative housing corporation, any lien for amounts due to the
cooperative housing corporation for unpaid assessments or charges or any
lien of any assignment of rents or maintenance expenses secured by the
real property owned by the cooperative housing corporation; and any
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security agreement, chattel mortgage or equivalent document related to,
and delivered to the Trust Administrator or to the Custodian with, any
Mortgage establishes in the Seller a valid and subsisting first lien on
the property described therein and the Seller has full right to sell and
assign the same to the Trust Administrator on behalf of the Trustee;
(iv) Neither the Seller nor any prior holder of the Mortgage or
the related Mortgage Note has modified the Mortgage or the related
Mortgage Note in any material respect, satisfied, canceled or
subordinated the Mortgage in whole or in part, released the Mortgaged
Property in whole or in part from the lien of the Mortgage, or executed
any instrument of release, cancellation, modification or satisfaction,
except in each case as is reflected in an agreement delivered to the
Trust Administrator or the Custodian pursuant to Section 2.01;
(v) All taxes, governmental assessments, insurance premiums, and
water, sewer and municipal charges, which previously became due and
owing have been paid, or an escrow of funds has been established, to the
extent permitted by law, in an amount sufficient to pay for every such
item which remains unpaid; and the Seller has not advanced funds, or
received any advance of funds by a party other than the Mortgagor,
directly or indirectly (except pursuant to any Subsidy Loan arrangement)
for the payment of any amount required by the Mortgage, except for
interest accruing from the date of the Mortgage Note or date of
disbursement of the Mortgage Loan proceeds, whichever is later, to the
day which precedes by thirty days the first Due Date under the related
Mortgage Note;
(vi) The Mortgaged Property is undamaged by water, fire,
earthquake, earth movement other than earthquake, windstorm, flood,
tornado or similar casualty (excluding casualty from the presence of
hazardous wastes or hazardous substances, as to which the Seller makes
no representations), so as to affect adversely the value of the
Mortgaged Property as security for the Mortgage Loan or the use for
which the premises were intended and to the best of the Seller's
knowledge, there is no proceeding pending or threatened for the total or
partial condemnation of the Mortgaged Property;
(vii) The Mortgaged Property is free and clear of all mechanics'
and materialmen's liens or liens in the nature thereof; provided,
however, that this warranty shall be deemed not to have been made at the
time of the initial issuance of the Certificates if a title policy
affording, in substance, the same protection afforded by this warranty
is furnished to the Trust Administrator by the Seller;
(viii) Except for Mortgage Loans secured by Co-op Shares and
Mortgage Loans secured by residential long-term leases, the Mortgaged
Property consists of a fee simple estate in real property; all of the
improvements which are included for the purpose of determining the
appraised value of the Mortgaged Property lie wholly within the
boundaries and building restriction lines of such property and no
improvements on adjoining properties encroach upon the Mortgaged
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Property (unless insured against under the related title insurance
policy); and to the best of the Seller's knowledge, the Mortgaged
Property and all improvements thereon comply with all requirements of
any applicable zoning and subdivision laws and ordinances;
(ix) with respect to a Mortgage Loan that is secured by a
long-term residential lease, (A) the terms of such lease expressly
permit the mortgaging of the leasehold estate, the assignment of the
lease without the lessor's consent and the acquisition by the holder of
the Mortgage of the rights of the lessee upon foreclosure or assignment
in lieu of foreclosure or provide the holder of the Mortgage with
substantially similar protections; (B) the terms of such lease do not
(i) allow the termination thereof upon the lessee's default without the
holder of the Mortgage being entitled to receive written notice of, and
opportunity to cure, such default, (ii) allow the termination of the
lease in the event of damage or destruction as long as the Mortgage is
in existence or (iii) prohibit the holder of the Mortgage from being
insured under the hazard insurance policy or policies relating to the
related premises; (C) the original term of such lease is not less than
15 years; (D) the term of such lease does not terminate earlier than
five years after the maturity date of the Mortgage Note; and (E) such
Mortgage Loan was originated, and the leased premises are located, in
the State of Hawaii;
(x) The Mortgage Loan meets, or is exempt from, applicable state
or federal laws, regulations and other requirements, pertaining to
usury, and the Mortgage Loan is not usurious;
(xi) To the best of the Seller's knowledge, all inspections,
licenses and certificates required to be made or issued with respect to
all occupied portions of the Mortgaged Property and, with respect to the
use and occupancy of the same, including, but not limited to,
certificates of occupancy and fire underwriting certificates, have been
made or obtained from the appropriate authorities;
(xii) All payments required to be made up to the Due Date
immediately preceding the Cut-Off Date for such Mortgage Loan under the
terms of the related Mortgage Note have been made;
(xiii) The Mortgage Note, the related Mortgage and other agreements
executed in connection therewith are genuine, and each is the legal,
valid and binding obligation of the maker thereof, enforceable 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 generally and by general equity
principles (regardless of whether such enforcement is considered in a
proceeding in equity or at law); and, to the best of the Seller's
knowledge, all parties to the Mortgage Note and the Mortgage had legal
capacity to execute the Mortgage Note and the Mortgage and each Mortgage
Note and Mortgage has been duly and properly executed by the Mortgagor;
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(xiv) Any and all requirements of any federal, state or local law
with respect to the origination of the Mortgage Loans including, without
limitation, truth-in-lending, real estate settlement procedures,
consumer credit protection, equal credit opportunity or disclosure laws
applicable to the Mortgage Loans have been complied with;
(xv) The proceeds of the Mortgage Loans have been fully disbursed,
there is no requirement for future advances thereunder and any and all
requirements as to completion of any on-site or off-site improvements
and as to disbursements of any escrow funds therefor have been complied
with (except for escrow funds for exterior items which could not be
completed due to weather); and all costs, fees and expenses incurred in
making, closing or recording the Mortgage Loan have been paid, except
recording fees with respect to Mortgages not recorded as of the Closing
Date;
(xvi) The Mortgage Loan (except any Mortgage Loan secured by
Mortgaged Property located in Iowa, as to which an opinion of counsel of
the type customarily rendered in such State in lieu of title insurance
is instead received) is covered by an American Land Title Association
mortgagee title insurance policy or other generally acceptable form of
policy or insurance acceptable to FNMA or FHLMC, issued by a title
insurer acceptable to FNMA or FHLMC insuring the originator, its
successors and assigns, as to the first priority lien of the Mortgage in
the original principal amount of the Mortgage Loan and subject only to
(A) the lien of current real property taxes and assessments not yet due
and payable, (B) covenants, conditions and restrictions, rights of way,
easements and other matters of public record as of the date of recording
of such Mortgage acceptable to mortgage lending institutions in the area
in which the Mortgaged Property is located or specifically referred to
in the appraisal performed in connection with the origination of the
related Mortgage Loan, (C) liens created pursuant to any federal, state
or local law, regulation or ordinance affording liens for the costs of
clean-up of hazardous substances or hazardous wastes or for other
environmental protection purposes and (D) such other matters to which
like properties are commonly subject which do not individually, or in
the aggregate, materially interfere with the benefits of the security
intended to be provided by the Mortgage; the Seller is the sole insured
of such mortgagee title insurance policy, the assignment to the Trust
Administrator of the Seller's interest in such mortgagee title insurance
policy does not require any consent of or notification to the insurer
which has not been obtained or made, such mortgagee title insurance
policy is in full force and effect and will be in full force and effect
and inure to the benefit of the Trust Administrator on behalf of the
Trustee, no claims have been made under such mortgagee title insurance
policy, and no prior holder of the related Mortgage, including the
Seller, has done, by act or omission, anything which would impair the
coverage of such mortgagee title insurance policy;
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(xvii) The Mortgaged Property securing each Mortgage Loan is insured
by an insurer acceptable to FNMA or FHLMC against loss by fire and such
hazards as are covered under a standard extended coverage endorsement,
in an amount which is not less than the lesser of 100% of the insurable
value of the Mortgaged Property and the outstanding principal balance of
the Mortgage Loan, but in no event less than the minimum amount
necessary to fully compensate for any damage or loss on a replacement
cost basis; if the Mortgaged Property is a condominium unit, it is
included under the coverage afforded by a blanket policy for the
project; if upon origination of the Mortgage Loan, the improvements on
the Mortgaged Property were in an area identified in the Federal
Register by the Federal Emergency Management Agency as having special
flood hazards, a flood insurance policy meeting the requirements of the
current guidelines of the Federal Insurance Administration is in effect
with a generally acceptable insurance carrier, in an amount representing
coverage not less than the least of (A) the outstanding principal
balance of the Mortgage Loan, (B) the full insurable value and (C) the
maximum amount of insurance which was available under the Flood Disaster
Protection Act of 1973; and each Mortgage obligates the Mortgagor
thereunder to maintain all such insurance at the Mortgagor's cost and
expense;
(xviii) To the best of the Seller's knowledge, there is no default,
breach, violation or event of acceleration existing under the Mortgage
or the related Mortgage Note and no event which, with the passage of
time or with notice and the expiration of any grace or cure period,
would constitute a default, breach, violation or event of acceleration;
the Seller has not waived any default, breach, violation or event of
acceleration; and no foreclosure action is currently threatened or has
been commenced with respect to the Mortgage Loan;
(xix) No Mortgage Note or Mortgage is subject to any right of
rescission, set-off, counterclaim or defense, including the defense of
usury, nor will the operation of any of the terms of the Mortgage Note
or Mortgage, or the exercise of any right thereunder, render the
Mortgage Note or Mortgage unenforceable, in whole or in part, or subject
it to any right of rescission, set-off, counterclaim or defense,
including the defense of usury, and no such right of rescission,
set-off, counterclaim or defense has been asserted with respect thereto;
(xx) Each Mortgage Note is payable in monthly payments, resulting
in complete amortization of the Mortgage Loan over a term of not more
than 360 months;
(xxi) Each Mortgage contains customary and enforceable provisions
such as to render the rights and remedies of the holder thereof adequate
for the realization against the Mortgaged Property of the benefits of
the security, including realization by judicial foreclosure (subject to
any limitation arising from any bankruptcy, insolvency or other law for
the relief of debtors), and there is no homestead or other exemption
available to the Mortgagor which would interfere with such right of
foreclosure;
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(xxii) To the best of the Seller's knowledge, no Mortgagor is a
debtor in any state or federal bankruptcy or insolvency proceeding;
(xxiii) Each Mortgaged Property is located in the United States and
consists of a one- to four-unit residential property, which may include
a detached home, townhouse, condominium unit or a unit in a planned unit
development or, in the case of Mortgage Loans secured by Co-op Shares,
leases or occupancy agreements;
(xxiv) No payment required under any Mortgage Loan is more than 30
days past due and no Mortgage Loan had more than one delinquency in the
preceding 13 months; and
(xxv) The Mortgage Loan is a "qualified mortgage" within the
meaning of Section 860G of the Code.
Notwithstanding the foregoing, no representations or warranties
are made by the Seller as to the absence or effect of hazardous wastes or
hazardous substances on any of the Mortgaged Properties or on the lien of any
Mortgage. In addition, no representations or warranties are made by the Seller
with respect to the absence or effect of fraud in the origination of any
Mortgage Loan.
It is understood and agreed that the representations and
warranties set forth in this Section 2.03(b) shall survive delivery of the
respective Owner Mortgage Loan Files to the Trust Administrator and shall inure
to the benefit of the Trust Administrator on behalf of the Trustee
notwithstanding any restrictive or qualified endorsement or assignment.
(c) Upon discovery by either the Seller, the Master Servicer, the
Trustee, the Trust Administrator or the Custodian that any of the
representations and warranties made in subsection (b) above is not accurate
(referred to herein as a "breach") and that such breach materially and adversely
affects the interests of the Certificateholders in the related Mortgage Loan,
the party discovering such breach shall give prompt written notice to the other
parties (any Custodian being so obligated under a Custodial Agreement). Within
60 days of its discovery or its receipt of notice of any such breach, the Seller
shall cure such breach in all material respects or shall either (i) repurchase
the Mortgage Loan or any property acquired in respect thereof from the Trust
Administrator at a price equal to (A) 100% of the unpaid principal balance of
such Mortgage Loan plus (B) accrued interest at the Net Mortgage Interest Rate
for such Mortgage Loan through the last day of the month in which such
repurchase took place or (ii) if within two years of the Startup Day, or such
other period permitted by the REMIC Provisions, substitute for such Mortgage
Loan in the manner described in Section 2.02. The purchase price of any
repurchase described in this paragraph and the Substitution Principal Amount, if
any, plus accrued interest thereon and the other amounts referred to in Section
2.02, shall be deposited in the Master Servicer Custodial Account. It is
understood and agreed that the obligation of the Seller to repurchase or
substitute for any Mortgage Loan or property as to which such a breach has
occurred and is continuing shall constitute the sole remedy respecting such
breach available to Certificateholders, the Trust Administrator on behalf of the
Trustee or the Trustee on behalf of Certificateholders, and such obligation
shall survive until termination of the Trust Estate hereunder.
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Section 2.04. Execution and Delivery of Certificates. The Trust
Administrator acknowledges the assignment to it of the Mortgage Loans and the
delivery of the Owner Mortgage Loan Files to it, and, concurrently with such
delivery, has executed and delivered to or upon the order of the Seller, in
exchange for the Mortgage Loans together with all other assets included in the
definition of "Trust Estate," receipt of which is hereby acknowledged,
Certificates in authorized denominations which evidence ownership of the entire
Trust Estate.
Section 2.05. Designation of Certificates; Designation of Startup
Day and Latest Possible Maturity Date. The Seller hereby designates the
Subclasses of Class A Certificates (other than the Class A-R Certificate), the
Class AP Certificates, the Class M Certificates and the Subclasses of Class B
Certificates as classes of "regular interests" and the Class A-R Certificate as
the single class of "residual interest" in the REMIC for the purposes of Code
Sections 860G(a)(1) and 860G(a)(2), respectively. The Closing Date is hereby
designated as the "Startup Day" of the REMIC within the meaning of Code Section
860G(a)(9). The "latest possible maturity date" of the regular interests in the
REMIC is March 25, 2011 for purposes of Code Section 860G(a)(1).
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ARTICLE III
ADMINISTRATION OF THE TRUST ESTATE; SERVICING
OF THE MORTGAGE LOANS
Section 3.01. Master Servicer Custodial Account. (a) The Master
Servicer shall establish and maintain a Master Servicer Custodial Account for
the deposit of funds received by the Master Servicer with respect to the
Mortgage Loans serviced by each Servicer pursuant to each of the Servicing
Agreements. Such account shall be maintained as an Eligible Account. The Master
Servicer shall give notice to each Servicer and the Seller of the location of
the Master Servicer Custodial Account and of any change in the location thereof.
(b) The Master Servicer shall deposit into the Master Servicer
Custodial Account on the day of receipt thereof all amounts received by it from
any Servicer pursuant to any of the Servicing Agreements, and shall, in
addition, deposit into the Master Servicer Custodial Account the following
amounts, in the case of amounts specified in clause (i), not later than the
Distribution Date on which such amounts are required to be distributed to
Certificateholders and, in the case of the amounts specified in clause (ii), not
later than the Business Day next following the day of receipt and posting by the
Master Servicer:
(i) Periodic Advances pursuant to Section 3.03(a) made by the
Master Servicer or the Trust Administrator, if any; and
(ii) in the case of any Mortgage Loan that is repurchased by the
Seller pursuant to Section 2.02 or 2.03 or that is auctioned by the Master
Servicer pursuant to Section 3.08 or purchased by the Master Servicer pursuant
to Section 3.08 or 9.01, the purchase price therefor or, where applicable, any
Substitution Principal Amount and any amounts received in respect of the
interest portion of unreimbursed Periodic Advances.
(c) The Master Servicer shall cause the funds in the Master
Servicer Custodial Account to be invested in Eligible Investments. No such
Eligible Investments will be sold or disposed of at a gain prior to maturity
unless the Master Servicer has received an Opinion of Counsel or other evidence
satisfactory to it that such sale or disposition will not cause the Trust Estate
to be subject to Prohibited Transactions Tax, otherwise subject the Trust Estate
to tax, or cause the Trust Estate to fail to qualify as a REMIC while any
Certificates are outstanding. Any amounts deposited in the Master Servicer
Custodial Account prior to the Distribution Date shall be invested for the
account of the Master Servicer and any investment income thereon shall be
additional compensation to the Master Servicer for services rendered under this
Agreement. The amount of any losses incurred in respect of any such investments
shall be deposited in the Master Servicer Custodial Account by the Master
Servicer out of its own funds immediately as realized.
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Section 3.02. Permitted Withdrawals from the Master Servicer
Custodial Account. (a) The Master Servicer may, from time to time, make
withdrawals from the Master Servicer Custodial Account for the following
purposes (limited, in the case of Servicer reimbursements, to cases where funds
in the respective Custodial P&I Account are not sufficient therefor):
(i) to reimburse the Master Servicer, the Trust Administrator or
any Servicer for Periodic Advances made by the Master Servicer or the Trust
Administrator pursuant to Section 3.03(a) or any Servicer pursuant to any
Servicing Agreement with respect to previous Distribution Dates, such right to
reimbursement pursuant to this subclause (i) being limited to amounts received
on or in respect of particular Mortgage Loans (including, for this purpose,
Liquidation Proceeds, Insurance Proceeds, REO Proceeds and proceeds from the
purchase, sale, repurchase or substitution of Mortgage Loans pursuant to
Sections 2.02, 2.03, 3.08 or 9.01) respecting which any such Periodic Advance
was made;
(ii) to reimburse any Servicer, the Master Servicer or the Trust
Administrator for any Periodic Advances determined in good faith to have become
Nonrecoverable Advances; provided, however, that any portion of Nonrecoverable
Advances representing Fixed Retained Yield shall be reimbursable only from
amounts constituting Fixed Retained Yield and not from the assets of the Trust
Estate;
(iii) to reimburse the Master Servicer or any Servicer from
Liquidation Proceeds or Insurance Proceeds for Liquidation Expenses and for
amounts expended by the Master Servicer or any Servicer pursuant hereto or to
any Servicing Agreement, respectively, in good faith in connection with the
restoration of damaged property or for foreclosure expenses;
(iv) from any Mortgagor payment on account of interest or other
recovery (including Net REO Proceeds) with respect to a particular Mortgage
Loan, to pay the Master Servicing Fee with respect to such Mortgage Loan to the
Master Servicer;
(v) to reimburse the Master Servicer, any Servicer or the Trust
Administrator (or, in certain cases, the Seller) for expenses incurred by it
(including taxes paid on behalf of the Trust Estate) and recoverable by or
reimbursable to it pursuant to Section 3.03(c), 3.03(d) or 6.03 or the second
sentence of Section 8.14(a) or pursuant to such Servicer's Servicing Agreement;
(vi) to pay to the Seller or other purchaser with respect to each
Mortgage Loan or property acquired in respect thereof that has been repurchased
or replaced pursuant to Section 2.02 or 2.03 or auctioned pursuant to Section
3.08 or to pay to the Master Servicer with respect to each Mortgage Loan or
property acquired in respect thereof that has been purchased pursuant to Section
3.08 or 9.01, all amounts received thereon and not required to be distributed as
of the date on which the related repurchase or purchase price or Scheduled
Principal Balance was determined;
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(vii) to remit funds to the Paying Agent in the amounts and in
the manner provided for herein;
(viii) to pay to the Master Servicer any interest earned on or
investment income with respect to funds in the Master Servicer Custodial
Account;
(ix) to pay to the Master Servicer or any Servicer out of Net
Liquidation Proceeds allocable to interest the amount of any unpaid Master
Servicing Fee or Servicing Fee (as adjusted pursuant to such Servicer's
Servicing Agreement) and any unpaid assumption fees, late payment charges or
other Mortgagor charges on the related Mortgage Loan;
(x) to withdraw from the Master Servicer Custodial Account any
amount deposited in the Master Servicer Custodial Account that was not required
to be deposited therein;
(xi) to clear and terminate the Master Servicer Custodial Account
pursuant to Section 9.01; and
(xii) to pay to PHMC from any Mortgagor payment on account of
interest or other recovery (including Net REO Proceeds) with respect to a
particular Mortgage Loan, the Fixed Retained Yield, if any, with respect to such
Mortgage Loan; provided, however, that with respect to any payment of interest
received by the Master Servicer in respect of a Mortgage Loan (whether paid by
the Mortgagor or received as Liquidation Proceeds, Insurance Proceeds or
otherwise) which is less than the full amount of interest then due with respect
to such Mortgage Loan, only that portion of such payment of interest that bears
the same relationship to the total amount of such payment of interest as the
Fixed Retained Yield Rate, if any, in respect of such Mortgage Loan bears to the
Mortgage Interest Rate shall be allocated to the Fixed Retained Yield with
respect thereto.
(b) The Master Servicer shall keep and maintain separate
accounting, on a Mortgage Loan by Mortgage Loan basis, for the purpose of
justifying any payment to and withdrawal from the Master Servicer Custodial
Account.
Section 3.03 Advances by Master Servicer and Trust Administrator.
(a) In the event a Servicer fails to make any required Periodic Advances of
principal and interest on a Mortgage Loan as required by the related Servicing
Agreement prior to the Distribution Date occurring in the month during which
such Periodic Advance is due, the Master Servicer shall make Periodic Advances
to the extent provided hereby. The Master Servicer shall certify to the Trust
Administrator with respect to such Distribution Date (i) the amount of Periodic
Advances required of such Servicer, (ii) the amount actually advanced, (iii) the
amount that the Master Servicer is required to advance hereunder and (iv)
whether it has been determined not to make an advance because it reasonably
believes that such Periodic Advance is a Nonrecoverable Advance. Amounts
advanced by the Master Servicer shall be deposited in the Master Servicer
Custodial Account at least one Business Day prior to the related Distribution
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Date. If the Master Servicer fails to make any Periodic Advance required of it
hereunder, the Trust Administrator shall instead make such Periodic Advance to
the extent required by Section 8.15, provided that the Trust Administrator has
previously received the foregoing certificate of the Master Servicer.
Notwithstanding the foregoing, neither the Master Servicer nor the Trust
Administrator will be obligated to make a Periodic Advance that it reasonably
believes to be a Nonrecoverable Advance. The Trust Administrator may
conclusively rely for any determination to be made by it hereunder upon the
determination of the Master Servicer as set forth in its certificate.
(b) To the extent a Servicer fails to make an advance on account
of the taxes or insurance premiums with respect to a Mortgage Loan required
pursuant to Section 17.3 of the related Servicing Agreement, the Master Servicer
shall, if the Master Servicer knows of such failure of the Servicer, advance
such funds and take such steps as are necessary to pay such taxes or insurance
premiums.
(c) The Master Servicer and the Trust Administrator shall each be
entitled to be reimbursed from the Master Servicer Custodial Account for any
Periodic Advance made by it under Section 3.03(a) to the extent described in
Section 3.02(a)(i) or with respect to any such Periodic Advance which the Master
Servicer or the Trust Administrator shall ultimately determine in its good faith
judgment to be a Nonrecoverable Advance from funds generally available in the
Master Servicer Custodial Account.
(d) Except as provided in Section 3.03(a) and (b), neither the
Master Servicer nor the Trust Administrator shall be required to pay or advance
any amount which any Servicer was required, but failed, to deposit in the Master
Servicer Custodial Account.
The Master Servicer shall be entitled to be reimbursed pursuant
to Section 3.02(a)(v) for any advance by it pursuant to Section 3.03(b), but
shall diligently pursue restoration of such amount to the Master Servicer
Custodial Account from the related Servicer.
Section 3.04. Trust Administrator to Cooperate; Release of Owner
Mortgage Loan Files. Upon the receipt by the Master Servicer of a Request for
Release in connection with the deposit by a Servicer into the Master Servicer
Custodial Account of the proceeds from a Liquidated Loan or of a Prepayment in
Full, the Master Servicer shall confirm to the Trust Administrator that all
amounts required to be remitted to the Master Servicer Custodial Account in
connection with such Mortgage Loan have been so deposited, and shall deliver
such Request for Release to the Trust Administrator. The Trust Administrator
shall, within five Business Days of its receipt of such a Request for Release,
release the related Owner Mortgage Loan File to the Master Servicer or such
Servicer, as requested by the Master Servicer. No expenses incurred in
connection with any instrument of satisfaction or deed of reconveyance shall be
chargeable to the Master Servicer Custodial Account.
From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, including but not limited to, collection under
any insurance policies, or to effect a partial release of any Mortgaged Property
from the lien of the Mortgage, the Servicer of such Mortgage Loan shall deliver
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to the Master Servicer a Request for Release. Upon the Master Servicer's receipt
of any such Request for Release, the Master Servicer shall promptly forward such
request to the Trust Administrator and the Trust Administrator shall, within
five Business Days, release the related Owner Mortgage Loan File to the Master
Servicer or such Servicer, as requested by the Master Servicer. Any such Request
for Release shall obligate the Master Servicer or such Servicer, as the case may
be, to return each and every document previously requested from the Owner
Mortgage Loan File to the Trust Administrator by the twenty-first day following
the release thereof, unless (i) the Mortgage Loan has been liquidated and the
Liquidation Proceeds relating to the Mortgage Loan have been deposited in the
Master Servicer Custodial Account or (ii) the Owner Mortgage Loan File or such
document has been delivered to an attorney, or to a public trustee or other
public official as required by law, for purposes of initiating or pursuing legal
action or other proceedings for the foreclosure of the Mortgaged Property either
judicially or non-judicially, and the Master Servicer has delivered to the Trust
Administrator a certificate of the Master Servicer or such Servicer certifying
as to the name and address of the Person to which such Owner Mortgage Loan File
or such document was delivered and the purpose or purposes of such delivery.
Upon receipt of an Officer's Certificate of the Master Servicer or such Servicer
stating that such Mortgage Loan was liquidated and that all amounts received or
to be received in connection with such liquidation which are required to be
deposited into the Master Servicer Custodial Account have been so deposited, or
that such Mortgage Loan has become an REO Mortgage Loan, the Request for Release
shall be released by the Trust Administrator to the Master Servicer or such
Servicer, as appropriate.
Upon written certification of the Master Servicer or the Servicer
of such Mortgage Loan, the Trust Administrator shall execute and deliver to the
Master Servicer or such Servicer, as directed by the Master Servicer, court
pleadings, requests for trustee's sale or other documents necessary to the
foreclosure or trustee's sale in respect of a Mortgaged Property or to any legal
action brought to obtain judgment against any Mortgagor on the Mortgage Note or
Mortgage or to obtain a deficiency judgment, or to enforce any other remedies or
rights provided by the Mortgage Note or Mortgage or otherwise available at law
or in equity. Each such certification shall include a request that such
pleadings or documents be executed by the Trust Administrator and a statement as
to the reason such documents or pleadings are required and that the execution
and delivery thereof by the Trust Administrator will not invalidate or otherwise
affect the lien of the Mortgage, except for the termination of such a lien upon
completion of the foreclosure proceeding or trustee's sale.
Section 3.05. Reports to the Trust Administrator; Annual
Compliance Statements. (a) Not later than 15 days after each Distribution Date,
the Master Servicer shall deliver to the Trustee and the Trust Administrator a
statement setting forth the status of the Master Servicer Custodial Account as
of the close of business on such Distribution Date stating that all
distributions required to be made by the Master Servicer under this Agreement
have been made (or, if any required distribution has not been made by the Master
Servicer, specifying the nature and status thereof) and showing, for the period
covered by such statement, the aggregate amount of deposits into and withdrawals
from such account for each category of deposit and withdrawal specified in
Sections 3.01 and 3.02. Such statement may be in the form of the then current
FNMA monthly accounting report for its Guaranteed Mortgage Pass-Through Program
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with appropriate additions and changes, and shall also include information as to
the aggregate unpaid principal balance of all of the Mortgage Loans as of the
close of business as of the last day of the calendar month immediately preceding
such Distribution Date. Copies of such statement shall be provided by the Trust
Administrator to any Certificateholder upon written request, provided such
statement is delivered, or caused to be delivered, by the Master Servicer to the
Trust Administrator.
(b) The Master Servicer shall deliver to the Trustee and the
Trust Administrator on or before April 30 of each year, an Officers' Certificate
signed by an officer of the Master Servicer, certifying that (i) such officer
has reviewed the activities of the Master Servicer during the preceding calendar
year or portion thereof and its performance under this agreement and (ii) to the
best of such officer's knowledge, based on such review, the Master Servicer has
performed and fulfilled its duties, responsibilities and obligations under this
agreement in all material respects throughout such year, or, if there has been a
default in the fulfillment of any such duties, responsibilities or obligations,
specifying each such default known to such officer and the nature and status
thereof, and, (iii) (A) an officer of the Master Servicer has conducted an
examination of the activities of the Servicers during the preceding calendar
year and their performance under the Servicing Agreements, (B) an officer of the
Master Servicer has examined the Servicers' Fidelity Bond and Errors and
Omissions Policies and each such bond or policy is in effect and conforms to the
requirements of the applicable Servicing Agreement, (C) the Master Servicer has
received from each Servicer any required financial statements and such other
information as is required by such Servicer's Servicing Agreement and (D) to the
best of such officer's knowledge, based on such examination, each Servicer has
performed and fulfilled its duties, responsibilities and obligations under its
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
officer and the nature and status thereof. Copies of such Officers' Certificate
shall be provided by the Trust Administrator to any Certificateholder upon
written request provided such certificate is delivered, or caused to be
delivered, by the Master Servicer to the Trust Administrator.
(c) Each year the Master Servicer shall review each Servicer's
performance under its Servicing Agreement and the status of any fidelity bond
and errors and omissions policy required to be maintained by such Servicer under
its Servicing Agreement.
Section 3.06. Title, Management and Disposition of Any REO
Mortgage Loan. In the event that a Servicer is unable to dispose of any REO
Mortgage Loan within the period mandated by Section 14.4.2 of each of the
Servicing Agreements, the Master Servicer shall monitor such Servicer to verify
that such REO Mortgage Loan is auctioned to the highest bidder within the period
so specified. In the event of any such sale of REO Mortgage Loan, the Trust
Administrator shall, at the written request of the Master Servicer and upon
being supported with appropriate forms therefor, within five Business Days of
the deposit by the Master Servicer of the proceeds of such sale or auction into
the Master Servicer Custodial Account, release or cause to be released to the
entity identified by the Master Servicer the related Owner Mortgage Loan File
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and Servicer Mortgage Loan File and shall execute and deliver such instruments
of transfer or assignment, in each case without recourse, as shall be necessary
to vest in the auction purchaser title to the REO Mortgage Loan and the Trust
Administrator shall have no further responsibility with regard to such Owner
Mortgage Loan File or Servicer Mortgage Loan File. Neither the Trust
Administrator, the Master Servicer nor any Servicer, acting on behalf of the
Trust Estate, shall provide financing from the Trust Estate to any purchaser of
REO Mortgage Loan.
Section 3.07. Amendments to Servicing Agreements, Modification of
Standard Provisions. (a) Subject to the prior written consent of the Trustee and
the Trust Administrator pursuant to Section 3.07(b), the Master Servicer from
time to time may, to the extent permitted by the applicable Servicing Agreement,
make such modifications and amendments to such Servicing Agreement as the Master
Servicer deems necessary or appropriate to confirm or carry out more fully the
intent and purpose of such Servicing Agreement and the duties, responsibilities
and obligations to be performed by the Servicer thereunder. Such modifications
may only be made if they are consistent with the REMIC Provisions, as evidenced
by an Opinion of Counsel. Prior to the issuance of any modification or
amendment, the Master Servicer shall deliver to the Trustee and the Trust
Administrator such Opinion of Counsel and an Officer's Certificate setting forth
(i) the provision that is to be modified or amended, (ii) the modification or
amendment that the Master Servicer desires to issue and (iii) the reason or
reasons for such proposed amendment or modification.
(b) The Trustee and the Trust Administrator shall consent to any
amendment or supplement to a Servicing Agreement proposed by the Master Servicer
pursuant to Section 3.07(a), which consent and amendment shall not require the
consent of any Certificateholder if it is (i) for the purpose of curing any
mistake or ambiguity or to further effect or protect the rights of the
Certificateholders or (ii) for any other purpose, provided such amendment or
supplement for such other purpose cannot reasonably be expected to adversely
affect Certificateholders. The lack of an adverse effect on Certificateholders
may be established through various means, including the delivery to the Trustee
and the Trust Administrator of (i) an Opinion of Counsel to such effect or (ii)
written notification from each Rating Agency to the effect that such amendment
or supplement will not result in reduction of the current rating assigned by
that Rating Agency to the Certificates. Either the Trustee or the Trust
Administrator may, in its discretion, decline to enter into or consent to any
such supplement or amendment if its own rights, duties or immunities shall be
adversely affected.
Section 3.08. Oversight of Servicing. The Master Servicer shall
supervise, monitor and oversee the servicing of the Mortgage Loans by each
Servicer and the performance by each Servicer of all services, duties,
responsibilities and obligations that are to be observed or performed by the
Servicer under its respective Servicing Agreement. In performing its obligations
hereunder, the Master Servicer shall act in a manner consistent with Accepted
Master Servicing Practices and with the Trustee's, the Trust Administrator's and
the Certificateholders' reliance on the Master Servicer, and in a manner
consistent with the terms and provisions of any insurance policy required to be
maintained by the Master Servicer or any Servicer pursuant to this Agreement or
any Servicing Agreement. The Master Servicer acknowledges that prior to taking
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certain actions required to service the Mortgage Loans, each Servicing Agreement
provides that the Servicer thereunder must notify, consult with, obtain the
consent of or otherwise follow the instructions of the Master Servicer. The
Master Servicer is also given authority to waive compliance by a Servicer with
certain provisions of its Servicing Agreement. In each such instance, the Master
Servicer shall promptly instruct such Servicer or otherwise respond to such
Servicer's request. In no event will the Master Servicer instruct such Servicer
to take any action, give any consent to action by such Servicer or waive
compliance by such Servicer with any provision of such Servicer's Servicing
Agreement if any resulting action or failure to act would be inconsistent with
the requirements of the Rating Agencies that rated the Certificates or would
otherwise have an adverse effect on the Certificateholders. Any such action or
failure to act shall be deemed to have an adverse effect on the
Certificateholders if such action or failure to act either results in (i) the
downgrading of the rating assigned by any Rating Agency to the Certificates,
(ii) the loss by the Trust Estate of REMIC status for federal income tax
purposes or (iii) the imposition of any Prohibited Transaction Tax or any
federal taxes on the REMIC or the Trust Estate. The Master Servicer shall have
full power and authority in its sole discretion to take any action with respect
to the Trust Estate as may be necessary or advisable to avoid the circumstances
specified including clause (ii) or (iii) of the preceding sentence.
For the purposes of determining whether any modification of a
Mortgage Loan shall be permitted by the Trust Administrator or the Master
Servicer, such modification shall be construed as a substitution of the modified
Mortgage Loan for the Mortgage Loan originally deposited in the Trust Estate. No
modification shall be approved unless (i) the modified Mortgage Loan would
qualify as a substitute Mortgage Loan under Section 2.02 and (ii) with respect
to any modification that occurs more than three months after the Closing Date
and is not the result of a default or a reasonably foreseeable default under the
Mortgage Loan, there is delivered to the Trustee and the Trust Administrator an
Opinion of Counsel (at the expense of the party seeking to modify the Mortgage
Loan) to the effect that such modification would not be treated as giving rise
to a new debt instrument for federal income tax purposes.
During the term of this Agreement, the Master Servicer shall
consult fully with each Servicer as may be necessary from time to time to
perform and carry out the Master Servicer's obligations hereunder and otherwise
exercise reasonable efforts to encourage such Servicer to perform and observe
the covenants, obligations and conditions to be performed or observed by it
under its Servicing Agreement.
The relationship of the Master Servicer to the Trustee and the
Trust Administrator 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.
The Master Servicer shall administer the Trust Estate on behalf
of the Trustee and shall have full power and authority, acting alone or (subject
to Section 6.06) through one or more subcontractors, to do any and all things in
connection with such administration which it may deem necessary or desirable.
Upon the execution and delivery of this Agreement, and from time to time as may
be required thereafter, the Trust Administrator, on behalf of the Trustee, shall
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furnish the Master Servicer or its subcontractors with any powers of attorney
and such other documents as may be necessary or appropriate to enable the Master
Servicer to carry out its administrative duties hereunder.
The Master Servicer shall be entitled, at its option, to
repurchase any defaulted Mortgage Loan from the Trust Estate if, in the Master
Servicer's judgment, the default is not likely to be cured by the Mortgagor. The
purchase price for any such Mortgage Loan shall be 100% of the unpaid principal
balance of such Mortgage Loan plus accrued interest thereon at the Mortgage
Interest Rate less any Fixed Retained Yield for such Mortgage Loan through the
last day of the month in which such repurchase occurs. Upon the receipt of such
purchase price, the Master Servicer shall provide to the Trust Administrator the
certification required by Section 3.04 and the Trust Administrator and the
Custodian, if any, shall promptly release to the Master Servicer the Owner
Mortgage Loan File relating to the Mortgage Loan being repurchased.
In the event that (i) the Master Servicer determines at any time
that, notwithstanding the representations and warranties set forth in Section
2.03(b), any Mortgage Loan is not a "qualified mortgage" within the meaning of
Section 860G of the Code and (ii) the Master Servicer is unable to enforce the
obligation of the Seller to purchase such Mortgage Loan pursuant to Section 2.02
within two months of such determination, the Master Servicer shall cause such
Mortgage Loan to be auctioned to the highest bidder and sold out of the Trust
Estate no later than the date 90 days after such determination. In the event of
any such sale of a Mortgage Loan, the Trust Administrator shall, at the written
request of the Master Servicer and upon being supported with appropriate forms
therefor, within five Business Days of the deposit by the Master Servicer of the
proceeds of such auction into the Master Servicer Custodial Account, release or
cause to be released to the entity identified by the Master Servicer the related
Owner Mortgage Loan File and Servicer Mortgage Loan File and shall execute and
deliver such instruments of transfer or assignment, in each case without
recourse, as shall be necessary to vest in the auction purchaser title to the
Mortgage Loan and the Trust Administrator shall have no further responsibility
with regard to such Owner Mortgage Loan File or Servicer Mortgage Loan File.
Neither the Trust Administrator, the Master Servicer nor any Servicer, acting on
behalf of the Trust Administrator, shall provide financing from the Trust Estate
to any purchaser of a Mortgage Loan.
The Master Servicer, on behalf of the Trustee, shall, pursuant to
the Servicing Agreements, object to the foreclosure upon, or other related
conversion of the ownership of, any Mortgaged Property by the related Servicer
if (i) the Master Servicer believes such Mortgaged Property may be contaminated
with or affected by hazardous wastes or hazardous substances or (ii) such
Servicer does not agree to administer such Mortgaged Property, once the related
Mortgage Loan becomes an REO Mortgage Loan, in a manner which would not result
in a federal tax being imposed upon the Trust Estate or the REMIC.
The Master Servicer may enter into a special servicing agreement
with an unaffiliated holder of 100% Percentage Interest of a Class B Subclass or
a holder of a class of securities representing interests in the Class B
Certificates and/or other subordinated mortgage pass-through certificates, such
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agreement to be substantially in the form of Exhibit M hereto or subject to each
Rating Agency's acknowledgment that the ratings of the Certificates in effect
immediately prior to the entering into of such agreement would not be qualified,
downgraded or withdrawn and the Certificates would not be placed on credit
review status (except for possible upgrading) as a result of such agreement. Any
such agreement may contain provisions whereby such holder may instruct the
Master Servicer to instruct a Servicer to the extent provided in the applicable
Servicing Agreement to commence or delay foreclosure proceedings with respect to
delinquent Mortgage Loans and will contain provisions for the deposit of cash by
the holder that would be available for distribution to Certificateholders if
Liquidation Proceeds are less than they otherwise may have been had the Servicer
acted in accordance with its normal procedures.
Section 3.09. Termination and Substitution of Servicing
Agreements. Upon the occurrence of any event for which a Servicer may be
terminated pursuant to its Servicing Agreement, the Master Servicer shall
promptly deliver to the Seller, the Trust Administrator and the Trustee an
Officer's Certificate certifying that an event has occurred which may justify
termination of such Servicing Agreement, describing the circumstances
surrounding such event and recommending what action should be taken by the
Trustee with respect to such Servicer. If the Master Servicer recommends that
such Servicing Agreement be terminated, the Master Servicer's certification must
state that the breach is material and not merely technical in nature. Upon
written direction of the Master Servicer, based upon such certification, the
Trustee shall promptly terminate such Servicing Agreement.
The Master Servicer shall indemnify the Trustee and the Trust
Administrator and hold each harmless from and against any and all claims,
liabilities, costs and expenses (including, without limitation, reasonable
attorneys' fees) arising out of, or assessed against the Trustee or the Trust
Administrator in connection with termination of such Servicing Agreement at the
direction of the Master Servicer. If the Trustee terminates such Servicing
Agreement, the Trustee may enter into a substitute Servicing Agreement with the
Master Servicer or, at the Master Servicer's nomination, with another mortgage
loan service company acceptable to the Trustee, the Trust Administrator, the
Master Servicer and each Rating Agency under which the Master Servicer or such
substitute servicer, as the case may be, shall assume, satisfy, perform and
carry out all liabilities, duties, responsibilities and obligations that are to
be, or otherwise were to have been, satisfied, performed and carried out by such
Servicer under such terminated Servicing Agreement. Until such time as the
Trustee enters into a substitute servicing agreement with respect to the
Mortgage Loans previously serviced by such Servicer, the Master Servicer shall
assume, satisfy, perform and carry out all obligations which otherwise were to
have been satisfied, performed and carried out by such Servicer under its
terminated Servicing Agreement. However, in no event shall the Master Servicer
be deemed to have assumed the obligations of a Servicer to advance payments of
principal and interest on a delinquent Mortgage Loan in excess of the Master
Servicer's independent Periodic Advance obligation under Section 3.03 of this
Agreement. As compensation for the Master Servicer of any servicing obligations
fulfilled or assumed by the Master Servicer, the Master Servicer shall be
entitled to any servicing compensation to which a Servicer would have been
entitled if the Servicing Agreement with such Servicer had not been terminated.
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ARTICLE IV
DISTRIBUTIONS IN RESPECT OF CERTIFICATES;
PAYMENTS TO CERTIFICATEHOLDERS;
STATEMENTS AND REPORTS
Section 4.01. Distributions. (a) On each Distribution Date, the
Pool Distribution Amount will be applied in the following amounts, to the extent
the Pool Distribution Amount is sufficient therefor, in the manner and in the
order of priority as follows:
first, to the Subclasses of Class A Certificates, pro rata, based
upon their respective Class A Subclass Interest Accrual Amounts, in an aggregate
amount up to the Class A Interest Accrual Amount;
second, to the Subclasses of Class A Certificates, pro rata,
based upon their respective Class A Subclass Unpaid Interest Shortfalls in an
aggregate amount up to the Class A Unpaid Interest Shortfall;
third, concurrently, to the Class A and Class AP Certificates,
pro rata based on their respective Class A Optimal Principal Amount and Class AP
Optimal Principal Amount, (A) to the Subclasses of Class A Certificates, in an
aggregate amount up to the Class A Optimal Principal Amount, such distribution
to be allocated among such Subclasses in accordance with Section 4.01(b) or
Section 4.01(c), as applicable and (B) to the Class AP Certificates up to the
Class AP Optimal Principal Amount;
fourth, to the Class AP Certificates in an amount up to the Class
AP Deferred Amount first from amounts otherwise distributable (without regard to
this Paragraph fourth) first to the Class B-5 Certificates pursuant to Paragraph
twenty-second, below, second to the Class B-4 Certificates pursuant to Paragraph
nineteenth, below, third to the Class B-3 Certificates pursuant to Paragraph
sixteenth, below, fourth to the Class B-2 Certificates pursuant to Paragraph
thirteenth, below and fifth to the Class B-1 Certificates pursuant to Paragraph
tenth below and then from amounts otherwise distributable (without regard to
this paragraph fourth) to the Class M Certificates pursuant to Paragraph
seventh, below;
fifth, to the Class M Certificates in an amount up to the Class M
Interest Accrual Amount;
sixth, to the Class M Certificates in an amount up to the Class M
Unpaid Interest Shortfall;
seventh, to the Class M Certificates in an amount up to the Class
M Optimal Principal Amount; provided, however, that the amount distributable to
the Class M Certificates pursuant to this Paragraph seventh will be reduced by
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the amount, if any, that would have been distributable to the Class M
Certificates hereunder used to pay the Class AP Deferred Amount as provided in
Paragraph fourth above;
eighth, to the Class B-1 Certificates in an amount up to the
Class B Subclass Interest Accrual Amount for the Class B-1 Certificates with
respect to such Distribution Date;
ninth, to the Class B-1 Certificates in an amount up to the Class
B-1 Unpaid Interest Shortfall;
tenth, to the Class B-1 Certificates in an amount up to the Class
B-1 Optimal Principal Amount; provided, however, that the amount distributable
to the Class B-1 Certificates pursuant to this Paragraph tenth will be reduced
by the amount, if any, that would have been distributable to the Class B-1
Certificates hereunder used to pay the Class AP Deferred Amount as provided in
Paragraph fourth above;
eleventh, to the Class B-2 Certificates in an amount up to the
Class B Subclass Interest Accrual Amount for the Class B-2 Certificates with
respect to such Distribution Date;
twelfth, to the Class B-2 Certificates in an amount up to the
Class B-2 Unpaid Interest Shortfall;
thirteenth, to the Class B-2 Certificates in an amount up to the
Class B-2 Optimal Principal Amount; provided, however, that the amount
distributable to the Class B-2 Certificates pursuant to this Paragraph
thirteenth will be reduced by the amount, if any, that would have been
distributable to the Class B-2 Certificates hereunder used to pay the Class AP
Deferred Amount as provided in Paragraph fourth above;
fourteenth, to the Class B-3 Certificates in an amount up to the
Class B Subclass Interest Accrual Amount for the Class B-3 Certificates with
respect to such Distribution Date;
fifteenth, to the Class B-3 Certificates in an amount up to the
Class B-3 Unpaid Interest Shortfall;
sixteenth, to the Class B-3 Certificates in an amount up to the
Class B-3 Optimal Principal Amount; provided, however, that the amount
distributable to the Class B-3 Certificates pursuant to this Paragraph sixteenth
will be reduced by the amount, if any, that would have been distributable to the
Class B-3 Certificates hereunder used to pay the Class AP Deferred Amount as
provided in Paragraph fourth above;
seventeenth, to the Class B-4 Certificates in an amount up to the
Class B Subclass Interest Accrual Amount for the Class B-4 Certificates with
respect to such Distribution Date;
eighteenth, to the Class B-4 Certificates in an amount up to the
Class B-4 Unpaid Interest Shortfall;
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nineteenth, to the Class B-4 Certificates in an amount up to the
Class B-4 Optimal Principal Amount; provided, however, that the amount
distributable to the Class B-4 Certificates pursuant to this Paragraph
nineteenth will be reduced by the amount, if any, that would have been
distributable to the Class B-4 Certificates hereunder used to pay the Class AP
Deferred Amount as provided in Paragraph fourth above;
twentieth, to the Class B-5 Certificates in an amount up to the
Class B Subclass Interest Accrual Amount for the Class B-5 Certificates with
respect to such Distribution Date;
twenty-first, to the Class B-5 Certificates in an amount up to
the Class B-5 Unpaid Interest Shortfall;
twenty-second, to the Class B-5 Certificates in an amount up to
the Class B-5 Optimal Principal Amount; provided, however, that the amount
distributable to the Class B-5 Certificates pursuant to this Paragraph
twenty-second will be reduced by the amount, if any, that would have been
distributable to the Class B-5 Certificates hereunder used to pay the Class AP
Deferred Amount as provided in Paragraph fourth above; and
twenty-third, to the Holder of the Class A-R Certificate.
In addition, Net Foreclosure Profits, if any, with respect to
such Distribution Date minus any portion thereof payable to a Servicer pursuant
to Section 3.02(ix) hereof shall be distributed to the Holder of the Class A-R
Certificate.
With respect to any Distribution Date, the amount of the
Principal Adjustment, if any, attributable to any Class B Subclass will be
allocated pro rata based on principal balance among the Class A and Class M
Certificates and any Class B Subclass with a lower numerical designation and the
amount of the Principal Adjustment, if any, attributable to the Class M
Certificates will be allocated to the Subclasses of Class A Certificates pro
rata based on Class A Subclass Principal Balance.
(b) On each Distribution Date occurring prior to the Cross-Over
Date, the Class A Principal Distribution Amount shall be allocated among and
distributed, pursuant to Section 4.01(e) hereof, in reduction of the principal
balances of the Subclasses of Class A Certificates as follows:
first, to the Class A-5 Certificates up to the Class A-5 Priority
Amount;
second, to the Class A-R Certificate until the Class A Subclass
Principal Balance thereof has been reduced to zero;
third, concurrently, as follows:
(i) 4.95905905% to the Class A-1 Certificates until the Class A
Subclass Principal Balance thereof has been reduced to zero; and
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(ii) sequentially, 95.04094095% as follows:
(a) concurrently, 43.10589511% to the Class A-2 Certificates and
56.89410489% to the Class A-3 Certificates until the Class A Subclass Principal
Balance of the Class A-2 Certificates has been reduced to zero; and
(b) sequentially, to the Class A-3 and Class A-4 Certificates, in
that order, until the Class A Subclass Principal Balance of each such Subclass
has been reduced to zero;
fourth, to the Class A-5 Certificates until the Class A Subclass
Principal Balance thereof has been reduced to zero.
(c) On each Distribution Date occurring on or subsequent to the
Cross-Over Date, the Class A Principal Distribution Amount shall be distributed
among the Subclasses of Class A Certificates pro rata in accordance with their
outstanding Class A Subclass Principal Balances.
(d) (i) For purposes of determining whether the Subclasses of
Class B Certificates are eligible to receive distributions of principal with
respect to any Distribution Date, the following tests shall apply:
(a) if the Current Class M Fractional Interest is less than the
Original Class M Fractional Interest and the Class M Principal Balance
is greater than zero, the Class B-1, Class B-2, Class B-3, Class B-4 and
Class B-5 Certificates shall not be eligible to receive distributions of
principal; or
(b) if the Current Class B-1 Fractional Interest is less than the
Original Class B-1 Fractional Interest and the Class B-1 Principal
Balance is greater than zero, the Class B-2, Class B-3, Class B-4 and
Class B-5 Certificates shall not be eligible to receive distributions of
principal; or
(c) if the Current Class B-2 Fractional Interest is less than the
Original Class B-2 Fractional Interest and the Class B-2 Principal
Balance is greater than zero, the Class B-3, Class B-4 and Class B-5
Certificates shall not be eligible to receive distributions of
principal; or
(d) if the Current Class B-3 Fractional Interest is less than the
Original Class B-3 Fractional Interest and the Class B-3 Principal
Balance is greater than zero, the Class B-4 and Class B-5 Certificates
shall not be eligible to receive distributions of principal; or
(e) if the Current Class B-4 Fractional Interest is less than the
Original Class B-4 Fractional Interest and the Class B-4 Principal
Balance is greater than zero, the Class B-5 Certificates shall not be
eligible to receive distributions of principal.
(ii) Notwithstanding the foregoing, if on any Distribution Date
the aggregate distributions to Holders of the Class M Certificates and/or the
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Subclasses of Class B Certificates entitled to receive distributions of
principal would reduce the Subclasses of Class B Certificates entitled to
receive distributions of principal below zero, first the Class M Prepayment
Percentage and/or the Class B Subclass Prepayment Percentage of any affected
Class B Subclass for such Distribution Date beginning with the affected Subclass
with the lowest numerical Subclass designation and then, if necessary, the Class
M Percentage and/or the Class B Subclass Percentage of such Subclass of the
Class B Certificates for such Distribution Date shall be reduced to the
respective percentages necessary to bring the Class M Principal Balance and/or
the Class B Subclass Principal Balance of such Class B Subclass to zero. The
Class B Subclass Prepayment Percentages and the Class B Subclass Percentages of
the remaining Class B Subclasses will be recomputed substituting for the
Subordinated Prepayment Percentage and Subordinated Percentage in such
computations the difference between (A) the Subordinated Prepayment Percentage
or Subordinated Percentage, as the case may be, and (B) the percentages
determined in accordance with the preceding sentence necessary to bring the
Class M Principal Balance and/or the Class B Subclass Principal Balance of the
affected Class B Subclasses to zero; provided, however, that if the Class B
Subclass Principal Balances of all the Class B Subclasses eligible to receive
distributions of principal shall be reduced to zero on such Distribution Date
the Class B Subclass Prepayment Percentage and the Class B Subclass Percentage
of the Class B Subclass with the lowest numerical Subclass designation which
would otherwise be ineligible to receive distributions of principal in
accordance with this Section shall equal the remainder of the Subordinated
Prepayment Percentage for such Distribution Date minus the sum of the Class M
Prepayment Percentage and the Class B Subclass Prepayment Percentages of the
Class B Subclasses having lower numerical Subclass designations, if any, and the
remainder of the Subordinated Percentage for such Distribution Date minus the
sum of the Class M Percentage and the Class B Subclass Percentages of the Class
B Subclasses having lower numerical Subclass designations, if any, respectively.
Any entitlement of any Class B Subclass to principal payments solely pursuant to
this clause (ii) shall not cause such Subclass to be regarded as being eligible
to receive principal distributions for the purpose of applying the definition of
its Class B Subclass Percentage or Class B Subclass Prepayment Percentage.
(e) On each Distribution Date other than the Final Distribution
Date (if such Final Distribution Date is in connection with a purchase of the
assets of the Trust Estate by the Master Servicer), the Paying Agent shall, on
behalf of the Master Servicer, from funds remitted to it by the Master Servicer,
distribute to each Certificateholder of record on the preceding Record Date
(other than as provided in Section 9.01 respecting the final distribution to
Certificateholders or in the last paragraph of this Section 4.01(e) respecting
the final distribution in respect of any Class or Subclass) either in
immediately available funds by wire transfer to the account of such
Certificateholder at a bank or other entity having appropriate facilities
therefor, if such Certificateholder holds Certificates having a Denomination at
least equal to that specified in Section 11.26, and has so notified the Master
Servicer or, if applicable, the Paying Agent at least seven Business Days prior
to the Distribution Date or, if such Holder holds Certificates having, in the
aggregate, a Denomination less than the requisite minimum Denomination or if
such Holder holds the Class A-R Certificate or has not so notified the Paying
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Agent, by check mailed to such Holder at the address of such Holder appearing in
the Certificate Register, such Holder's share (based on the aggregate of the
Percentage Interests represented by Certificates of the applicable Subclass or
Class of Certificates held by such Holder) of the Class A Subclass Distribution
Amount with respect to each Subclass of Class A Certificates, the Class AP
Distribution Amount with respect to the Class AP Certificates, the Class M
Distribution Amount with respect to the Class M Certificates and the Class B
Subclass Distribution Amount with respect to each such Subclass of Class B
Certificates.
In the event that, on any Distribution Date prior to the Final
Distribution Date, the Class A Subclass Principal Balance of any Subclass of
Class A Certificates (other than the Class A-R Certificate), the Class AP
Principal Balance of the Class AP Certificates, the Class M Principal Balance of
the Class M Certificates or the Class B Subclass Principal Balance of any
Subclass of Class B Certificates would be reduced to zero, the Master Servicer
shall, as soon as practicable after the Determination Date relating to such
Distribution Date, send a notice to the Trust Administrator. The Trust
Administrator will then send a notice to each Certificateholder of such Subclass
or Class with a copy to the Certificate Registrar, specifying that the final
distribution with respect to such Subclass will be made on such Distribution
Date only upon the presentation and surrender of such Certificateholder's
Certificates at the office or agency of the Trust Administrator therein
specified; provided, however, that the failure to give such notice will not
entitle a Certificateholder to any interest beyond the interest payable with
respect to such Distribution Date in accordance with Section 4.01(a).
(g) The Paying Agent (or if no Paying Agent is appointed by the
Master Servicer, the Master Servicer) shall withhold or cause to be withheld
such amounts as may be required by the Code (giving full effect to any
exemptions from withholding and related certifications required to be furnished
by Certificateholders and any reductions to withholding by virtue of any
bilateral tax treaties and any applicable certification required to be furnished
by Certificateholders with respect thereto) from distributions to be made to
Non-U.S. Persons. For the purposes of this paragraph, a "Non-U.S. Person" is an
individual, corporation, partnership or other person other than 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
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subdivision thereof, or an estate or trust that is subject to U.S. federal
income tax regardless of the source of its income.
Section 4.02. Allocation of Realized Losses. (a) With respect to
any Distribution Date, the principal portion of Realized Losses (other than Debt
Service Reductions, Excess Special Hazard Losses, Excess Fraud Losses and Excess
Bankruptcy Losses) will be allocated as follows:
first, to the Class B-5 Certificates until the Class B-5
Principal Balance has been reduced to zero;
second, to the Class B-4 Certificates until the Class B-4
Principal Balance has been reduced to zero;
third, to the Class B-3 Certificates until the Class B-3
Principal Balance has been reduced to zero;
fourth, to the Class B-2 Certificates until the Class B-2
Principal Balance has been reduced to zero;
fifth, to the Class B-1 Certificates until the Class B-1
Principal Balance has been reduced to zero;
sixth, to the Class M Certificates until the Class M Principal
Balance has been reduced to zero; and
seventh, to the Class A and Class AP Certificates pro rata based
on the Classes A/M/B Fraction and the Class AP Fraction, respectively.
This allocation of Realized Losses will be effected through the
reduction of the applicable Subclass principal balance.
(b) With respect to any Distribution Date, the principal portion
of Excess Special Hazard Losses, Excess Fraud Losses and Excess Bankruptcy
Losses occurring with respect to any Mortgage Loan allocable to the Class AP
Certificates will equal the product of the amount of any such principal loss and
the Class AP Fraction for such Mortgage Loan. The principal portion of any
Excess Special Hazard Losses, Excess Fraud Losses and Excess Bankruptcy Losses
remaining after allocation to the Class AP Certificates in accordance with the
preceding sentence shall be allocated pro rata among the Class A, Class M and
Class B Certificates based on the Class A Principal Balance, the Class M
Principal Balance and the Class B Principal Balance. Any such loss allocated to
the Class A Certificates shall be allocated on the subsequent Determination Date
among the outstanding Subclasses of Class A Certificates in accordance with the
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Class A Subclass Loss Percentages as of such Determination Date. Any such loss
allocated to the Class B Certificates shall be allocated pro rata among the
outstanding Subclasses of Class B Certificates based on their Class B Subclass
Principal Balances.
(c) Any Realized Losses allocated to a Subclass of Class A
Certificates or Class B Certificates or to the Class AP Certificates or Class M
Certificates pursuant to Section 4.02(a) or Section 4.02(b) shall be allocated
among the Certificates of such Subclass or Class based on their Percentage
Interests.
(d) In the event that there is a recovery of an amount in respect
of principal of a Mortgage Loan which had previously been allocated as a
Realized Loss to any Subclasses of Class A Certificates, the Class AP
Certificates, the Class M Certificates or any Subclasses of Class B
Certificates, each outstanding Subclass or Class to which such Realized Loss had
previously been allocated shall be entitled to its share (with respect to the
Class AP Certificates, based on the Class AP Fraction of such Mortgage Loan and,
with respect to the Class A Certificates, Class M Certificates and Class B
Certificates, based on their pro rata share of the Classes A/M/B Fraction of
such Mortgage Loan) of such recovery up to the amount of such Realized Loss
previously allocated to such Subclass or Class on the Distribution Date in the
month following the month in which such recovery is received. A Subclass or
Class of Certificates that is no longer outstanding shall not be entitled to any
share of such recovery. In the event that the amount of such recovery exceeds
the amount of such recovery allocated to each outstanding Subclass or Class in
accordance with the preceding provisions, each outstanding Subclass or Class
shall be entitled to its pro rata share (determined as described above) of such
excess up to the amount of any unrecovered Realized Loss previously allocated to
such Subclass or Class .
(e) The interest portion of Excess Special Hazard Losses, Excess
Fraud Losses and Excess Bankruptcy Losses shall be allocated among the Class A
Certificates, the Class M Certificates and the Class B Certificates, pro rata
based on the Class A Interest Accrual Amount, the Class M Interest Accrual
Amount and the Class B Interest Accrual Amount for the related Distribution
Date. Any such loss allocated to the Class A Certificates shall be allocated
among the outstanding Subclasses of Class A Certificates based on their Class A
Subclass Interest Percentages. Any such loss allocated to the Class B
Certificates will be allocated among the outstanding Subclasses of Class B
Certificates based on their Class B Subclass Interest Percentages. In addition,
after the Class M Principal Balance and the Class B Principal Balance have been
reduced to zero, the interest portion of Realized Losses (other than Excess
Special Hazard Losses, Excess Fraud Losses and Excess Bankruptcy Losses) will be
allocated among the outstanding Subclasses of Class A Certificates based on
their Class A Subclass Interest Percentages.
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(f) Realized Losses allocated in accordance with this Section
4.02 will be allocated on the Determination Date in the second month following
the month in which such loss was incurred with respect to the preceding
Distribution Date.
Section 4.03 Paying Agent. (a) The Master Servicer hereby
appoints the Trust Administrator as initial Paying Agent to make distributions
to Certificateholders and to forward to Certificateholders the periodic
statements and the annual statements required by Section 4.04 as agent of the
Master Servicer.
The Master Servicer may, at any time, remove or replace the
Paying Agent.
The Master Servicer shall cause any Paying Agent that is not the
Trust Administrator to execute and deliver to the Trust Administrator an
instrument in which such Paying Agent agrees with the Trust Administrator that
such Paying Agent shall:
(i) hold all amounts remitted to it by the Master Servicer for
distribution to Certificateholders in trust for the benefit of
Certificateholders until such amounts are distributed to Certificateholders or
otherwise disposed of as herein provided;
(ii) give the Trust Administrator notice of any default by the
Master Servicer in remitting any required amount; and
(iii) at any time during the continuance of any such default,
upon the written request of the Trust Administrator, forthwith pay to the Trust
Administrator all amounts held in trust by such Paying Agent.
(b) The Paying Agent shall establish and maintain a Payment
Account, which shall be a separate trust account and an Eligible Account, in
which the Master Servicer shall cause to be deposited from funds in the Master
Servicer Custodial Account or, to the extent required hereunder, from its own
funds (i) at or before 10:00 a.m., New York time, on the Business Day preceding
each Distribution Date, by wire transfer of immediately available funds, any
Periodic Advance for such Distribution Date, pursuant to Section 3.03 and (ii)
at or before 10:00 a.m., New York time, on the Business Day preceding each
Distribution Date, by wire transfer of immediately available funds, (a) an
amount equal to the Pool Distribution Amount, (b) Net Foreclosure Profits, if
any, with respect to such Distribution Date and (c) the amount of any recovery
in respect of a Realized Loss. The Master Servicer may cause the Paying Agent to
invest the funds in the Payment Account. Any such investment shall be in
Eligible Investments, which shall mature not later than the Business Day
preceding the related Distribution Date (unless the Eligible Investments are
obligations of the Trust Administrator, in which case such Eligible Investments
shall mature not later than the Distribution Date), and shall not be sold or
disposed of prior to maturity. All income and gain realized from any such
investment shall be for the benefit of the Master Servicer and shall be subject
to its withdrawal or order from time to time. The amount of any losses incurred
in respect of any such investments shall be deposited in the Payment Account by
the Master Servicer out of its own funds immediately as realized. The Paying
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Agent may withdraw from the Payment Account any amount deposited in the Payment
Account that was not required to be deposited therein and may clear and
terminate the Payment Account pursuant to Section 9.01.
Section 4.04. Statements to Certificateholders; Report to the
Trust Administrator and the Seller. Concurrently with each distribution pursuant
to Section 4.01(e), the Master Servicer, or the Paying Agent appointed by the
Master Servicer (upon receipt of such statement from the Master Servicer), shall
forward or cause to be forwarded by mail to each Holder of a Certificate and the
Seller a statement setting forth:
(i) the amount of such distribution to Holders of each Class A
Subclass allocable to principal, separately identifying the aggregate amount of
any Principal Prepayments included therein;
(ii) (a) the amount of such distribution to Holders of each
Subclass of Class A Certificates allocable to interest, (b) the amount of the
Current Class A Interest Distribution Amount allocated to each Class A Subclass,
(c) any Class A Subclass Interest Shortfall Amounts arising with respect to such
Distribution Date and any remaining Class A Subclass Unpaid Interest Shortfall
with respect to each Subclass after giving effect to such distribution, (d) the
amount of any Non-Supported Interest Shortfall allocated to each Class A
Subclass for such Distribution Date and (e) the interest portion of Excess
Special Hazard Losses, Excess Fraud Losses and Excess Bankruptcy Losses
allocated to each Subclass for such Distribution Date;
(iii) the amount of such distribution to Holders of the Class AP
Certificates, identifying the aggregate amount of any Principal Prepayments
included therein;
(iv) the amount of such distribution to Holders of the Class M
Certificates allocable to principal, separately identifying the aggregate amount
of any Principal Prepayments included therein;
(v) (a) the amount of such distribution to Holders of the Class M
Certificates allocable to interest, (b) the amount of the Current Class M
Interest Distribution Amount, (c) any Class M Interest Shortfall Amount arising
with respect to such Distribution Date and any remaining Class M Unpaid Interest
Shortfall after giving effect to such distribution, (d) the amount of any
Non-Supported Interest Shortfall allocated to the Class M Certificates for such
Distribution Date and (e) the interest portion of Excess Special Hazard Losses,
Excess Fraud Losses and Excess Bankruptcy Losses allocated to the Class M
Certificates for such Distribution Date;
(vi) the amount of such distribution to Holders of each Class B
Subclass allocable to principal, separately identifying the aggregate amount of
any Principal Prepayments included therein;
(vii) (a) the amount of such distribution to Holders of each
Class B Subclass allocable to interest, (b) the amount of the Current Class B
Interest Distribution Amount allocated to each Class B Subclass and the
Pass-Through Rate applicable to such Distribution Date, (c) any Class B Subclass
Interest Shortfall Amounts arising with respect to such Distribution Date and
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any remaining Class B Subclass Unpaid Interest Shortfall with respect to each
Class B Subclass after giving effect to such distribution, (d) the amount of any
Non-Supported Interest Shortfall allocated to each Class B Subclass for such
Distribution Date, and (e) the interest portion of Excess Special Hazard Losses,
Excess Fraud Losses and Excess Bankruptcy Losses allocated to each Class B
Subclass for such Distribution Date;
(viii) the amount of any Periodic Advance by any Servicer, the
Master Servicer or the Trust Administrator pursuant to the Servicing Agreements
or this Agreement;
(ix) the number of Mortgage Loans outstanding as of the preceding
Determination Date;
(x) the Class A Principal Balance, the Class A Subclass Principal
Balance of each Subclass of Class A Certificates, the Class AP Principal
Balance, the Class M Principal Balance, the Class B Principal Balance and the
Class B Subclass Principal Balance of each Subclass of Class B Certificates as
of the following Determination Date after giving effect to the distributions of
principal made, and the principal portion of Realized Losses, if any, allocated
with respect to such Distribution Date;
(xi) the Adjusted Pool Amount, the Adjusted Pool Amount (Class AP
Portion), the Pool Scheduled Principal Balance of the Mortgage Loans for such
Distribution Date and the aggregate Scheduled Principal Balance of the Discount
Mortgage Loans for such Distribution Date;
(xii) the aggregate Scheduled Principal Balances of the Mortgage
Loans serviced by PHMC and, collectively, by the Other Servicers as of such
Distribution Date;
(xiii) the Class A Percentage for the following Distribution Date
(without, in the case of Exhibit F-1 Mortgage Loans, giving effect to
Curtailments and Net Partial Liquidation Proceeds received after the
Determination Date in the current month which are applied as of the Due Date
occurring in such month);
(xiv) the Class A Prepayment Percentage for the following
Distribution Date (without, in the case of Exhibit F-1 Mortgage Loans, giving
effect to Curtailments and Net Partial Liquidation Proceeds received after the
Determination Date in the current month which are applied as of the Due Date
occurring in such month);
(xv) the Class M Percentage for the following Distribution Date
(without, in the case of Exhibit F-1 Mortgage Loans, giving effect to
Curtailments and Net Partial Liquidation Proceeds received after the
Determination Date in the current month which are applied as of the Due Date
occurring in such month);
(xvi) the Class M Prepayment Percentage for the following
Distribution Date (without, in the case of Exhibit F-1 Mortgage Loans, giving
effect to Curtailments and Net Partial Liquidation Proceeds received after the
Determination Date in the current month which are applied as of the Due Date
occurring in such month);
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(xvii) the Class B-1, Class B-2, Class B-3, Class B-4 and Class
B-5 Percentages for the following Distribution Date (without, in the case of
Exhibit F-1 Mortgage Loans, giving effect to Curtailments and Net Partial
Liquidation Proceeds received after the Determination Date in the current month
which are applied as of the Due Date occurring in such month);
(xviii) the Class B-1, Class B-2, Class B-3, Class B-4 and Class
B-5 Prepayment Percentages for the following Distribution Date (without, in the
case of Exhibit F-1 Mortgage Loans, giving effect to Curtailments and Net
Partial Liquidation Proceeds received after the Determination Date in the
current month which are applied as of the Due Date occurring in such month);
(xix) the number and aggregate principal balances of Mortgage
Loans delinquent (a) one month, (b) two months and (c) three months or more;
(xx) the number and aggregate principal balances of the Mortgage
Loans in foreclosure as of the preceding Determination Date;
(xxi) the book value of any real estate acquired through
foreclosure or grant of a deed in lieu of foreclosure;
(xxii) the amount of the remaining Special Hazard Loss Amount,
Fraud Loss Amount and Bankruptcy Loss Amount as of the close of business on such
Distribution Date;
(xxiii) the principal and interest portions of Realized Losses
allocated as of such Distribution Date and the amount of such Realized Losses
constituting Excess Special Hazard Losses, Excess Fraud Losses or Excess
Bankruptcy Losses;
(xxiv) the aggregate amount of Bankruptcy Losses allocated to
each Subclass of Class B Certificates or, following the reduction of the Class B
Principal Balance to zero, solely to the Class M Certificates in accordance with
Section 4.02(a) since the Relevant Anniversary;
(xxv) the amount by which the Class B Subclass Principal Balance
of each Subclass of Class B Certificates and the Class M Principal Balance has
been reduced as a result of Realized Losses allocated as of such Distribution
Date;
(xxvi) the unpaid principal balance of any Mortgage Loan as to
which the Servicer of such Mortgage Loan has determined not to foreclose because
it believes the related Mortgaged Property may be contaminated with or affected
by hazardous wastes or hazardous substances;
(xxvii) the amount of the aggregate Servicing Fees and Master
Servicing Fees paid (and not previously reported) with respect to the related
Distribution Date and the amount by which the aggregate Servicing Compensation
has been reduced by the Prepayment Interest Shortfall or Curtailment Interest
Shortfall for the related Distribution Date;
(xxviii) the Class AP Deferred Amount, if any; and
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(xxix) such other customary information as the Master Servicer
deems necessary or desirable to enable Certificateholders to prepare their tax
returns; and
deliver a copy of each type of statement to the Trust
Administrator, who shall provide copies thereof to Persons making written
request therefor at the Corporate Trust Office.
In the case of information furnished with respect to a Class A
Subclass pursuant to clauses (i) and (ii) above, with respect to the Class AP
Certificates pursuant to clause (iii) above, with respect to the Class M
Certificates pursuant to clauses (iv) and (v) above and with respect to a Class
B Subclass pursuant to clauses (vi) and (vii) above, the amounts shall be
expressed as a dollar amount per Class A Certificate with a $1,000 Denomination,
and as a dollar amount per Class B Certificate with a $1 Denomination.
Within a reasonable period of time after the end of each calendar
year, the Master Servicer shall furnish or cause to be furnished to each Person
who at any time during the calendar year was the Holder of a Certificate a
statement containing the information set forth in clauses (i) and (ii)(a) above
in the case of a Class A Certificateholder, the information contained in clause
(iii) above in the case of a Class AP Certificateholder, the information
contained in clauses (iv) and (v)(a) above in the case of a Class M
Certificateholder and the information contained in clauses (vi) and (vii)(a)
above in the case of a Class B Certificateholder aggregated for such calendar
year or applicable portion thereof during which such Person was a
Certificateholder. Such obligation of the Master Servicer shall be deemed to
have been satisfied to the extent that substantially comparable information
shall be provided by the Master Servicer pursuant to any requirements of the
Code.
Prior to the close of business on the third Business Day
preceding each Distribution Date, the Master Servicer shall furnish a statement
to the Trust Administrator, any Paying Agent and the Seller (the information in
such statement to be made available to Certificateholders by the Master Servicer
on written request) setting forth the Class A Subclass Distribution Amount with
respect to each Class A Subclass, the Class AP Distribution Amount, the Class M
Distribution Amount and the Class B Subclass Distribution Amount with respect to
each Class B Subclass. The determination by the Master Servicer of such amounts
shall, in the absence of obvious error, be presumptively deemed to be correct
for all purposes hereunder and the Trust Administrator and the Paying Agent
shall be protected in relying upon the same without any independent check or
verification.
In addition to the reports required pursuant to this Section
4.04, the Master Servicer shall make available upon request to each Holder and
each proposed transferee of a Class B-3, Class B-4 or Class B-5 Certificate such
additional information, if any, as may be required to permit the proposed
transfer to be effected pursuant to Rule 144A.
Section 4.05 Reports to Mortgagors and the Internal Revenue
Service. The Master Servicer shall, in each year beginning after the Cut-Off
Date, make the reports of foreclosures and abandonments of any Mortgaged
Property as required by Code Section 6050J. In order to facilitate this
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reporting process, the Master Servicer shall request that each Servicer, on or
before January 15th of each year, shall provide to the Internal Revenue Service,
with copies to the Master Servicer, reports relating to each instance occurring
during the previous calendar year in which such Servicer (i) on behalf of the
Trustee acquires an interest in a Mortgaged Property through foreclosure or
other comparable conversion in full or partial satisfaction of a Mortgage Loan
serviced by such Servicer, or (ii) knows or has reason to know that a Mortgaged
Property has been abandoned. Reports from the Servicers shall be in form and
substance sufficient to meet the reporting requirements imposed by Code Section
6050J. In addition, each Servicer shall provide the Master Servicer with
sufficient information to allow the Master Servicer to, for each year ending
after the Cut-Off Date, provide, or cause to be provided, to the Internal
Revenue Service and the Mortgagors such information as is required under Code
Sections 6050H (regarding payment of interest) and 6050P (regarding cancellation
of indebtedness).
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ARTICLE V
THE CERTIFICATES
Section 5.01. The Certificates. (a) The Class A, Class AP, Class
M and Class B Certificates shall be issued only in minimum denominations of a
Single Certificate and, except for the Class A-R Certificates, integral
multiples of $1,000 (or $1 in the case of the Class AP Certificates and Class
B-5 Certificates) in excess thereof (except, if necessary, for one Certificate
of each Subclass (other than the Class A-R Certificate) that evidences one
Single Certificate plus such additional principal portion as is required in
order for all Certificates of such Subclass to equal the aggregate Original
Class A Subclass Principal Balance, Original Class AP Principal Balance,
Original Class M Principal Balance or the aggregate Original Class B Subclass
Principal Balance of such Subclass, as the case may be), and shall be
substantially in the respective forms set forth as Exhibits A-1, A-2, A-3, A-4,
A-5, A-R, B-1, B-2, B-3, B-4, B-5, C, C-1 and D (reverse side of Certificates)
hereto. On original issue the Certificates shall be executed and delivered by
the Trust Administrator to or upon the order of the Seller upon receipt by the
Trust Administrator or the Custodian of the documents specified in Section 2.01.
The aggregate principal portion evidenced by the Class A, Class AP, Class M and
Class B Certificates shall be the sum of the amounts specifically set forth in
the respective Certificates. The Certificates shall be executed by manual or
facsimile signature on behalf of the Trust Administrator by any Responsible
Officer thereof. Certificates bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Trust Administrator
shall bind the Trust Administrator notwithstanding that such individuals or any
of them have ceased to hold such offices prior to the authentication and
delivery of such Certificates or did not hold such offices at the date of such
Certificates. No Certificate shall be entitled to any benefit under this
Agreement, or be valid for any purpose, unless manually countersigned by a
Responsible Officer of the Trust Administrator, or unless there appears on such
Certificate a certificate of authentication executed by the Authenticating Agent
by manual signature, and such countersignature or certificate upon a 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.
Until such time as Definitive Certificates are issued pursuant to
Section 5.07, each Book-Entry Certificate shall bear the following legend:
"Unless this certificate is presented by an authorized
representative of [the Clearing Agency] to the Trust Administrator or its agent
for registration of transfer, exchange or payment, and any certificate issued is
registered in the name of [the Clearing Agency] or such other name as requested
by an authorized representative of [the Clearing Agency] and any payment is made
to [the Clearing Agency], any transfer, pledge or other use hereof for value or
otherwise by or to any person is wrongful since the registered owner hereof,
[the Clearing Agency], has an interest herein."
(b) Upon original issuance, the Book-Entry Certificates shall be
issued in the form of one or more typewritten certificates, to be delivered to
The Depository Trust Company, the initial Clearing Agency, by, or on behalf of,
the Seller. Such Certificates shall initially be registered in the Certificate
Register in the name of the nominee of the initial Clearing Agency, and no
Beneficial Owner will receive a definitive certificate representing such
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Beneficial Owner's interest in the Book-Entry Certificates, except as provided
in Section 5.07. Unless and until definitive, fully registered certificates
("Definitive Certificates") have been issued to Beneficial Owners pursuant to
Section 5.07:
(i) the provisions of this Section 5.01(b) shall be in full force
and effect;
(ii) the Seller, the Master Servicer, the Certificate Registrar
and the Trust Administrator may deal with the Clearing Agency for all purposes
(including the making of distributions on the Book-Entry Certificates and the
taking of actions by the Holders of Book-Entry Certificates) as the authorized
representative of the Beneficial Owners;
(iii) to the extent that the provisions of this Section 5.01(b)
conflict with any other provisions of this Agreement, the provisions of this
Section 5.01(b) shall control;
(iv) the rights of Beneficial Owners shall be exercised only
through the Clearing Agency and shall be limited to those established by law,
the rules, regulations and procedures of the Clearing Agency and agreements
between such Beneficial Owners and the Clearing Agency and/or the Clearing
Agency Participants, and all references in this Agreement to actions by
Certificateholders shall, with respect to the Book-Entry Certificates, refer to
actions taken by the Clearing Agency upon instructions from the Clearing Agency
Participants, and all references in this Agreement to distributions, notices,
reports and statements to Certificateholders shall, with respect to the
Book-Entry Certificates, refer to distributions, notices, reports and statements
to the Clearing Agency or its nominee, as registered holder of the Book-Entry
Certificates, as the case may be, for distribution to Beneficial Owners in
accordance with the procedures of the Clearing Agency; and
(v) the initial Clearing Agency will make book-entry transfers
among the Clearing Agency Participants and receive and transmit distributions of
principal and interest on the Certificates to the Clearing Agency Participants,
for distribution by such Clearing Agency Participants to the Beneficial Owners
or their nominees.
For purposes of any provision of this Agreement requiring or
permitting actions with the consent of, or at the direction of, Holders of
Book-Entry Certificates evidencing specified Voting Interests, such direction or
consent shall be given by Beneficial Owners having the requisite Voting
Interests, acting through the Clearing Agency.
Unless and until Definitive Certificates have been issued to
Beneficial Owners pursuant to Section 5.07, copies of the reports or statements
referred to in Section 4.04 shall be available to Beneficial Owners upon written
request to the Trust Administrator at the Corporate Trust Office.
Section 5.02. Registration of Transfer and Exchange of
Certificates. (a) The Trust Administrator shall cause to be kept at one of the
offices or agencies to be maintained in accordance with the provisions of
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Section 5.06 a Certificate Register in which, subject to such reasonable
regulations as it may prescribe, the Trust Administrator shall provide for the
registration of Certificates and of transfers and exchanges of Certificates as
herein provided. The Trust Administrator shall act as, or shall appoint, a
Certificate Registrar for the purpose of registering Certificates and transfers
and exchanges of Certificates as herein provided.
Upon surrender for registration of transfer of any Certificate at
any office or agency maintained for such purpose pursuant to Section 5.06 (and
subject to the provisions of this Section 5.02) the Trust Administrator shall
execute, and shall date, authenticate (or cause the Authenticating Agent to
authenticate) and deliver, in the name of the designated transferee or
transferees, one or more new Certificates of a like aggregate principal portion
or Percentage Interest and of the same Class or Subclass.
At the option of the Certificateholders, Certificates may be
exchanged for other Certificates of authorized Denominations of a like aggregate
principal portion or Percentage Interest and of the same Class or Subclass upon
surrender of the Certificates to be exchanged at any such office or agency.
Whenever any Certificates are so surrendered for exchange, the Trust
Administrator shall execute, and shall date, authenticate (or cause the
Authenticating Agent to authenticate) and deliver, the Certificates which the
Certificateholder making the exchange is entitled to receive. Every Certificate
presented or surrendered for transfer or exchange shall (if so required by the
Certificate Registrar or the Trust Administrator) be duly endorsed by, or be
accompanied by a written instrument of transfer in form satisfactory to the
Certificate Registrar, duly executed by the Holder thereof or his attorney duly
authorized in writing.
No service charge shall be made for any transfer or exchange of
Certificates, but the Trust Administrator or the Certificate Registrar may
require payment of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any transfer or exchange of Certificates.
All Certificates surrendered for transfer and exchange shall be
canceled by the Certificate Registrar, the Trust Administrator or the
Authenticating Agent in accordance with their standard procedures.
(b) No transfer of a Class B-3, Class B-4 or Class B-5
Certificate shall be made unless the registration requirements of the Securities
Act of 1933, as amended, and any applicable State securities laws are complied
with, or such transfer is exempt from the registration requirements under said
Act and laws. In the event that a transfer is to be made in reliance upon an
exemption from said Act or laws, (i) unless such transfer is made in reliance on
Rule 144A, the Trust Administrator or the Seller may, if such transfer is to be
made within three years from the date of the initial sale of Certificates,
require a Class B-3, Class B-4 or Class B-5 Certificateholder to deliver a
written Opinion of Counsel acceptable to and in form and substance satisfactory
to the Trust Administrator and the Seller, to the effect that such transfer may
be made pursuant to an exemption, describing the applicable exemption and the
basis therefor, from said Act and laws or is being made pursuant to said Act and
laws, which Opinion of Counsel shall not be an expense of the Trust
Administrator, the Seller or the Master Servicer, and (ii) the Trust
Administrator shall require the transferee to execute an investment letter in
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the form of Exhibit J hereto certifying to the Seller and the Trust
Administrator the facts surrounding such transfer, which investment letter shall
not be an expense of the Trust Administrator, the Seller or the Master Servicer.
The Holder of a Class B-3, Class B-4 or Class B-5 Certificate desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trust
Administrator, the Seller, the Master Servicer and any Paying Agent acting on
behalf of the Trust Administrator against any liability that may result if the
transfer is not so exempt or is not made in accordance with such federal and
state laws. Neither the Seller nor the Trust Administrator is under an
obligation to register the Class B-3, Class B-4 or Class B-5 Certificates under
said Act or any other securities law.
(c) No transfer of a Class M or Class B Certificate shall be made
unless the Trust Administrator shall have received (i) a representation letter
from the transferee in the form of Exhibit J hereto, to the effect that either
(a) such transferee is not an employee benefit plan subject to the fiduciary
responsibility provisions of ERISA, or a governmental plan as defined in Section
3(32) of ERISA or Code Section 4975 or subject to any federal, state or local
law ("Similar Law") which is to a material extent, similar to the foregoing
provisions of ERISA or the Code (collectively, a "Plan") and is not a person
acting on behalf of any such Plan, which representation letter shall not be an
expense of the Trust Administrator, the Seller or the Master Servicer or (b) if
such transferee is an insurance company, the source of funds used to purchase
the Class M or Class B Certificate is an "insurance company general account" (as
such term is defined in Section V(e) of Prohibited Transaction Class Exemption
95-60 ("PTE 95-60"), 60 Fed. Reg. 35925 (July 12, 1995) and there is no Plan
with respect to which the amount of such general account's reserves and
liabilities for the contract(s) held by or on behalf of such Plan and all other
Plans maintained by the same employer (or affiliate thereof as defined in
Section V(a)(1) of PTE 95-60) or by the same employee organization, exceed 10%
of the total of all reserves and liabilities of such general account (as such
amounts are determined under Section I(a) of PTE 95-60) at the date of
acquisition or (ii) in the case of any such Class M or Class B Certificate
presented for registration in the name of a Plan, or a Trust Administrator of
any such Plan, an Opinion of Counsel satisfactory to the Trust Administrator and
the Seller to the effect that the purchase or holding of such Class M or Class B
Certificate will not result in the assets of the Trust Estate being deemed to be
"plan assets" and subject to the prohibited transaction provisions of ERISA and
the Code or Similar Law and will not subject the Trust Administrator, the Seller
or the Master Servicer to any obligation in addition to those undertaken in this
Agreement, which Opinion of Counsel shall not be an expense of the Trust
Administrator, the Seller or the Master Servicer. The Class M or Class B
Certificates shall bear a legend referring to the foregoing restrictions
contained in this paragraph.
(d) No legal or beneficial interest in all or any portion of the
Class A-R Certificate may be transferred directly or indirectly to a
"disqualified organization" within the meaning of Code Section 860E(e)(5) or an
agent of a disqualified organization (including a broker, nominee, or
middleman), to a Plan or a Person investing the assets of a Plan (such plan or
Person, an "ERISA Prohibited Holder") or to an individual, corporation,
partnership or other person unless such transferee (i) is not a Non-U.S. Person
or (ii) is a Non-U.S. Person that holds the Class A-R Certificate in connection
with the conduct of a trade or business within the United States and has
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furnished the transferor and the Trust Administrator with an effective Internal
Revenue Service Form 4224 or (iii) is a Non-U.S. Person that has delivered to
both the transferor and the Trust Administrator an opinion of a nationally
recognized tax counsel to the effect that the transfer of the Class A-R
Certificate to it is in accordance with the requirements of the Code and the
regulations promulgated thereunder and that such transfer of the Class A-R
Certificate will not be disregarded for federal income tax purposes (any such
person who is not covered by clauses (i), (ii) or (iii) above being referred to
herein as a "Non-permitted Foreign Holder"), and any such purported transfer
shall be void and have no effect. The Trust Administrator shall not execute, and
shall not authenticate (or cause the Authenticating Agent to authenticate) and
deliver, a new Class A-R Certificate in connection with any such transfer to a
disqualified organization or agent thereof (including a broker, nominee or
middleman), an ERISA Prohibited Holder or a Non-permitted Foreign Holder, and
neither the Certificate Registrar nor the Trust Administrator shall accept a
surrender for transfer or registration of transfer, or register the transfer of,
the Class A-R Certificate, unless the transferor shall have provided to the
Trust Administrator an affidavit, substantially in the form attached as Exhibit
H hereto, signed by the transferee, to the effect that the transferee is not
such a disqualified organization, an agent (including a broker, nominee, or
middleman) for any entity as to which the transferee has not received a
substantially similar affidavit, an ERISA Prohibited Holder or a Non-permitted
Foreign Holder, which affidavit shall contain the consent of the transferee to
any such amendments of this Agreement as may be required to further effectuate
the foregoing restrictions on transfer of the Class A-R Certificate to
disqualified organizations, ERISA Prohibited Holders or Non-permitted Foreign
Holders. Such affidavit shall also contain the statement of the transferee that
(i) the transferee has historically paid its debts as they have come due and
intends to do so in the future, (ii) the transferee understands that it may
incur liabilities in excess of cash flows generated by the residual interest,
(iii) the transferee intends to pay taxes associated with holding the residual
interest as they become due and (iv) the transferee will not transfer the Class
A-R Certificate to any Person who does not provide an affidavit substantially in
the form attached as Exhibit H hereto.
The affidavit described in the preceding paragraph, if not
executed in connection with the initial issuance of the Class A-R Certificate,
shall be accompanied by a written statement in the form attached as Exhibit I
hereto, signed by the transferor, to the effect that as of the time of the
transfer, the transferor has no actual knowledge that the transferee is a
disqualified organization, ERISA Prohibited Holder or Non-permitted Foreign
Holder, and has no knowledge or reason to know that the statements made by the
transferee with respect to clauses (i) and (iii) of the last sentence of the
preceding paragraph are not true. The Class A-R Certificate shall bear a legend
referring to the foregoing restrictions contained in this paragraph and the
preceding paragraph.
Upon notice to the Master Servicer that any legal or beneficial
interest in any portion of the Class A-R Certificate has been transferred,
directly or indirectly, to a disqualified organization or agent thereof
(including a broker, nominee, or middleman) in contravention of the foregoing
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restrictions, (i) such transferee shall be deemed to hold the Class A-R
Certificate in constructive trust for the last transferor who was not a
disqualified organization or agent thereof, and such transferor shall be
restored as the owner of such Class A-R Certificate as completely as if such
transfer had never occurred, provided that the Master Servicer may, but is not
required to, recover any distributions made to such transferee with respect to
the Class A-R Certificate, and (ii) the Master Servicer agrees to furnish to the
Internal Revenue Service and to any transferor of the Class A-R Certificate or
such agent (within 60 days of the request therefor by the transferor or agent)
such information necessary to the application of Code Section 860E(e) as may be
required by the Code, including but not limited to the present value of the
total anticipated excess inclusions with respect to the Class A-R Certificate
(or portion thereof) for periods after such transfer. At the election of the
Master Servicer, the cost to the Master Servicer of computing and furnishing
such information may be charged to the transferor or such agent referred to
above; however, the Master Servicer shall in no event be excused from furnishing
such information.
Section 5.03. Mutilated, Destroyed, Lost or Stolen Certificates.
If (i) any mutilated Certificate is surrendered to the Trust Administrator or
the Authenticating Agent, or the Trust Administrator or the Authenticating Agent
receives evidence to its satisfaction of the destruction, loss or theft of any
Certificate, and (ii) there is delivered to the Trust Administrator or the
Authenticating Agent such security or indemnity as may be required by them to
hold each of them harmless, then, in the absence of notice to the Trust
Administrator or the Authenticating Agent that such Certificate has been
acquired by a bona fide purchaser, the Trust Administrator shall execute and
authenticate (or cause the Authenticating Agent to 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 principal portion or Percentage
Interest and of the same Class or Subclass. Upon the issuance of any new
Certificate under this Section, the Trust Administrator or the Certificate
Registrar 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
expense (including the fees and expenses of the Trust Administrator or the
Authenticating Agent) in connection therewith. Any duplicate Certificate issued
pursuant to this Section shall constitute complete and indefeasible evidence of
ownership in the Trust Estate, as if originally issued, whether or not the lost,
stolen, or destroyed Certificate shall be found at any time.
Section 5.04. Persons Deemed Owners. Prior to the due
presentation of a Certificate for registration of transfer, the Seller, the
Master Servicer, the Trustee, the Trust Administrator, the Certificate Registrar
and any agent of the Seller, the Master Servicer, the Trustee, the Trust
Administrator or the Certificate Registrar may treat the Person in whose name
any Certificate is registered as the owner of such Certificate for the purpose
of receiving distributions pursuant to Section 4.01, and for all other purposes
whatsoever, and neither the Seller, the Master Servicer, the Trustee, the Trust
Administrator, the Certificate Registrar nor any agent of the Seller, the Master
Servicer, the Trustee, the Trust Administrator or the Certificate Registrar
shall be affected by notice to the contrary.
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Section 5.05. Access to List of Certificateholders' Names and
Addresses. (a) If the Trust Administrator is not acting as Certificate
Registrar, the Certificate Registrar shall furnish or cause to be furnished to
the Trust Administrator, within 15 days after receipt by the Certificate
Registrar of a request by the Trust Administrator in writing, a list, in such
form as the Trust Administrator may reasonably require, of the names and
addresses of the Certificateholders of each Class or Subclass as of the most
recent Record Date.
(b) If five or more Certificateholders (hereinafter referred to
as "applicants") apply in writing to the Trust Administrator, and such
application states that the applicants desire to communicate with other
Certificateholders with respect to their rights under this Agreement or under
the Certificates and is accompanied by a copy of the communication which such
applicants propose to transmit, then the Trust Administrator shall, within five
Business Days following the receipt of such application, afford such applicants
access during normal business hours to the most recent list of
Certificateholders held by the Trust Administrator. If such a list is as of the
date more than 90 days prior to the date of receipt of such applicants' request
and the Trust Administrator is not the Certificate Registrar, the Trust
Administrator shall promptly request from the Certificate Registrar a current
list as provided in paragraph (a) hereof, and shall afford such applicants
access to such list promptly upon receipt.
(c) Every Certificateholder, by receiving and holding a
Certificate, agrees with the Seller, the Master Servicer, the Certificate
Registrar, the Trust Administrator and the Trustee that neither the Seller, the
Master Servicer, the Certificate Registrar, the Trust Administrator nor the
Trustee shall be held accountable by reason of the disclosure of any such
information as to the names, addresses and Percentage Interests of the
Certificateholders hereunder, regardless of the source from which such
information was delivered.
Section 5.06. Maintenance of Office or Agency. The Trust
Administrator will maintain, at its expense, an office or agency where
Certificates may be surrendered for registration of transfer or exchange and
where notices and demands to or upon the Certificate Registrar in respect of the
Certificates and this Agreement may be served. The Trust Administrator initially
designates the Corporate Trust Office and the principal corporate trust office
of the Authenticating Agent, if any, as its offices and agencies for said
purposes.
Section 5.07. Definitive Certificates. If (i)(A) the Master
Servicer advises the Trust Administrator in writing that the Clearing Agency is
no longer willing or able properly to discharge its responsibilities as
depository with respect to the Book-Entry Certificates, and (B) the Master
Servicer is unable to locate a qualified successor, (ii) the Master Servicer, at
its option, advises the Trust Administrator in writing that it elects to
terminate the book-entry system through the Clearing Agency or (iii) after the
occurrence of dismissal or resignation of the Master Servicer, Beneficial Owners
representing aggregate Voting Interests of not less than 51% of the aggregate
Voting Interests of each outstanding Subclass of Book-Entry Certificates advise
the Trust Administrator through the Clearing Agency and Clearing Agency
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Participants in writing that the continuation of a book-entry system through the
Clearing Agency is no longer in the best interests of the Beneficial Owners, the
Trust Administrator shall notify the Beneficial Owners, through the Clearing
Agency, of the occurrence of any such event and of the availability of
Definitive Certificates to Beneficial Owners requesting the same. Upon surrender
to the Trust Administrator by the Clearing Agency of the Certificates held of
record by its nominee, accompanied by reregistration instructions and directions
to execute and authenticate new Certificates from the Master Servicer, the Trust
Administrator shall execute and authenticate Definitive Certificates for
delivery at its Corporate Trust Office. The Master Servicer shall arrange for,
and will bear all costs of, the printing and issuance of such Definitive
Certificates. Neither the Seller, the Master Servicer, the Trustee nor the Trust
Administrator shall be liable for any delay in delivery of such instructions by
the Clearing Agency and may conclusively rely on, and shall be protected in
relying on, such instructions.
Section 5.08. Notices to Clearing Agency. Whenever notice or
other communication to the Holders of Book-Entry Certificates is required under
this Agreement, unless and until Definitive Certificates shall have been issued
to Beneficial Owners pursuant to Section 5.07, the Trust Administrator shall
give all such notices and communications specified herein to be given to Holders
of Book-Entry Certificates to the Clearing Agency.
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ARTICLE VI
THE SELLER AND THE MASTER SERVICER
Section 6.01. Liability of the Seller and the Master Servicer.
The Seller and the Master Servicer shall each be liable in accordance herewith
only to the extent of the obligations specifically imposed by this Agreement and
undertaken hereunder by the Seller and the Master Servicer.
Section 6.02. Merger or Consolidation of the Seller or the Master
Servicer. Subject to the following paragraph, the Seller and the Master Servicer
each will keep in full effect its existence, rights and franchises as a
corporation under the laws of the jurisdiction of its incorporation, and will
obtain and preserve its qualification to do business as a foreign corporation in
each jurisdiction in which such qualification is or shall be necessary to
protect the validity and enforceability of this Agreement, the Certificates or
any of the Mortgage Loans and to perform its respective duties under this
Agreement.
The Seller or the Master Servicer may be merged or consolidated
with or into any Person, or transfer all or substantially all of its assets to
any Person, in which case any Person resulting from any merger or consolidation
to which the Seller or Master Servicer shall be a party, or any Person
succeeding to the business of the Seller or Master Servicer, shall be the
successor of the Seller or Master Servicer hereunder, without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding; provided, however, that, in the
case of the Master Servicer, any such successor or resulting Person shall be
qualified to service mortgage loans for FNMA or FHLMC.
Section 6.03. Limitation on Liability of the Seller, the Master
Servicer and Others. Neither the Seller nor the Master Servicer nor any of the
directors, officers, employees or agents of either entity shall be under any
liability to the Trust Estate or the Certificateholders and all such Persons
shall be held harmless for any action taken or for refraining from the taking of
any action in good faith pursuant to this Agreement, or for errors in judgment;
provided, however, that this provision shall not protect any such Person against
any breach of warranties or representations made herein or against any liability
which would otherwise be imposed by reason of willful misfeasance, bad faith or
gross negligence in the performance of duties or by reason of reckless disregard
of obligations and duties hereunder. The Seller, the Master Servicer, and any
director, officer, employee or agent of either of them shall be entitled to
indemnification by the Trust Estate and will be 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 willful misfeasance, bad faith or gross negligence in the
performance of his or its duties hereunder or by reason of reckless disregard of
his or its obligations and duties hereunder. The Seller, the Master Servicer and
any of the directors, officers, employees or agents of either may rely in good
faith on any document of any kind which, prima facie, is properly executed and
submitted by any Person respecting any matters arising hereunder. Neither the
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Seller nor the Master Servicer shall be under any obligation to appear in,
prosecute or defend any legal action unless such action is related to its
respective duties under this Agreement and which in its opinion does not involve
it in any expense or liability; provided, however, that the Seller or the Master
Servicer may in its discretion undertake any such action which it may deem
necessary or desirable with respect to this Agreement and the rights and duties
of the parties hereto and the interests of the Certificateholders hereunder if
the Certificateholders offer to the Seller or the Master Servicer, as the case
may be, reasonable security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby. 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 Estate, and the Seller or the
Master Servicer shall be entitled to be reimbursed therefor out of the Master
Servicer Custodial Account, and such amounts shall, on the following
Distribution Date or Distribution Dates, be allocated in reduction of
distributions on the Class A, Class AP, Class M and Subclasses of Class B
Certificates in the same manner as Realized Losses are allocated pursuant to
Section 4.02(a).
Section 6.04. Resignation of the Master Servicer. The Master
Servicer shall not resign from the obligations and duties hereby imposed on it
except upon determination that its duties hereunder are no longer permissible
under applicable law or are in material conflict by reason of applicable law
with any other activities carried on by it. Any such determination permitting
the resignation of the Master Servicer shall be evidenced by an Opinion of
Counsel to such effect delivered to the Trust Administrator and the Trustee. No
such resignation shall become effective until the Trust Administrator, the
Trustee or a successor servicer shall have assumed the Master Servicer's
responsibilities, duties, liabilities and obligations hereunder.
Section 6.05. Compensation to the Master Servicer. The Master
Servicer shall be entitled to receive a monthly fee equal to the Master
Servicing Fee, as compensation for services rendered by the Master Servicer
under this Agreement. The Master Servicer also will be entitled to any late
reporting fees paid by a Servicer pursuant to its Servicing Agreement and any
investment income on funds on deposit in the Master Servicer Custodial Account
as additional compensation.
Section 6.06. Assignment or Delegation of Duties by Master
Servicer. The Master Servicer shall not assign or transfer any of its rights,
benefits or privileges under this Agreement to any other Person, or delegate to
or subcontract with, or authorize or appoint any other Person to perform any of
the duties, covenants or obligations to be performed by the Master Servicer
without the prior written consent of the Trustee and the Trust Administrator,
and any agreement, instrument or act purporting to effect any such assignment,
transfer, delegation or appointment shall be void. Notwithstanding the
foregoing, the Master Servicer shall have the right without the prior written
consent of the Trustee or the Trust Administrator (i) to assign its rights and
delegate its duties and obligations hereunder; provided, however, that (a) the
purchaser or transferee accepting such assignment or delegation is qualified to
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service mortgage loans for FNMA or FHLMC, is satisfactory to the Trust
Administrator and the Trustee, in the exercise of its reasonable judgment, and
executes and delivers to the Trust Administrator and the Trustee an agreement,
in form and substance reasonably satisfactory to the Trust Administrator and the
Trustee, which contains an assumption by such purchaser or transferee of the due
and punctual performance and observance of each covenant and condition to be
performed or observed by the Master Servicer hereunder from and after the date
of such agreement; and (b) each applicable Rating Agency's rating of any
Certificates in effect immediately prior to such assignment, sale or transfer is
not reasonably likely to be qualified, downgraded or withdrawn as a result of
such assignment, sale or transfer and the Certificates are not reasonably likely
to be placed on credit review status by any such Rating Agency; and (ii) to
delegate to, subcontract with, authorize, or appoint an affiliate of the Master
Servicer to perform and carry out any duties, covenants or obligations to be
performed and carried out by the Master Servicer under this Agreement and hereby
agrees so to delegate, subcontract, authorize or appoint to an affiliate of the
Master Servicer any duties, covenants or obligations to be performed and carried
out by the Master Servicer to the extent that such duties, covenants or
obligations are to be performed in any state or states in which the Master
Servicer is not authorized to do business as a foreign corporation but in which
the affiliate is so authorized. In no case, however, shall any permitted
assignment and delegation relieve the Master Servicer of any liability to the
Trust Administrator, the Trustee or the Seller under this Agreement, incurred by
it prior to the time that the conditions contained in clause (i) above are met.
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ARTICLE VII
DEFAULT
Section 7.01. Events of Default. In case one or more of the
following Events of Default by the Master Servicer shall occur and be
continuing, that is to say:
(i) any failure by the Master Servicer (a) to remit any funds to
the Paying Agent as required by Section 4.03 or (b) to distribute or
cause to be distributed to Certificateholders any payment required to be
made by the Master Servicer under the terms of this Agreement which, in
either case, continues unremedied for a period of three business days
after the date upon which written notice of such failure, requiring the
same to be remedied, shall have been given to the Master Servicer by the
Trustee or to the Master Servicer and the Trustee by the holders of
Certificates evidencing in the aggregate not less than 25% of the
aggregate Voting Interest represented by all Certificates; or
(ii) any failure on the part of the Master Servicer duly to
observe or perform in any material respect any other of the covenants or
agreements on the part of the Master Servicer in the Certificates or in
this Agreement which continues unremedied for a period of 60 days after
the date on which written notice of such failure, requiring the same to
be remedied, shall have been given to the Master Servicer by the
Trustee, or to the Master Servicer and the Trustee by the holders of
Certificates evidencing in the aggregate not less than 25% of the
aggregate Voting Interest represented by all Certificates; or
(iii) a decree or order of a court or agency or supervisory
authority having jurisdiction in the premises for the appointment of a
trustee, conservator, receiver or liquidator in any bankruptcy,
insolvency, readjustment of debt, marshaling of assets and liabilities
or similar proceedings, or for the winding-up or liquidation of its
affairs, shall have been entered against the Master Servicer and such
decree or order shall have remained in force undischarged and unstayed
for a period of 60 days; or
(iv) the Master Servicer shall consent to the appointment of a
trustee, conservator, receiver or liquidator or liquidating committee in
any bankruptcy, insolvency, readjustment of debt, marshaling of assets
and liabilities, voluntary liquidation or similar proceedings of or
relating to the Master Servicer, or of or relating to all or
substantially all of its property; or
(v) the Master Servicer shall admit in writing its inability to
pay its debts generally as they become due, file a petition to take
advantage of any applicable insolvency, bankruptcy or reorganization
statute, make an assignment for the benefit of its creditors or
voluntarily suspend payment of its obligations; or
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(vi) the Master Servicer shall be dissolved, or shall dispose of
all or substantially all of its assets; or consolidate with or merge
into another entity or shall permit another entity to consolidate or
merge into it, such that the resulting entity does not meet the criteria
for a successor servicer, as specified in Section 6.02 hereof;
then, and in each and every such case, subject to applicable law, so long as an
Event of Default shall not have been remedied, either the Trustee or the holders
of Certificates evidencing in the aggregate not less than 25% of the aggregate
Voting Interest represented by all Certificates, by notice in writing to the
Master Servicer (and to the Trustee if given by the Certificateholders) may
terminate all of the rights and obligations of the Master Servicer under this
Agreement and in and to the Mortgage Loans, but without prejudice to any rights
which the Master Servicer may have to the aggregate Master Servicing Fees due
prior to the date of transfer of the Master Servicer's responsibilities
hereunder, reimbursement of expenses to the extent permitted by this Agreement,
Periodic Advances and other advances of its own funds. Upon receipt by the
Master Servicer of such written notice, all authority and power of the Master
Servicer under this Agreement, whether with respect to the Certificates or the
Mortgage Loans or otherwise, shall pass to and be vested in the Trust
Administrator pursuant to and under this Section, subject to the provisions of
Section 7.05; and, without limitation, the Trust Administrator is hereby
authorized and empowered to execute and deliver, on behalf of the Master
Servicer, as attorney-in-fact or otherwise, any and all documents and other
instruments, and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement or assignment of the Mortgage Loans and
related documents or otherwise. The Master Servicer agrees to cooperate with the
Trust Administrator in effecting the termination of the Master Servicer's
responsibilities and rights hereunder and shall promptly provide the Trust
Administrator all documents and records reasonably requested by it to enable it
to assume the Master Servicer's functions hereunder and shall promptly also
transfer to the Trust Administrator all amounts which then have been or should
have been deposited in the Master Servicer Custodial Account by the Master
Servicer or which are thereafter received by the Master Servicer with respect to
the Mortgage Loans.
Section 7.02. 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 7.01,
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 proofs
of claim and debt in connection therewith). 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.
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Section 7.03. Directions by Certificateholders and Duties of
Trustee During Event of Default. During the continuance of any Event of Default,
Holders of Certificates evidencing in the aggregate not less than 25% of the
aggregate Voting Interest represented by all Certificates may direct 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; provided, however, that the Trustee shall be under no obligation to
pursue any such remedy, or to exercise any of the trusts or powers vested in it
by this agreement (including, without limitation, (i) the conducting or
defending of any administrative action or litigation hereunder or in relation
hereto and (ii) the terminating of the Master Servicer from its rights and
duties as servicer hereunder) at the request, order or direction of any of the
Certificateholders, unless such Certificateholders shall have offered to the
Trustee reasonable security or indemnity against the cost, expenses and
liabilities which may be incurred therein or thereby and, provided further,
that, subject to the provisions of Section 8.01, the Trustee shall have the
right to decline to follow any such direction if the Trustee, in accordance with
an Opinion of Counsel, determines that the action or proceeding so directed may
not lawfully be taken or if the Trustee in good faith determines that the action
or proceeding so directed would involve it in personal liability or be unjustly
prejudicial to the nonassenting Certificateholders.
Section 7.04. Action upon Certain Failures of the Master Servicer
and upon Event of Default. In the event that the Trustee or the Trust
Administrator shall have knowledge of any failure of the Master Servicer
specified in Section 7.01(i) or (ii) which would become an Event of Default upon
the Master Servicer's failure to remedy the same after notice, the Trustee or
the Trust Administrator may, but need not if the Trustee or the Trust
Administrator, as the case may be, deems it not in the Certificateholders' best
interest, give notice thereof to the Master Servicer. For all purposes of this
Agreement, in the absence of actual knowledge by a corporate trust officer of
the Trustee or the Trust Administrator, the Trustee or Trust Administrator shall
not be deemed to have knowledge of any failure of the Master Servicer as
specified in Section 7.01(i) and (ii) or any Event of Default unless notified
thereof in writing by the Master Servicer or by a Certificateholder.
Section 7.05. Trust Administrator to Act; Appointment of
Successor. When the Master Servicer receives notice of termination pursuant to
Section 7.01 or the Trustee or the Trust Administrator receives the resignation
of the Master Servicer evidenced by an Opinion of Counsel pursuant to Section
6.04, the Trust Administrator shall be the successor in all respects to the
Master Servicer in its capacity as master servicer under this Agreement and the
transactions set forth or provided for herein and shall have the rights and
powers and be subject to all the responsibilities, duties and liabilities
relating thereto placed on the Master Servicer by the terms and provisions
hereof and in its capacity as such successor shall have the same limitation of
liability herein granted to the Master Servicer. In the event that the Trust
Administrator is succeeding to the Master Servicer as the Master Servicer, as
compensation therefor, the Trust Administrator shall be entitled to receive
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monthly such portion of the Master Servicing Fee, together with such other
servicing compensation as is agreed to at such time by the Trust Administrator
and the Master Servicer, but in no event more than 25% thereof until the date of
final cessation of the Master Servicer's servicing activities hereunder.
Notwithstanding the above, the Trust Administrator may, if it shall be unwilling
to so act, or shall, if it is unable to so act or to obtain a qualifying bid as
described below, appoint, or petition a court of competent jurisdiction to
appoint, any housing and home finance institution, bank or mortgage servicing
institution having a net worth of not less than $10,000,000 and meeting such
other standards for a successor servicer as are set forth herein, as the
successor to the Master Servicer hereunder in the assumption of all or any part
of the responsibilities, duties or liabilities of the Master Servicer hereunder;
provided, however, that until such a successor master servicer is appointed and
has assumed the responsibilities, duties and liabilities of the Master Servicer
hereunder, the Trust Administrator shall continue as the successor to the Master
Servicer as provided above. The compensation of any successor master servicer so
appointed shall not exceed the compensation specified in Section 6.05 hereof. In
the event the Trust Administrator is required to solicit bids as provided above,
the Trust Administrator shall solicit, by public announcement, bids from housing
and home finance institutions, banks and mortgage servicing institutions meeting
the qualifications set forth in the preceding sentence for the purchase of the
master servicing functions. Such public announcement shall specify that the
successor master servicer shall be entitled to the full amount of the Master
Servicing Fee as compensation together with the other servicing compensation in
the form of late reporting fees or otherwise as provided in Section 6.05. Within
30 days after any such public announcement, the Trust Administrator shall
negotiate and effect the sale, transfer and assignment of the master servicing
rights and responsibilities hereunder to the qualified party submitting the
highest qualifying bid. The Trust Administrator shall deduct all costs and
expenses of any public announcement and of any sale, transfer and assignment of
the servicing rights and responsibilities hereunder from any sum received by the
Trust Administrator from the successor to the Master Servicer in respect of such
sale, transfer and assignment. After such deductions, the remainder of such sum
shall be paid by the Trust Administrator to the Master Servicer at the time of
such sale, transfer and assignment to the Master Servicer's successor. The Trust
Administrator and such successor shall take such action, consistent with this
Agreement, as shall be necessary to effectuate any such succession. The Master
Servicer agrees to cooperate with the Trust Administrator and any successor
servicer in effecting the termination of the Master Servicer's servicing
responsibilities and rights hereunder and shall promptly provide the Trust
Administrator or such successor master servicer, as applicable, all documents
and records reasonably requested by it to enable it to assume the Master
Servicer's function hereunder and shall promptly also transfer to the Trust
Administrator or such successor master servicer, as applicable, all amounts
which then have been or should have been deposited in the Master Servicer
Custodial Account by the Master Servicer or which are thereafter received by the
Master Servicer with respect to the Mortgage Loans. Neither the Trust
Administrator nor any other successor master servicer shall be deemed to be in
default hereunder by reason of any failure to make, or any delay in making, any
distribution hereunder or any portion thereof caused by (i) the failure of the
Master Servicer to deliver, or any delay in delivering, cash, documents or
records to it, or (ii) restrictions imposed by any regulatory authority having
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jurisdiction over the Master Servicer. Notwithstanding anything to the contrary
contained in Section 7.01 above or this Section 7.05, the Master Servicer shall
retain all of its rights and responsibilities hereunder, and no successor
(including the Trust Administrator) shall succeed thereto, if the assumption
thereof by such successor would cause the rating assigned to any Certificates to
be revoked, downgraded or placed on credit review status (other than for
possible upgrading) by either Rating Agency and the retention thereof by the
Master Servicer would avert such revocation, downgrading or review.
Section 7.06. Notification to Certificateholders. Upon any
termination of the Master Servicer or appointment of a successor master
servicer, in each case as provided herein, the Trustee shall give prompt written
notice thereof to Certificateholders at their respective addresses appearing in
the Certificate Register. The Trustee shall also, within 45 days after the
occurrence of any Event of Default known to the Trustee, give written notice
thereof to Certificateholders at their respective addresses appearing in the
Certificate Register, unless such Event of Default shall have been cured or
waived within said 45 day period.
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ARTICLE VIII
CONCERNING THE TRUSTEE AND THE TRUST ADMINISTRATOR
Section 8.01. Duties of Trustee. The Trustee, prior to the
occurrence of an Event of Default and after the curing of all Events of Default
which may have occurred, undertakes to perform such duties and only such duties
as are specifically set forth in this Agreement. In case an Event of Default has
occurred (which has not been cured), the Trustee, subject to the provisions of
Sections 7.01, 7.03, 7.04 and 7.05, shall exercise such of the rights and powers
vested in it by this Agreement, and use the same degree of care and skill in its
exercise as a prudent investor would exercise or use under the circumstances in
the conduct of such investor's own affairs.
The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee, which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they are in
the form required by this Agreement; provided, however, that the Trustee shall
not be responsible for the accuracy or content of any certificate, statement,
instrument, report, notice or other document furnished by the Servicers pursuant
to Articles III, IV and IX.
No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct; provided, however, that:
(i) Prior to the occurrence of an Event of Default and after the
curing of all such Events of Default which may have occurred, the duties
and obligations of the Trustee shall be determined solely by the express
provisions of this Agreement, the Trustee shall not be liable except for
the performance of such duties and obligations as are specifically set
forth in this Agreement, no implied covenants or obligations shall be
read into this Agreement against the Trustee and, in the absence of bad
faith on the part of the Trustee, the Trustee may conclusively rely, as
to the truth of the statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished to the
Trustee, and conforming to the requirements of this Agreement;
(ii) The Trustee shall not be 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 which evidence
in the aggregate not less than 25% of the Voting Interest represented by
all 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
(iii) the Trustee shall not be liable for any error of judgment
made in good faith by any of its Responsible Officers, unless it shall
be proved that the Trustee, or such Responsible Officer was negligent in
ascertaining the pertinent facts.
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None of the provisions contained in this Agreement shall require
the Trustee or the Trust Administrator to expend or risk its own funds or
otherwise incur personal financial liability in the performance of any of its
duties hereunder or in the exercise of any of its rights or powers if there is
reasonable ground for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.
Section 8.02. Certain Matters Affecting the Trust Administrator
and the Trustee. Except as otherwise provided in Section 8.01:
(i) Each of the Trust Administrator and the Trustee may rely and
shall be protected in acting or refraining from acting upon any
resolution, Officers' Certificate, certificate of auditors or any other
certificate, statement, instrument, opinion, report, notice, request,
consent, order, appraisal, bond or other paper or document believed by
it to be genuine and to have been signed or presented by the proper
party or parties;
(ii) Each of the Trust Administrator and 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) Each of the Trust Administrator and the Trustee shall not be
personally liable for any action taken, suffered or omitted by it in
good faith and believed by it to be authorized or within the discretion
or rights or powers conferred upon it by this Agreement; and
(iv) Each of the Trust Administrator and the Trustee may execute
any of the trusts or powers hereunder or perform any duties hereunder
either directly or by or through agents or attorneys.
Section 8.03. Neither Trustee nor Trust Administrator Required to
Make Investigation. Prior to the occurrence of an Event of Default hereunder and
after the curing of all Events of Default which may have occurred, neither the
Trustee nor the Trust Administrator 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, appraisal, bond,
Mortgage, Mortgage Note or other paper or document (provided the same appears
regular on its face), unless requested in writing to do so by holders of
Certificates evidencing in the aggregate not less than 51% of the Voting
Interest represented by all Certificates; provided, however, that if the payment
within a reasonable time to the Trustee or the Trust Administrator 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 or the Trust Administrator, not
reasonably assured to the Trustee or the Trust Administrator by the security
afforded to it by the terms of this Agreement, the Trustee or the Trust
Administrator may require reasonable indemnity against such expense or liability
as a condition to so proceeding. The reasonable expense of every such
investigation shall be paid by the Master Servicer or, if paid by the Trustee or
the Trust Administrator, shall be repaid by the Master Servicer upon demand.
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Section 8.04. Neither Trustee nor Trust Administrator Liable for
Certificates or Mortgage Loans. The recitals contained herein and in the
Certificates (other than the certificate of authentication on the Certificates)
shall be taken as the statements of the Seller, and neither the Trustee nor the
Trust Administrator assumes responsibility as to the correctness of the same.
Neither the Trustee nor the Trust Administrator makes a representation for the
correctness of the same. Neither the Trustee nor the Trust Administrator makes a
representation as to the validity or sufficiency of this Agreement or of the
Certificates or of any Mortgage Loan or related document. Neither the Trustee
nor, subject to Section 2.04, the Trust Administrator, shall be accountable for
the use or application by the Seller of any of the Certificates or of the
proceeds of such Certificates, or for the use or application of any funds paid
to the Master Servicer in respect of the Mortgage Loans deposited into the
Master Servicer Custodial Account by the Master Servicer or, in its capacity as
trustee, for investment of any such amounts.
Section 8.05. Trustee and Trust Administrator May Own
Certificates. Each of the Trustee, the Trust Administrator and any agent
thereof, in its individual or any other capacity, may become the owner or
pledgee of Certificates with the same rights it would have if it were not
Trustee, Trust Administrator or such agent.
Section 8.06. The Master Servicer to Pay Fees and Expenses. The
Master Servicer covenants and agrees to pay to each of the Trustee and the Trust
Administrator from time to time, and each of the Trustee and the Trust
Administrator shall be entitled to receive, reasonable compensation (which shall
not be limited by any provision of law in regard to the compensation of a
trustee of an express trust) for all services rendered by it in the execution of
the trusts hereby created and in the exercise and performance of any of the
powers and duties hereunder of the Trustee or the Trust Administrator, as the
case may be, and the Master Servicer will pay or reimburse the Trustee or the
Trust Administrator, as the case may be, upon its request for all reasonable
expenses, disbursements and advances incurred or made by it in accordance with
any of the provisions of this Agreement (including the reasonable compensation
and the expenses and disbursements of its counsel and of all persons not
regularly in its employ) except any such expense, disbursement, or advance as
may arise from its negligence or bad faith.
Section 8.07. Eligibility Requirements. Each of the Trustee and
the Trust Administrator hereunder shall at all times be a corporation having its
principal office in a state and city acceptable to the Seller, organized and
doing business under the laws of such state or the United States of America,
authorized under such laws to exercise corporate trust powers, having a combined
capital and surplus of at least $50,000,000, or shall be a member of a bank
holding system, the aggregate combined capital and surplus of which is at least
$50,000,000, provided that its separate capital and surplus shall at all times
be at least the amount specified in Section 310(a)(2) of the Trust Indenture Act
of 1939, and shall be subject to supervision or examination by federal or state
authority. If such corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of the aforesaid supervising or examining
authority, then for the purposes of this Section the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
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case at any time the Trustee or the Trust Administrator shall cease to be
eligible in accordance with the provisions of this Section, such entity shall
resign immediately in the manner and with the effect specified in Section 8.08.
Section 8.08. Resignation and Removal. Each of the Trustee and
the Trust Administrator may at any time resign and be discharged from the trust
hereby created by giving written notice of resignation to the Master Servicer,
such resignation to be effective upon the appointment of a successor trustee or
trust administrator, as the case may be. Upon receiving such notice of
resignation, the Master Servicer shall promptly appoint a successor trustee by
written instrument, in duplicate, one copy of which instrument shall be
delivered to the resigning entity and one copy to its successor. If no successor
trustee or trust administrator shall have been appointed and have accepted
appointment within 30 days after the giving of such notice of resignation, the
resigning Trustee or Trust Administrator, as the case may be, may petition any
court of competent jurisdiction for the appointment of a successor trustee or
successor trust administrator.
If at any time the Trustee or the Trust Administrator shall cease
to be eligible in accordance with the provisions of Section 8.07 and shall fail
to resign after written request for its resignation by the Master Servicer, or
if at any time the Trustee or the Trust Administrator shall become incapable of
acting, or an order for relief shall have been entered in any bankruptcy or
insolvency proceeding with respect to such entity, or a receiver of such entity
or of its property shall be appointed, or any public officer shall take charge
or control of the Trustee or the Trust Administrator or of the property or
affairs of the Trustee or the Trust Administrator for the purpose of
rehabilitation, conversion or liquidation, or the Master Servicer shall deem it
necessary in order to change the situs of the Trust Estate for state tax
reasons, then the Master Servicer shall remove the Trustee and/or the Trust
Administrator, as the case may be, and appoint a successor trustee and/or
successor trust administrator by written instrument, in duplicate, one copy of
which instrument shall be delivered to the Trustee or Trust Administrator so
removed and one copy to the successor trustee or successor trust administrator,
as the case may be.
The Holders of Certificates evidencing in the aggregate not less
than 51% of the Voting Interests represented by all Certificates (except that
any Certificate registered in the name of the Seller, the Master Servicer or any
affiliate thereof will not be taken into account in determining whether the
requisite Voting Interests has been obtained) may at any time remove the Trustee
and/or the Trust Administrator and appoint a successor by written instrument or
instruments, in triplicate, signed by such holders or their attorneys-in-fact
duly authorized, one complete set of which instruments shall be delivered to the
Master Servicer, one complete set of which shall be delivered to the entity or
entities so removed and one complete set of which shall be delivered to the
successor so appointed.
Any resignation or removal of the Trustee or the Trust
Administrator and appointment of a successor pursuant to any of the provisions
of this Section shall become effective upon acceptance of appointment by the
successor as provided in Section 8.09.
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Section 8.09. Successor. Any successor trustee or successor trust
administrator appointed as provided in Section 8.08 shall execute, acknowledge
and deliver to the Master Servicer and to its predecessor trustee or trust
administrator, as the case may be, an instrument accepting such appointment
hereunder, and thereupon the resignation or removal of the predecessor trustee
or trust administrator shall become effective, and such successor, without any
further act, deed or reconveyance, shall become fully vested with all the
rights, powers, duties and obligations of its predecessor hereunder, with like
effect as if originally named as trustee or trust administrator, as the case may
be, herein. The predecessor trustee or trust administrator shall deliver to its
successor all Owner Mortgage Loan Files and related documents and statements
held by it hereunder (other than any Owner Mortgage Loan Files at the time held
by a Custodian, which Custodian shall become the agent of any successor trustee
hereunder), and the Seller, the Master Servicer and the predecessor entity shall
execute and deliver such instruments and do such other things as may reasonably
be required for more fully and certainly vesting and confirming in the successor
trustee or successor trust administrator, as the case may be, all such rights,
powers, duties and obligations. No successor shall accept appointment as
provided in this Section unless at the time of such acceptance such successor
shall be eligible under the provisions of Section 8.07.
Upon acceptance of appointment by a successor as provided in this
Section, the Master Servicer shall mail notice of the succession of such trustee
or trust administrator 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 the successor trustee or
trust administrator, the successor trustee or trust administrator, as the case
may be, shall cause such notice to be mailed at the expense of the Master
Servicer.
Section 8.10. Merger or Consolidation. Any Person into which
either the Trustee or the Trust Administrator may be merged or converted or with
which it may be consolidated, to which it may sell or transfer its corporate
trust business and assets as a whole or substantially as a whole or any Person
resulting from any merger, sale, transfer, conversion or consolidation to which
the Trustee or the Trust Administrator shall be a party, or any Person
succeeding to the business of such entity, shall be the successor of the Trustee
or the Trust Administrator, as the case may be, hereunder; provided, however,
that (i) such Person shall be eligible under the provisions of Section 8.07,
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, and
(ii) the Trustee or the Trust Administrator, as the case may be, shall deliver
an Opinion of Counsel to the Seller and the Master Servicer to the effect that
such merger, consolidation, sale or transfer will not subject the REMIC to
federal, state or local tax or cause the Trust Estate to fail to qualify as a
REMIC, which Opinion of Counsel shall be at the sole expense of the Trustee or
the Trust Administrator, as the case may be.
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Section 8.11. Authenticating Agent. The Trust Administrator may
appoint an Authenticating Agent, which shall be authorized to act on behalf of
the Trust Administrator in authenticating Certificates. Wherever reference is
made in this Agreement to the authentication of Certificates by the Trust
Administrator or the Trust Administrator's countersignature, such reference
shall be deemed to include authentication on behalf of the Trust Administrator
by the Authenticating Agent and a certificate of authentication executed on
behalf of the Trust Administrator by the Authenticating Agent. The
Authenticating Agent must be acceptable to the Seller and the Master Servicer
and must be a corporation organized and doing business under the laws of the
United States of America or of any state, having a principal office and place of
business in a state and city acceptable to the Seller and the Master Servicer,
having a combined capital and surplus of at least $15,000,000, authorized under
such laws to do a trust business and subject to supervision or examination by
federal or state authorities.
Any corporation into which the Authenticating Agent may be merged
or converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency business
of the Authenticating Agent, shall be the Authenticating Agent without the
execution or filing of any paper or any further act on the part of the Trust
Administrator or the Authenticating Agent.
The Authenticating Agent may at any time resign by giving at
least 30 days' advance written notice of resignation to the Trustee, the Trust
Administrator, the Seller and the Master Servicer. The Trust Administrator may
at any time terminate the agency of the Authenticating Agent by giving written
notice thereof to the Authenticating Agent, the Seller and the Master Servicer.
Upon receiving a notice of resignation or upon such a termination, or in case at
any time the Authenticating Agent shall cease to be eligible in accordance with
the provisions of this Section 8.11, the Trust Administrator promptly shall
appoint a successor Authenticating Agent, which shall be acceptable to the
Master Servicer, and shall give written notice of such appointment to the
Seller, and shall mail notice of such appointment to all Certificateholders. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers, duties and responsibilities of
its predecessor hereunder, with like effect as if originally named as
Authenticating Agent herein. No successor Authenticating Agent shall be
appointed unless eligible under the provisions of this Section 8.11.
The Authenticating Agent shall have no responsibility or
liability for any action taken by it as such at the direction of the Trust
Administrator. Any reasonable compensation paid to the Authenticating Agent
shall be a reimbursable expense under Section 8.06.
Section 8.12. Separate Trustees and Co-Trustees. The Trustee
shall have the power from time to time to appoint one or more persons or
corporations to act either as co-trustees jointly with the Trustee, or as
separate trustees, for the purpose of holding title to, foreclosing or otherwise
taking action with respect to any Mortgage Loan outside the state where the
Trustee has its principal place of business, where such separate trustee or
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co-trustee is necessary or advisable (or the Trustee is advised by the Master
Servicer that such separate trustee or co-trustee is necessary or advisable)
under the laws of any state in which a Mortgaged Property is located or for the
purpose of otherwise conforming to any legal requirement, restriction or
condition in any state in which a Mortgaged Property is located or in any state
in which any portion of the Trust Estate is located. The Master Servicer shall
advise the Trustee when, in its good faith opinion, a separate trustee or
co-trustee is necessary or advisable as aforesaid. The separate trustees or
co-trustees so appointed shall be trustees for the benefit of all of the
Certificateholders and shall have such powers, rights and remedies as shall be
specified in the instrument of appointment; provided, however, that no such
appointment shall, or shall be deemed to, constitute the appointee an agent of
the Trustee. The Seller and the Master Servicer shall join in any such
appointment, but such joining shall not be necessary for the effectiveness of
such appointment.
Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all powers, duties, obligations and rights conferred upon
the Trustee, in respect of the receipt, custody and payment of moneys
shall be exercised solely by the Trustee;
(ii) all other rights, powers, duties and obligations conferred
or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or
co-trustee jointly, except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed
(whether as Trustee hereunder or as successor to the Master Servicer
hereunder) the Trustee shall be incompetent or unqualified to perform
such act or acts, in which event such rights, powers, duties and
obligations (including the holding of title to the Trust Estate or any
portion thereof in any such jurisdiction) shall be exercised and
performed by such separate trustee or co-trustee;
(iii) no separate trustee or co-trustee hereunder shall be
personally liable by reason of any act or omission of any other separate
trustee or co-trustee hereunder; and
(iv) the Trustee may at any time accept the resignation of or
remove any separate trustee or co-trustee so appointed by it, if such
resignation or removal does not violate the other terms of this
Agreement.
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, co-trustee, or custodian shall refer to this
Agreement and the conditions of this Article. Each separate trustee and
co-trustee, upon its acceptance of the trusts conferred, shall be vested with
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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 furnished
to the Trustee.
Any separate trustee, co-trustee, or custodian 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.
No separate trustee or co-trustee hereunder shall be required to
meet the terms of eligibility as a successor trustee under Section 8.07
hereunder and no notice to Certificateholders of the appointment thereof shall
be required under Section 8.09 hereof.
The Trustee agrees to instruct its co-trustees, if any, to the
extent necessary to fulfill such entity's obligations hereunder.
The Master Servicer shall pay the reasonable compensation of the
co-trustees to the extent, and in accordance with the standards, specified in
Section 8.06 hereof.
Section 8.13. Appointment of Custodians. The Trust Administrator
may at any time on or after the Closing Date, with the consent of the Master
Servicer and the Seller, appoint one or more Custodians to hold all or a portion
of the Owner Mortgage Loan Files as agent for the Trust Administrator, by
entering into a Custodial Agreement. Subject to this Article VIII, the Trust
Administrator agrees to comply with the terms of each Custodial Agreement and to
enforce the terms and provisions thereof against the Custodian for the benefit
of the Certificateholders. Each Custodian shall be a depository institution
subject to supervision by federal or state authority, shall have a combined
capital and surplus of at least $10,000,000 and shall be qualified to do
business in the jurisdiction in which it holds any Owner Mortgage Loan File.
Each Custodial Agreement may be amended only as provided in Section 10.01.
Section 8.14. Tax Matters; Compliance with REMIC Provisions. (a)
Each of the Trustee, the Trust Administrator and the Master Servicer covenants
and agrees that it shall perform its duties hereunder in a manner consistent
with the REMIC Provisions and shall not knowingly take any action or fail to
take any action that would (i) affect the determination of the Trust Estate's
status as a REMIC; or (ii) cause the imposition of any federal, state or local
income, prohibited transaction, contribution or other tax on either the REMIC or
the Trust Estate. The Master Servicer, or, in the case of the execution of any
tax return or other action required by law to be performed directly by the Trust
Administrator, the Trust Administrator, shall (i) prepare, or cause to be
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prepared, and timely cause to be signed by the Trustee and file annual federal
and applicable state and local income tax returns using a calendar year as the
taxable year for the REMIC and the accrual method of accounting; (ii) in the
first such federal tax return, make, or cause to be made, elections satisfying
the requirements of the REMIC Provisions, on behalf of the Trust Estate, to
treat the Trust Estate as a REMIC; (iii) prepare, execute and forward, or cause
to be prepared, executed and forwarded, to the Certificateholders all
information reports or tax returns required with respect to the Trust Estate, as
and when required to be provided to the Certificateholders, and to the Internal
Revenue Service and any other relevant governmental taxing authority in
accordance with the REMIC Provisions and any other applicable federal, state or
local laws, including without limitation information reports relating to
"original issue discount" and "market discount" as defined in the Code based
upon the issue prices, prepayment assumption and cash flows provided by the
Seller to the Trust Administrator and calculated on a monthly basis by using the
issue price of the Certificates; (iv) make available information necessary for
the application of any tax imposed on transferors of residual interests to
"disqualified organizations" (as defined in the REMIC Provisions); (v) file
Forms SS-4 and 8811 and respond to inquiries by Certificateholders or their
nominees concerning information returns, reports or tax returns; (vi) maintain
(or cause to be maintained by the Servicers) such records relating to the Trust
Estate, including but not limited to the income, expenses, individual Mortgage
Loans (including REO Mortgage Loans, other assets and liabilities of the Trust
Estate, and the fair market value and adjusted basis of the Trust Estate
property determined at such intervals as may be required by the Code, as may be
necessary to prepare the foregoing returns or information reports; (vii)
exercise reasonable care not to allow the creation of any "interests" in the
REMIC within the meaning of Code Section 860D(a)(2) other than the interests
represented by the Class A-l, Class A-2, Class A-3, Class A-5 and Class A-R
Certificates, the Class AP Certificates, the Class M Certificates and the Class
B-l, Class B-2, Class B-3, Class B-4 and Class B-5 Certificates; (viii) exercise
reasonable care not to allow the occurrence of any "prohibited transactions"
within the meaning of Code Section 860F(a), unless the Master Servicer shall
have provided an Opinion of Counsel to the Trustee and the Trust Administrator
that such occurrence would not (a) result in a taxable gain, (b) otherwise
subject either the Trust Estate or the REMIC to tax or (c) cause the Trust
Estate to fail to qualify as a REMIC; (ix) exercise reasonable care not to allow
the Trust Estate to receive income from the performance of services or from
assets not permitted under the REMIC Provisions to be held by a REMIC; (x) pay
(on behalf of the Trust Estate) the amount of any federal income tax, including,
without limitation, prohibited transaction taxes, taxes on net income from
foreclosure property, and taxes on certain contributions to a REMIC after the
Startup Day, imposed on the Trust Estate when and as the same shall be due and
payable (but such obligation shall not prevent the Master Servicer or any other
appropriate Person from contesting any such tax in appropriate proceedings and
shall not prevent the Master Servicer from withholding or depositing payment of
such tax, if permitted by law, pending the outcome of such proceedings); and
(xi) if required or permitted by the Code and applicable law, act as "tax
matters person" for the REMIC within the meaning of Treasury Regulations Section
1.860F-4(d), and the Master Servicer is hereby designated as agent of the Class
A-R Certificateholder for such purpose (or if the Master Servicer is not so
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permitted, the Holder of the Class A-R Certificate shall be tax matters person
in accordance with the REMIC Provisions). The Master Servicer shall be entitled
to be reimbursed pursuant to Section 3.02 for any taxes paid by it pursuant to
clause (x) of the preceding sentence, except to the extent that such taxes are
imposed as a result of the bad faith, willful misfeasance or gross negligence of
the Master Servicer in the performance of its obligations hereunder. The Trustee
shall sign the Tax Returns referred to in clause (i) of the preceding sentence.
In order to enable the Master Servicer, the Trust Administrator or the Trustee,
as the case may be, to perform its duties as set forth above, the Seller shall
provide, or cause to be provided, to the Master Servicer within ten days after
the Closing Date all information or data that the Master Servicer determines to
be relevant for tax purposes to the valuations and offering prices of the
Certificates, including, without limitation, the price, yield, prepayment
assumption and projected cash flows of each Class and Subclass of Certificates
and the Mortgage Loans in the aggregate. Thereafter, the Seller shall provide to
the Master Servicer, the Trust Administrator or the Trustee, as the case may be,
promptly upon request therefor, any such additional information or data that the
Master Servicer, the Trust Administrator or the Trustee, as the case may be, may
from time to time, request in order to enable the Master Servicer to perform its
duties as set forth above. The Seller hereby indemnifies the Master Servicer,
the Trust Administrator or the Trustee, as the case may be, for any losses,
liabilities, damages, claims or expenses of the Master Servicer, the Trust
Administrator or the Trustee arising from any errors or miscalculations by the
Master Servicer, the Trust Administrator or the Trustee pursuant to this Section
that result from any failure of the Seller to provide, or to cause to be
provided, accurate information or data to the Master Servicer, the Trust
Administrator or the Trustee, as the case may be, on a timely basis. The Master
Servicer hereby indemnifies the Seller, the Trust Administrator and the Trustee
for any losses, liabilities, damages, claims or expenses of the Seller, the
Trust Administrator or the Trustee arising from the Master Servicer's willful
misfeasance, bad faith or gross negligence in preparing any of the federal,
state and local tax returns of the REMIC as described above. In the event that
the Trust Administrator prepares any of the federal, state and local tax returns
of the REMIC as described above, the Trust Administrator hereby indemnifies the
Seller, the Master Servicer and the Trustee for any losses, liabilities,
damages, claims or expenses of the Seller, the Master Servicer or the Trustee
arising from the Trust Administrator's willful misfeasance, bad faith or
negligence in connection with such preparation.
(b) Notwithstanding anything in this Agreement to the contrary,
each of the Master Servicer, the Trust Administrator and the Trustee shall pay
from its own funds, without any right of reimbursement therefor, the amount of
any costs, liabilities and expenses incurred by the Trust Estate (including,
without limitation, any and all federal, state or local taxes, including taxes
imposed on "prohibited transactions" within the meaning of the REMIC Provisions)
if and to the extent that such costs, liabilities and expenses arise from a
failure of the Master Servicer, the Trust Administrator or the Trustee to
perform its obligations under this Section 8.14.
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Section 8.15. Monthly Advances. In the event that the Master
Servicer fails to make a Periodic Advance required to be made pursuant to
Section 3.03(a) on or before the Distribution Date (and similarly fails to
deliver an Officers' Certificate evidencing the Master Servicer's determination
that any Periodic Advance if made would be a Nonrecoverable Advance), the Trust
Administrator shall provide to the Master Servicer by telecopy notice of such an
Event of Default and shall deposit in the Master Servicer Custodial Account an
amount equal to the excess of (a) Periodic Advances required to be made by the
Master Servicer pursuant to this Agreement (as evidenced by the certificate
required to be delivered to the Trust Administrator by the Master Servicer
pursuant to Section 3.03(a)) over (b) the amount of Periodic Advances made by
the Master Servicer, or a Servicer acting on its behalf, with respect to such
Distribution Date; provided that the Trust Administrator shall not be required
to make such Periodic Advances if prohibited by law or if it determines that
such Periodic Advance would be a Nonrecoverable Advance. The Trust Administrator
shall be entitled to be reimbursed from the Master Servicer Custodial Account
for Periodic Advances and Nonrecoverable Advances made by it pursuant to this
Section 8.15 in like manner as if it were the Master Servicer.
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ARTICLE IX
TERMINATION
Section 9.01. Termination upon Purchase by the Master Servicer or
Liquidation of All Mortgage Loans. Subject to Section 9.02, the respective
obligations and responsibilities of the Seller, the Master Servicer, the Trust
Administrator and the Trustee created hereby (other than the obligation of the
Trust Administrator to make certain payments after the Final Distribution Date
to Certificateholders and the obligation of the Master Servicer to send certain
notices as hereinafter set forth and the tax reporting obligations under
Sections 4.05 and 8.14 hereof) shall terminate upon the last action required to
be taken by the Trust Administrator on the Final Distribution Date pursuant to
this Article IX following the earlier of (i) the purchase by the Master Servicer
of all Mortgage Loans and all property acquired in respect of any Mortgage Loan
remaining in the Trust Estate at a price equal to the greater of (a) the sum of
(x) 100% of the unpaid principal balance of each Mortgage Loan (other than any
REO Mortgage Loan) as of the Final Distribution Date, and (y) the fair market
value of the Mortgaged Property related to any REO Mortgage Loan (as determined
by the Master Servicer as of the close of business on the third Business Day
next preceding the date upon which notice of any such termination is furnished
to Certificateholders pursuant to the third paragraph of this Section 9.01),
plus any accrued and unpaid interest through the last day of the month preceding
the month of such purchase at the applicable Mortgage Interest Rate less any
Fixed Retained Yield on each Mortgage Loan (including any REO Mortgage Loan) and
(b) the aggregate fair market value (as determined by the Master Servicer as of
the close of business on such third Business Day) of all of the assets of the
Trust Estate, and (ii) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan remaining in the Trust Estate
(including for this purpose the discharge of any Mortgagor under a defaulted
Mortgage Loan on which a Servicer is not obligated to foreclose due to
environmental impairment) or the disposition of all property acquired upon
foreclosure or deed in lieu of foreclosure of any Mortgage Loan; provided,
however, that in no event shall the trust created hereby continue beyond the
expiration of 21 years from the death of the last survivor of the descendants of
Joseph P. Kennedy, the late ambassador of the United States to the Court of St.
James's, living on the date hereof.
The right of the Master Servicer to purchase all the assets of
the Trust Estate pursuant to clause (i) of the preceding paragraph are subject
to Section 9.02 and conditioned upon the Pool Scheduled Principal Balance of the
Mortgage Loans as of the Final Distribution Date being less than the amount set
forth in Section 11.25. In the case of any purchase by the Master Servicer
pursuant to said clause (i), the Master Servicer shall provide to the Trust
Administrator the certification required by Section 3.04 and the Trust
Administrator and the Custodian shall, promptly following payment of the
purchase price, release to the Master Servicer the Owner Mortgage Loan Files
pertaining to the Mortgage Loans being purchased.
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Notice of any termination, specifying the Final Distribution Date
(which shall be a date that would otherwise be a Distribution Date) upon which
the Certificateholders may surrender their Certificates to the Trust
Administrator for payment of the final distribution and cancellation, shall be
given promptly by the Master Servicer (if it is exercising its right to purchase
the assets of the Trust Estate) or by the Trust Administrator (in any other
case) by letter to Certificateholders mailed not earlier than the 15th day of
the month preceding the month of such final distribution and not later than the
twentieth day of the month of such final distribution specifying (A) the Final
Distribution Date upon which final payment of the Certificates will be made upon
presentation and surrender of Certificates at the office or agency of the Trust
Administrator therein designated, (B) the amount of any such final payment and
(C) that the Record Date otherwise applicable to such Distribution Date is not
applicable, payments being made (except in the case of any Class A Certificate
surrendered on a prior Distribution Date pursuant to Section 4.01) only upon
presentation and surrender of the Certificates at the office or agency of the
Trust Administrator therein specified. If the Master Servicer is obligated to
give notice to Certificateholders as aforesaid, it shall give such notice to the
Trust Administrator and the Certificate Registrar at the time such notice is
given to Certificateholders. In the event such notice is given by the Master
Servicer, the Master Servicer shall deposit in the Master Servicer Custodial
Account on or before the Final Distribution Date in immediately available funds
an amount equal to the purchase price for the assets of the Trust Estate
computed as above provided. Failure to give notice of termination as described
herein shall not entitle a Certificateholder to any interest beyond the interest
payable on the Final Distribution Date.
Upon presentation and surrender of the Certificates, the Trust
Administrator shall cause to be distributed to Certificateholders on the Final
Distribution Date in proportion to their respective Percentage Interests an
amount equal to (i) as to the Subclasses of Class A Certificates, the respective
Class A Subclass Principal Balance together with any related Class A Subclass
Unpaid Interest Shortfall and one month's interest in an amount equal to the
respective Class A Subclass Interest Accrual Amount, (ii) as to the Class AP
Certificates, the Class AP Principal Balance, (iii) as to the Class M
Certificates, the Class M Principal Balance together with any Class M Unpaid
Interest Shortfall and one month's interest at the Class M Pass-Through Rate on
the Class M Principal Balance, (iv) as to the Subclasses of Class B
Certificates, the respective Class B Subclass Principal Balance together with
any related Class B Subclass Unpaid Interest Shortfall and one month's interest
in an amount equal to the respective Class B Subclass Interest Accrual Amount
and (v) as to the Class A-R Certificate, the amount, if any, which remains on
deposit in the Master Servicer Custodial Account (other than amounts retained to
meet claims) after application pursuant to clauses (i), (ii) and (iii) above and
payment to the Master Servicer of any amounts it is entitled as reimbursement or
otherwise hereunder; provided, however, that if the price paid pursuant to
clause (i) of the first paragraph of this Section 9.01, after reimbursement to
the Servicers, the Master Servicer and the Trust Administrator of any Periodic
Advances, is insufficient to pay in full the amounts set forth in clauses (i),
(ii), (iii) and (iv) of this paragraph, then any shortfall in the amount
available for distribution to Certificateholders shall be allocated in reduction
of the amounts otherwise distributable on the Final Distribution Date in the
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same manner as Realized Losses are allocated pursuant to Section 4.02(b) hereof.
Such distribution on the Final Distribution Date shall be in lieu of the
distribution otherwise required to be made on such Distribution Date in respect
of each Class of Certificates.
In the event that all of the Certificateholders shall not
surrender their Certificates for final payment and cancellation within three
months following the Final Distribution Date, the Trust Administrator shall on
such date cause all funds, if any, in the Master Servicer Custodial Account not
distributed in final distribution to Certificateholders to be withdrawn
therefrom and credited to the remaining Certificateholders by depositing such
funds in a separate escrow account for the benefit of such Certificateholders,
and the Master Servicer (if it exercised its right to purchase the assets of the
Trust Estate) or the Trust Administrator (in any other case) shall give a second
written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within three months after the second notice all the Certificates
shall not have been surrendered for cancellation, the Trust Administrator 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 on deposit in
such escrow account.
Section 9.02. Additional Termination Requirements. In the event
of a termination of the Trust Estate upon the exercise by the Master Servicer of
its purchase option as provided in Section 9.01, the Trust Estate shall be
terminated in accordance with the following additional requirements, provided
that the Trust Administrator has received an Opinion of Counsel or other
evidence to the effect that such termination (i) will constitute a "qualified
liquidation" of the Trust Estate within the meaning of Code Section
860F(a)(4)(A) and (ii) will not subject either the Trust Estate or the REMIC to
federal tax or cause the Trust Estate to fail to qualify as a REMIC at any time
that any Certificates are outstanding:
(i) The notice given by the Master Servicer under Section 9.01
shall provide that such notice constitutes the adoption of a plan of
complete liquidation of the REMIC as of the date of such notice (or, if
earlier, the date on which the first such notice is mailed to
Certificateholders). The Master Servicer shall also specify such date in
a statement attached to the final tax returns of the REMIC; and
(ii) At or after the time of adoption of such a plan of complete
liquidation and at or prior to the Final Distribution Date, the Trust
Administrator shall sell all of the assets of the Trust Estate to the
Master Servicer for cash at the purchase price specified in Section 9.01
and shall distribute such cash in the manner specified in Section 9.01.
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ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.01.Amendment. This Agreement or any Custodial
Agreement may be amended from time to time by the Seller, the Master Servicer,
the Trust Administrator and the Trustee, without the consent of any of the
Certificateholders, (i) to cure any ambiguity or mistake, (ii) to correct or
supplement any provisions herein or therein which may be inconsistent with any
other provisions herein or therein, (iii) to modify, eliminate or add to any of
its provisions to such extent as shall be necessary to maintain the
qualification of the Trust Estate as a REMIC at all times that any Certificates
are outstanding or to avoid or minimize the risk of the imposition of any
federal tax on the Trust Estate or the REMIC pursuant to the Code that would be
a claim against the Trust Estate, provided that (a) the Trustee and the Trust
Administrator have received an Opinion of Counsel to the effect that such action
is necessary or desirable to maintain such qualification or to avoid or minimize
the risk of the imposition of any such tax and (b) such action shall not, as
evidenced by such Opinion of Counsel, adversely affect in any material respect
the interests of any Certificateholder, (iv) to change the timing and/or nature
of deposits into the Master Servicer Custodial Account provided that (a) such
change shall not, as evidenced by an Opinion of Counsel, adversely affect in any
material respect the interests of any Certificateholder and (b) such change
shall not adversely affect the then-current rating of the Certificates as
evidenced by a letter from each Rating Agency to such effect, (v) to modify,
eliminate or add to the provisions of Section 5.02 or any other provisions
hereof restricting transfer of the Certificates, provided that the Master
Servicer for purposes of Section 5.02 has determined in its sole discretion that
any such modifications to this Agreement will neither adversely affect the
rating on the Certificates nor give rise to a risk that either the Trust Estate
or the REMIC or any of the Certificateholders will be subject to a tax caused by
a transfer to a non-permitted transferee and (vi) to make any other provisions
with respect to matters or questions arising under this Agreement or such
Custodial Agreement which shall not be materially inconsistent with the
provisions of this Agreement, provided that such action shall not, as evidenced
by an Opinion of Counsel, adversely affect in any material respect the interests
of any Certificateholder.
This Agreement or any Custodial Agreement may also be amended
from time to time by the Seller, the Master Servicer, the Trust Administrator
and the Trustee with the consent of the Holders of Certificates evidencing in
the aggregate not less than 66-2/3% of the aggregate Voting Interests of each
Class or Subclass of Certificates affected thereby for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Agreement or such Custodial Agreement or of modifying in any manner the
rights of the Holders of Certificates of such Class or Subclass; provided,
however, that no such amendment shall (i) reduce in any manner the amount of, or
delay the timing of, payments received on Mortgage Loans which are required to
be distributed on any Certificate without the consent of the Holder of such
Certificate, (ii) adversely affect in any material respect the interest of the
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Holders of Certificates of any Class or Subclass in a manner other than as
described in clause (i) hereof without the consent of Holders of Certificates of
such Class or Subclass evidencing, as to such Class or Subclass, Voting
Interests aggregating not less than 66-2/3% or (iii) reduce the aforesaid
percentage of Certificates of any Class or Subclass the Holders of which are
required to consent to any such amendment, without the consent of the Holders of
all Certificates of such Class or Subclass then outstanding.
Notwithstanding any contrary provision of this Agreement, the
Trustee and the Trust Administrator shall not consent to any amendment to this
Agreement unless each shall have first received an Opinion of Counsel to the
effect that such amendment will not subject either the Trust Estate or the REMIC
to tax or cause the Trust Estate to fail to qualify as a REMIC at any time that
any Certificates are outstanding.
Promptly after the execution of any amendment requiring the
consent of Certificateholders, the Trust Administrator shall furnish written
notification of the substance of such amendment to each Certificateholder.
It shall not be necessary for the consent of Certificateholders
under this Section 10.01 to approve the particular form of any proposed
amendment, but it shall be sufficient if such consent shall approve the
substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Certificateholders shall be subject to
such reasonable regulations as the Trust Administrator may prescribe.
Section 10.02. Recordation of Agreement. This Agreement (or an
abstract hereof, if acceptable to the applicable recording office) is subject to
recordation in all appropriate public offices for real property records in all
the towns or other comparable jurisdictions in which any or all of the Mortgaged
Properties are situated, and in any other appropriate public office or
elsewhere, such recordation to be effected by the Master Servicer and at its
expense on direction by the Trust Administrator, but only upon direction
accompanied by an Opinion of Counsel to the effect that such recordation
materially and beneficially affects the interests of the Certificateholders.
For the purpose of facilitating the recordation of this Agreement
as herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
Section 10.03. Limitation on Rights of Certificateholders. The
death or incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust Estate, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or take any action or proceeding
in any court for a partition or winding up of the Trust Estate, nor otherwise
affect the rights, obligations and liabilities of the parties hereto or any of
them.
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Except as otherwise expressly provided herein, no
Certificateholder, solely by virtue of its status as a Certificateholder, shall
have any right to vote or in any manner otherwise control the operation and
management of the Trust Estate, or the obligations of the parties hereto, nor
shall anything herein set forth, or contained in the terms of the Certificates,
be construed so as to constitute the Certificateholders from time to time as
partners or members of an association, nor shall any Certificateholder be under
any liability to any third person by reason of any action taken by the parties
to this Agreement pursuant to any provision hereof.
No Certificateholder, solely by virtue of its status as
Certificateholder, shall have any right by virtue or by availing of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Holder previously shall have given to the Trust Administrator a written notice
of default and of the continuance thereof, as hereinbefore provided, and unless
also the Holders of Certificates evidencing not less than 25% of the Voting
Interest represented by all Certificates shall have made written request upon
the Trust Administrator to institute such action, suit or proceeding in its own
name as Trust Administrator hereunder and shall have offered to the Trust
Administrator such reasonable indemnity as it may require against the cost,
expenses and liabilities to be incurred therein or thereby, and the Trust
Administrator, 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 Trust
Administrator, that no one or more Holders of Certificates shall have any right
in any manner whatever by virtue or by availing of any provision of this
Agreement to affect, disturb or prejudice the rights of the Holders of any other
of such Certificates, or to obtain or seek to obtain priority over or preference
to any other such Holder, or to enforce any right under this Agreement, except
in the manner herein provided and for the benefit of all Certificateholders. For
the protection and enforcement of the provisions of this Section, each and every
Certificateholder and the Trust Administrator shall be entitled to such relief
as can be given either at law or in equity.
Section 10.04. Governing Law; Jurisdiction. This Agreement shall
be construed in accordance with the laws of the State of New York (without
regard to conflicts of laws principles), and the obligations, rights and
remedies of the parties hereunder shall be determined in accordance with such
laws.
Section 10.05. Notices. All demands, notices and communications
hereunder shall be in writing and shall be deemed to have been duly given if
personally delivered at or mailed by certified or registered mail, return
receipt requested (i) in the case of the Seller, to The Prudential Home Mortgage
Securities Company, Inc., 5325 Spectrum Drive, Frederick, Maryland 21701,
Attention: Chief Executive Officer, or such other address as may hereafter be
furnished to the Master Servicer and the Trustee in writing by the Seller, (ii)
in the case of the Master Servicer, to Securitized Asset Services Corporation,
5325 Spectrum Drive, Frederick, Maryland 21701, Attention: Vice President or
such other address as may hereafter be furnished to the Seller and the Trustee
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in writing by the Master Servicer, (iii) in the case of the Trustee, to the
Corporate Trust Office and (iv) in the case of the Trust Administrator, to the
Corporate Trust Office, or such other address as may hereafter be furnished to
the Seller and the Master Servicer in writing by the Trustee or the Trust
Administrator, in each case Attention: Corporate Trust Department. Any notice
required or permitted to be mailed to a Certificateholder shall be given by
first class mail, postage prepaid, at the address of such Holder as shown in the
Certificate Register. Any notice mailed or transmitted within the time
prescribed in this Agreement shall be conclusively presumed to have been duly
given, whether or not the addressee receives such notice, provided, however,
that any demand, notice or communication to or upon the Seller, the Master
Servicer, the Trustee or the Trust Administrator shall not be effective until
received.
For all purposes of this Agreement, in the absence of actual
knowledge by an officer of the Master Servicer, the Master Servicer shall not be
deemed to have knowledge of any act or failure to act of any Servicer unless
notified thereof in writing by the Trustee, the Trust Administrator, such
Servicer or a Certificateholder.
Section 10.06. Severability of Provisions. If any one or more of
the covenants, agreements, provisions or terms of this Agreement shall be for
any reason whatsoever held invalid, then such covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or the rights of the Holders thereof.
Section 10.07. Special Notices to Rating Agencies. (a) The Trust
Administrator shall give prompt notice to each Rating Agency of the occurrence
of any of the following events of which it has notice:
(i) any amendment to this Agreement pursuant to Section 10.01;
(ii) any sale or transfer of the Class B Certificates pursuant to
Section 5.02 to an affiliate of the Seller other than The Prudential Insurance
Company of America;
(iii) any assignment by the Master Servicer of its rights and
delegation of its duties pursuant to Section 6.06;
(iv) any resignation of the Master Servicer pursuant to Section
6.04;
(v) the occurrence of any of the Events of Default described in
Section 7.01;
(vi) any notice of termination given to the Master Servicer
pursuant to Section 7.01;
(vii) the appointment of any successor to the Master Servicer
pursuant to Section 7.05; or
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(viii) the making of a final payment pursuant to Section 9.01.
(b) The Master Servicer shall give prompt notice to each Rating
Agency of the occurrence of any of the following events:
(i) the appointment of a Custodian pursuant to Section 2.02;
(ii) the resignation or removal of the Trustee or the Trust
Administrator pursuant to Section 8.08;
(iii) the appointment of a successor trustee or trust
administrator pursuant to Section 8.09; or
(iv) the sale, transfer or other disposition in a single
transaction of 50% or more of the equity interests in the Master Servicer, other
than to any affiliate of The Prudential Insurance Company of America.
(c) The Master Servicer shall deliver to each Rating Agency:
(i) reports prepared pursuant to Section 3.05; and
(ii) statements prepared pursuant to Section 4.04.
Section 10.08. Covenant of Seller. The Seller shall not amend
Article Third of its Certificate of Incorporation without the prior written
consent of each Rating Agency rating the Certificates.
Section 10.09. Recharacterization. The Parties intend the
conveyance by the Seller to the Trustee of all of its right, title and interest
in and to the Mortgage Loans pursuant to this Agreement to constitute a purchase
and sale and not a loan. Notwithstanding the foregoing, to the extent that such
conveyance is held not to constitute a sale under applicable law, it is intended
that this Agreement shall constitute a security agreement under applicable law
and that the Seller shall be deemed to have granted to the Trustee a first prior
security interest in all of the Seller's right, title and interest in and to the
Mortgage Loans.
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ARTICLE XI
TERMS FOR CERTIFICATES
Section 11.01. Class A Fixed Pass-Through Rate. The Class A Fixed
Pass-Through Rate is 6.75% per annum.
Section 11.02. Cut-Off Date. The Cut-Off Date for the
Certificates is February 1, 1996.
Section 11.03. Cut-Off Date Aggregate Principal Balance. The
Cut-Off Date Aggregate Principal Balance is $124,872,914.35.
Section 11.04. Original Class A Percentage. The Original Class A
Percentage is 96.48119977%.
Section 11.05. Original Class A Subclass Principal Balances. As
to the following Subclasses of Class A Certificates, the Class A Subclass
Principal Balance of such Subclass as of the Cut-Off Date, as follows:
Original Class A Class A Subclass Subclass Principal Balance
Class A-1 ......................... $ 5,051,000.00
Class A-2 ......................... $ 27,033,000.00
Class A-3 ......................... $ 58,855,000.00
Class A-4 ......................... $ 10,915,000.00
Class A-5 ......................... $ 18,000,000.00
Class A-R ......................... $ 100.00
Section 11.06. Original Class A Principal Balance. The Original
Class A Principal Balance is $119,854,100.00.
Section 11.07. Original Class AP Principal Balance. The Original
Class AP Principal Balance is $647,572.74.
Section 11.08. Original Class M Percentage. The Original Class M
Percentage is 1.00543092%.
Section 11.09. Original Class M Principal Balance. The Original
Class M Principal Balance is $1,249,000.00.
Section 11.10. Original Class M Fractional Interest. The Original
Class M Fractional Interest is 2.51336931%.
Section 11.11. Master Servicing Fee Rate. The rate used to
calculate the Master Servicing Fee for each Mortgage Loan is 0.02% per annum.
Section 11.12. Original Class B-1 Percentage. The Original Class
B-1 Percentage is 1.00543092%.
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Section 11.13. Original Class B-2 Percentage. The Original Class
B-2 Percentage is 0.50231297%.
Section 11.14. Original Class B-3 Percentage. The Original Class
B-3 Percentage is 0.45240367%.
Section 11.15. Original Class B-4 Percentage. The Original Class
B-4 Percentage is 0.25115648%.
Section 11.16. Original Class B-5 Percentage. The Original Class
B-5 Percentage is 0.30206527%.
Section 11.17. Original Class B Principal Balance. The Original
Class B Principal Balance is $3,122,241.61.
Section 11.18. Original Class B Subclass Principal Balances. As
to any Class B Certificate, the Class B Subclass Principal Balance of such
Subclass as of the Cut-Off Date, is as follows:
Original Class B Class B Subclass Subclass Principal Balance
Class B-1 .......................... $ 1,249,000.00
Class B-2 .......................... $ 624,000.00
Class B-3 .......................... $ 562,000.00
Class B-4 .......................... $ 312,000.00
Class B-5 .......................... $ 375,241.61
Section 11.19. Original Class B-1 Fractional Interest. The
Original Class B-1 Fractional Interest is 1.50793838%.
Section 11.20. Original Class B-2 Fractional Interest. The
Original Class B-2 Fractional Interest is 1.00562542%.
Section 11.21. Original Class B-3 Fractional Interest. The
Original Class B-3 Fractional Interest is 0.55322175%.
Section 11.22. Original Class B-4 Fractional Interest. The
Original Class B-4 Fractional Interest is 0.30206527%.
Section 11.23. Original Subordinated Percentage. The Original
Subordinated Percentage is 3.51880023%.
Section 11.24. Closing Date. The Closing Date is February 28,
1996.
Section 11.25. Right to Purchase. The right of the Master
Servicer to purchase all of the Mortgage Loans pursuant to Section 9.01 hereof
shall be conditioned upon the Pool Scheduled Principal Balance of the Mortgage
Loans being less than $12,487,291.44 (10% of the Cut-Off Date Aggregate
Principal Balance) at the time of any such purchase.
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Section 11.26. Wire Transfer Eligibility. With respect to the
Certificates (other than the Class AP, Class M, Class A-R, Class B-1, Class B-2,
Class B-3, Class B-4 and Class B-5 Certificates), the minimum Denomination
eligible for wire transfer on each Distribution Date is $5,000,000. The minimum
Denomination eligible for wire transfer on each Distribution Date for the Class
AP, Class M, Class B-1, Class B-2, Class B-3, Class B-4 and Class B-5
Certificates is 100% Percentage Interest. The Class A-R Certificate is not
eligible for wire transfer.
Section 11.27. Single Certificate. A Single Certificate for each
Subclass of Class A Certificates (other than the Class A-R Certificate), the
Class AP Certificates, the Class M Certificates, and each Subclass of Class B
Certificates represents a $100,000 Denomination. A Single Certificate for the
Class A-R Certificate represents a $100 Denomination.
Section 11.28. Servicing Fee Rate. The rate used to calculate the
Servicing Fee which ranges from 0.200% to 0.250% per annum and, as to each
Mortgage Loan, is set forth on Exhibit F-1 or F-2 hereto.
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<PAGE>
IN WITNESS WHEREOF, the Seller, the Master Servicer, the Trust
Administrator and the Trustee have caused their names to be signed hereto by
their respective officers thereunto duly authorized, all as of the day and year
first above written.
THE PRUDENTIAL HOME MORTGAGE
SECURITIES COMPANY, INC.
as Seller
By:
Name:
Title:
SECURITIZED ASSET SERVICES
CORPORATION
as Master Servicer
By:
Name:
Title:
FIRST BANK NATIONAL
ASSOCIATION
as Trust Administrator
By:
Name:
Title:
FIRSTAR TRUST COMPANY
as Trustee
By:
Name:
Title:
Attest:
By:
Name:
Title:
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<PAGE>
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On this 28th day of February, 1996, before me, a notary public in
and for the State of New York, personally B. David Bialzak, known to me who,
being by me duly sworn, did depose and say that he resides at Frederick,
Maryland; that he is a Vice President of The Prudential Home Mortgage Securities
Company, Inc., a Delaware corporation, one of the parties that executed the
foregoing instrument; and that he signed his name thereto by order of the Board
of Directors of said corporation.
- -------------------------
Notary Public
[NOTARIAL SEAL]
128
<PAGE>
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On this 28th day of February, 1996, before me, a notary public in
and for the State of New York, personally appeared B. David Bialzak, known to me
who, being by me duly sworn, did depose and say that he resides at Frederick,
Maryland; that he is a Vice President of Securitized Asset Services Corporation,
a New Jersey corporation, one of the parties that executed the foregoing
instrument; and that he signed his name thereto by order of the Board of
Directors of said corporation.
- -------------------------
Notary Public
[NOTARIAL SEAL]
129
<PAGE>
STATE OF MINNESOTA )
ss.:
COUNTY OF )
On this 28th day of February, 1996, before me, a notary public in
and for the State of Minnesota, personally appeared ___________________, known
to me who, being by me duly sworn, did depose and say that she resides at
_________________, Minnesota; that she is a ____________________ of First Bank
National Association, a national banking association, one of the parties that
executed the foregoing instrument; and that she signed her name thereto by order
of the Board of Directors of said corporation.
- -------------------------
Notary Public
[NOTARIAL SEAL]
130
<PAGE>
STATE OF MINNESOTA )
ss.:
COUNTY OF )
On this 28th day of February, 1996, before me, a notary public in
and for the State of Minnesota, personally appeared _____________________, known
to me who, being by me duly sworn, did depose and say that he resides at
__________________, Minnesota; that he is a _____________________ of First Bank
National Association, a national banking association, one of the parties that
executed the foregoing instrument; and that he signed his name thereto by order
of the Board of Directors of said corporation.
- -------------------------
Notary Public
[NOTARIAL SEAL]
131
<PAGE>
STATE OF WISCONSIN )
ss.:
COUNTY OF )
On this 28th day of February, 1996, before me, a notary public in
and for the State of Wisconsin, personally appeared ___________________, known
to me who, being by me duly sworn, did depose and say that s/he resides at
________________, Wisconsin; that s/he is a ____________________ of Firstar
Trust Company, a ________________________, one of the parties that executed the
foregoing instrument; and that s/he signed her/his name thereto by order of the
Board of Directors of said corporation.
- -------------------------
Notary Public
[NOTARIAL SEAL]
132
<PAGE>
STATE OF WISCONSIN )
ss.:
COUNTY OF )
On this 28th day of February, 1996, before me, a notary public in
and for the State of Wisconsin, personally appeared ___________________, known
to me who, being by me duly sworn, did depose and say that s/he resides at
________________, Wisconsin; that s/he is a ____________________ of Firstar
Trust Company, a ________________________, one of the parties that executed the
foregoing instrument; and that s/he signed her/his name thereto by order of the
Board of Directors of said corporation.
- -------------------------
Notary Public
[NOTARIAL SEAL]
133
<PAGE>
EXHIBIT A-1
[FORM OF FACE OF CLASS A-1 CERTIFICATE]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE TRUST ADMINISTRATOR OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT
IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.]
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 1996-3 CLASS A-1
evidencing an interest in a pool of fixed
interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to
four-family residential mortgage loans, which may
include loans secured by shares issued by
cooperative housing corporations, sold by
THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC.
(Not an interest in or obligation of the Seller)
THIS CERTIFICATE DOES NOT EVIDENCE AN OBLIGATION OF, OR AN
INTEREST IN, THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST
ADMINISTRATOR OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY
THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST ADMINISTRATOR OR ANY OF
THEIR AFFILIATES, OR BY ANY GOVERNMENT AGENCY OR PRIVATE INSURER.
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS
CERTIFICATE WILL BE MADE IN THE MANNER DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT. ACCORDINGLY THE OUTSTANDING PRINCIPAL BALANCE OF THIS CERTIFICATE AT
ANY TIME MAY BE LESS THAN THE INITIAL PRINCIPAL BALANCE REPRESENTED HEREBY.
Certificate No. Cut-Off Date: February 1, 1996
CUSIP No.: 74434U First Distribution Date: March 25, 1996
Percentage Interest evidenced Denomination: $
by this Certificate: %
134
<PAGE>
THIS CERTIFIES THAT ___________________________ is the registered
owner of the Percentage Interest evidenced by this Certificate in monthly
distributions to the Holders of Class A-1 Certificates with respect to a Trust
Estate consisting of a pool of fixed interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to four-family residential mortgage loans,
other than the Fixed Retained Yield, if any, with respect thereto, and which may
include loans secured by shares issued by cooperative housing corporations (the
"Mortgage Loans"), formed by The Prudential Home Mortgage Securities Company,
Inc. (hereinafter called the "Seller", which term includes any successor entity
under the Agreement referred to below). The Trust Estate was created pursuant to
a Pooling and Servicing Agreement dated as of February 28, 1996 (the
"Agreement") among the Seller, Securitized Asset Services Corporation, as master
servicer (the "Master Servicer"), First Bank National Association, as trust
administrator (the "Trust Administrator") and Firstar Trust Company, as trustee
(the "Trustee"), a summary of certain of the pertinent provisions of which is
set forth hereinafter. To the extent not defined herein, the capitalized terms
used herein have the meanings ascribed to such terms in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month preceding the month of such distribution, in an amount equal to the
product of the Percentage Interest evidenced by this Certificate and the Class A
Subclass Distribution Amount for the Class A-1 Certificates required to be
distributed to Holders of Class A-1 Certificates on such Distribution Date,
subject to adjustment in certain events as specified in the Agreement.
Distributions in reduction of the principal balance of certain Subclasses of
Class A Certificates may not commence on the first Distribution Date specified
above. Distributions of principal will be allocated among the Subclasses of
Class A Certificates in accordance with the provisions of the Agreement. The
pass-through rate on the Class A-1 Certificates applicable to each Distribution
Date will be 6.75% per annum. The amount of interest which accrues on this
Certificate in any month will be subject to reduction with respect to any
Non-Supported Interest Shortfall and the interest portion of certain Realized
Losses allocated to the Class A-1 Certificates, as described in the Agreement.
Distributions on this Certificate will be made on behalf of the
Trustee either by the Master Servicer or by a Paying Agent appointed by the
Master Servicer by check mailed to the address of the Person entitled thereto,
as such name and address shall appear on the Certificate Register, unless such
Person is entitled to receive payments by wire transfer in immediately available
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<PAGE>
funds in accordance with the Pooling and Servicing Agreement and such Person has
notified the Master Servicer pursuant to the Pooling and Servicing Agreement
that such payments are to be made by wire transfer of immediately available
funds. Notwithstanding the above, the final distribution in reduction of the
principal balance of this Certificate will be made after due notice of the
pendency of such distribution and only upon presentation and surrender of this
Certificate at the office or agency specified by the Trust Administrator for
that purpose in the notice of final distribution.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate constitutes a "regular interest" in a "real
estate mortgage investment conduit" as those terms are defined in Section
860G(a)(1) and Section 860D, respectively, of the Internal Revenue Code of 1986,
as amended.
Unless this Certificate has been countersigned by an authorized
officer of the Trust Administrator, by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement or be valid for any purpose.
136
<PAGE>
IN WITNESS WHEREOF, the Trust Administrator has caused this
Certificate to be duly executed as of the date set forth below.
Dated: February 28, 1996
First Bank National Association,
Trust Administrator
By____________________________
Authorized Officer
Countersigned:
First Bank National Association,
Trust Administrator
By ________________________
Authorized Officer
137
<PAGE>
EXHIBIT A-2
[FORM OF FACE OF CLASS A-2 CERTIFICATE]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE TRUST ADMINISTRATOR OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT
IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.]
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 1996-3 CLASS A-2
evidencing an interest in a pool of fixed
interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to
four-family residential mortgage loans, which may
include loans secured by shares issued by
cooperative housing corporations, sold by
THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC.
(Not an interest in or obligation of the Seller)
THIS CERTIFICATE DOES NOT EVIDENCE AN OBLIGATION OF, OR AN
INTEREST IN, THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST
ADMINISTRATOR OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY
THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST ADMNINISTRATOR OR ANY OF
THEIR AFFILIATES, OR BY ANY GOVERNMENT AGENCY OR PRIVATE INSURER.
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS
CERTIFICATE WILL BE MADE IN THE MANNER DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT. ACCORDINGLY THE OUTSTANDING PRINCIPAL BALANCE OF THIS CERTIFICATE AT
ANY TIME MAY BE LESS THAN THE INITIAL PRINCIPAL BALANCE REPRESENTED HEREBY.
Certificate No. Cut-Off Date: February 1, 1996
CUSIP No.: 74434U First Distribution Date: March 25, 1996
Percentage Interest evidenced Denomination: $
by this Certificate: %
138
<PAGE>
THIS CERTIFIES THAT ___________________________ is the registered
owner of the Percentage Interest evidenced by this Certificate in monthly
distributions to the Holders of Class A-2 Certificates with respect to a Trust
Estate consisting of a pool of fixed interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to four-family residential mortgage loans,
other than the Fixed Retained Yield, if any, with respect thereto, and which may
include loans secured by shares issued by cooperative housing corporations (the
"Mortgage Loans"), formed by The Prudential Home Mortgage Securities Company,
Inc. (hereinafter called the "Seller", which term includes any successor entity
under the Agreement referred to below). The Trust Estate was created pursuant to
a Pooling and Servicing Agreement dated as of February 28, 1996 (the
"Agreement") among the Seller, Securitized Asset Services Corporation, as master
servicer (the "Master Servicer"), First Bank National Association, as trust
administrator (the "Trust Administrator") and Firstar Trust Company, as trustee
(the "Trustee"), a summary of certain of the pertinent provisions of which is
set forth hereinafter. To the extent not defined herein, the capitalized terms
used herein have the meanings ascribed to such terms in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month preceding the month of such distribution, in an amount equal to the
product of the Percentage Interest evidenced by this Certificate and the Class A
Subclass Distribution Amount for the Class A-2 Certificates required to be
distributed to Holders of Class A-2 Certificates on such Distribution Date,
subject to adjustment in certain events as specified in the Agreement.
Distributions in reduction of the principal balance of certain Subclasses of
Class A Certificates may not commence on the first Distribution Date specified
above. Distributions of principal will be allocated among the Subclasses of
Class A Certificates in accordance with the provisions of the Agreement. The
pass-through rate on the Class A-2 Certificates applicable to each Distribution
Date will be 6.75% per annum. The amount of interest which accrues on this
Certificate in any month will be subject to reduction with respect to any
Non-Supported Interest Shortfall and the interest portion of certain Realized
Losses allocated to the Class A-2 Certificates, as described in the Agreement.
Distributions on this Certificate will be made on behalf of the
Trustee either by the Master Servicer or by a Paying Agent appointed by the
Master Servicer by check mailed to the address of the Person entitled thereto,
as such name and address shall appear on the Certificate Register, unless such
Person is entitled to receive payments by wire transfer in immediately available
funds in accordance with the Pooling and Servicing Agreement and such Person has
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<PAGE>
notified the Master Servicer pursuant to the Pooling and Servicing Agreement
that such payments are to be made by wire transfer of immediately available
funds. Notwithstanding the above, the final distribution in reduction of the
principal balance of this Certificate will be made after due notice of the
pendency of such distribution and only upon presentation and surrender of this
Certificate at the office or agency specified by the Trust Administrator for
that purpose in the notice of final distribution.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate constitutes a "regular interest" in a "real
estate mortgage investment conduit" as those terms are defined in Section
860G(a)(1) and Section 860D, respectively, of the Internal Revenue Code of 1986,
as amended.
Unless this Certificate has been countersigned by an authorized
officer of the Trust Administrator, by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement or be valid for any purpose.
140
<PAGE>
IN WITNESS WHEREOF, the Trust Administrator has caused this
Certificate to be duly executed as of the date set forth below.
Dated: February 28, 1996
First Bank National Association,
Trust Administrator
By____________________________
Authorized Officer
Countersigned:
First Bank National Association,
Trust Administrator
By ________________________
Authorized Officer
141
<PAGE>
EXHIBIT A-3
[FORM OF FACE OF CLASS A-3 CERTIFICATE]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE TRUST ADMINISTRATOR OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT
IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.
]
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 1996-3 CLASS A-3
evidencing an interest in a pool of fixed
interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to
four-family residential mortgage loans, which may
include loans secured by shares issued by
cooperative housing corporations, sold by
THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC.
(Not an interest in or obligation of the Seller)
THIS CERTIFICATE DOES NOT EVIDENCE AN OBLIGATION OF, OR AN
INTEREST IN, THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST
ADMINISTRATOR OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY
THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST ADMINISTRATOR OR ANY OF
THEIR AFFILIATES, OR BY ANY GOVERNMENT AGENCY OR PRIVATE INSURER.
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS
CERTIFICATE WILL BE MADE IN THE MANNER DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT. ACCORDINGLY THE OUTSTANDING PRINCIPAL BALANCE OF THIS CERTIFICATE AT
ANY TIME MAY BE LESS THAN THE INITIAL PRINCIPAL BALANCE REPRESENTED HEREBY.
Certificate No. Cut-Off Date: February 1, 1996
CUSIP No.: 74434U First Distribution Date: March 25, 1996
Percentage Interest evidenced Denomination: $
by this Certificate: %
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<PAGE>
THIS CERTIFIES THAT ___________________________ is the registered
owner of the Percentage Interest evidenced by this Certificate in monthly
distributions to the Holders of Class A-3 Certificates with respect to a Trust
Estate consisting of a pool of fixed interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to four-family residential mortgage loans,
other than the Fixed Retained Yield, if any, with respect thereto, and which may
include loans secured by shares issued by cooperative housing corporations (the
"Mortgage Loans"), formed by The Prudential Home Mortgage Securities Company,
Inc. (hereinafter called the "Seller", which term includes any successor entity
under the Agreement referred to below). The Trust Estate was created pursuant to
a Pooling and Servicing Agreement dated as of February 28, 1996 (the
"Agreement") among the Seller, Securitized Asset Services Corporation, as master
servicer (the "Master Servicer"), First Bank National Association, as trust
administrator (the "Trust Administrator") and Firstar Trust Company, as Trustee
(the "Trustee"), a summary of certain of the pertinent provisions of which is
set forth hereinafter. To the extent not defined herein, the capitalized terms
used herein have the meanings ascribed to such terms in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month preceding the month of such distribution, in an amount equal to the
product of the Percentage Interest evidenced by this Certificate and the Class A
Subclass Distribution Amount for the Class A-3 Certificates required to be
distributed to Holders of Class A-3 Certificates on such Distribution Date,
subject to adjustment in certain events as specified in the Agreement.
Distributions in reduction of the principal balance of certain Subclasses of
Class A Certificates may not commence on the first Distribution Date specified
above. Distributions of principal will be allocated among the Subclasses of
Class A Certificates in accordance with the provisions of the Agreement. The
pass-through rate on the Class A-3 Certificates applicable to each Distribution
Date will be 6.75% per annum. The amount of interest which accrues on this
Certificate in any month will be subject to reduction with respect to any
Non-Supported Interest Shortfall and the interest portion of certain Realized
Losses allocated to the Class A-3 Certificates, as described in the Agreement.
Distributions on this Certificate will be made on behalf of the
Trustee either by the Master Servicer or by a Paying Agent appointed by the
Master Servicer by check mailed to the address of the Person entitled thereto,
as such name and address shall appear on the Certificate Register, unless such
Person is entitled to receive payments by wire transfer in immediately available
143
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funds in accordance with the Pooling and Servicing Agreement and such Person has
notified the Master Servicer pursuant to the Pooling and Servicing Agreement
that such payments are to be made by wire transfer of immediately available
funds. Notwithstanding the above, the final distribution in reduction of the
principal balance of this Certificate will be made after due notice of the
pendency of such distribution and only upon presentation and surrender of this
Certificate at the office or agency specified by the Trust Administrator for
that purpose in the notice of final distribution.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate constitutes a "regular interest" in a "real
estate mortgage investment conduit" as those terms are defined in Section
860G(a)(1) and Section 860D, respectively, of the Internal Revenue Code of 1986,
as amended.
Unless this Certificate has been countersigned by an authorized
officer of the Trust Administrator, by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement or be valid for any purpose.
144
<PAGE>
IN WITNESS WHEREOF, the Trust Administrator has caused this
Certificate to be duly executed as of the date set forth below.
Dated: February 28, 1996
First Bank National Association,
Trust Administrator
By____________________________
Authorized Officer
Countersigned:
First Bank National Association,
Trust Administrator
By ________________________
Authorized Officer
145
<PAGE>
EXHIBIT A-4
[FORM OF FACE OF CLASS A-4 CERTIFICATE]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE TRUST ADMINISTRATOR OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT
IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.]
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 1996-3 CLASS A-4
evidencing an interest in a pool of fixed
interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to
four-family residential mortgage loans, which may
include loans secured by shares issued by
cooperative housing corporations, sold by
THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC.
(Not an interest in or obligation of the Seller)
THIS CERTIFICATE DOES NOT EVIDENCE AN OBLIGATION OF, OR AN
INTEREST IN, THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST
ADMINISTRATOR OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY
THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST ADMINISTRATOR OR ANY OF
THEIR AFFILIATES, OR BY ANY GOVERNMENT AGENCY OR PRIVATE INSURER.
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS
CERTIFICATE WILL BE MADE IN THE MANNER DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT. ACCORDINGLY THE OUTSTANDING PRINCIPAL BALANCE OF THIS CERTIFICATE AT
ANY TIME MAY BE LESS THAN THE INITIAL PRINCIPAL BALANCE REPRESENTED HEREBY.
Certificate No. Cut-Off Date: February 1, 1996
CUSIP No.: 74434U First Distribution Date: March 25, 1996
Percentage Interest evidenced Denomination: $
by his Certificate: %
146
<PAGE>
THIS CERTIFIES THAT ___________________________ is the registered
owner of the Percentage Interest evidenced by this Certificate in monthly
distributions to the Holders of Class A-4 Certificates with respect to a Trust
Estate consisting of a pool of fixed interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to four-family residential mortgage loans,
other than the Fixed Retained Yield, if any, with respect thereto, and which may
include loans secured by shares issued by cooperative housing corporations (the
"Mortgage Loans"), formed by The Prudential Home Mortgage Securities Company,
Inc. (hereinafter called the "Seller", which term includes any successor entity
under the Agreement referred to below). The Trust Estate was created pursuant to
a Pooling and Servicing Agreement dated as of February 28, 1996 (the
"Agreement") among the Seller, Securitized Asset Services Corporation, as master
servicer (the "Master Servicer"), First Bank National Association, as trust
administrator (the "Trust Administrator") and Firstar Trust Company, as trustee
(the "Trustee"), a summary of certain of the pertinent provisions of which is
set forth hereinafter. To the extent not defined herein, the capitalized terms
used herein have the meanings ascribed to such terms in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month preceding the month of such distribution, in an amount equal to the
product of the Percentage Interest evidenced by this Certificate and the Class A
Subclass Distribution Amount for the Class A-4 Certificates required to be
distributed to Holders of Class A-4 Certificates on such Distribution Date,
subject to adjustment in certain events as specified in the Agreement.
Distributions in reduction of the principal balance of certain Subclasses of
Class A Certificates may not commence on the first Distribution Date specified
above. Distributions of principal will be allocated among the Subclasses of
Class A Certificates in accordance with the provisions of the Agreement. The
pass-through rate on the Class A-4 Certificates applicable to each Distribution
Date will be 6.75% per annum. The amount of interest which accrues on this
Certificate in any month will be subject to reduction with respect to any
Non-Supported Interest Shortfall and the interest portion of certain Realized
Losses allocated to the Class A-4 Certificates, as described in the Agreement.
Distributions on this Certificate will be made on behalf of the
Trustee either by the Master Servicer or by a Paying Agent appointed by the
Master Servicer by check mailed to the address of the Person entitled thereto,
as such name and address shall appear on the Certificate Register, unless such
Person is entitled to receive payments by wire transfer in immediately available
147
<PAGE>
funds in accordance with the Pooling and Servicing Agreement and such Person has
notified the Master Servicer pursuant to the Pooling and Servicing Agreement
that such payments are to be made by wire transfer of immediately available
funds. Notwithstanding the above, the final distribution in reduction of the
principal balance of this Certificate will be made after due notice of the
pendency of such distribution and only upon presentation and surrender of this
Certificate at the office or agency specified by the Trust Administrator for
that purpose in the notice of final distribution.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate constitutes a "regular interest" in a "real
estate mortgage investment conduit" as those terms are defined in Section
860G(a)(1) and Section 860D, respectively, of the Internal Revenue Code of 1986,
as amended.
Unless this Certificate has been countersigned by an authorized
officer of the Trust Administrator, by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement or be valid for any purpose.
148
<PAGE>
IN WITNESS WHEREOF, the Trust Administrator has caused this
Certificate to be duly executed as of the date set forth below.
Dated: February 28, 1996
First Bank National Association,
Trust Administrator
By____________________________
Authorized Officer
Countersigned:
First Bank National Association,
Trust Administrator
By ________________________
Authorized Officer
149
<PAGE>
EXHIBIT A-5
[FORM OF FACE OF CLASS A-5 CERTIFICATE]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE TRUST ADMINISTRATOR OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT
IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.]
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 1996-3 CLASS A-5
evidencing an interest in a pool of fixed
interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to
four-family residential mortgage loans, which may
include loans secured by shares issued by
cooperative housing corporations, sold by
THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC.
(Not an interest in or obligation of the Seller)
THIS CERTIFICATE DOES NOT EVIDENCE AN OBLIGATION OF, OR AN
INTEREST IN, THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST
ADMINISTRATOR OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY
THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST ADMINISTRATOR OR ANY OF
THEIR AFFILIATES, OR BY ANY GOVERNMENT AGENCY OR PRIVATE INSURER.
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS
CERTIFICATE WILL BE MADE IN THE MANNER DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT. ACCORDINGLY THE OUTSTANDING PRINCIPAL BALANCE OF THIS CERTIFICATE AT
ANY TIME MAY BE LESS THAN THE INITIAL PRINCIPAL BALANCE REPRESENTED HEREBY.
Certificate No. Cut-Off Date: February 1, 1996
CUSIP No.: 74434U First Distribution Date: March 25, 1996
Percentage Interest evidenced Denomination: $
by this Certificate: %
150
<PAGE>
THIS CERTIFIES THAT ___________________________ is the registered
owner of the Percentage Interest evidenced by this Certificate in monthly
distributions to the Holders of Class A-5 Certificates with respect to a Trust
Estate consisting of a pool of fixed interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to four-family residential mortgage loans,
other than the Fixed Retained Yield, if any, with respect thereto, and which may
include loans secured by shares issued by cooperative housing corporations (the
"Mortgage Loans"), formed by The Prudential Home Mortgage Securities Company,
Inc. (hereinafter called the "Seller", which term includes any successor entity
under the Agreement referred to below). The Trust Estate was created pursuant to
a Pooling and Servicing Agreement dated as of February 28, 1996 (the
"Agreement") among the Seller, Securitized Asset Services Corporation, as master
servicer (the "Master Servicer"), First Bank National Association, as trust
administrator (the "Trust Administrator") and Firstar Trust Company, as trustee
(the "Trustee"), a summary of certain of the pertinent provisions of which is
set forth hereinafter. To the extent not defined herein, the capitalized terms
used herein have the meanings ascribed to such terms in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month preceding the month of such distribution, in an amount equal to the
product of the Percentage Interest evidenced by this Certificate and the Class A
Subclass Distribution Amount for the Class A-5 Certificates required to be
distributed to Holders of Class A-5 Certificates on such Distribution Date,
subject to adjustment in certain events as specified in the Agreement.
Distributions in reduction of the principal balance of certain Subclasses of
Class A Certificates may not commence on the first Distribution Date specified
above. Distributions of principal will be allocated among the Subclasses of
Class A Certificates in accordance with the provisions of the Agreement. The
pass-through rate on the Class A-5 Certificates applicable to each Distribution
Date will be 6.75% per annum. The amount of interest which accrues on this
Certificate in any month will be subject to reduction with respect to any
Non-Supported Interest Shortfall and the interest portion of certain Realized
Losses allocated to the Class A-5 Certificates, as described in the Agreement.
Distributions on this Certificate will be made on behalf of the
Trustee either by the Master Servicer or by a Paying Agent appointed by the
Master Servicer by check mailed to the address of the Person entitled thereto,
as such name and address shall appear on the Certificate Register, unless such
Person is entitled to receive payments by wire transfer in immediately available
151
<PAGE>
funds in accordance with the Pooling and Servicing Agreement and such Person has
notified the Master Servicer pursuant to the Pooling and Servicing Agreement
that such payments are to be made by wire transfer of immediately available
funds. Notwithstanding the above, the final distribution in reduction of the
principal balance of this Certificate will be made after due notice of the
pendency of such distribution and only upon presentation and surrender of this
Certificate at the office or agency specified by the Trust Administrator for
that purpose in the notice of final distribution.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate constitutes a "regular interest" in a "real
estate mortgage investment conduit" as those terms are defined in Section
860G(a)(1) and Section 860D, respectively, of the Internal Revenue Code of 1986,
as amended.
Unless this Certificate has been countersigned by an authorized
officer of the Trust Administrator, by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement or be valid for any purpose.
152
<PAGE>
IN WITNESS WHEREOF, the Trust Administrator has caused this
Certificate to be duly executed as of the date set forth below.
Dated: February 28, 1996
First Bank National Association,
Trust Administrator
By____________________________
Authorized Officer
Countersigned:
First Bank National Association,
Trust Administrator
By ________________________
Authorized Officer
153
<PAGE>
EXHIBIT A-R
[Form of Face of Class A-R Certificate]
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(a)(2) AND 860D OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE"). A TRANSFEREE OF THIS CERTIFICATE, BY ACCEPTANCE
HEREOF, IS DEEMED TO HAVE ACCEPTED THIS CERTIFICATE SUBJECT TO CERTAIN
RESTRICTIONS ON TRANSFERABILITY, AS SET FORTH IN SECTION 5.02(d) OF THE POOLING
AND SERVICING AGREEMENT, AND SHALL BE REQUIRED TO FURNISH AN AFFIDAVIT TO THE
TRANSFEROR AND THE TRUST ADMINISTRATOR TO THE EFFECT THAT, AMONG OTHER THINGS,
IT IS NOT A DISQUALIFIED ORGANIZATION, AS SUCH TERM IS DEFINED IN CODE SECTION
860E(e)(5), AN AGENT (INCLUDING A BROKER, NOMINEE OR OTHER MIDDLEMAN) FOR SUCH
DISQUALIFIED ORGANIZATION OR A NON-PERMITTED FOREIGN HOLDER, AS DEFINED IN
SECTION 5.02(d) OF THE POOLING AND SERVICING AGREEMENT AND TO HAVE AGREED TO
SUCH AMENDMENTS TO THE POOLING AND SERVICING AGREEMENT AS MAY BE REQUIRED TO
FURTHER EFFECTUATE THE RESTRICTIONS ON TRANSFERS TO DISQUALIFIED ORGANIZATIONS,
AGENTS THEREOF OR NON-PERMITTED FOREIGN HOLDERS.
THE HOLDER OF THIS CLASS A-R CERTIFICATE, BY ACCEPTANCE HEREOF, IS DEEMED TO
HAVE AGREED TO THE DESIGNATION OF THE MASTER SERVICER AS ITS AGENT TO ACT AS
"TAX MATTERS PERSON" OF THE REMIC TO PERFORM THE FUNCTIONS OF A "TAX MATTERS
PARTNER" FOR PURPOSES OF SUBCHAPTER C OF CHAPTER 63 OF SUBTITLE F OF THE CODE,
OR, IF SO REQUESTED BY THE MASTER SERVICER, TO ACT AS TAX MATTERS PERSON OF THE
REMIC.
THIS CERTIFICATE MAY NOT BE PURCHASED BY OR TRANSFERRED TO ANY PERSON WHICH IS
AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE CODE OF ANY GOVERNMENTAL PLAN, AS DEFINED IN SECTION 3(32)
OF ERISA SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW WHICH IS, TO A MATERIAL
EXTENT, SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (COLLECTIVELY,
A "PLAN"), OR ANY PERSON INVESTING THE ASSETS OF A PLAN.
PURCHASERS OF THIS CLASS A-R CERTIFICATE SHOULD BE AWARE THAT ON JANUARY 3,
1995, THE INTERNAL REVENUE SERVICE ISSUED PROPOSED REGULATIONS UNDER CODE
SECTION 475 THAT, IF ADOPTED IN FINAL FORM, WOULD APPLY TO THIS CLASS A-R
CERTIFICATE AND WOULD NOT PERMIT THIS CLASS A-R CERTIFICATE TO BE MARKED TO
MARKET.
154
<PAGE>
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 1996-3, CLASS A-R
evidencing an interest in a pool of fixed
interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to
four-family residential mortgage loans, which may
include loans secured by shares issued by
cooperative housing corporations, sold by
THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC.
(Not an interest in or obligation of the Seller)
THIS CERTIFICATE DOES NOT EVIDENCE AN OBLIGATION OF, OR AN
INTEREST IN, THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST
ADMINISTRATOR OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY
THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST ADMNINISTRATOR OR ANY OF
THEIR AFFILIATES, OR BY ANY GOVERNMENT AGENCY OR PRIVATE INSURER.
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS
CERTIFICATE WILL BE MADE IN THE MANNER DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT. ACCORDINGLY THE OUTSTANDING PRINCIPAL BALANCE OF THIS CERTIFICATE AT
ANY TIME MAY BE LESS THAN THE INITIAL PRINCIPAL BALANCE REPRESENTED HEREBY.
Certificate No. Cut-Off Date: February 1, 1996
CUSIP No.: 74434U First Distribution Date: March 25, 1996
Percentage Interest evidenced Denomination: $
by this Certificate: %
155
<PAGE>
THIS CERTIFIES THAT __________________________ is the registered
owner of the Percentage Interest evidenced by this Certificate in monthly
distributions to the Holder of the Class A-R Certificate with respect to a Trust
Estate consisting of a pool of fixed interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to four-family residential mortgage loans,
other than the Fixed Retained Yield, if any, with respect thereto, and which may
include loans secured by shares issued by cooperative housing corporations (the
"Mortgage Loans"), formed by The Prudential Home Mortgage Securities Company,
Inc. (hereinafter called the "Seller", which term includes any successor entity
under the Agreement referred to below). The Trust Estate was created pursuant to
a Pooling and Servicing Agreement dated as of February 28, 1996 (the
"Agreement") among the Seller, Securitized Asset Services Corporation, as master
servicer (the "Master Servicer"), First Bank National Association, as trust
administrator (the "Trust Administrator") and Firstar Trust Company, as trustee
(the "Trustee"), a summary of certain of the pertinent provisions of which is
set forth hereinafter. To the extent not defined herein, the capitalized terms
used herein have the meanings ascribed to such terms in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month preceding the month of such distribution, in an amount equal to the
product of the Percentage Interest evidenced by this Certificate and the Class A
Subclass Distribution Amount for the Class A-R Certificate required to be
distributed to the Holders of the Class A-R Certificate on such Distribution
Date, subject to adjustment in certain events as specified in the Agreement.
Distributions in reduction of the principal balance of certain Subclasses of
Class A Certificates will not commence on the first Distribution Date specified
above. Distributions of principal will be allocated among the Subclasses of
Class A Certificates in accordance with the provisions of the Agreement. The
pass-through rate on the Class A-R Certificate applicable to each Distribution
Date will be 6.75% per annum. The amount of interest which accrues on this
Certificate in any month will be subject to reduction with respect to any
Non-Supported Interest Shortfall and the interest portion of certain Realized
Losses allocated to the Class A-R Certificate, as described in the Agreement.
Distributions on this Certificate will be made on behalf of the
Trustee either by the Master Servicer or by a Paying Agent appointed by the
Master Servicer by check mailed to the address of the Person entitled thereto,
as such name and address shall appear on the Certificate Register.
156
<PAGE>
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice of the pendency of such distribution and only upon
presentation and surrender of this Certificate at the office or agency specified
by the Trust Administrator for that purpose in the notice of final distribution.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless this Certificate has been countersigned by an authorized
officer of the Trust Administrator, by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement or be valid for any purpose.
157
<PAGE>
IN WITNESS WHEREOF, the Trust Administrator has caused this
Certificate to be duly executed as of the date set forth below.
Dated: February 28, 1996
First Bank National Association,
Trust Administrator
By____________________________
Authorized Officer
Countersigned:
First Bank National Association,
Trust Administrator
By ________________________
Authorized Officer
158
<PAGE>
EXHIBIT B-1
[FORM OF FACE OF CLASS B-1 CERTIFICATE]
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS AP
AND CLASS M CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(C) OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN, THIS CERTIFICATE MAY NOT BE PURCHASED BY OR TRANSFERRED TO
ANY PERSON THAT HAS NOT DELIVERED A REPRESENTATION LETTER STATING EITHER (A)
THAT THE TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE FIDUCIARY
RESPONSIBILITY PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA") OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986,
AS AMENDED (THE "CODE") OR ANY GOVERNMENTAL PLAN, AS DEFINED IN SECTION 3(32) OF
ERISA, SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW WHICH IS, TO A MATERIAL
EXTENT, SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (COLLECTIVELY,
A "PLAN"), OR ANY PERSON INVESTING THE ASSETS OF A PLAN OR (B) SUBJECT TO
CERTAIN CONDITIONS SET FORTH IN THE POOLING AND SERVICING AGREEMENT, THAT THE
SOURCE OF FUNDS USED TO PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY
GENERAL ACCOUNT."
159
<PAGE>
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 1996-3, CLASS B-1
evidencing an interest in a pool of fixed
interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to
four-family residential mortgage loans, which may
include loans secured by shares issued by
cooperative housing corporations, sold by
THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC.
(Not an interest in or obligation of the Seller)
THIS CERTIFICATE DOES NOT EVIDENCE AN OBLIGATION OF, OR AN
INTEREST IN, THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST
ADMINISTRATOR OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY
THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST ADMNINISTRATOR OR ANY OF
THEIR AFFILIATES, OR BY ANY GOVERNMENT AGENCY OR PRIVATE INSURER.
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS
CERTIFICATE WILL BE MADE IN THE MANNER DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT. ACCORDINGLY THE OUTSTANDING PRINCIPAL BALANCE OF THIS CERTIFICATE AT
ANY TIME MAY BE LESS THAN THE INITIAL PRINCIPAL BALANCE REPRESENTED HEREBY.
Certificate No. Cut-Off Date: February 1, 1996
CUSIP No.: 74434U First Distribution Date: March 25, 1996
Percentage Interest evidenced Denomination: $
by this Certificate: %
160
<PAGE>
THIS CERTIFIES THAT ____________________________ is the
registered owner of the Percentage Interest evidenced by this Certificate in
monthly distributions to the Holders of the Class B-1 Certificates with respect
to a Trust Estate consisting of a pool of fixed interest rate, conventional,
monthly pay, fully amortizing, first lien, one- to four-family residential
mortgage loans, other than the Fixed Retained Yield, if any, with respect
thereto, and which may include loans secured by shares issued by cooperative
housing corporations (the "Mortgage Loans") formed by The Prudential Home
Mortgage Securities Company, Inc. (hereinafter called the "Seller", which term
includes any successor entity under the Agreement referred to below). The Trust
Estate was created pursuant to a Pooling and Servicing Agreement dated as of
February 28, 1996 (the "Agreement") among the Seller, Securitized Asset Services
Corporation, as master servicer (the "Master Servicer"), First Bank National
Association, as trust administrator (the "Trust Administrator") and Firstar
Trust Company, as trustee (the "Trustee"), a summary of certain of the pertinent
provisions of which is set forth hereinafter. To the extent not defined herein,
the capitalized terms used herein have the meanings ascribed to such terms in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month preceding the month of such distribution, in an amount equal to the
product of the Percentage Interest evidenced by this Certificate and, subject to
the prior rights of the Class A, Class AP and Class M Certificates as specified
in the Agreement, any Class B-1 Distribution Amount required to be distributed
to Holders of Class B-1 Certificates on such Distribution Date, subject to
adjustment, in certain events, as specified in the Agreement. The Pass-Through
Rate on the Class B-1 Certificates applicable to each Distribution Date will be
6.75% per annum. The amount of interest which accrues on this Certificate in any
month will be subject to reduction with respect to any Non-Supported Interest
Shortfall and the interest portion of certain Realized Losses allocated to the
Class B-1 Certificates, as described in the Agreement.
Distributions on this Certificate will be made on behalf of the
Trustee either by the Master Servicer or by a Paying Agent appointed by the
Master Servicer by check mailed to the address of the Person entitled thereto,
as such name and address shall appear on the Certificate Register, unless such
Person is entitled to receive payments by wire transfer in immediately available
funds in accordance with the Pooling and Servicing Agreement and such Person has
notified the Master Servicer pursuant to the Pooling and Servicing Agreement
161
<PAGE>
that such payments are to be made by wire transfer of immediately available
funds. Notwithstanding the above, the final distribution in reduction of the
principal balance of this Certificate will be made after due notice of the
pendency of such distribution and only upon presentation and surrender of this
Certificate at the office or agency specified by the Trust Administrator for
that purpose in the notice of final distribution.
No transfer of a Class B-1 Certificate will be made unless the
Holder hereof desiring to make any such transfer shall deliver to the Trust
Administrator (i) a representation letter, in the form as described in the
Agreement, stating either (a) that the transferee is not a Plan and is not
acting on behalf of a Plan or using the assets of a Plan to effect such purchase
or (b) subject to certain conditions described in the Agreement, that the source
of funds used to purchase this Certificate is an "insurance company general
account," or (ii) if such transferee is a Plan, an opinion of counsel acceptable
to and in form and substance satisfactory to the Seller and the Trust
Administrator with respect to certain matters, as described in the Agreement.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate constitutes a "regular interest" in a "real
estate mortgage investment conduit" as those terms are defined in Section
860G(a)(1) and Section 860D, respectively, of the Internal Revenue Code of 1986,
as amended.
Unless this Certificate has been countersigned by an authorized
officer of the Trust Administrator, by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement or be valid for any purpose.
162
<PAGE>
IN WITNESS WHEREOF, the Trust Administrator has caused this
Certificate to be duly executed as of the date set forth below.
Dated: February 28, 1996
First Bank National Association,
Trust Administrator
By____________________________
Authorized Officer
Countersigned:
First Bank National Association,
Trust Administrator
By ________________________
Authorized Officer
163
<PAGE>
EXHIBIT B-2
[FORM OF FACE OF CLASS B-2 CERTIFICATE]
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS AP,
CLASS M AND CLASS B-1 CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(C) OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN, THIS CERTIFICATE MAY NOT BE PURCHASED BY OR TRANSFERRED TO
ANY PERSON THAT HAS NOT DELIVERED A REPRESENTATION LETTER STATING EITHER (A)
THAT THE TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE FIDUCIARY
RESPONSIBILITY PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA") OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986,
AS AMENDED (THE "CODE") OR ANY GOVERNMENTAL PLAN, AS DEFINED IN SECTION 3(32) OF
ERISA, SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW WHICH IS, TO A MATERIAL
EXTENT, SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (COLLECTIVELY,
A "PLAN"), OR ANY PERSON INVESTING THE ASSETS OF A PLAN OR (B) SUBJECT TO
CERTAIN CONDITIONS SET FORTH IN THE POOLING AND SERVICING AGREEMENT, THAT THE
SOURCE OF FUNDS USED TO PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY
GENERAL ACCOUNT."
164
<PAGE>
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 1996-3, CLASS B-2
evidencing an interest in a pool of fixed
interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to
four-family residential mortgage loans, which may
include loans secured by shares issued by
cooperative housing corporations, sold by
THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC.
(Not an interest in or obligation of the Seller)
THIS CERTIFICATE DOES NOT EVIDENCE AN OBLIGATION OF, OR AN
INTEREST IN, THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST
ADMINISTRATOR OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY
THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST ADMNINISTRATOR OR ANY OF
THEIR AFFILIATES, OR BY ANY GOVERNMENT AGENCY OR PRIVATE INSURER.
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS
CERTIFICATE WILL BE MADE IN THE MANNER DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT. ACCORDINGLY THE OUTSTANDING PRINCIPAL BALANCE OF THIS CERTIFICATE AT
ANY TIME MAY BE LESS THAN THE INITIAL PRINCIPAL BALANCE REPRESENTED HEREBY.
Certificate No. Cut-Off Date: February 1, 1996
CUSIP No.: 74434U First Distribution Date: March 25, 1996
Percentage Interest evidenced Denomination: $
by this Certificate: %
165
<PAGE>
THIS CERTIFIES THAT ____________________________ is the
registered owner of the Percentage Interest evidenced by this Certificate in
monthly distributions to the Holders of the Class B-2 Certificates with respect
to a Trust Estate consisting of a pool of fixed interest rate, conventional,
monthly pay, fully amortizing, first lien, one- to four-family residential
mortgage loans, other than the Fixed Retained Yield, if any, with respect
thereto, and which may include loans secured by shares issued by cooperative
housing corporations (the "Mortgage Loans") formed by The Prudential Home
Mortgage Securities Company, Inc. (hereinafter called the "Seller", which term
includes any successor entity under the Agreement referred to below). The Trust
Estate was created pursuant to a Pooling and Servicing Agreement dated as of
February 28, 1996 (the "Agreement") among the Seller, Securitized Asset Services
Corporation, as master servicer (the "Master Servicer"), First Bank National
Association, as trust administrator (the "Trust Administrator") and Firstar
Trust Company, as trustee (the "Trustee"), a summary of certain of the pertinent
provisions of which is set forth hereinafter. To the extent not defined herein,
the capitalized terms used herein have the meanings ascribed to such terms in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month preceding the month of such distribution, in an amount equal to the
product of the Percentage Interest evidenced by this Certificate and, subject to
the prior rights of the Class A, Class AP and Class M Certificates and each
Subclass of Class B Certificates bearing a lower numerical designation as
specified in the Agreement, any Class B-2 Distribution Amount required to be
distributed to Holders of Class B-2 Certificates on such Distribution Date,
subject to adjustment, in certain events, as specified in the Agreement. The
Pass-Through Rate on the Class B-2 Certificates applicable to each Distribution
Date will be 6.75% per annum. The amount of interest which accrues on this
Certificate in any month will be subject to reduction with respect to any
Non-Supported Interest Shortfall and the interest portion of certain Realized
Losses allocated to the Class B-2 Certificates, as described in the Agreement.
Distributions on this Certificate will be made on behalf of the
Trustee either by the Master Servicer or by a Paying Agent appointed by the
Master Servicer by check mailed to the address of the Person entitled thereto,
as such name and address shall appear on the Certificate Register, unless such
Person is entitled to receive payments by wire transfer in immediately available
funds in accordance with the Pooling and Servicing Agreement and such Person has
notified the Master Servicer pursuant to the Pooling and Servicing Agreement
that such payments are to be made by wire transfer of immediately available
166
<PAGE>
funds. Notwithstanding the above, the final distribution in reduction of the
principal balance of this Certificate will be made after due notice of the
pendency of such distribution and only upon presentation and surrender of this
Certificate at the office or agency specified by the Trust Administrator for
that purpose in the notice of final distribution.
No transfer of a Class B-2 Certificate will be made unless the
Holder hereof desiring to make any such transfer shall deliver to the Trust
Administrator (i) a representation letter, in the form as described in the
Agreement, stating either (a) that the transferee is not a Plan and is not
acting on behalf of a Plan or using the assets of a Plan to effect such purchase
or (b) subject to certain conditions described in the Agreement, that the source
of funds used to purchase this Certificate is an "insurance company general
account," or (ii) if such transferee is a Plan, an opinion of counsel acceptable
to and in form and substance satisfactory to the Seller and the Trust
Administrator with respect to certain matters, as described in the
Agreement.Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
This Certificate is issued on February 28, 1996, and based on its
issue price of 97.14687%, including accrued interest, and a stated redemption
price at maturity equal to its initial principal balance (plus 3 days of
interest at the Pass-Through Rate hereon), is issued with original issue
discount ("OID") for federal income tax purposes. Assuming that this Certificate
pays in accordance with projected cash flows reflecting the prepayment
assumption of 300% SPA (as defined in the Prospectus Supplement dated February
15, 1996 with respect to the offering of the Class A Certificates, Class AP
Certificates, Class M Certificates, Class B-1 Certificates and Class B-2
Certificates) used to price this Certificate: (i) the amount of OID as a
percentage of the initial principal balance of this Certificate is approximately
2.90937500%; (ii) the annual yield to maturity of this Certificate, compounded
monthly, is approximately 7.28%; and (iii) the amount of OID allocable to the
short first accrual period (February 28, 1996 to March 25, 1996) as a percentage
of the initial principal balance of this Certificate, calculated using the exact
method, is approximately 0.02373132%.
This Certificate constitutes a "regular interest" in a "real
estate mortgage investment conduit" as those terms are defined in Section
860G(a)(1) and Section 860D, respectively, of the Internal Revenue Code of 1986,
as amended.
Unless this Certificate has been countersigned by an authorized
officer of the Trust Administrator, by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement or be valid for any purpose.
167
<PAGE>
IN WITNESS WHEREOF, the Trust Administrator has caused this
Certificate to be duly executed as of the date set forth below.
Dated: February 28, 1996
First Bank National Association,
Trust Administrator
By____________________________
Authorized Officer
Countersigned:
First Bank National Association,
Trust Administrator
By ________________________
Authorized Officer
168
<PAGE>
EXHIBIT B-3
[FORM OF FACE OF CLASS B-3 CERTIFICATE]
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS AP,
CLASS M, CLASS B-1 AND CLASS B-2 CERTIFICATES AS DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE
RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO SUCH ACT AND LAWS OR
IS SOLD OR TRANSFERRED IN TRANSACTIONS WHICH ARE EXEMPT FROM REGISTRATION UNDER
SUCH ACT AND UNDER APPLICABLE STATE LAW AND IS TRANSFERRED IN ACCORDANCE WITH
THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(C) OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN, THIS CERTIFICATE MAY NOT BE PURCHASED BY OR TRANSFERRED TO
ANY PERSON THAT HAS NOT DELIVERED A REPRESENTATION LETTER STATING EITHER (A)
THAT THE TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE FIDUCIARY
RESPONSIBILITY PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA") OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986,
AS AMENDED (THE "CODE") OR ANY GOVERNMENTAL PLAN, AS DEFINED IN SECTION 3(32) OF
ERISA, SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW WHICH IS, TO A MATERIAL
EXTENT, SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (COLLECTIVELY,
A "PLAN"), OR ANY PERSON INVESTING THE ASSETS OF A PLAN OR (B) SUBJECT TO
CERTAIN CONDITIONS SET FORTH IN THE POOLING AND SERVICING AGREEMENT, THAT THE
SOURCE OF FUNDS USED TO PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY
GENERAL ACCOUNT."
169
<PAGE>
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 1996-3, CLASS B-3
evidencing an interest in a pool of fixed
interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to
four-family residential mortgage loans, which may
include loans secured by shares issued by
cooperative housing corporations, sold by
THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC.
(Not an interest in or obligation of the Seller)
THIS CERTIFICATE DOES NOT EVIDENCE AN OBLIGATION OF, OR AN
INTEREST IN, THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST
ADMINISTRATOR OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY
THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST ADMNINISTRATOR OR ANY OF
THEIR AFFILIATES, OR BY ANY GOVERNMENT AGENCY OR PRIVATE INSURER.
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS
CERTIFICATE WILL BE MADE IN THE MANNER DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT. ACCORDINGLY THE OUTSTANDING PRINCIPAL BALANCE OF THIS CERTIFICATE AT
ANY TIME MAY BE LESS THAN THE INITIAL PRINCIPAL BALANCE REPRESENTED HEREBY.
Certificate No. Cut-Off Date: February 1, 1996
CUSIP No.: 74434U First Distribution Date: March 25, 1996
Percentage Interest evidenced Denomination: $
by this Certificate: %
170
<PAGE>
THIS CERTIFIES THAT ____________________________ is the
registered owner of the Percentage Interest evidenced by this Certificate in
monthly distributions to the Holders of the Class B-3 Certificates with respect
to a Trust Estate consisting of a pool of fixed interest rate, conventional,
monthly pay, fully amortizing, first lien, one- to four-family residential
mortgage loans, other than the Fixed Retained Yield, if any, with respect
thereto, and which may include loans secured by shares issued by cooperative
housing corporations (the "Mortgage Loans") formed by The Prudential Home
Mortgage Securities Company, Inc. (hereinafter called the "Seller", which term
includes any successor entity under the Agreement referred to below). The Trust
Estate was created pursuant to a Pooling and Servicing Agreement dated as of
February 28, 1996 (the "Agreement") among the Seller, Securitized Asset Services
Corporation, as master servicer (the "Master Servicer"), First Bank National
Association, as trust administrator (the "Trust Administrator") and Firstar
Trust Company, as trustee (the "Trustee"), a summary of certain of the pertinent
provisions of which is set forth hereinafter. To the extent not defined herein,
the capitalized terms used herein have the meanings ascribed to such terms in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month preceding the month of such distribution, in an amount equal to the
product of the Percentage Interest evidenced by this Certificate and, subject to
the prior rights of the Class A, Class AP and Class M Certificates and each
Subclass of Class B Certificates bearing a lower numerical designation as
specified in the Agreement, any Class B-3 Distribution Amount required to be
distributed to Holders of Class B-3 Certificates on such Distribution Date,
subject to adjustment, in certain events, as specified in the Agreement. The
Pass-Through Rate on the Class B-3 Certificates applicable to each Distribution
Date will be 6.75% per annum. The amount of interest which accrues on this
Certificate in any month will be subject to reduction with respect to any
Non-Supported Interest Shortfall and the interest portion of certain Realized
Losses allocated to the Class B-3 Certificates, as described in the Agreement.
Distributions on this Certificate will be made on behalf of the
Trustee either by the Master Servicer or by a Paying Agent appointed by the
Master Servicer by check mailed to the address of the Person entitled thereto,
as such name and address shall appear on the Certificate Register, unless such
Person is entitled to receive payments by wire transfer in immediately available
funds in accordance with the Pooling and Servicing Agreement and such Person has
notified the Master Servicer pursuant to the Pooling and Servicing Agreement
that such payments are to be made by wire transfer of immediately available
171
<PAGE>
funds. Notwithstanding the above, the final distribution in reduction of the
principal balance of this Certificate will be made after due notice of the
pendency of such distribution and only upon presentation and surrender of this
Certificate at the office or agency specified by the Trust Administrator for
that purpose in the notice of final distribution.
No transfer of a Class B-3 Certificate will be made unless such
transfer is exempt from the registration requirements of the Securities Act of
1933, as amended, and any applicable state securities laws or is made in
accordance with said Act and laws. In the event that such a transfer is desired
to be made by the Holder hereof, (i) the transferee will be required to execute
an investment letter in the form described in the Agreement and (ii) if such
transfer is to be made within three years from the date of initial issuance of
the Certificates pursuant to the Agreement, and unless such transfer is made in
reliance on Rule 144A of the Securities Act of 1933, as amended, the Trust
Administrator or the Seller may require the Holder to deliver an opinion of
counsel acceptable to and in form and substance satisfactory to the Trust
Administrator and the Seller that such transfer is exempt (describing the
applicable exemption and the basis therefor) from or is being made pursuant to
the registration requirements of the Securities Act of 1933, as amended, and of
any applicable statute of any state. The Holder hereof desiring to effect such
transfer shall, and does hereby agree to, indemnify the Trustee, the Trust
Administrator, the Seller, the Master Servicer, and any Paying Agent acting on
behalf of the Trust Administrator against any liability that may result if the
transfer is not so exempt or is not made in accordance with such Federal and
state laws. In connection with any such transfer, the Trust Administrator will
also require (i) a representation letter, in the form as described in the
Agreement, stating either (a) that the transferee is not a Plan and is not
acting on behalf of a Plan or using the assets of a Plan to effect such purchase
or (b) subject to certain conditions described in the Agreement, that the source
of funds used to purchase this Certificate is an "insurance company general
account," or (ii) if such transferee is a Plan, an opinion of counsel acceptable
to and in form and substance satisfactory to the Trust Administrator and the
Seller with respect to certain matters, as described in the Agreement.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate is issued on February 28, 1996, and based on its
issue price of 87.41806%, including accrued interest, and a stated redemption
price at maturity equal to its initial principal balance (plus 3 days of
interest at the Pass-Through Rate hereon), is issued with original issue
discount ("OID") for federal income tax purposes. Assuming that this Certificate
pays in accordance with projected cash flows reflecting the prepayment
assumption of 300% SPA (as defined in the Prospectus Supplement dated February
15, 1996 with respect to the offering of the Class A Certificates, Class AP
Certificates, Class M Certificates, Class B-1 Certificates and Class B-2
Certificates) used to price this Certificate: (i) the amount of OID as a
percentage of the initial principal balance of this Certificate is approximately
172
<PAGE>
12.63819000%; (ii) the annual yield to maturity of this Certificate, compounded
monthly, is approximately 9.21%; and (iii) the amount of OID allocable to the
short first accrual period (February 28, 1996 to March 25, 1996) as a percentage
of the initial principal balance of this Certificate, calculated using the exact
method, is approximately 0.09746399%.
This Certificate constitutes a "regular interest" in a "real
estate mortgage investment conduit" as those terms are defined in Section
860G(a)(1) and Section 860D, respectively, of the Internal Revenue Code of 1986,
as amended.
Unless this Certificate has been countersigned by an authorized
officer of the Trust Administrator, by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement or be valid for any purpose.
173
<PAGE>
IN WITNESS WHEREOF, the Trust Administrator has caused this
Certificate to be duly executed as of the date set forth below.
Dated: February 28, 1996
First Bank National Association,
Trust Administrator
By____________________________
Authorized Officer
Countersigned:
First Bank National Association,
Trust Administrator
By ________________________
Authorized Officer
174
<PAGE>
EXHIBIT B-4
[FORM OF FACE OF CLASS B-4 CERTIFICATE]
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS AP,
CLASS M, CLASS B-1, CLASS B-2 AND CLASS B-3 CERTIFICATES AS DESCRIBED IN THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE
RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO SUCH ACT AND LAWS OR
IS SOLD OR TRANSFERRED IN TRANSACTIONS WHICH ARE EXEMPT FROM REGISTRATION UNDER
SUCH ACT AND UNDER APPLICABLE STATE LAW AND IS TRANSFERRED IN ACCORDANCE WITH
THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(C) OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN, THIS CERTIFICATE MAY NOT BE PURCHASED BY OR TRANSFERRED TO
ANY PERSON THAT HAS NOT DELIVERED A REPRESENTATION LETTER STATING EITHER (A)
THAT THE TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE FIDUCIARY
RESPONSIBILITY PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA") OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986,
AS AMENDED (THE "CODE") OR ANY GOVERNMENTAL PLAN, AS DEFINED IN SECTION 3(32) OF
ERISA, SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW WHICH IS, TO A MATERIAL
EXTENT, SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (COLLECTIVELY,
A "PLAN"), OR ANY PERSON INVESTING THE ASSETS OF A PLAN OR (B) SUBJECT TO
CERTAIN CONDITIONS SET FORTH IN THE POOLING AND SERVICING AGREEMENT, THAT THE
SOURCE OF FUNDS USED TO PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY
GENERAL ACCOUNT."
175
<PAGE>
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 1996-3, CLASS B-4
evidencing an interest in a pool of fixed
interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to
four-family residential mortgage loans, which may
include loans secured by shares issued by
cooperative housing corporations, sold by
THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC.
(Not an interest in or obligation of the Seller)
THIS CERTIFICATE DOES NOT EVIDENCE AN OBLIGATION OF, OR AN
INTEREST IN, THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST
ADMINISTRATOR OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY
THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST ADMNINISTRATOR OR ANY OF
THEIR AFFILIATES, OR BY ANY GOVERNMENT AGENCY OR PRIVATE INSURER.
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS
CERTIFICATE WILL BE MADE IN THE MANNER DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT. ACCORDINGLY THE OUTSTANDING PRINCIPAL BALANCE OF THIS CERTIFICATE AT
ANY TIME MAY BE LESS THAN THE INITIAL PRINCIPAL BALANCE REPRESENTED HEREBY.
Certificate No. Cut-Off Date: February 1, 1996
CUSIP No.: 74434U First Distribution Date: March 25, 1996
Percentage Interest evidenced Denomination: $
by this Certificate: %
176
<PAGE>
THIS CERTIFIES THAT ____________________________ is the
registered owner of the Percentage Interest evidenced by this Certificate in
monthly distributions to the Holders of the Class B-4 Certificates with respect
to a Trust Estate consisting of a pool of fixed interest rate, conventional,
monthly pay, fully amortizing, first lien, one- to four-family residential
mortgage loans, other than the Fixed Retained Yield, if any, with respect
thereto, and which may include loans secured by shares issued by cooperative
housing corporations (the "Mortgage Loans") formed by The Prudential Home
Mortgage Securities Company, Inc. (hereinafter called the "Seller", which term
includes any successor entity under the Agreement referred to below). The Trust
Estate was created pursuant to a Pooling and Servicing Agreement dated as of
February 28, 1996 (the "Agreement") among the Seller, Securitized Asset Services
Corporation, as master servicer (the "Master Servicer"), First Bank National
Association, as trust administrator (the "Trust Administrator") and Firstar
Trust Company, as trustee (the "Trustee"), a summary of certain of the pertinent
provisions of which is set forth hereinafter. To the extent not defined herein,
the capitalized terms used herein have the meanings ascribed to such terms in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month preceding the month of such distribution, in an amount equal to the
product of the Percentage Interest evidenced by this Certificate and, subject to
the prior rights of the Class A, Class AP and Class M Certificates and each
Subclass of Class B Certificates bearing a lower numerical designation as
specified in the Agreement, any Class B-4 Distribution Amount required to be
distributed to Holders of Class B-4 Certificates on such Distribution Date,
subject to adjustment, in certain events, as specified in the Agreement. The
Pass-Through Rate on the Class B-4 Certificates applicable to each Distribution
Date will be 6.75% per annum. The amount of interest which accrues on this
Certificate in any month will be subject to reduction with respect to any
Non-Supported Interest Shortfall and the interest portion of certain Realized
Losses allocated to the Class B-4 Certificates, as described in the Agreement.
Distributions on this Certificate will be made on behalf of the
Trustee either by the Master Servicer or by a Paying Agent appointed by the
Master Servicer by check mailed to the address of the Person entitled thereto,
as such name and address shall appear on the Certificate Register, unless such
Person is entitled to receive payments by wire transfer in immediately available
funds in accordance with the Pooling and Servicing Agreement and such Person has
notified the Master Servicer pursuant to the Pooling and Servicing Agreement
177
<PAGE>
that such payments are to be made by wire transfer of immediately available
funds. Notwithstanding the above, the final distribution in reduction of the
principal balance of this Certificate will be made after due notice of the
pendency of such distribution and only upon presentation and surrender of this
Certificate at the office or agency specified by the Trust Administrator for
that purpose in the notice of final distribution.
No transfer of a Class B-4 Certificate will be made unless such
transfer is exempt from the registration requirements of the Securities Act of
1933, as amended, and any applicable state securities laws or is made in
accordance with said Act and laws. In the event that such a transfer is desired
to be made by the Holder hereof, (i) the transferee will be required to execute
an investment letter in the form described in the Agreement and (ii) if such
transfer is to be made within three years from the date of initial issuance of
the Certificates pursuant to the Agreement, and unless such transfer is made in
reliance on Rule 144A of the Securities Act of 1933, as amended, the Trust
Administrator or the Seller may require the Holder to deliver an opinion of
counsel acceptable to and in form and substance satisfactory to the Trust
Administrator and the Seller that such transfer is exempt (describing the
applicable exemption and the basis therefor) from or is being made pursuant to
the registration requirements of the Securities Act of 1933, as amended, and of
any applicable statute of any state. The Holder hereof desiring to effect such
transfer shall, and does hereby agree to, indemnify the Trustee, the Trust
Administrator, the Seller, the Master Servicer, and any Paying Agent acting on
behalf of the Trust Administrator against any liability that may result if the
transfer is not so exempt or is not made in accordance with such Federal and
state laws. In connection with any such transfer, the Trust Administrator will
also require (i) a representation letter, in the form as described in the
Agreement, stating either (a) that the transferee is not a Plan and is not
acting on behalf of a Plan or using the assets of a Plan to effect such purchase
or (b) subject to certain conditions described in the Agreement, that the source
of funds used to purchase this Certificate is an "insurance company general
account," or (ii) if such transferee is a Plan, an opinion of counsel acceptable
to and in form and substance satisfactory to the Trust Administrator and the
Seller with respect to certain matters, as described in the Agreement.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate is issued on February 28, 1996, and based on its
issue price of 71.12446%, including accrued interest, and a stated redemption
price at maturity equal to its initial principal balance (plus 3 days of
interest at the Pass-Through Rate hereon), is issued with original issue
discount ("OID") for federal income tax purposes. Assuming that this Certificate
pays in accordance with projected cash flows reflecting the prepayment
assumption of 300% SPA (as defined in the Prospectus Supplement dated February
15, 1996 with respect to the offering of the Class A Certificates, Class AP
Certificates, Class M Certificates, Class B-1 Certificates and Class B-2
Certificates) used to price this Certificate: (i) the amount of OID as a
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percentage of the initial principal balance of this Certificate is approximately
28.93179000%; (ii) the annual yield to maturity of this Certificate, compounded
monthly, is approximately 13.27%; and (iii) the amount of OID allocable to the
short first accrual period (February 28, 1996 to March 25, 1996) as a percentage
of the initial principal balance of this Certificate, calculated using the exact
method, is approximately 0.20113727%.
This Certificate constitutes a "regular interest" in a "real
estate mortgage investment conduit" as those terms are defined in Section
860G(a)(1) and Section 860D, respectively, of the Internal Revenue Code of 1986,
as amended.
Unless this Certificate has been countersigned by an authorized
officer of the Trust Administrator, by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement or be valid for any purpose.
179
<PAGE>
IN WITNESS WHEREOF, the Trust Administrator has caused this
Certificate to be duly executed as of the date set forth below.
Dated: February 28, 1996
First Bank National Association,
Trust Administrator
By____________________________
Authorized Officer
Countersigned:
First Bank National Association,
Trust Administrator
By ________________________
Authorized Officer
180
<PAGE>
EXHIBIT B-5
[FORM OF FACE OF CLASS B-5 CERTIFICATE]
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS AP,
CLASS M, CLASS B-1, CLASS B-2, CLASS B-3 AND CLASS B-4 CERTIFICATES AS DESCRIBED
IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE
RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO SUCH ACT AND LAWS OR
IS SOLD OR TRANSFERRED IN TRANSACTIONS WHICH ARE EXEMPT FROM REGISTRATION UNDER
SUCH ACT AND UNDER APPLICABLE STATE LAW AND IS TRANSFERRED IN ACCORDANCE WITH
THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(C) OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN, THIS CERTIFICATE MAY NOT BE PURCHASED BY OR TRANSFERRED TO
ANY PERSON THAT HAS NOT DELIVERED A REPRESENTATION LETTER STATING EITHER (A)
THAT THE TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE FIDUCIARY
RESPONSIBILITY PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA") OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986,
AS AMENDED (THE "CODE") OR ANY GOVERNMENTAL PLAN, AS DEFINED IN SECTION 3(32) OF
ERISA, SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW WHICH IS, TO A MATERIAL
EXTENT, SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (COLLECTIVELY,
A "PLAN"), OR ANY PERSON INVESTING THE ASSETS OF A PLAN OR (B) SUBJECT TO
CERTAIN CONDITIONS SET FORTH IN THE POOLING AND SERVICING AGREEMENT, THAT THE
SOURCE OF FUNDS USED TO PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY
GENERAL ACCOUNT."
181
<PAGE>
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 1996-3, CLASS B-5
evidencing an interest in a pool of fixed
interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to
four-family residential mortgage loans, which may
include loans secured by shares issued by
cooperative housing corporations, sold by
THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC.
(Not an interest in or obligation of the Seller)
THIS CERTIFICATE DOES NOT EVIDENCE AN OBLIGATION OF, OR AN
INTEREST IN, THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST
ADMINISTRATOR OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY
THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST ADMNINISTRATOR OR ANY OF
THEIR AFFILIATES, OR BY ANY GOVERNMENT AGENCY OR PRIVATE INSURER.
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS
CERTIFICATE WILL BE MADE IN THE MANNER DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT. ACCORDINGLY THE OUTSTANDING PRINCIPAL BALANCE OF THIS CERTIFICATE AT
ANY TIME MAY BE LESS THAN THE INITIAL PRINCIPAL BALANCE REPRESENTED HEREBY.
Certificate No. Cut-Off Date: February 1, 1996
CUSIP No.: 74434U First Distribution Date: March 25, 1996
Percentage Interest evidenced Denomination: $
by this Certificate: %
182
<PAGE>
THIS CERTIFIES THAT ____________________________ is the
registered owner of the Percentage Interest evidenced by this Certificate in
monthly distributions to the Holders of the Class B-5 Certificates with respect
to a Trust Estate consisting of a pool of fixed interest rate, conventional,
monthly pay, fully amortizing, first lien, one- to four-family residential
mortgage loans, other than the Fixed Retained Yield, if any, with respect
thereto, and which may include loans secured by shares issued by cooperative
housing corporations (the "Mortgage Loans") formed by The Prudential Home
Mortgage Securities Company, Inc. (hereinafter called the "Seller", which term
includes any successor entity under the Agreement referred to below). The Trust
Estate was created pursuant to a Pooling and Servicing Agreement dated as of
February 28, 1996 (the "Agreement") among the Seller, Securitized Asset Services
Corporation, as master servicer (the "Master Servicer"), First Bank National
Association, as trust administrator (the "Trust Administrator") and Firstar
Trust Company, as trustee (the "Trustee"), a summary of certain of the pertinent
provisions of which is set forth hereinafter. To the extent not defined herein,
the capitalized terms used herein have the meanings ascribed to such terms in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month preceding the month of such distribution, in an amount equal to the
product of the Percentage Interest evidenced by this Certificate and, subject to
the prior rights of the Class A, Class AP and Class M Certificates and each
Subclass of Class B Certificates bearing a lower numerical designation as
specified in the Agreement, any Class B-5 Distribution Amount required to be
distributed to Holders of Class B-5 Certificates on such Distribution Date,
subject to adjustment, in certain events, as specified in the Agreement. The
Pass-Through Rate on the Class B-5 Certificates applicable to each Distribution
Date will be 6.75% per annum. The amount of interest which accrues on this
Certificate in any month will be subject to reduction with respect to any
Non-Supported Interest Shortfall and the interest portion of certain Realized
Losses allocated to the Class B-5 Certificates, as described in the Agreement.
Distributions on this Certificate will be made on behalf of the
Trustee either by the Master Servicer or by a Paying Agent appointed by the
Master Servicer by check mailed to the address of the Person entitled thereto,
as such name and address shall appear on the Certificate Register, unless such
Person is entitled to receive payments by wire transfer in immediately available
funds in accordance with the Pooling and Servicing Agreement and such Person has
notified the Master Servicer pursuant to the Pooling and Servicing Agreement
183
<PAGE>
that such payments are to be made by wire transfer of immediately available
funds. Notwithstanding the above, the final distribution in reduction of the
principal balance of this Certificate will be made after due notice of the
pendency of such distribution and only upon presentation and surrender of this
Certificate at the office or agency specified by the Trust Administrator for
that purpose in the notice of final distribution.
No transfer of a Class B-5 Certificate will be made unless such
transfer is exempt from the registration requirements of the Securities Act of
1933, as amended, and any applicable state securities laws or is made in
accordance with said Act and laws. In the event that such a transfer is desired
to be made by the Holder hereof, (i) the transferee will be required to execute
an investment letter in the form described in the Agreement and (ii) if such
transfer is to be made within three years from the date of initial issuance of
the Certificates pursuant to the Agreement, and unless such transfer is made in
reliance on Rule 144A of the Securities Act of 1933, as amended, the Trust
Administrator or the Seller may require the Holder to deliver an opinion of
counsel acceptable to and in form and substance satisfactory to the Trust
Administrator and the Seller that such transfer is exempt (describing the
applicable exemption and the basis therefor) from or is being made pursuant to
the registration requirements of the Securities Act of 1933, as amended, and of
any applicable statute of any state. The Holder hereof desiring to effect such
transfer shall, and does hereby agree to, indemnify the Trustee, the Trust
Administrator, the Seller, the Master Servicer, and any Paying Agent acting on
behalf of the Trust Administrator against any liability that may result if the
transfer is not so exempt or is not made in accordance with such Federal and
state laws. In connection with any such transfer, the Trust Administrator will
also require (i) a representation letter, in the form as described in the
Agreement, stating either (a) that the transferee is not a Plan and is not
acting on behalf of a Plan or using the assets of a Plan to effect such purchase
or (b) subject to certain conditions described in the Agreement, that the source
of funds used to purchase this Certificate is an "insurance company general
account," or (ii) if such transferee is a Plan, an opinion of counsel acceptable
to and in form and substance satisfactory to the Trust Administrator and the
Seller with respect to certain matters, as described in the Agreement.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate is issued on February 28, 1996, and based on its
issue price of 35.50625%, including accrued interest, and a stated redemption
price at maturity equal to its initial principal balance (plus 3 days of
interest at the Pass-Through Rate hereon), is issued with original issue
discount ("OID") for federal income tax purposes. Assuming that this Certificate
pays in accordance with projected cash flows reflecting the prepayment
assumption of 300% SPA (as defined in the Prospectus Supplement dated February
15, 1996 with respect to the offering of the Class A Certificates, Class AP
Certificates, Class M Certificates, Class B-1 Certificates and Class B-2
Certificates) used to price this Certificate: (i) the amount of OID as a
184
<PAGE>
percentage of the initial principal balance of this Certificate is approximately
64.55000000%; (ii) the annual yield to maturity of this Certificate, compounded
monthly, is approximately 30.88%; and (iii) the amount of OID allocable to the
short first accrual period (February 28, 1996 to March 25, 1996) as a percentage
of the initial principal balance of this Certificate, calculated using the exact
method, is approximately 0.31498008%.
This Certificate constitutes a "regular interest" in a "real
estate mortgage investment conduit" as those terms are defined in Section
860G(a)(1) and Section 860D, respectively, of the Internal Revenue Code of 1986,
as amended.
Unless this Certificate has been countersigned by an authorized
officer of the Trust Administrator, by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement or be valid for any purpose.
185
<PAGE>
IN WITNESS WHEREOF, the Trust Administrator has caused this
Certificate to be duly executed as of the date set forth below.
Dated: February 28, 1996
First Bank National Association,
Trust Administrator
By____________________________
Authorized Officer
Countersigned:
First Bank National Association,
Trust Administrator
By ________________________
Authorized Officer
186
<PAGE>
EXHIBIT C-1
[FORM OF FACE OF CLASS AP CERTIFICATE]
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 1996-3, CLASS AP
evidencing an interest in a pool of fixed
interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to
four-family residential mortgage loans, which may
include loans secured by shares issued by
cooperative housing corporations, sold by
THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC.
(Not an interest in or obligation of the Seller)
THIS CERTIFICATE DOES NOT EVIDENCE AN OBLIGATION OF, OR AN
INTEREST IN, THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST
ADMINISTRATOR OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY
THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST ADMNINISTRATOR OR ANY OF
THEIR AFFILIATES, OR BY ANY GOVERNMENT AGENCY OR PRIVATE INSURER.
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS
CERTIFICATE WILL BE MADE IN THE MANNER DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT. ACCORDINGLY THE OUTSTANDING PRINCIPAL BALANCE OF THIS CERTIFICATE AT
ANY TIME MAY BE LESS THAN THE INITIAL PRINCIPAL BALANCE REPRESENTED HEREBY.
Certificate No. Cut-Off Date: February 1, 1996
CUSIP No.: 74434U First Distribution Date: March 25, 1996
Percentage Interest evidenced Denomination: $
by this Certificate: %
187
<PAGE>
THIS CERTIFIES THAT _____________________________ is the
registered owner of the Percentage Interest evidenced by this Certificate in
monthly distributions to the Holders of Class AP Certificates with respect to a
Trust Estate consisting of a pool of fixed interest rate, conventional, monthly
pay, fully amortizing, first lien, one- to four-family residential mortgage
loans, other than the Fixed Retained Yield, if any, with respect thereto, and
which may include loans secured by shares issued by cooperative housing
corporations (the "Mortgage Loans"), formed by The Prudential Home Mortgage
Securities Company, Inc. (hereinafter called the "Seller", which term includes
any successor entity under the Agreement referred to below). The Trust Estate
was created pursuant to a Pooling and Servicing Agreement dated as of February
28, 1996 (the "Agreement") among the Seller, Securitized Asset Services
Corporation, as master servicer (the "Master Servicer"), First Bank National
Association, as trust administrator (the "Trust Administrator") and Firstar
Trust Company, as trustee (the "Trustee"), a summary of certain of the pertinent
provisions of which is set forth hereinafter. To the extent not defined herein,
the capitalized terms used herein have the meanings ascribed to such terms in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month preceding the month of such distribution, in an amount equal to the
product of the Percentage Interest evidenced by this Certificate and the Class
AP Distribution Amount required to be distributed to Holders of Class AP
Certificates on such Distribution Date, subject to adjustment in certain events
as specified in the Agreement. The Class AP Certificates will not be entitled to
distributions in respect of interest.
Distributions on this Certificate will be made on behalf of the
Trustee either by the Master Servicer or by a Paying Agent appointed by the
Master Servicer by check mailed to the address of the Person entitled thereto,
as such name and address shall appear on the Certificate Register, unless such
Person is entitled to receive payments by wire transfer in immediately available
funds in accordance with the Pooling and Servicing Agreement and such Person has
notified the Master Servicer pursuant to the Pooling and Servicing Agreement
188
<PAGE>
that such payments are to be made by wire transfer of immediately available
funds. Notwithstanding the above, the final distribution in reduction of the
principal balance of this Certificate will be made after due notice of the
pendency of such distribution and only upon presentation and surrender of this
Certificate at the office or agency specified by the Trust Administrator for
that purpose in the notice of final distribution.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate is issued on February 28, 1996, at an issue
price of 69.00000% and a stated redemption price at maturity equal to its
initial principal balance, and is issued with original issue discount ("OID")
for federal income tax purposes. Assuming that this Certificate pays in
accordance with projected cash flows reflecting the prepayment assumption of
300% SPA (as defined in the Prospectus Supplement dated February 15, 1996 with
respect to the offering of the Class A Certificates, Class AP Certificates,
Class M Certificates, Class B-1 Certificates and Class B-2 Certificates) used to
price this Certificate: (i) the amount of OID as a percentage of the initial
principal balance of this Certificate is approximately 31.00000000%; (ii) the
annual yield to maturity of this Certificate, compounded monthly, is
approximately 9.30%; and (iii) the amount of OID allocable to the short first
accrual period (February 28, 1996 to March 25, 1996) as a percentage of the
initial principal balance of this Certificate, calculated using the exact
method, is approximately 0.48132541%.
This Certificate constitutes a "regular interest" in a "real
estate mortgage investment conduit" as those terms are defined in Section
860G(a)(1) and Section 860D, respectively, of the Internal Revenue Code of 1986,
as amended.
Unless this Certificate has been countersigned by an authorized
officer of the Trust Administrator, by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement or be valid for any purpose.
189
<PAGE>
IN WITNESS WHEREOF, the Trust Administrator has caused this
Certificate to be duly executed as of the date set forth below.
Dated: February 28, 1996
First Bank National Association,
Trust Administrator
By____________________________
Authorized Officer
Countersigned:
First Bank National Association,
Trust Administrator
By ________________________
Authorized Officer
190
<PAGE>
EXHIBIT C
[Form of Face of Class M Certificate]
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A AND CLASS AP
CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(C) OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN, THIS CERTIFICATE MAY NOT BE PURCHASED BY OR TRANSFERRED TO
ANY PERSON THAT HAS NOT DELIVERED A REPRESENTATION LETTER STATING EITHER (A)
THAT THE TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE FIDUCIARY
RESPONSIBILITY PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA") OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986,
AS AMENDED (THE "CODE") OR ANY GOVERNMENTAL PLAN, AS DEFINED IN SECTION 3(32) OF
ERISA, SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW WHICH IS, TO A MATERIAL
EXTENT, SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (COLLECTIVELY,
A "PLAN"), OR ANY PERSON INVESTING THE ASSETS OF A PLAN OR (B) SUBJECT TO
CERTAIN CONDITIONS SET FORTH IN THE POOLING AND SERVICING AGREEMENT, THAT THE
SOURCE OF FUNDS USED TO PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY
GENERAL ACCOUNT."
191
<PAGE>
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 1996-3, CLASS M
evidencing an interest in a pool of fixed
interest rate, conventional, monthly pay,
fully amortizing, first lien, one- to
four-family residential mortgage loans, which may
include loans secured by shares issued by
cooperative housing corporations, sold by
THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC.
(Not an interest in or obligation of the Seller)
THIS CERTIFICATE DOES NOT EVIDENCE AN OBLIGATION OF, OR AN
INTEREST IN, THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST
ADMINISTRATOR OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY
THE SELLER, THE MASTER SERVICER, THE TRUSTEE, THE TRUST ADMNINISTRATOR OR ANY OF
THEIR AFFILIATES, OR BY ANY GOVERNMENT AGENCY OR PRIVATE INSURER.
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS
CERTIFICATE WILL BE MADE IN THE MANNER DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT. ACCORDINGLY THE OUTSTANDING PRINCIPAL BALANCE OF THIS CERTIFICATE AT
ANY TIME MAY BE LESS THAN THE INITIAL PRINCIPAL BALANCE REPRESENTED HEREBY.
Certificate No. Cut-Off Date: February 1, 1996
CUSIP No.: 74434U First Distribution Date: March 25, 1996
Percentage Interest evidenced Denomination: $
by this Certificate: %
192
<PAGE>
THIS CERTIFIES THAT _______________________________ is the
registered owner of the Percentage Interest evidenced by this Certificate in
monthly distributions to the Holders of the Class M Certificates with respect to
a Trust Estate consisting of a pool of fixed interest rate, conventional,
monthly pay, fully amortizing, first lien, one- to four-family residential
mortgage loans, other than the Fixed Retained Yield, if any, with respect
thereto, and which may include loans secured by shares issued by cooperative
housing corporations (the "Mortgage Loans") formed by The Prudential Home
Mortgage Securities Company, Inc. (hereinafter called the "Seller", which term
includes any successor entity under the Agreement referred to below). The Trust
Estate was created pursuant to a Pooling and Servicing Agreement dated as of
February 28, 1996 (the "Agreement") among the Seller, Securitized Asset Services
Corporation, as master servicer (the "Master Servicer"), First Bank National
Association, as trust administrator (the "Trust Administrator") and Firstar
Trust Company, as trustee (the "Trustee"), a summary of certain of the pertinent
provisions of which is set forth hereinafter. To the extent not defined herein,
the capitalized terms used herein have the meanings ascribed to such terms in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month preceding the month of such distribution, in an amount equal to the
product of the Percentage Interest evidenced by this Certificate and, subject to
the prior rights of the Class A and Class AP Certificates as specified in the
Agreement, any Class M Distribution Amount required to be distributed to Holders
of Class M Certificates on such Distribution Date, subject to adjustment, in
certain events, as specified in the Agreement. The Class M Pass-Through Rate
applicable to each Distribution Date will be 6.75% per annum. The amount of
interest which accrues on this Certificate in any month will be subject to
reduction with respect to any Non-Supported Interest Shortfall and the interest
portion of certain Realized Losses allocated to the Class M Certificates, as
described in the Agreement.
Distributions on this Certificate will be made on behalf of the
Trustee either by the Master Servicer or by a Paying Agent appointed by the
Master Servicer by check mailed to the address of the Person entitled thereto,
as such name and address shall appear on the Certificate Register, unless such
Person is entitled to receive payments by wire transfer in immediately available
funds in accordance with the Pooling and Servicing Agreement and such Person has
notified the Master Servicer pursuant to the Pooling and Servicing Agreement
that such payments are to be made by wire transfer of immediately available
193
<PAGE>
funds. Notwithstanding the above, the final distribution in reduction of the
principal balance of this Certificate will be made after due notice of the
pendency of such distribution and only upon presentation and surrender of this
Certificate at the office or agency specified by the Trust Administrator for
that purpose in the notice of final distribution.
No transfer of a Class M Certificate will be made unless the
Holder hereof desiring to make any such transfer shall deliver to the Trust
Administrator (i) a representation letter, in the form as described in the
Agreement, stating either (a) that the transferee is not a Plan and is not
acting on behalf of a Plan or using the assets of a Plan to effect such purchase
or (b) subject to certain conditions described in the Agreement, that the source
of funds used to purchase this Certificate is an "insurance company general
account," or (ii) if such transferee is a Plan, an opinion of counsel acceptable
to and in form and substance satisfactory to the Trust Administrator with
respect to certain matters, as described in the Agreement.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate constitutes a "regular interest" in a "real
estate mortgage investment conduit" as those terms are defined in Section
860G(a)(1) and Section 860D, respectively, of the Internal Revenue Code of 1986,
as amended.
Unless this Certificate has been countersigned by an authorized
officer of the Trust Administrator, by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement or be valid for any purpose.
194
<PAGE>
IN WITNESS WHEREOF, the Trust Administrator has caused this
Certificate to be duly executed as of the date set forth below.
Dated: February 28, 1996
First Bank National Association,
Trust Administrator
By____________________________
Authorized Officer
Countersigned:
First Bank National Association,
Trust Administrator
By ________________________
Authorized Officer
195
<PAGE>
EXHIBIT D
[Form of Reverse of Series 1996-3 Certificates]
THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC.
MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1996-3
This Certificate is one of a duly authorized issue of
Certificates issued in several Classes and Subclasses designated as Mortgage
Pass-Through Certificates of the Series specified hereon (herein collectively
called the "Certificates").
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. In the event funds are
advanced with respect to any Mortgage Loan by a Servicer, the Master Servicer or
the Trust Administrator, such advances are reimbursable to such Servicer, the
Master Servicer or the Trust Administrator to the extent provided in the
Agreement, from related recoveries on such Mortgage Loan or from other cash that
would have been distributable to Certificateholders.
As provided in the Agreement, withdrawals from the Master
Servicer Custodial Account created for the benefit of Certificateholders may be
made by the Master Servicer from time to time for purposes other than
distributions to Certificateholders, such purposes including reimbursement to a
Servicer, the Master Servicer or the Trust Administrator, as applicable, of
advances made by such Servicer, the Master Servicer or the Trust Administrator.
The Agreement permits, with certain exceptions therein provided,
the amendment of the Agreement and the modification of the rights and
obligations of the Seller, the Master Servicer, the Trust Administrator and the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Seller, the Master Servicer, the Trust Administrator and the Trustee with
the consent of the Holders of Certificates evidencing in the aggregate not less
than 66 2/3% of the Voting Interests of each Class or Subclass of Certificates
affected thereby. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange hereof or in lieu hereof whether or not notation of such consent is
made upon the Certificate. The Agreement also permits the amendment thereof in
certain circumstances without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
196
<PAGE>
Certificate Register upon surrender of this Certificate for registration of
transfer at the office or agency appointed by the Trust Administrator, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trust Administrator and the
Certificate Registrar, duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of authorized Denominations evidencing the same Class and Subclass and aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates
without coupons in Classes and Denominations specified in the Agreement. As
provided in the Agreement and subject to certain limitations therein set forth,
Certificates are exchangeable for new Certificates of authorized Denominations
evidencing the same Class and Subclass and aggregate Percentage Interest, as
requested by the Holder surrendering the same.
No service charge will be made for any such registration of
transfer or exchange, but the Trust Administrator or the Certificate Registrar
may require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.
The Seller, the Master Servicer, the Trust Administrator, the
Trustee and the Certificate Registrar, and any agent of the Seller, the Master
Servicer, the Trust Administrator, the Trustee or the Certificate Registrar, may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and neither the Seller, the Master Servicer, the Trust
Administrator, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement in respect of the
Certificates and the Trust Estate created thereby shall terminate upon the last
action required to be taken by the Trust Administrator on the Final Distribution
Date pursuant to the Agreement following the earlier of (i) the payment or other
liquidation (or advance with respect thereto) of the last Mortgage Loan subject
thereto or the disposition of all property acquired upon foreclosure or deed in
lieu of foreclosure of any Mortgage Loan, and (ii) the purchase by the Master
Servicer from the Trust Estate of all remaining Mortgage Loans and all property
acquired in respect of such Mortgage Loans; provided, however, that the Trust
Estate will in no event continue beyond the expiration of 21 years from the
death of the last survivor of the descendants of Joseph P. Kennedy, the late
ambassador of the United States to the Court of St. James's, living on the date
of the Agreement. The Agreement permits, but does not require, the Master
Servicer to purchase all remaining Mortgage Loans and all property acquired in
respect of any Mortgage Loan at a price determined as provided in the Agreement.
The exercise of such option will effect early retirement of the Certificates,
the Master Servicer's right to exercise such option being subject to the Pool
Scheduled Principal Balance of the Mortgage Loans as of the Distribution Date
upon which the proceeds of such repurchase are distributed being less than ten
percent of the Cut-Off Date Aggregate Principal Balance.
197
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ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
lease print or typewrite name and address including postal zip code of assignee)
the beneficial interest evidenced by the within Mortgage Pass-Through
Certificate and hereby authorizes the transfer of registration of such interest
to assignee on the Certificate Register of the Trust Estate.
I (We) further direct the Certificate Registrar to issue a new
Certificate of a like Denomination or Percentage Interest and Class or Subclass,
to the above named assignee and deliver such Certificate to the following
address:
Social Security or other Identifying Number of Assignee:
Dated:
-----------------------------------
Signature by or on behalf of assignor
-----------------------------------
Signature Guaranteed
198
<PAGE>
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, if the assignee is eligible to
receive distributions in immediately available funds, by wire transfer or
otherwise, in immediately available funds to
_________________________________________________________________ for the
account of _______________________________________________ account number
_____________, or, if mailed by check, to
_______________________________________________________. Applicable statements
should be mailed to ______________________
- ----------------------------------------------------------------.
This information is provided by ______________________, the
assignee named above, or ___________________________________, as its agent.
199
<PAGE>
EXHIBIT E
CUSTODIAL AGREEMENT
THIS CUSTODIAL AGREEMENT (as amended and supplemented from time
to time, the "Agreement"), dated as of _____________, by and among FIRST BANK
NATIONAL ASSOCIATION, not individually, but solely as Trust Administrator
(including its successors under the Pooling and Servicing Agreement defined
below, the "Trust Administrator"), THE PRUDENTIAL HOME MORTGAGE SECURITIES
COMPANY, INC. (together with any successor in interest, the "Seller"),
SECURITIZED ASSET SALES CORPORATION (together with any successor in interest or
successor under the Pooling and Servicing Agreement referred to below, the
"Master Servicer") and ___________________________ (together with any successor
in interest or any successor appointed hereunder, the "Custodian").
W I T N E S S E T H T H A T
WHEREAS, the Seller, the Master Servicer, the Trust Administrator
and Firstar Trust Company, as trustee, have entered into a Pooling and Servicing
Agreement dated as of February 28, 1996 relating to the issuance of Mortgage
Pass-Through Certificates, Series 1996-3 (as in effect on the date of this
Agreement, the "Original Pooling and Servicing Agreement", and as amended and
supplemented from time to time, the "Pooling and Servicing Agreement"); and
WHEREAS, the Custodian has agreed to act as agent for the Trust
Administrator for the purposes of receiving and holding certain documents and
other instruments delivered by the Seller under the Pooling and Servicing
Agreement, all upon the terms and conditions and subject to the limitations
hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements hereinafter set forth, the Trust Administrator, the
Seller, the Master Servicer and the Custodian hereby agree as follows:
ARTICLE I
Definitions
Capitalized terms used in this Agreement and not defined herein
shall have the meanings assigned in the Original Pooling and Servicing
Agreement, unless otherwise required by the context herein.
ARTICLE II
Custody of Mortgage Documents
Section 2.1. Custodian to Act as Agent; Acceptance of Custodial
Files. The Custodian, as the duly appointed agent of the Trust Administrator for
200
<PAGE>
these purposes, acknowledges receipt of the Mortgage Notes, the Mortgages, the
assignments and other documents relating to the Mortgage Loans identified on the
schedule attached hereto and declares that it holds and will hold such Mortgage
Notes, Mortgages, assignments and other documents and any similar documents
received by the Trust Administrator subsequent to the date hereof (the
"Custodial Files") as agent for the Trust Administrator, in trust, for the use
and benefit of all present and future Certificateholders.
Section 2.2. Recordation of Assignments. If any Custodial File
includes one or more assignments to the Trust Administrator of Mortgage Notes
and related Mortgages that have not been recorded, each such assignment shall be
delivered by the Custodian to the Seller for the purpose of recording it in the
appropriate public office for real property records, and the Seller, at no
expense to the Custodian, shall promptly cause to be recorded in the appropriate
public office for real property records each such assignment and, upon receipt
thereof from such public office, shall return each such assignment to the
Custodian.
Section 2.3. Review of Custodial Files. The Custodian agrees, for
the benefit of Certificateholders, to review, in accordance with the provisions
of Section 2.01 of the Pooling and Servicing Agreement, each Custodial File. If
in performing the review required by this Section 2.3 the Custodian finds any
document or documents constituting a part of a Custodial File to be missing or
defective in any material respect, the Custodian shall promptly so notify the
Seller, the Master Servicer and the Trust Administrator.
Section 2.4. Notification of Breaches of Representations and
Warranties. Upon discovery by the Custodian of a breach of any representation or
warranty made by the Seller or the Master Servicer as set forth in the Pooling
and Servicing Agreement, the Custodian shall give prompt written notice to the
Seller, the Master Servicer and the Trust Administrator.
Section 2.5. Custodian to Cooperate; Release of Custodial Files.
Upon the payment in full of any Mortgage Loan, or the receipt by the Master
Servicer of a notification that payment in full will be escrowed in an manner
customary for such purposes, the Master Servicer shall immediately notify the
Custodian by a certification (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 Certificate Account pursuant
to Section 3.02 of the Pooling and Servicing Agreement have been or will be so
deposited) of a Servicing Officer and shall request delivery to it of the
Custodial File. The Custodian agrees, upon receipt of such certification and
request, promptly to release the related Custodial File to the Master Servicer.
From time to time as is appropriate for the servicing or
foreclosure of any Mortgage Loan, the Master Servicer shall deliver to the
Custodian a certificate of a Servicing Officer requesting that possession of
all, or any document constituting part of, the Custodial File be released to the
Master Servicer and certifying as to the reason for such release and that such
release will not invalidate any insurance coverage provided in respect of the
201
<PAGE>
Mortgage Loan. With such certificate, the Master Servicer shall deliver to the
Custodian a receipt signed by a Servicing Officer on behalf of the Master
Servicer, and upon receipt of the foregoing, the Custodian shall deliver the
Custodial File or such document to the Master Servicer. The Master Servicer
shall cause each Custodial File or any document therein so released to be
returned to the Custodian when the need therefor by the Master Servicer no
longer exists, unless (i) the Mortgage Loan has been liquidated and the
Liquidation Proceeds relating to the Mortgage Loan have been deposited in the
Certificate Account to the extent required by the Pooling and Servicing
Agreement or (ii) the Custodial File or such document has been delivered to an
attorney, or to a public Trust Administrator or other public official as
required by law, for purposes of initiating or pursuing legal action or other
proceedings for the foreclosure of the Mortgaged Property either judicially or
non-judicially, and the Master Servicer has delivered to the Custodian a
certificate of a Servicing Officer certifying as to the name and address of the
Person to which such Custodial File or such document were delivered and the
purpose or purposes of such delivery. In the event of the liquidation of a
Mortgage Loan, the Custodian shall deliver such receipt with respect thereto to
the Master Servicer upon deposit of the related Liquidation Proceeds in the
Certificate Account to the extent required by the Pooling and Servicing
Agreement.
Section 2.6. Assumption Agreements. In the event that any
assumption agreement or substitution of liability agreement is entered into with
respect to any Mortgage Loan subject to this Agreement in accordance with the
terms and provisions of the Pooling and Servicing Agreement, the Master Servicer
shall notify the Custodian that such assumption or substitution agreement has
been completed by forwarding to the Custodian the original of such assumption or
substitution agreement, which copy shall be added to the related Custodial File
and, for all purposes, shall be considered a part of such Custodial File to the
same extent as all other documents and instruments constituting parts thereof.
ARTICLE III
Concerning the Custodian
Section 3.1. Custodian a Bailee and Agent of the Trust
Administrator. With respect to each Mortgage Note, Mortgage and other documents
constituting each Custodian File which are delivered to the Custodian, the
Custodian is exclusively the bailee and agent of the Trust Administrator, holds
such documents for the benefit of Certificateholders and undertakes to perform
such duties and only such duties as are specifically set forth in this
Agreement. Except upon compliance with the provisions of Section 2.5 of this
Agreement, no Mortgage Note, Mortgage or other document constituting a part of a
Custodial File shall be delivered by the Custodian to the Seller or the Master
Servicer or otherwise released from the possession of the Custodian.
Section 3.2. Indemnification. The Seller hereby agrees to
indemnify and hold the Custodian harmless from and against all claims,
liabilities, losses, actions, suits or proceedings at law or in equity, or any
202
<PAGE>
other expenses, fees or charges of any character or nature, which the Custodian
may incur or with which the Custodian may be threatened by reasons of its acting
as custodian under this Agreement, including indemnification of the Custodian
against any and all expenses, including attorney's fees if counsel for the
Custodian has been approved by the Seller, and the cost of defending any action,
suit or proceedings or resisting any claim. Notwithstanding the foregoing, it is
specifically understood and agreed that in the event any such claim, liability,
loss, action, suit or proceeding or other expense, fees, or charge shall have
been caused by reason of any negligent act, negligent failure to act, or willful
misconduct on the part of the Custodian, or which shall constitute a willful
breach of its duties hereunder, the indemnification provisions of this Agreement
shall not apply.
Section 3.3. Custodian May Own Certificates. The Custodian in its
individual or any other capacity may become the owner or pledgee of Certificates
with the same rights it would have if it were not Custodian.
Section 3.4. Master Servicer to Pay Custodian's Fees and
Expenses. The Master Servicer covenants and agrees to pay to the Custodian from
time to time, and the Custodian shall be entitled to, reasonable compensation
for all services rendered by it in the exercise and performance of any of the
powers and duties hereunder of the Custodian, and the Master Servicer will pay
or reimburse the Custodian upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Custodian in accordance with
any of the provisions of this Agreement (including the reasonable compensation
and the expenses and disbursements of its counsel and of all persons not
regularly in its employ), except any such expense, disbursement or advance as
may arise from its negligence or bad faith.
Section 3.5. Custodian May Resign; Trust Administrator May Remove
Custodian. The Custodian may resign from the obligations and duties hereby
imposed upon it as such obligations and duties relate to its acting as Custodian
of the Mortgage Loans. Upon receiving such notice of resignation, the Trust
Administrator shall either take custody of the Custodial Files itself and give
prompt notice thereof to the Seller, the Master Servicer and the Custodian or
promptly appoint a successor Custodian by written instrument, in duplicate, one
copy of which instrument shall be delivered to the resigning Custodian and one
copy to the successor Custodian. If the Trust Administrator shall not have taken
custody of the Custodial Files and no successor Custodian shall have been so
appointed and have accepted resignation, the resigning Custodian may petition
any court of competent jurisdiction for the appointment of a successor
Custodian.
The Trust Administrator may remove the Custodian at any time. In
such event, the Trust Administrator shall appoint, or petition a court of
competent jurisdiction to appoint, a successor Custodian hereunder. Any
successor Custodian shall be a depository institution subject to supervision or
examination by federal or state authority and shall be able to satisfy the other
requirements contained in Section 3.7.
203
<PAGE>
Any resignation or removal of the Custodian and appointment of a
successor Custodian pursuant to any of the provisions of this Section 3.5 shall
become effective upon acceptance of appointment by the successor Custodian. The
Trust Administrator shall give prompt notice to the Seller and the Master
Servicer of the appointment of any successor Custodian. No successor Custodian
shall have been appointed and accepted appointment by the Trust Administrator
without the prior approval of the Seller and the Master Servicer.
Section 3.6. Merger or Consolidation of Custodian. Any Person
into which the Custodian 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 Custodian shall be a party, or any Person succeeding
to the business of the Custodian, shall be the successor of the Custodian
hereunder, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding.
Section 3.7. Representations of the Custodian. The Custodian
hereby represents that it is a depository institution subject to supervision or
examination by a federal or state authority, has a combined capital and surplus
of at least $10,000,000 and is qualified to do business in the jurisdiction in
which it will hold any Custodian File.
ARTICLE IV
Miscellaneous Provisions
Section 4.1. Notices. All notices, requests, consents and demands
and other communications required under this Agreement or pursuant to any other
instrument or document delivered hereunder shall be in writing and, unless
otherwise specifically provided, may be delivered personally, by telegram or
telex, or by registered or certified mail, postage prepaid, return receipt
requested, at the addresses specified on the signature page hereof (unless
changed by the particular party whose address is stated herein by similar notice
in writing), in which case the notice will be deemed delivered when received.
Section 4.2. Amendments. No modification or amendment of or
supplement to this Agreement shall be valid or effective unless the same is in
writing and signed by all parties hereto, and neither the Seller, the Master
Servicer nor the Trust Administrator shall enter into any amendment hereof
except as permitted by the Pooling and Servicing Agreement. The Trust
Administrator shall give prompt notice to the Custodian of any amendment or
supplement to the Pooling and Servicing Agreement and furnish the Custodian with
written copies thereof.
Section 4.3. Governing Law. This Agreement shall be deemed a
contract made under the laws of the State of New York and shall be construed and
enforced in accordance with and governed by the laws of the State of New York.
Section 4.4. Recordation of Agreement. To the extent permitted by
204
<PAGE>
applicable law, this Agreement is subject to recordation in all appropriate
public offices for real property records in all the counties or other comparable
jurisdictions in which any or all of the properties subject to the Mortgages are
situated, and in any other appropriate public recording office or elsewhere,
such recordation to be effected by the Master Servicer and at its expense on
direction by the Trust Administrator, but only upon direction accompanied by an
Opinion of Counsel to the effect that such recordation materially and
beneficially affects the interests of the Certificateholders.
For the purpose of facilitating the recordation of this Agreement
as herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
Section 4.5. Severability of Provisions. If any one or more of
the covenants, agreements, provisions or terms of this Agreement shall be for
any reason whatsoever held invalid, then such covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or the rights of the holders thereof.
205
<PAGE>
IN WITNESS WHEREOF, this Agreement is executed as of the date
first above written.
Address: FIRST BANK NATIONAL ASSOCIATION
180 East Fifth Street By:
St. Paul, Minnesota 55101 Name:
Title:
Address: THE PRUDENTIAL HOME MORTGAGE
SECURITIES COMPANY, INC.
5325 Spectrum Drive
Frederick, Maryland 21701 By:
Name:
Title:
Address: SECURITIZED ASSET SERVICES
CORPORATION
7485 New Horizon Way
Frederick, Maryland 21701 By:
Name:
Title:
Address: THE PRUDENTIAL HOME MORTGAGE
COMPANY, INC.
5325 Spectrum Drive
Frederick, Maryland 21701 By:
Name:
Title:
Address: [CUSTODIAN]
By:
Name:
Title:
206
<PAGE>
STATE OF )
: ss.:
COUNTY OF )
On this ____ day of _________, 19__, before me, a notary public
in and for the State of ____________, personally appeared _______________, known
to me who, being by me duly sworn, did depose and say that he resides at
__________________________; that he is the __________ of The Prudential Home
Mortgage Securities Company, Inc. a Delaware corporation, one of the parties
that executed the foregoing instrument; and that he signed his name thereto by
order of the Board of Directors of said corporation.
Notary Public
[NOTARIAL SEAL]
207
<PAGE>
STATE OF )
: ss.:
COUNTY OF )
On this ____ day of _________, 19__, before me, a notary public
in and for the State of ____________, personally appeared _______________, known
to me who, being by me duly sworn, did depose and say that he resides at
__________________________; that he is the __________ of Securitized Asset
Services Corporation, one of the parties that executed the foregoing instrument;
and that he signed his name thereto by order of the Board of Directors of said
corporation.
Notary Public
[NOTARIAL SEAL]
208
<PAGE>
STATE OF )
: ss.:
COUNTY OF )
On this ___ day of ________, 19__, before me, a notary public in
and for the State of ____________, personally appeared __________ _________,
known to me who, being by me duly sworn, did depose and say that he resides at
__________________________; that he is the ____________________ of First Bank
National Association, a national banking association, one of the parties that
executed the foregoing instrument; and that he signed his name thereto by order
of the Board of Directors of said association.
Notary Public
[NOTARIAL SEAL]
209
<PAGE>
STATE OF )
: ss.:
COUNTY OF )
On this ___ day of ________, 19__, before me, a notary public in
and for the State of ____________, personally appeared _______________
_______________, known to me who, being by me duly sworn, did depose and say
that he resides at __________________________; that he is the __________ of The
Prudential Home Mortgage Company, Inc., a New Jersey corporation, one of the
parties that executed the foregoing instrument; and that he signed his name
thereto by order of the Board of Directors of said corporation.
Notary Public
[NOTARIAL SEAL]
210
<PAGE>
STATE OF )
: ss.:
COUNTY OF )
On this ____ day of ________, 19 , before me, a notary public in
and for the State of __________, personally appeared __________ __________,
known to me who, being by me duly sworn, did depose and say that he resides at
__________________________; that he is the _______________________ of
______________________, a _________________________, one of the parties that
executed the foregoing instrument; and that he signed his name thereto by order
of the Board of Directors of said association.
Notary Public
[NOTARIAL SEAL]
211
<PAGE>
EXHIBIT F-1
PHMSC
PHM / 1996-3 Exhibit F-1
10 & 15 YEAR FIXED RATE NON-RELOCATION AND RELOCATION LOANS
<TABLE>
<CAPTION>
(i) (ii) (iii) (iv) (v) (vi) (vii) (viii)
- ----- --------------------------- ----- ----- -------- -------- -------- ---------- -------- ----------
NET
MORTGAGE MORTGAGE MORTGAGE CURRENT ORIGINAL SCHEDULED
LOAN ZIP PROPERTY INTEREST INTEREST MONTHLY TERM TO MATURITY
NUMBER CITY STATE CODE TYPE RATE RATE PAYMENT MATURITY DATE
- -------- ----------------------------------------------------- -------- -------- ---------- -------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
3498299 FAIRVIEW MT 59221 SFD 6.750 6.530 $707.93 180 1-May-09
3514509 LOXAHATCHEE FL 33470 SFD 8.750 6.750 $1,099.39 180 1-Sep-10
3563482 NAPLES FL 33964 SFD 8.375 6.750 $784.87 180 1-Oct-10
3574023 DOVER NJ 08753 SFD 7.750 6.750 $2,117.87 180 1-Nov-10
3578477 LANDENBERG PA 19350 SFD 7.000 6.750 $2,157.19 180 1-Dec-10
3580592 VALLEY STREAM NY 11580 SFD 7.625 6.750 $934.13 180 1-Jul-10
3583791 YORBA LINDA CA 92686 SFD 6.500 6.280 $3,527.99 180 1-Nov-10
3589922 CLOSTER NJ 07624 SFD 7.250 6.750 $2,190.88 180 1-Nov-10
3590443 TOWN OF ORLEANS NY 13692 SFD 8.500 6.750 $310.20 180 1-Jul-10
3592817 BOCA RATON FL 33428 SFD 7.250 6.750 $1,384.82 180 1-Dec-10
3593089 PRINCETON JUNCTION NJ 08550 SFD 7.000 6.750 $3,123.43 180 1-Dec-10
3594249 WARREN NJ 07060 SFD 7.000 6.750 $3,011.08 180 1-Dec-10
3596729 ANCHORAGE AK 99516 SFD 7.250 6.750 $5,933.61 180 1-Jul-10
3596887 WAYLAND MA 01778 SFD 7.500 6.750 $3,708.05 180 1-Dec-10
3600353 GLASTONBURY CT 06033 SFD 7.125 6.750 $3,424.05 180 1-Aug-10
3601335 SHAWNEE OK 74801 SFD 7.625 6.750 $2,206.89 180 1-Feb-11
3601629 RIVERDALE NY 10471 SFD 7.375 6.750 $2,989.76 180 1-Jan-11
4447407 MIAMI FL 33016 SFD 7.875 6.750 $711.34 180 1-Jan-11
4448080 BROOKLYN NY 11204 SFD 7.500 6.750 $5,423.03 180 1-Dec-10
4448988 FAIR HAVEN NJ 07704 SFD 6.500 6.280 $2,836.33 180 1-Jan-11
4450230 WASHINGTON TWP NJ 07675 SFD 7.500 6.750 $850.08 180 1-Oct-10
4450351 CLOVIS CA 93611 SFD 8.625 6.750 $2,976.25 180 1-Sep-09
4450413 HORSEHEADS NY 14845 SFD 6.750 6.530 $2,237.06 180 1-Dec-10
4451369 NORTH MIAMI BEACH FL 33160 SFD 7.625 6.750 $4,642.63 180 1-Dec-10
4451681 HONOLULU HI 96816 SFD 8.375 6.750 $1,759.37 180 1-Nov-10
4452598 ALPHARETTA GA 30202 SFD 7.125 6.750 $2,060.32 180 1-Jan-11
4453384 MONTVILLE NJ 07045 SFD 8.250 6.750 $3,880.57 180 1-Oct-10
4453417 WOODBURY MN 55125 SFD 6.875 6.655 $2,247.48 180 1-Dec-10
4455768 BOCA RATON FL 33498 SFD 8.500 6.750 $2,999.52 180 1-Dec-10
4456674 WINDHAM NH 03087 SFD 6.750 6.530 $2,442.36 180 1-Jan-11
4456939 HIGHLAND LAKES NJ 07422 SFD 8.000 6.750 $856.27 180 1-Sep-10
4457343 DARIEN CT 06820 SFD 8.000 6.750 $3,440.35 180 1-Dec-10
4457413 ELLICOTT CITY MD 21043 SFD 7.000 6.750 $2,049.33 180 1-Nov-10
4457806 MANHASSET NY 11030 SFD 7.125 6.750 $3,261.00 180 1-Dec-10
4458155 DENVILLE NJ 07834 SFD 7.000 6.750 $3,775.08 180 1-Jan-11
4458735 CHESTER SPRINGS PA 19425 SFD 6.750 6.530 $3,760.87 180 1-Jan-11
4458956 SAN FRANCISCO CA 94127 SFD 7.375 6.750 $3,219.73 180 1-Sep-10
4459524 NORTH MIAMI BEACH FL 33179 SFD 8.500 6.750 $1,585.43 180 1-Oct-10
4459714 EASTON CT 06612 SFD 6.875 6.655 $2,229.64 180 1-Dec-10
4459914 YONKERS NY 10583 LCO 8.750 6.750 $1,255.56 180 1-Nov-10
4460230 HONOLULU HI 96821 SFD 8.125 6.750 $6,257.77 180 1-Nov-10
4460306 KILDEER IL 60047 SFD 6.875 6.655 $3,419.37 180 1-Dec-10
4461573 SMITHTOWN NY 11787 SFD 7.625 6.750 $1,065.85 180 1-Oct-10
4462224 NORTH HAMPTON NH 03862 SFD 6.875 6.655 $2,229.64 180 1-Dec-10
4462339 PLEASANTON CA 94588 SFD 6.625 6.405 $3,099.32 180 1-Jan-11
4463187 SOUTH HAMILTON MA 01982 SFD 6.750 6.530 $3,052.94 180 1-Jan-11
212
<PAGE>
<CAPTION>
(i) (ii) (iii) (iv) (v) (vi) (vii) (viii)
- ----- --------------------------- ----- ----- -------- -------- -------- ---------- -------- ----------
NET
MORTGAGE MORTGAGE MORTGAGE CURRENT ORIGINAL SCHEDULED
LOAN ZIP PROPERTY INTEREST INTEREST MONTHLY TERM TO MATURITY
NUMBER CITY STATE CODE TYPE RATE RATE PAYMENT MATURITY DATE
- -------- ----------------------------------------------------- -------- -------- ---------- -------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
4463261 TRUCKEE CA 96161 SFD 7.375 6.750 $4,268.45 180 1-Nov-10
4463605 MINEOLA NY 11501 SFD 7.875 6.750 $1,623.75 180 1-Dec-10
4463712 LEAVENWORTH WA 98826 SFD 7.125 6.750 $2,233.78 180 1-Jan-11
4464156 PORTAGE MI 49008 SFD 7.375 6.750 $2,695.38 180 1-Jan-11
4464568 ATLANTIC HIGHLANDS NJ 07716 SFD 7.250 6.750 $2,419.09 180 1-Nov-10
4464929 DIX HILLS NY 11746 SFD 7.500 6.750 $2,692.98 180 1-Dec-10
4464936 HACKENSACK NJ 07601 SFD 7.500 6.750 $1,260.74 180 1-Jan-11
4465357 MUKILTEO WA 98275 SFD 7.500 6.750 $2,132.13 180 1-Oct-10
4465821 HICKSVILLE NY 11801 SFD 7.750 6.750 $1,963.51 180 1-Nov-10
4465826 HAWTHORNE NY 10532 SFD 7.125 6.750 $1,277.23 180 1-Dec-10
4465881 FRANKLIN TN 37064 SFD 7.125 6.750 $2,445.75 180 1-Nov-10
4466009 SUMMERLAND KEY FL 33042 SFD 8.250 6.750 $3,541.01 180 1-Nov-10
4466596 COPPELL TX 75019 SFD 6.750 6.530 $2,583.94 180 1-Dec-10
4466756 NANTUCKET MA 02554 SFD 8.500 6.750 $4,431.33 180 1-Oct-10
4467153 SILVER SPRING MD 20910 SFD 7.625 6.750 $2,294.23 180 1-Jan-11
4467158 EAST ISLIP NY 11730 SFD 7.875 6.750 $787.22 180 1-Dec-10
4467376 GERMANTOWN MD 20876 SFD 8.625 6.750 $1,293.68 180 1-Sep-10
4467801 POTOMAC MD 20854 PUD 7.000 6.750 $3,190.85 180 1-Jan-11
4468012 WEST ISLIP NY 11795 SFD 7.375 6.750 $2,253.82 180 1-Dec-10
4468250 TEMECULA CA 92592 SFD 7.875 6.750 $4,283.20 180 1-Dec-10
4468413 MISSION HILLS KS 66208 SFD 7.625 6.750 $3,546.90 180 1-Nov-10
4468684 HILTON HEAD ISLAND SC 29928 SFD 7.875 6.750 $3,319.57 180 1-Dec-10
4468965 POMPANO BEACH FL 33060 SFD 7.625 6.750 $373.66 180 1-Nov-10
4469044 VENICE CA 90291 LCO 7.625 6.750 $2,129.82 180 1-Dec-10
4469609 DOUGLASTON NY 11363 SFD 7.625 6.750 $2,802.39 180 1-Dec-10
4469684 SANTA BARBARA CA 93105 SFD 7.750 6.750 $4,461.65 180 1-Jan-11
4469930 BAYSIDE NY 11361 SFD 7.500 6.750 $3,283.48 180 1-Dec-10
4469931 MIAMI BEACH FL 33140 HCO 7.750 6.750 $3,576.85 180 1-Dec-10
4470213 ANTIOCH TN 37013 SFD 7.500 6.750 $556.21 180 1-Nov-10
4470369 SAN JOSE CA 95124 SFD 7.875 6.750 $1,877.93 180 1-Nov-10
4470728 RANCHO CUCAMONGA CA 91730 SFD 7.750 6.750 $2,372.02 180 1-Nov-10
4470905 MIDLOTHIAN VA 23113 SFD 6.625 6.405 $2,809.59 180 1-Jan-11
4470998 FORT SALONGA NY 11768 SFD 8.000 6.750 $3,679.27 180 1-Dec-10
4471411 SPOKANE WA 99204 SFD 7.000 6.750 $1,561.27 180 30-Nov-10
4471491 PALM BAY FL 32908 SFD 8.875 6.750 $445.53 180 1-Nov-10
4471711 WARWICK RI 02886 SFD 8.250 6.750 $1,327.16 180 1-Dec-10
4471874 CORAM NY 11727 SFD 7.500 6.750 $876.03 180 1-Nov-10
4472080 ST CLAIR SHORES MI 48080 SFD 8.625 6.750 $297.63 180 1-Nov-10
4472216 HIALEAH FL 33013 SFD 8.625 6.750 $694.46 180 1-Oct-10
4472540 BARDONIA NY 10954 LCO 8.500 6.750 $1,102.91 180 1-Dec-10
4472613 LOUISVILLE CO 80027 SFD 7.125 6.750 $2,264.58 180 1-Nov-10
4472719 HENDERSON NV 89015 SFD 8.750 6.750 $749.59 180 1-Oct-10
4472798 SPOKANE WA 99204 SFD 7.375 6.750 $3,219.74 180 1-Jan-11
4472849 LITTLE SILVER NJ 07739 SFD 7.125 6.750 $2,404.99 180 1-Dec-10
4473055 RIVERSIDE CA 92501 SFD 7.250 6.750 $2,027.93 180 1-Dec-10
4473071 SAN JOSE CA 95125 SFD 8.250 6.750 $2,010.14 180 1-Dec-10
4473093 BARRINGTON IL 60010 SFD 6.500 6.280 $2,613.33 180 1-Feb-11
4473121 BLOOMFIELD HILLS MI 48302 SFD 7.625 6.750 $5,324.55 180 1-Dec-10
4473176 STAMFORD CT 06903 SFD 7.750 6.750 $2,146.11 180 1-Nov-10
4473250 MASPETH QUEENS NY 11378 SFD 7.750 6.750 $1,317.79 180 1-Nov-10
4473321 NEW YORK NY 10001 HCO 7.750 6.750 $2,259.07 180 1-Dec-10
4473327 DOVER TOWNSHIP NJ 08753 SFD 7.375 6.750 $2,796.57 180 1-Nov-10
4473354 SHAMONG NJ 08088 SFD 7.625 6.750 $663.24 180 1-Dec-10
4473370 CLARKSTON GA 30021 SFD 8.375 6.750 $547.36 180 1-Oct-10
4473646 NORTHRIDGE CA 91326 SFD 7.375 6.750 $2,142.97 180 1-Dec-10
4473740 BROOKLYN NY 11204 SFD 8.500 6.750 $1,969.48 180 1-Nov-10
4474063 GARDEN CITY NY 11530 SFD 8.250 6.750 $1,406.70 180 1-Nov-10
213
<PAGE>
<CAPTION>
(i) (ii) (iii) (iv) (v) (vi) (vii) (viii)
- ----- --------------------------- ----- ----- -------- -------- -------- ---------- -------- ----------
NET
MORTGAGE MORTGAGE MORTGAGE CURRENT ORIGINAL SCHEDULED
LOAN ZIP PROPERTY INTEREST INTEREST MONTHLY TERM TO MATURITY
NUMBER CITY STATE CODE TYPE RATE RATE PAYMENT MATURITY DATE
- -------- ----------------------------------------------------- -------- -------- ---------- -------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
4474077 PRINCETON NJ 08540 SFD 7.625 6.750 $991.58 180 1-Nov-10
4474110 SLATE HILL NY 10973 SFD 7.750 6.750 $1,031.64 180 1-Dec-10
4474257 WOODSIDE CA 94062 SFD 7.375 6.750 $4,746.81 180 1-Dec-10
4474334 NEEDHAM MA 02192 SFD 8.000 6.750 $3,242.53 180 1-Dec-10
4474400 PISCATAWAY NJ 08854 LCO 7.750 6.750 $940.33 180 1-Dec-10
4474540 DUNWOODY GA 30350 SFD 6.625 6.405 $1,894.72 180 1-Nov-10
4474606 FORT LAUDERDALE FL 33332 PUD 8.125 6.750 $3,562.67 180 1-Dec-10
4474779 TRABUCO CANYON CA 92679 SFD 7.375 6.750 $2,334.77 180 1-Dec-10
4474932 DESTIN FL 32541 THS 7.625 6.750 $2,652.93 180 1-Nov-10
4474977 RANCHO PALOS VERDES CA 90275 SFD 6.375 6.155 $4,321.26 180 1-Jan-11
4475134 SEVIERVILLE TN 37862 SFD 8.250 6.750 $911.94 180 1-Nov-10
4475181 SARATOGA CA 95070 SFD 7.375 6.750 $3,679.70 180 1-Nov-10
4475208 SEAFORD NY 11783 SFD 8.000 6.750 $1,567.27 180 1-Dec-10
4475227 CHAPPAQUA NY 10514 SFD 7.375 6.750 $4,231.65 180 1-Dec-10
4475272 NAPLES FL 33963 SFD 7.250 6.750 $3,432.37 180 1-Feb-11
4475495 SAN FRANCISCO CA 94133 SFD 7.375 6.750 $3,543.09 180 1-Dec-10
4475656 LONGMONT CO 80503 SFD 7.375 6.750 $3,078.53 180 1-Jan-11
4475849 LOS ANGELES CA 91304 SFD 7.750 6.750 $2,146.11 180 1-Oct-10
4476207 LOUISVILLE KY 40207 SFD 8.500 6.750 $590.85 180 1-Nov-10
4476272 RANCHO SANTA FE CA 92067 SFD 7.375 6.750 $3,633.70 180 1-Dec-10
4476353 ALBUQUERQUE NM 87111 SFD 7.500 6.750 $2,862.62 180 1-Nov-10
4476556 TORRANCE CA 90503 SFD 6.750 6.530 $2,527.31 180 1-Feb-11
4476642 HONOLULU HI 96814 HCO 7.750 6.750 $4,574.61 180 1-Dec-10
4476701 MOUNT SINAI NY 11766 PUD 8.000 6.750 $1,529.04 180 1-Jan-11
4476839 ANAHEIM CA 92808 SFD 7.875 6.750 $2,437.52 180 1-Nov-10
4476840 SALINAS CA 93908 SFD 6.875 6.655 $1,937.11 180 1-Jan-11
4476884 ROSLYN NY 11576 SFD 7.000 6.750 $1,825.97 180 1-Jan-11
4476904 SARASOTA FL 34242 HCO 8.375 6.750 $1,515.02 180 1-Nov-10
4476909 AVON NC 27915 PUD 8.500 6.750 $905.97 180 1-Nov-10
4476934 WINSTON OR 97496 SFD 7.250 6.750 $1,551.87 180 1-Dec-10
4476937 TERRY MS 39170 SFD 7.375 6.750 $471.47 180 1-Nov-10
4477142 BOXFORD MA 01921 SFD 7.875 6.750 $1,612.37 180 1-Nov-10
4477186 NORCROSS GA 30093 SFD 8.500 6.750 $679.48 180 1-Oct-10
4477300 MESA AZ 85205 SFD 8.750 6.750 $655.64 180 1-Nov-10
4477517 MOUNTAIN VIEW CA 94040 SFD 7.125 6.750 $2,083.42 180 1-Jan-11
4477621 BLUFFTON SC 29910 SFD 7.500 6.750 $4,324.52 180 1-Jan-11
4477662 PINE BEACH NJ 08741 SFD 7.750 6.750 $2,124.46 180 1-Dec-10
4477707 DIX HILLS NY 11746 SFD 7.375 6.750 $2,506.34 180 1-Dec-10
4477878 PALM DESERT CA 92211 LCO 8.500 6.750 $1,092.57 180 1-Oct-10
4477968 EDGEWATER MD 21037 SFD 6.875 6.655 $2,363.42 180 1-Dec-10
4478000 FLEMINGTON NJ 08822 SFD 7.625 6.750 $1,401.20 180 1-Dec-10
4478204 PARAMUS NJ 07652 SFD 8.250 6.750 $2,764.90 180 1-Dec-10
4478266 INCLINE VILLAGE NV 89450 SFD 7.000 6.750 $2,243.48 180 1-Jan-11
4478323 SAN RAFAEL CA 94901 SFD 8.250 6.750 $2,910.43 180 1-Nov-10
4478390 SARASOTA FL 34236 SFD 8.500 6.750 $392.92 180 1-Nov-10
4478503 KENT WA 98042 SFD 7.375 6.750 $2,281.41 180 1-Dec-10
4478525 WYCKOFF NJ 07481 SFD 7.500 6.750 $3,986.16 180 1-Dec-10
4478558 MANHATTAN BEACH CA 90266 SFD 7.250 6.750 $3,834.03 180 1-Jan-11
4478587 WEST HARTFORD CT 06119 SFD 7.625 6.750 $893.97 180 1-Dec-10
214
<PAGE>
<CAPTION>
(i) (ii) (iii) (iv) (v) (vi) (vii) (viii)
- ----- --------------------------- ----- ----- -------- -------- -------- ---------- -------- ----------
NET
MORTGAGE MORTGAGE MORTGAGE CURRENT ORIGINAL SCHEDULED
LOAN ZIP PROPERTY INTEREST INTEREST MONTHLY TERM TO MATURITY
NUMBER CITY STATE CODE TYPE RATE RATE PAYMENT MATURITY DATE
- -------- ----------------------------------------------------- -------- -------- ---------- -------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
4478628 PROVO UT 84604 SFD 7.500 6.750 $3,708.05 180 1-Dec-10
4478836 CARNATION WA 98014 SFD 7.750 6.750 $753.02 180 1-Nov-10
4478883 LINCOLN MA 01773 SFD 7.375 6.750 $3,771.69 180 1-Jan-11
4478934 NORTH MASSAPEQUA NY 11758 SFD 8.375 6.750 $488.72 180 1-Dec-10
4479004 OKLAHOMA CITY OK 73116 SFD 7.875 6.750 $2,821.64 180 1-Nov-10
4479008 NEW YORK NY 10021 HCO 7.875 6.750 $2,631.95 180 1-Dec-10
4479086 MIAMI FL 33178 SFD 8.000 6.750 $1,538.60 180 1-Nov-10
4479143 GREECE NY 14626 SFD 8.250 6.750 $1,067.16 180 1-Dec-10
4479218 REDWOOD CITY CA 94065 SFD 6.875 6.655 $2,485.60 180 1-Dec-10
4479238 CHARLOTTE NC 28226 SFD 7.500 6.750 $2,265.16 180 1-Nov-10
4479242 CORONADO CA 92118 SFD 7.125 6.750 $4,340.29 180 1-Jan-11
4479262 BAYSIDE NY 11360 SFD 7.500 6.750 $2,729.13 180 1-Dec-10
4479394 LONG BEACH CA 90805 SFD 7.875 6.750 $901.03 180 1-Oct-10
4479616 GURNEE IL 60031 SFD 6.875 6.655 $2,586.38 180 1-Dec-10
4479631 RYE NY 10580 SFD 7.125 6.750 $3,849.79 180 1-Jan-11
4479662 SACRAMENTO CA 95831 SFD 7.500 6.750 $2,706.88 180 1-Jan-11
4479674 LAKE WORTH FL 33467 SFD 7.500 6.750 $2,227.15 180 1-Jan-11
4479711 PREBLE NY 13141 SFD 7.500 6.750 $787.97 180 1-Dec-10
4479775 YUCAIPA CA 92399 SFD 7.375 6.750 $3,171.90 180 1-Dec-10
4479798 PITTSFORD NY 14534 SFD 6.625 6.405 $2,985.18 180 1-Dec-10
4479826 SISTERS OR 97759 SFD 7.500 6.750 $2,855.20 180 1-Nov-10
4479895 TOMS RIVER NJ 08753 SFD 7.375 6.750 $919.93 180 1-Jan-11
4479900 DURANGO CO 81301 SFD 7.500 6.750 $2,545.58 180 1-Jan-11
4479947 GROSSE POINTE FARMS MI 48236 SFD 7.500 6.750 $2,895.99 180 1-Dec-10
4479958 MENDHAM NJ 07945 SFD 7.250 6.750 $2,902.91 180 1-Jan-11
4480060 SAN JOSE CA 95125 SFD 7.875 6.750 $863.09 180 1-Dec-10
4480070 LOS ANGELES CA 90077 LCO 8.000 6.750 $2,790.50 180 1-Nov-10
4480080 MANALAPAN NJ 07726 SFD 7.125 6.750 $2,989.25 180 1-Jan-11
4480095 SOMERS NY 10589 SFD 7.000 6.750 $2,653.35 180 1-Dec-10
4480288 NORFOLK VA 23517 SFD 7.375 6.750 $2,649.38 180 1-Jan-11
4480435 CHESTERLAND OH 44026 SFD 6.875 6.655 $3,959.84 180 1-Dec-10
4480436 CARMEL CA 93921 SFD 8.375 6.750 $4,457.06 180 1-Nov-10
4480470 NORTH MIAMI BEACH FL 33160 LCO 7.750 6.750 $317.69 180 1-Nov-10
4480528 FAYETTEVILLE NC 28314 SFD 7.500 6.750 $423.65 180 1-Jan-11
4480541 DIMONDALE MI 48821 SFD 7.625 6.750 $2,045.75 180 1-Jan-11
4480558 MALVERN PA 19355 SFD 6.750 6.530 $4,548.44 180 1-Jan-11
4480581 ORINDA CA 94563 SFD 8.000 6.750 $621.18 180 1-Dec-10
4480589 WAPPINGERS FALLS NY 12590 SFD 6.750 6.530 $1,946.81 180 1-Dec-10
4480614 SAVANNAH GA 31411 SFD 6.875 6.655 $3,130.41 180 1-Jan-11
4480634 BRENTWOOD CA 94513 SFD 6.875 6.655 $2,065.54 180 1-Dec-10
4480655 RAHWAY NJ 07065 SFD 7.875 6.750 $379.38 180 1-Nov-10
4480695 DOWNINGTOWN PA 19335 SFD 6.875 6.655 $2,461.52 180 1-Jan-11
4480725 CAMPBELL CA 95008 SFD 7.250 6.750 $2,409.96 180 1-Dec-10
4480766 SMYRNA GA 30080 SFD 7.250 6.750 $2,299.51 180 1-Dec-10
4480826 BRIDGEHAMPTON NY 11932 SFD 7.000 6.750 $3,741.38 180 1-Dec-10
4480874 MAITLAND FL 32751 SFD 8.375 6.750 $2,233.42 180 1-Dec-10
4480938 HOUSTON TX 77057 SFD 7.625 6.750 $2,639.86 180 1-Dec-10
4481034 RALEIGH NC 27615 SFD 7.000 6.750 $4,134.62 180 1-Dec-10
4481102 SALT LAKE CITY UT 84124 SFD 7.625 6.750 $3,269.45 180 1-Jan-11
4481110 APTOS CA 95003 SFD 6.625 6.405 $1,931.59 180 1-Dec-10
4481177 NORTH ANDOVER MA 01845 SFD 7.250 6.750 $2,966.81 180 1-Jan-11
4481212 MYRTLE BEACH SC 29572 SFD 7.750 6.750 $2,447.32 180 1-Nov-10
4481239 KILL DEVIL HILLS NC 27948 LCO 7.750 6.750 $800.09 180 1-Jan-11
4481284 PLANO TX 75025 SFD 7.250 6.750 $2,117.85 180 1-Dec-10
4481308 HOHENWALD TN 38462 SFD 8.000 6.750 $573.40 180 1-Nov-10
4481330 SAN ANTONIO TX 78209 SFD 8.125 6.750 $2,201.15 180 1-Dec-10
4481358 WILLIAMSTOWN MA 01267 SFD 7.375 6.750 $3,794.69 180 1-Jan-11
4481400 BRIDGEWATER NJ 08807 SFD 7.125 6.750 $2,762.79 180 1-Jan-11
215
<PAGE>
<CAPTION>
(i) (ii) (iii) (iv) (v) (vi) (vii) (viii)
- ----- --------------------------- ----- ----- -------- -------- -------- ---------- -------- ----------
NET
MORTGAGE MORTGAGE MORTGAGE CURRENT ORIGINAL SCHEDULED
LOAN ZIP PROPERTY INTEREST INTEREST MONTHLY TERM TO MATURITY
NUMBER CITY STATE CODE TYPE RATE RATE PAYMENT MATURITY DATE
- -------- ----------------------------------------------------- -------- -------- ---------- -------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
4481531 HOUSTON TX 77041 SFD 7.000 6.750 $2,876.26 180 1-Dec-10
4481536 FREDERICKSBURG TX 78624 SFD 8.375 6.750 $797.58 180 1-Nov-10
4481633 DANVILLE CA 94526 SFD 7.375 6.750 $2,436.88 180 1-Dec-10
4481664 LEXINGTON KY 40502 SFD 7.250 6.750 $2,647.31 180 1-Jan-11
4481686 SAN JOSE CA 95135 SFD 8.250 6.750 $2,496.66 180 1-Nov-10
4481708 HOLMDEL NJ 07733 SFD 7.125 6.750 $2,500.10 180 1-Jan-11
4481723 PALATINE IL 60067 SFD 7.500 6.750 $3,198.20 180 1-Jan-11
4481778 LOS GATOS CA 95030 SFD 7.875 6.750 $2,608.24 180 1-Dec-10
4481779 LOS ALTOS CA 94024 SFD 7.500 6.750 $3,708.05 180 1-Dec-10
4481854 ARLINGTON HGHTS IL 60004 SFD 7.875 6.750 $2,371.12 180 1-Nov-10
4481889 SOUTHLAKE TX 76092 SFD 7.000 6.750 $2,471.78 180 1-Jan-11
4481955 DELRAY BEACH FL 33446 SFD 7.750 6.750 $5,930.04 180 1-Jan-11
4481980 LITTLE SILVER NJ 07739 SFD 7.000 6.750 $2,606.61 180 1-Jan-11
4481982 CANANDAIGUA NY 14424 SFD 7.375 6.750 $2,333.85 180 1-Jan-11
4482006 LAKE ALMANOR CA 96137 SFD 8.000 6.750 $3,344.79 180 1-Nov-10
4482041 JACKSON NJ 08527 LCO 7.125 6.750 $496.40 180 1-Dec-10
4482049 TAHOE CITY CA 96145 SFD 8.125 6.750 $3,658.96 180 1-Nov-10
4482202 ROANOKE IN 46753 SFD 7.250 6.750 $3,651.46 180 1-Jan-11
4482223 NAPLES FL 33964 SFD 7.875 6.750 $682.88 180 1-Dec-10
4482255 MALBA NY 11357 SFD 7.250 6.750 $2,875.52 180 1-Dec-10
4482273 BOXFORD MA 01921 SFD 6.750 6.530 $3,097.19 180 1-Dec-10
4482284 FALLS CHURCH VA 22041 SFD 7.500 6.750 $2,164.58 180 1-Nov-10
4482301 SAN JOSE CA 95123 SFD 7.500 6.750 $2,122.86 180 1-Jan-11
4482327 TARZANA CA 91356 SFD 7.250 6.750 $3,554.69 180 1-Dec-10
4482484 CARY NC 27511 SFD 7.000 6.750 $2,768.40 180 1-Dec-10
4482518 SONOMA CA 95476 SFD 7.875 6.750 $4,694.83 180 1-Nov-10
4482583 COLLEYVILLE TX 76034 SFD 7.000 6.750 $2,068.21 180 1-Jan-11
4482751 NEW HYDE PARK NY 11040 SFD 7.250 6.750 $1,606.64 180 1-Dec-10
4482883 DANA POINT CA 92629 SFD 7.500 6.750 $2,706.88 180 1-Dec-10
4483062 NAPLES FL 33940 SFD 7.750 6.750 $3,670.98 180 1-Dec-10
4483095 INDIAN WELLS CA 92210 SFD 8.250 6.750 $1,154.47 180 1-Nov-10
4483102 WESTPORT CT 06880 SFD 7.250 6.750 $4,637.35 180 1-Jan-11
4483251 BURLESON TX 76028 SFD 7.250 6.750 $444.57 180 1-Jan-11
4483275 WILTON CT 06897 SFD 7.375 6.750 $2,250.14 180 1-Dec-10
4483285 MIAMI BEACH FL 33160 HCO 8.250 6.750 $970.15 180 1-Dec-10
4483313 LENOIR CITY TN 37772 SFD 7.875 6.750 $2,503.91 180 1-Oct-10
4483319 SAN DIEGO CA 92109 SFD 8.375 6.750 $3,225.51 180 1-Nov-10
4483329 PALO ALTO CA 94301 SFD 7.750 6.750 $5,755.90 180 1-Dec-10
4483346 SAN ANTONIO TX 78248 SFD 7.500 6.750 $2,155.30 180 1-Dec-10
4483378 KINGS POINT NY 11024 SFD 7.250 6.750 $3,651.46 180 1-Jan-11
4483426 NISKAYUNA NY 12309 SFD 7.250 6.750 $2,254.78 180 1-Jan-11
4483447 GREENWICH CT 06830 SFD 7.250 6.750 $3,929.88 180 1-Jan-11
4483463 LONG BEACH CA 90803 SFD 7.500 6.750 $2,059.83 180 1-Jan-11
4483469 GUILFORD CT 06437 SFD 7.125 6.750 $2,119.65 180 1-Jan-11
4483499 MIDDLETOWN NJ 07716 SFD 7.375 6.750 $2,125.03 180 1-Jan-11
4483716 ATLANTA GA 30309 HCO 7.750 6.750 $680.46 120 1-Nov-05
4483738 SHERMAN OAKS CA 91423 SFD 7.625 6.750 $2,419.40 180 1-Dec-10
4483811 STATEN ISLAND NY 10304 SFD 7.375 6.750 $3,679.70 180 1-Jan-11
4483826 PHILADELPHIA PA 19128 SFD 8.250 6.750 $291.05 180 1-Dec-10
4483879 FARMINGTON UT 84025 SFD 8.000 6.750 $3,153.66 180 1-Nov-10
4484130 UNION CITY CA 94587 SFD 7.000 6.750 $2,416.06 180 1-Dec-10
4484166 LAFAYETTE CA 94549 SFD 7.250 6.750 $3,514.53 180 1-Jan-11
4484228 SAN RAMON CA 94583 SFD 6.875 6.655 $1,997.76 180 1-Jan-11
4484234 CARMEL IN 46033 SFD 6.875 6.655 $3,210.68 180 1-Dec-10
4484292 RANCHO MIRAGE CA 92270 LCO 7.750 6.750 $2,635.58 180 1-Nov-10
4484445 BEVERLY HILLS CA 90212 LCO 8.000 6.750 $4,013.74 180 1-Dec-10
4484543 GREAT RIVER NY 11739 SFD 7.250 6.750 $2,203.66 180 1-Jan-11
4484642 PORT ARTHUR TX 77642 SFD 7.875 6.750 $4,438.75 180 1-Oct-10
216
<PAGE>
<CAPTION>
(i) (ii) (iii) (iv) (v) (vi) (vii) (viii)
- ----- --------------------------- ----- ----- -------- -------- -------- ---------- -------- ----------
NET
MORTGAGE MORTGAGE MORTGAGE CURRENT ORIGINAL SCHEDULED
LOAN ZIP PROPERTY INTEREST INTEREST MONTHLY TERM TO MATURITY
NUMBER CITY STATE CODE TYPE RATE RATE PAYMENT MATURITY DATE
- -------- ----------------------------------------------------- -------- -------- ---------- -------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
4484662 LONG BEACH CA 90807 SFD 7.750 6.750 $2,018.10 180 1-Oct-10
4484665 SALINAS CA 93908 SFD 7.750 6.750 $2,823.83 180 1-Nov-10
4484672 LITTLETON CO 80124 SFD 7.500 6.750 $2,688.34 180 1-Sep-10
4484676 LAS VEGAS NV 89128 SFD 8.000 6.750 $2,458.42 180 1-Aug-10
4484680 HILLSBOROUGH CA 94010 SFD 7.625 6.750 $3,082.63 180 1-Nov-10
4484683 NORTHRIDGE CA 91324 SFD 7.500 6.750 $5,562.08 180 1-Oct-10
4484687 SCOTTSDALE AZ 85259 SFD 7.125 6.750 $2,708.44 180 1-Jul-10
4484704 SAN RAFAEL CA 94901 PUD 7.875 6.750 $2,531.42 180 1-Dec-10
4484790 SUMMIT NJ 07901 SFD 6.500 6.280 $2,831.10 180 1-Jan-11
4484832 HOUSTON TX 77099 SFD 7.750 6.750 $466.88 180 1-Jan-11
4484908 WEST LAKELAND MN 55042 SFD 6.625 6.405 $2,282.79 180 1-Dec-10
4484909 RICHMOND CA 94805 SFD 8.000 6.750 $1,490.82 180 1-Dec-10
4484952 TRABUCO CANYON CA 92679 SFD 7.250 6.750 $2,583.41 180 1-Jan-11
4484956 NORTHPORT NY 11768 SFD 8.750 6.750 $2,638.55 180 1-Dec-10
4484997 WAYLAND MA 01778 SFD 7.500 6.750 $4,449.66 180 1-Jan-11
4484998 LUDLOW VT 05149 LCO 8.375 6.750 $2,287.18 180 1-Jan-11
4485093 BARTLETT IL 60103 SFD 7.250 6.750 $2,738.59 180 1-Jan-11
4485106 VERO BEACH FL 32963 SFD 6.875 6.655 $3,140.67 180 1-Dec-10
4485185 SAN CLEMENTE CA 92672 SFD 6.875 6.655 $3,603.10 180 1-Feb-11
4485252 STAMFORD CT 06902 SFD 7.125 6.750 $2,162.22 180 1-Jan-11
4485268 SAN JOSE CA 95120 SFD 6.875 6.655 $2,363.42 180 1-Jan-11
4485300 SAN RAFAEL CA 94901 SFD 7.250 6.750 $2,362.04 180 1-Dec-10
4485482 VIENNA VA 22182 SFD 6.750 6.530 $2,477.75 180 1-Nov-10
4485484 FRAMINGHAM MA 01701 SFD 7.875 6.750 $2,339.83 180 1-Dec-10
4485499 CLIO CA 96106 SFD 7.875 6.750 $2,281.02 180 1-Dec-10
4485510 SCOTTSDALE AZ 85259 SFD 7.250 6.750 $2,756.85 180 1-Jan-11
4485536 REDONDO BEACH CA 90277 LCO 7.375 6.750 $2,667.78 180 1-Dec-10
4485564 HAMPTON VA 23664 LCO 6.750 6.530 $1,982.20 180 1-Nov-10
4485579 KILL DEVIL HILLS NC 27948 SFD 7.375 6.750 $846.33 180 1-Jan-11
4485593 ROME GA 30165 SFD 7.625 6.750 $2,055.09 180 1-Dec-10
4485663 CHESAPEAKE VA 23320 SFD 7.500 6.750 $2,085.78 180 1-Dec-10
4485668 NORTH MIAMI FL 33181 SFD 8.000 6.750 $2,389.14 180 1-Dec-10
4485774 MCLEAN VA 22101 SFD 6.875 6.655 $3,824.28 180 1-Dec-10
4485832 JACKSON MS 39211 SFD 8.125 6.750 $4,718.13 180 1-Dec-10
4485889 JOPPA MD 21085 SFD 8.375 6.750 $1,071.26 180 1-Nov-10
4485966 RIDGEFIELD CT 06877 SFD 7.250 6.750 $2,293.57 180 1-Jan-11
4485981 MILLER PLACE NY 11764 SFD 8.125 6.750 $2,416.84 180 1-Nov-10
4486026 LAS VEGAS NV 89113 SFD 7.750 6.750 $3,765.11 180 1-Oct-10
4486077 CHICAGO IL 60614 THS 7.250 6.750 $2,870.05 180 1-Jan-11
4486220 CORAL GABLES FL 33134 SFD 7.500 6.750 $3,930.54 180 1-Feb-11
4486237 FISHERS IN 46038 SFD 7.125 6.750 $2,049.90 180 1-Jan-11
4486253 SHARON CT 06069 SFD 8.000 6.750 $1,146.79 180 1-Jan-11
4486270 KEYSTONE CO 80435 SFD 7.250 6.750 $3,802.99 180 1-Feb-11
4486304 GROTON CT 06340 SFD 7.125 6.750 $2,237.41 180 1-Dec-10
4486352 BRYN MAWR PA 19010 SFD 7.375 6.750 $2,952.96 180 1-Dec-10
4486358 FUQUAY-VARINA NC 27526 SFD 6.875 6.655 $2,342.01 180 1-Jan-11
4486374 MODESTO CA 95356 SFD 7.250 6.750 $3,879.67 180 1-Feb-11
4486416 PLANO TX 75093 SFD 7.000 6.750 $2,070.01 180 1-Jan-11
4486431 BELLAIRE TX 77401 SFD 7.250 6.750 $2,282.16 180 1-Dec-10
4486452 VENETIA PA 15367 SFD 6.250 6.030 $2,054.39 180 1-Dec-10
4486507 PASADENA MD 21122 SFD 7.500 6.750 $876.96 180 1-Jan-11
4486508 BASKING RIDGE NJ 07920 SFD 7.125 6.750 $3,170.41 180 1-Feb-11
4486539 ROSLYN ESTATES NY 11576 SFD 7.250 6.750 $3,468.88 180 1-Feb-11
4486569 SACRAMENTO CA 95864 SFD 6.875 6.655 $3,317.70 180 1-Jan-11
4486626 ARCADIA CA 91006 SFD 7.000 6.750 $2,795.36 180 1-Jan-11
4486668 COLLEYVILLE TX 76051 SFD 7.375 6.750 $2,564.75 180 1-Nov-10
4486727 JOPLIN MO 64804 SFD 7.125 6.750 $1,132.29 180 1-Feb-11
4486770 TAMPA FL 33615 SFD 7.875 6.750 $1,043.30 180 1-Jan-11
217
<PAGE>
<CAPTION>
(i) (ii) (iii) (iv) (v) (vi) (vii) (viii)
- ----- --------------------------- ----- ----- -------- -------- -------- ---------- -------- ----------
NET
MORTGAGE MORTGAGE MORTGAGE CURRENT ORIGINAL SCHEDULED
LOAN ZIP PROPERTY INTEREST INTEREST MONTHLY TERM TO MATURITY
NUMBER CITY STATE CODE TYPE RATE RATE PAYMENT MATURITY DATE
- -------- ----------------------------------------------------- -------- -------- ---------- -------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
4486782 ORLANDO FL 32827 SFD 8.000 6.750 $2,866.96 180 1-Dec-10
4486796 RICHBORO PA 18954 SFD 6.750 6.530 $2,637.04 180 1-Jan-11
4486801 YORKTOWN IN 47396 SFD 6.625 6.405 $2,265.23 180 1-Feb-11
4486823 NEW YORK NY 10028 HCO 7.500 6.750 $3,939.81 180 1-Feb-11
4486886 LAWRENCE NY 11559 SFD 7.375 6.750 $2,759.77 180 1-Jan-11
4486889 REDLANDS CA 92373 SFD 7.625 6.750 $2,452.10 180 1-Jan-11
4486997 OLIVEHAIN CA 92024 SFD 6.750 6.530 $1,946.81 180 1-Jan-11
4487035 IRONIA NJ 07845 SFD 6.750 6.530 $2,477.75 180 1-Jan-11
4487083 OMAHA NE 68124 SFD 6.750 6.530 $3,539.64 180 1-Jan-11
4487139 LOS GATOS CA 95030 SFD 6.750 6.530 $3,451.15 180 1-Jan-11
4487191 DUNWOODY GA 30350 SFD 7.625 6.750 $2,832.29 180 1-Nov-10
4487289 ROSLYN HEIGHTS NY 11577 SFD 8.000 6.750 $764.53 180 1-Jan-11
4487305 YORBA LINDA CA 92686 SFD 7.000 6.750 $2,876.26 180 1-Feb-11
4487387 ALLENTOWN PA 18103 SFD 6.625 6.405 $439.00 180 1-Jan-11
4487436 BOULDER CO 80301 SFD 8.250 6.750 $2,439.91 180 1-Dec-10
4487485 LAKE OSWEGO OR 97034 SFD 7.125 6.750 $3,133.73 180 1-Jan-11
4487579 BERTHOUD CO 80513 SFD 7.875 6.750 $2,027.79 180 1-Dec-10
4487687 WESTON MA 02193 SFD 7.375 6.750 $5,381.56 180 1-Jan-11
4487780 NANTUCKET MA 02554 SFD 7.375 6.750 $4,158.06 180 1-Jan-11
4487926 PRINEVILLE OR 97754 SFD 7.875 6.750 $1,052.31 180 1-Jan-11
4487950 BAY SHORE NY 11706 SFD 7.750 6.750 $1,106.95 180 1-Jan-11
4487980 COMMERCE TOWNSHIP MI 48382 LCO 7.125 6.750 $2,256.43 180 1-Jan-11
4488093 OAKLEY CA 94561 SFD 7.250 6.750 $2,184.49 180 1-Jan-11
4488134 NEWTON CENTER MA 02159 SFD 8.000 6.750 $3,392.57 180 1-Jan-11
4488136 EAST QUOGUE NY 11942 SFD 8.375 6.750 $3,592.05 180 1-Jan-11
4488141 SANTA MONICA CA 90403 SFD 7.500 6.750 $2,966.44 180 1-Dec-10
4488200 WESTPORT CT 06880 SFD 7.250 6.750 $5,796.68 180 1-Jan-11
4488213 FORT SALONGA NY 11768 SFD 6.750 6.530 $2,654.73 180 1-Feb-11
4488228 LOS ANGELES CA 90020 SFD 7.000 6.750 $3,145.90 180 1-Jan-11
4488284 HARVEY CEDARS NJ 08008 SFD 7.500 6.750 $2,294.36 180 1-Feb-11
4488286 SAN ANTONIO TX 78216 SFD 7.500 6.750 $2,897.85 180 1-Jan-11
4488327 MANHATTAN BEACH CA 90266 SFD 7.250 6.750 $4,409.13 180 1-Jan-11
4488380 THORNBURY PA 19380 SFD 6.625 6.405 $4,302.17 180 1-Feb-11
4488395 RIDGEFIELD CT 06877 SFD 7.375 6.750 $2,557.39 180 1-Jan-11
4488491 AUSTIN TX 78750 SFD 7.375 6.750 $2,111.23 180 1-Jan-11
4488532 MARBLEHEAD MA 01945 SFD 7.500 6.750 $2,632.72 180 1-Jan-11
4488546 FALLS CHURCH VA 22044 HCO 7.000 6.750 $449.42 180 1-Dec-10
4488852 CHINO HILLS CA 91709 SFD 7.125 6.750 $1,935.31 180 1-Jan-11
4488884 HENDERSONVILLE TN 37075 SFD 7.375 6.750 $2,299.81 180 1-Dec-10
4488922 BETHESDA MD 20817 SFD 7.375 6.750 $3,683.38 180 1-Jan-11
4488956 ORANGE CITY FL 32763 SFD 7.250 6.750 $319.51 180 1-Jan-11
4488971 BERNARDSVILLE NJ 07924 SFD 7.000 6.750 $5,392.97 180 1-Feb-11
4489038 HOUSTON TX 77024 SFD 7.625 6.750 $6,071.85 180 1-Jan-11
4489121 PORTLAND OR 97221 SFD 7.750 6.750 $2,294.36 180 1-Dec-10
4489247 HOUSTON TX 77036 SFD 8.000 6.750 $611.62 180 1-Jan-11
4489281 LINCOLNSHIRE IL 60069 SFD 7.375 6.750 $3,449.72 180 1-Jan-11
4489396 BARRINGTON NH 03825 SFD 7.875 6.750 $1,297.96 180 1-Feb-11
4489540 SAVANNAH GA 31410 SFD 7.500 6.750 $4,635.06 180 1-Aug-10
4489567 ALAMEDA CA 94502 SFD 7.500 6.750 $1,561.09 180 1-Dec-10
4489573 LOS GATOS CA 95032 SFD 7.000 6.750 $3,733.74 180 1-Feb-11
4489595 KATONAH NY 10536 SFD 7.750 6.750 $2,252.01 180 1-Jan-11
4489604 RYE NY 10580 SFD 7.500 6.750 $3,775.26 180 1-Sep-10
4489627 CHEVY CHASE MD 20815 SFD 7.125 6.750 $3,623.33 180 1-Dec-10
4489645 LUBBOCK TX 79424 SFD 7.375 6.750 $2,796.57 180 1-Feb-11
4489733 SANTA BARBARA CA 93108 SFD 7.375 6.750 $7,612.37 180 1-Jan-11
4489771 NORTH EASTON MA 02356 SFD 7.375 6.750 $2,130.09 180 1-Feb-11
4489772 HOUSTON TX 77079 SFD 7.750 6.750 $1,521.11 180 1-Jan-11
4489774 LOS ANGELES CA 90024 HCO 7.500 6.750 $4,243.40 180 1-Jan-11
218
<PAGE>
<CAPTION>
(i) (ii) (iii) (iv) (v) (vi) (vii) (viii)
- ----- --------------------------- ----- ----- -------- -------- -------- ---------- -------- ----------
NET
MORTGAGE MORTGAGE MORTGAGE CURRENT ORIGINAL SCHEDULED
LOAN ZIP PROPERTY INTEREST INTEREST MONTHLY TERM TO MATURITY
NUMBER CITY STATE CODE TYPE RATE RATE PAYMENT MATURITY DATE
- -------- ----------------------------------------------------- -------- -------- ---------- -------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
4490099 HUGHSON CA 95326 SFD 7.750 6.750 $800.09 180 1-Dec-10
4490203 HILLSBOROUGH CA 94010 SFD 7.250 6.750 $2,282.16 180 1-Jan-11
4490401 BOONEVILLE MS 38829 SFD 7.125 6.750 $2,441.22 180 1-Feb-11
4490485 SKOKIE IL 60676 SFD 7.250 6.750 $1,369.30 180 1-Feb-11
4490487 PLANO TX 75024 SFD 7.375 6.750 $1,977.84 180 1-Feb-11
4490903 DENVER CO 80220 SFD 7.000 6.750 $5,392.97 180 1-Feb-11
4491007 NEWHALL CA 91321 SFD 7.875 6.750 $3,857.82 180 1-Jan-11
4491088 EMERYVILLE CA 94608 SFD 7.625 6.750 $934.13 180 1-Jan-11
4491216 ANAHEIM CA 92804 SFD 8.000 6.750 $1,223.23 180 1-Jan-11
4491377 LOS ANGELES CA 90067 LCO 7.375 6.750 $3,472.72 180 1-Jan-11
4491479 HOUSTON TX 77005 SFD 7.500 6.750 $2,363.88 180 1-Dec-10
4491502 HOUSTON TX 77024 SFD 7.875 6.750 $2,274.38 180 1-Dec-10
4491679 WILLISTON VT 05495 SFD 7.000 6.750 $2,085.29 180 1-Feb-11
4491761 PARK CITY UT 84060 SFD 7.375 6.750 $2,281.41 180 1-Feb-11
4491831 LONGWOOD FL 32750 SFD 7.375 6.750 $1,212.00 180 1-Jan-11
4491848 SPARTA NJ 07871 SFD 7.625 6.750 $1,401.20 180 1-Jan-11
4492037 INDIAN WELLS CA 92210 SFD 7.500 6.750 $4,797.29 180 1-Jan-11
4492094 PARK CITY UT 84060 LCO 8.000 6.750 $2,217.12 180 1-Dec-10
4492175 LADUE MO 63124 SFD 7.125 6.750 $2,038.13 180 1-Feb-11
4492207 FREEHOLD NJ 07728 SFD 7.625 6.750 $1,578.68 180 1-Feb-11
4492235 CINCINNATI OH 45243 SFD 8.000 6.750 $4,625.36 180 1-Dec-10
4492430 TUSTIN CA 92680 LCO 7.500 6.750 $1,277.43 180 1-Jan-11
4492556 SAYVILLE NY 11782 SFD 7.500 6.750 $927.02 180 1-Feb-11
4492558 MARCO ISLAND FL 33937 HCO 7.875 6.750 $1,422.68 180 1-Jan-11
4492595 PHOENIX AZ 85048 SFD 8.000 6.750 $955.65 180 1-Dec-10
4492730 BOCA RATON FL 33433 LCO 7.875 6.750 $725.57 180 1-Feb-11
4492817 FLUSHING NY 11367 SFD 7.625 6.750 $2,204.55 180 1-Feb-11
4492972 RIDGEFIELD CT 06877 SFD 6.875 6.655 $1,935.33 180 1-Feb-11
4493305 MIAMI FL 33157 SFD 7.750 6.750 $494.17 180 1-Jan-11
4493852 MONKTON MD 21111 SFD 7.625 6.750 $4,437.12 180 1-Dec-10
4493864 BROOKLYN NY 11214 SFD 7.750 6.750 $2,090.58 180 1-Feb-11
4493886 GARDEN CITY NY 11530 SFD 7.125 6.750 $4,529.16 180 1-Feb-11
4494634 WHITTIER CA 90601 SFD 7.750 6.750 $2,244.95 180 1-Jan-11
4494700 BERKELEY HEIGHTS NJ 07922 SFD 7.000 6.750 $2,993.10 180 1-Feb-11
4495024 SAN FRANCISCO CA 94123 SFD 7.125 6.750 $3,351.58 180 1-Dec-10
4495036 STUDIO CITY CA 91604 SFD 7.875 6.750 $2,532.37 180 1-Dec-10
4495068 HOUSTON TX 77019 SFD 7.500 6.750 $3,770.16 180 1-Dec-10
4495076 NORTHRIDGE CA 91326 PUD 7.375 6.750 $2,090.99 180 1-Dec-10
4495286 CROFTON MD 21114 SFD 7.875 6.750 $2,200.41 180 1-Jan-11
4495455 PROVIDENCE RI 02908 SFD 7.750 6.750 $301.21 180 1-Feb-11
4495641 SANTA ROSA CA 95404 SFD 7.750 6.750 $3,670.98 180 1-Jan-11
4495880 IRVINE CA 92714 SFD 8.000 6.750 $2,264.90 180 1-Jan-11
4497121 CHATSWORTH CA 91311 SFD 8.250 6.750 $2,968.63 180 1-Jan-11
4497688 SCOTTSDALE AZ 85255 SFD 7.000 6.750 $2,336.96 180 1-Feb-11
219
<PAGE>
<CAPTION>
(i) (ix) (x) (xi) (xii) (xiii) (xiv) (xv)
- ----- -------------- --------------- ---------- -------- ----------- -----------
CUT-OFF
MORTGAGE DATE MORTGAGE MASTER FIXED
LOAN PRINCIPAL INSURANCE SERVICE SERVICE RETAINED
NUMBER BALANCE LTV SUBSIDY CODE FEE FEE YIELD
- -------- -------------- --------------- ---------- -------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
3498299 $74,267.64 57.14 0.200 0.0200 0.0000
3514509 $108,491.63 60.56 0.200 0.0200 1.7800
3563482 $79,057.42 62.25 0.200 0.0200 1.4050
3574023 $222,992.86 77.03 0.200 0.0200 0.7800
3578477 $238,481.20 56.87 0.200 0.0200 0.0300
3580592 $97,868.74 64.52 0.200 0.0200 0.6550
3583791 $400,498.43 75.00 0.200 0.0200 0.0000
3589922 $237,763.90 80.00 0.200 0.0200 0.2800
3590443 $26,381.43 90.00 0.200 0.0200 1.5300
3592817 $150,760.58 69.98 0.200 0.0200 0.2800
3593089 $345,300.91 79.99 0.200 0.0200 0.0300
3594249 $332,880.01 50.00 0.200 0.0200 0.0300
3596729 $635,697.15 73.78 0.200 0.0200 0.2800
3596887 $397,576.35 76.92 0.200 0.0200 0.5300
3600353 $370,816.06 90.00 0.200 0.0200 0.1550
3601335 $236,250.00 75.00 0.200 0.0200 0.6550
3601629 $324,007.64 52.00 0.200 0.0200 0.4050
4447407 $74,780.85 54.00 0.200 0.0200 0.9050
4448080 $581,455.40 75.00 0.200 0.0200 0.5300
4448988 $324,527.34 80.00 GD 3YR 0.200 0.0200 0.0000
4450230 $90,581.75 69.60 0.200 0.0200 0.5300
4450351 $285,228.90 53.57 0.200 0.0200 1.6550
4450413 $251,165.30 79.99 0.200 0.0200 0.0000
4451369 $494,021.35 49.70 0.200 0.0200 0.6550
4451681 $178,480.08 80.00 0.200 0.0200 1.4050
4452598 $226,740.16 79.99 0.200 0.0200 0.1550
4453384 $395,430.86 49.69 0.200 0.0200 1.2800
4453417 $250,387.94 74.12 0.200 0.0200 0.0000
4455768 $302,910.16 89.99 0.200 0.0200 1.5300
4456674 $275,110.14 79.99 0.200 0.0200 0.0000
4456939 $87,474.50 70.00 0.200 0.0200 1.0300
4457343 $357,912.36 65.45 0.200 0.0200 1.0300
4457413 $225,829.39 82.91 0.200 0.0200 0.0300
4457806 $357,746.33 66.06 0.200 0.0200 0.1550
4458155 $418,674.92 70.59 0.200 0.0200 0.0300
4458735 $423,629.76 61.30 0.200 0.0200 0.0000
4458956 $344,590.48 51.85 0.200 0.0200 0.4050
4459524 $159,200.94 48.79 0.200 0.0200 1.5300
4459714 $248,400.73 53.76 0.200 0.0200 0.0000
4459914 $124,598.93 75.00 0.200 0.0200 1.7800
4460230 $644,289.98 71.42 0.200 0.0200 1.1550
4460306 $380,947.38 90.00 GD 3YR 0.200 0.0200 0.0000
4461573 $112,723.60 65.20 0.200 0.0200 0.6550
4462224 $248,400.73 42.02 GD 2YR 0.200 0.0200 0.0000
4462339 $351,849.53 79.99 0.200 0.0200 0.0000
4463187 $343,887.69 43.13 0.200 0.0200 0.0000
4463261 $459,723.48 80.00 0.200 0.0200 0.4050
4463605 $170,196.22 80.00 0.200 0.0200 0.9050
4463712 $245,830.41 67.93 0.200 0.0200 0.1550
4464156 $292,105.35 79.19 0.200 0.0200 0.4050
4464568 $262,531.00 73.00 0.200 0.0200 0.2800
220
<PAGE>
<CAPTION>
(i) (ix) (x) (xi) (xii) (xiii) (xiv) (xv)
- ----- -------------- --------------- ---------- -------- ----------- -----------
CUT-OFF
MORTGAGE DATE MORTGAGE MASTER FIXED
LOAN PRINCIPAL INSURANCE SERVICE SERVICE RETAINED
NUMBER BALANCE LTV SUBSIDY CODE FEE FEE YIELD
- -------- -------------- --------------- ---------- -------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
4464929 $288,739.81 65.28 0.200 0.0200 0.5300
4464936 $135,589.26 69.74 0.200 0.0200 0.5300
4465357 $227,195.29 66.76 0.200 0.0200 0.5300
4465821 $206,739.13 74.50 0.200 0.0200 0.7800
4465826 $140,117.30 48.45 0.200 0.0200 0.1550
4465881 $267,347.62 76.27 0.200 0.0200 0.1550
4466009 $361,883.76 75.26 0.200 0.0200 1.2800
4466596 $290,111.82 79.00 0.200 0.0200 0.0000
4466756 $444,971.56 78.95 0.200 0.0200 1.5300
4467153 $244,866.35 72.02 0.200 0.0200 0.6550
4467158 $82,513.35 64.84 0.200 0.0200 0.9050
4467376 $128,592.04 80.00 0.200 0.0200 1.6550
4467801 $353,879.98 64.16 0.200 0.0200 0.0300
4468012 $243,499.22 44.55 0.200 0.0200 0.4050
4468250 $448,952.20 58.27 0.200 0.0200 0.9050
4468413 $376,275.67 64.36 0.200 0.0200 0.6550
4468684 $347,947.90 76.09 0.200 0.0200 0.9050
4468965 $39,639.24 45.98 0.200 0.0200 0.6550
4469044 $226,633.53 80.00 0.200 0.0200 0.6550
4469609 $296,692.49 66.67 0.200 0.0200 0.6550
4469684 $472,599.60 27.48 0.200 0.0200 0.7800
4469930 $352,053.85 78.71 0.200 0.0200 0.5300
4469931 $377,747.39 74.51 0.200 0.0200 0.7800
4470213 $59,452.97 55.56 0.200 0.0200 0.5300
4470369 $196,252.92 70.71 0.200 0.0200 0.9050
4470728 $249,751.98 86.90 06 0.200 0.0200 0.7800
4470905 $318,957.08 74.09 0.200 0.0200 0.0000
4470998 $382,767.38 73.33 0.200 0.0200 1.0300
4471411 $171,540.48 90.00 0.200 0.0200 0.0300
4471491 $43,892.58 75.00 0.200 0.0200 1.9050
4471711 $136,024.02 80.00 0.200 0.0200 1.2800
4471874 $93,429.83 70.00 0.200 0.0200 0.5300
4472080 $29,752.22 33.82 0.200 0.0200 1.6550
4472216 $69,226.36 65.42 0.200 0.0200 1.6550
4472540 $111,378.65 80.00 0.200 0.0200 1.5300
4472613 $247,644.65 79.37 0.200 0.0200 0.1550
4472719 $74,180.23 55.39 0.200 0.0200 1.7800
4472798 $348,931.30 49.30 0.200 0.0200 0.4050
4472849 $263,837.92 79.97 0.200 0.0200 0.1550
4473055 $220,774.31 71.66 0.200 0.0200 0.2800
4473071 $206,024.69 80.00 0.200 0.0200 1.2800
4473093 $300,000.00 49.79 0.200 0.0200 0.0000
4473121 $566,583.84 71.25 0.200 0.0200 0.6550
4473176 $225,966.09 73.79 0.200 0.0200 0.7800
4473250 $138,751.11 73.68 0.200 0.0200 0.7800
4473321 $238,577.28 80.00 0.200 0.0200 0.7800
4473327 $301,198.14 67.56 0.200 0.0200 0.4050
4473354 $70,574.47 55.47 0.200 0.0200 0.6550
4473370 $55,367.30 80.00 0.200 0.0200 1.4050
4473646 $231,523.03 56.82 0.200 0.0200 0.4050
4473740 $198,329.79 59.70 0.200 0.0200 1.5300
4474063 $143,762.06 51.79 0.200 0.0200 1.2800
4474077 $105,192.68 74.75 0.200 0.0200 0.6550
4474110 $108,950.29 80.00 0.200 0.0200 0.7800
4474257 $512,839.20 49.14 0.200 0.0200 0.4050
4474334 $337,332.40 90.00 0.200 0.0200 1.0300
4474400 $99,307.81 79.98 0.200 0.0200 0.7800
4474540 $213,678.36 80.00 0.200 0.0200 0.0000
221
<PAGE>
<CAPTION>
(i) (ix) (x) (xi) (xii) (xiii) (xiv) (xv)
- ----- -------------- --------------- ---------- -------- ----------- -----------
CUT-OFF
MORTGAGE DATE MORTGAGE MASTER FIXED
LOAN PRINCIPAL INSURANCE SERVICE SERVICE RETAINED
NUMBER BALANCE LTV SUBSIDY CODE FEE FEE YIELD
- -------- -------------- --------------- ---------- -------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
4474606 $367,877.92 74.00 0.200 0.0200 1.1550
4474779 $252,245.32 76.91 0.200 0.0200 0.4050
4474932 $278,007.65 67.14 0.200 0.0200 0.6550
4474977 $498,334.99 59.25 0.200 0.0200 0.0000
4475134 $93,197.43 72.31 0.200 0.0200 1.2800
4475181 $396,313.33 61.54 0.200 0.0200 0.4050
4475208 $163,048.96 80.00 0.200 0.0200 1.0300
4475227 $457,182.23 56.10 0.200 0.0200 0.4050
4475272 $376,000.00 79.16 0.200 0.0200 0.2800
4475495 $382,790.73 47.55 0.200 0.0200 0.4050
4475656 $333,628.17 74.37 0.200 0.0200 0.4050
4475849 $225,279.34 80.00 0.200 0.0200 0.7800
4476207 $59,498.92 56.07 0.200 0.0200 1.5300
4476272 $392,580.39 65.83 0.200 0.0200 0.4050
4476353 $305,984.62 80.00 0.200 0.0200 0.5300
4476556 $285,600.00 80.00 GD 3YR 0.200 0.0200 0.0000
4476642 $483,119.01 58.87 0.200 0.0200 0.7800
4476701 $159,537.63 78.05 0.200 0.0200 1.0300
4476839 $254,732.30 77.88 0.200 0.0200 0.9050
4476840 $216,507.27 60.33 0.200 0.0200 0.0000
4476884 $202,509.07 48.95 0.200 0.0200 0.0300
4476904 $153,691.17 59.85 0.200 0.0200 1.4050
4476909 $90,307.28 69.70 0.200 0.0200 1.5300
4476934 $166,941.21 73.91 0.200 0.0200 0.2800
4476937 $50,777.61 64.06 0.200 0.0200 0.4050
4477142 $168,499.97 69.11 0.200 0.0200 0.9050
4477186 $68,228.94 35.94 0.200 0.0200 1.5300
4477300 $65,064.19 79.99 0.200 0.0200 1.7800
4477517 $229,282.21 61.33 0.200 0.0200 0.1550
4477621 $465,091.11 70.68 0.200 0.0200 0.5300
4477662 $224,362.07 76.51 0.200 0.0200 0.7800
4477707 $270,781.07 72.65 0.200 0.0200 0.4050
4477878 $109,710.21 74.97 0.200 0.0200 1.5300
4477968 $263,304.78 67.95 0.200 0.0200 0.0000
4478000 $149,101.01 56.60 0.200 0.0200 0.6550
4478204 $283,383.42 75.00 0.200 0.0200 1.2800
4478266 $248,812.52 68.38 0.200 0.0200 0.0300
4478323 $296,424.89 71.43 0.200 0.0200 1.2800
4478390 $39,526.19 79.96 0.200 0.0200 1.5300
4478503 $246,480.86 70.86 0.200 0.0200 0.4050
4478525 $426,388.31 73.50 0.200 0.0200 0.5300
4478558 $418,703.47 80.00 0.200 0.0200 0.2800
4478587 $95,126.43 74.94 0.200 0.0200 0.6550
4478628 $397,576.35 68.38 0.200 0.0200 0.5300
4478836 $79,286.35 53.33 0.200 0.0200 0.7800
4478883 $408,748.10 60.29 0.200 0.0200 0.4050
4478934 $49,719.50 26.32 0.200 0.0200 1.4050
4479004 $294,874.96 72.56 0.200 0.0200 0.9050
4479008 $275,872.96 75.00 0.200 0.0200 0.9050
4479086 $159,594.88 70.00 0.200 0.0200 1.0300
4479143 $109,376.04 46.61 0.200 0.0200 1.2800
4479218 $276,917.15 79.99 0.200 0.0200 0.0000
4479238 $242,122.22 84.99 0.200 0.0200 0.5300
4479242 $477,654.66 67.49 0.200 0.0200 0.1550
4479262 $292,616.18 80.00 0.200 0.0200 0.5300
4479394 $93,878.65 67.86 0.200 0.0200 0.9050
4479616 $288,144.86 69.88 0.200 0.0200 0.0000
4479631 $423,673.65 45.95 0.200 0.0200 0.1550
222
<PAGE>
<CAPTION>
(i) (ix) (x) (xi) (xii) (xiii) (xiv) (xv)
- ----- -------------- --------------- ---------- -------- ----------- -----------
CUT-OFF
MORTGAGE DATE MORTGAGE MASTER FIXED
LOAN PRINCIPAL INSURANCE SERVICE SERVICE RETAINED
NUMBER BALANCE LTV SUBSIDY CODE FEE FEE YIELD
- -------- -------------- --------------- ---------- -------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
4479662 $291,118.12 41.71 0.200 0.0200 0.5300
4479674 $239,524.41 68.64 0.200 0.0200 0.5300
4479711 $84,484.96 79.44 0.200 0.0200 0.5300
4479775 $342,687.89 80.00 0.200 0.0200 0.4050
4479798 $337,777.69 75.56 0.200 0.0200 0.0000
4479826 $305,191.93 80.00 0.200 0.0200 0.5300
4479895 $99,694.65 74.07 0.200 0.0200 0.4050
4479900 $273,770.67 32.31 0.200 0.0200 0.5300
4479947 $310,507.12 73.51 0.200 0.0200 0.5300
4479958 $317,018.34 53.00 0.200 0.0200 0.2800
4480060 $90,466.45 25.28 0.200 0.0200 0.9050
4480070 $289,451.59 80.00 0.200 0.0200 1.0300
4480080 $328,970.13 75.00 0.200 0.0200 0.1550
4480095 $293,331.87 84.34 0.200 0.0200 0.0300
4480288 $287,120.62 80.00 0.200 0.0200 0.4050
4480435 $441,159.71 80.00 0.200 0.0200 0.0000
4480436 $452,149.57 80.00 0.200 0.0200 1.4050
4480470 $33,448.90 75.00 0.200 0.0200 0.7800
4480528 $45,561.98 76.17 0.200 0.0200 0.5300
4480541 $218,345.81 82.99 0.200 0.0200 0.6550
4480558 $512,342.81 80.00 0.200 0.0200 0.0000
4480581 $64,623.06 16.67 0.200 0.0200 1.0300
4480589 $218,577.39 80.00 0.200 0.0200 0.0000
4480614 $349,880.53 90.00 0.200 0.0200 0.0000
4480634 $230,118.44 84.99 0.200 0.0200 0.0000
4480655 $39,647.05 55.56 0.200 0.0200 0.9050
4480695 $275,119.73 80.00 0.200 0.0200 0.0000
4480725 $262,365.16 60.69 0.200 0.0200 0.2800
4480766 $250,340.08 69.97 0.200 0.0200 0.2800
4480826 $413,615.82 50.27 0.200 0.0200 0.0300
4480874 $227,218.18 84.63 0.200 0.0200 1.4050
4480938 $280,906.29 89.71 0.200 0.0200 0.6550
4481034 $457,088.96 79.31 0.200 0.0200 0.0300
4481102 $348,954.51 62.50 0.200 0.0200 0.6550
4481110 $218,562.02 80.00 0.200 0.0200 0.0000
4481177 $323,996.73 62.50 0.200 0.0200 0.2800
4481212 $257,680.63 65.82 0.200 0.0200 0.7800
4481239 $84,748.87 73.91 0.200 0.0200 0.7800
4481284 $230,563.31 68.24 0.200 0.0200 0.2800
4481308 $59,476.32 68.18 0.200 0.0200 1.0300
4481330 $227,288.90 90.00 0.200 0.0200 1.1550
4481358 $411,240.47 75.00 0.200 0.0200 0.4050
4481400 $304,048.15 48.80 0.200 0.0200 0.1550
4481531 $317,974.93 80.00 0.200 0.0200 0.0300
4481536 $80,910.98 80.00 0.200 0.0200 1.4050
4481633 $263,277.33 67.92 0.200 0.0200 0.4050
4481664 $289,104.77 74.36 0.200 0.0200 0.2800
4481686 $255,152.83 79.99 0.200 0.0200 1.2800
4481708 $275,138.65 80.00 0.200 0.0200 0.1550
4481723 $343,958.05 75.00 0.200 0.0200 0.5300
4481778 $273,387.62 50.93 0.200 0.0200 0.9050
4481779 $397,576.35 54.05 0.200 0.0200 0.5300
4481854 $247,794.11 27.78 0.200 0.0200 0.9050
4481889 $274,132.39 52.99 0.200 0.0200 0.0300
4481955 $628,138.71 70.00 0.200 0.0200 0.7800
4481980 $289,085.06 58.00 0.200 0.0200 0.0300
223
<PAGE>
<CAPTION>
(i) (ix) (x) (xi) (xii) (xiii) (xiv) (xv)
- ----- -------------- --------------- ---------- -------- ----------- -----------
CUT-OFF
MORTGAGE DATE MORTGAGE MASTER FIXED
LOAN PRINCIPAL INSURANCE SERVICE SERVICE RETAINED
NUMBER BALANCE LTV SUBSIDY CODE FEE FEE YIELD
- -------- -------------- --------------- ---------- -------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
4481982 $252,925.35 74.62 0.200 0.0200 0.4050
4482006 $346,945.36 73.68 0.200 0.0200 1.0300
4482041 $54,456.94 77.18 0.200 0.0200 0.1550
4482049 $376,719.76 80.00 0.200 0.0200 1.1550
4482202 $398,765.21 78.90 0.200 0.0200 0.2800
4482223 $71,561.63 59.50 0.200 0.0200 0.9050
4482255 $313,049.34 68.48 0.200 0.0200 0.2800
4482273 $347,736.77 66.67 0.200 0.0200 0.0000
4482284 $231,371.14 79.97 0.200 0.0200 0.5300
4482301 $228,308.39 65.43 0.200 0.0200 0.5300
4482327 $386,988.61 73.47 0.200 0.0200 0.2800
4482484 $306,050.87 80.00 0.200 0.0200 0.0300
4482518 $490,632.29 70.71 0.200 0.0200 0.9050
4482583 $229,374.04 79.99 0.200 0.0200 0.0300
4482751 $174,910.10 70.40 0.200 0.0200 0.2800
4482883 $290,230.73 80.00 0.200 0.0200 0.5300
4483062 $387,688.10 58.56 0.200 0.0200 0.7800
4483095 $117,984.01 70.00 0.200 0.0200 1.2800
4483102 $506,431.82 74.71 0.200 0.0200 0.2800
4483251 $48,549.66 29.52 0.200 0.0200 0.2800
4483275 $243,101.67 75.26 0.200 0.0200 0.4050
4483285 $99,432.76 44.25 0.200 0.0200 1.2800
4483313 $260,883.85 80.00 0.200 0.0200 0.9050
4483319 $327,213.49 75.00 0.200 0.0200 1.4050
4483329 $607,875.08 55.59 0.200 0.0200 0.7800
4483346 $231,091.27 88.94 01 0.200 0.0200 0.5300
4483378 $398,765.21 33.33 0.200 0.0200 0.2800
4483426 $246,237.51 79.68 0.200 0.0200 0.2800
4483447 $429,171.06 70.00 0.200 0.0200 0.2800
4483463 $221,528.92 71.68 0.200 0.0200 0.5300
4483469 $233,269.73 69.85 0.200 0.0200 0.1550
4483499 $230,294.66 58.78 0.200 0.0200 0.4050
4483716 $55,751.09 70.00 0.200 0.0200 0.7800
4483738 $257,447.74 74.00 0.200 0.0200 0.6550
4483811 $398,778.63 71.17 0.200 0.0200 0.4050
4483826 $29,829.82 75.00 0.200 0.0200 1.2800
4483879 $307,243.67 62.86 0.200 0.0200 1.0300
4484130 $267,098.93 80.00 0.200 0.0200 0.0300
4484166 $383,811.51 73.75 0.200 0.0200 0.2800
4484228 $223,285.57 80.00 0.200 0.0200 0.0000
4484234 $357,697.06 72.01 0.200 0.0200 0.0000
4484292 $277,502.20 78.43 0.200 0.0200 0.7800
4484445 $417,564.43 80.00 0.200 0.0200 1.0300
4484543 $240,654.80 78.12 0.200 0.0200 0.2800
4484642 $461,334.90 76.86 0.200 0.0200 0.9050
4484662 $211,738.72 80.00 0.200 0.0200 0.7800
4484665 $297,323.80 79.47 0.200 0.0200 0.7800
4484672 $285,565.72 69.05 0.200 0.0200 0.5300
4484676 $252,714.48 79.99 0.200 0.0200 1.0300
4484680 $327,023.91 41.77 0.200 0.0200 0.6550
4484683 $592,606.41 70.59 0.200 0.0200 0.5300
4484687 $292,350.59 66.46 0.200 0.0200 0.1550
4484704 $265,335.10 82.38 13 0.200 0.0200 0.9050
4484790 $323,929.32 59.09 0.200 0.0200 0.0000
4484832 $49,453.45 80.00 0.200 0.0200 0.7800
4484908 $258,300.58 80.00 0.200 0.0200 0.0000
224
<PAGE>
<CAPTION>
(i) (ix) (x) (xi) (xii) (xiii) (xiv) (xv)
- ----- -------------- --------------- ---------- -------- ----------- -----------
CUT-OFF
MORTGAGE DATE MORTGAGE MASTER FIXED
LOAN PRINCIPAL INSURANCE SERVICE SERVICE RETAINED
NUMBER BALANCE LTV SUBSIDY CODE FEE FEE YIELD
- -------- -------------- --------------- ---------- -------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
4484909 $155,095.35 78.39 0.200 0.0200 1.0300
4484952 $282,126.38 77.96 0.200 0.0200 0.2800
4484956 $262,567.70 80.00 0.200 0.0200 1.7800
4484997 $478,550.34 67.61 0.200 0.0200 0.5300
4484998 $233,345.95 90.00 0.200 0.0200 1.4050
4485093 $299,073.91 59.41 0.200 0.0200 0.2800
4485106 $349,897.28 88.04 0.200 0.0200 0.0000
4485185 $404,000.00 80.00 0.200 0.0200 0.0000
4485252 $237,955.06 45.74 0.200 0.0200 0.1550
4485268 $264,154.81 78.64 0.200 0.0200 0.0000
4485300 $257,147.66 75.00 0.200 0.0200 0.2800
4485482 $277,276.49 80.00 0.200 0.0200 0.0000
4485484 $245,253.55 75.91 0.200 0.0200 0.9050
4485499 $239,089.92 90.00 12 0.200 0.0200 0.9050
4485510 $301,067.73 76.46 0.200 0.0200 0.2800
4485536 $288,223.59 74.36 0.200 0.0200 0.4050
4485564 $221,821.19 80.00 0.200 0.0200 0.0000
4485579 $91,719.09 63.45 0.200 0.0200 0.4050
4485593 $218,681.48 68.86 0.200 0.0200 0.6550
4485663 $223,636.69 60.00 0.200 0.0200 0.5300
4485668 $248,550.24 55.56 0.200 0.0200 1.0300
4485774 $426,056.94 80.00 0.200 0.0200 0.0000
4485832 $487,189.68 67.59 0.200 0.0200 1.1550
4485889 $108,674.54 80.00 0.200 0.0200 1.4050
4485966 $250,474.40 75.00 0.200 0.0200 0.2800
4485981 $248,833.30 76.29 0.200 0.0200 1.1550
4486026 $395,226.91 77.67 0.200 0.0200 0.7800
4486077 $313,429.45 80.00 0.200 0.0200 0.2800
4486220 $424,000.00 80.00 0.200 0.0200 0.5300
4486237 $225,593.76 83.20 0.200 0.0200 0.1550
4486253 $119,653.21 74.07 0.200 0.0200 1.0300
4486270 $416,600.00 40.06 0.200 0.0200 0.2800
4486304 $245,453.74 70.57 0.200 0.0200 0.1550
4486352 $319,033.68 42.24 0.200 0.0200 0.4050
4486358 $261,762.47 77.24 0.200 0.0200 0.0000
4486374 $425,000.00 77.27 0.200 0.0200 0.2800
4486416 $229,573.41 67.74 0.200 0.0200 0.0300
4486431 $248,451.85 78.13 0.200 0.0200 0.2800
4486452 $237,982.86 79.97 0.200 0.0200 0.0000
4486507 $94,314.29 70.07 0.200 0.0200 0.5300
4486508 $350,000.00 60.87 0.200 0.0200 0.1550
4486539 $380,000.00 64.41 0.200 0.0200 0.2800
4486569 $370,813.55 74.40 0.200 0.0200 0.0000
4486626 $310,018.81 64.12 0.200 0.0200 0.0300
4486668 $276,230.40 80.00 0.200 0.0200 0.4050
4486727 $125,000.00 27.47 0.200 0.0200 0.1550
4486770 $109,678.58 68.75 0.200 0.0200 0.9050
4486782 $298,260.30 40.54 0.200 0.0200 1.0300
4486796 $297,039.21 77.40 0.200 0.0200 0.0000
4486801 $258,000.00 80.00 0.200 0.0200 0.0000
4486823 $425,000.00 35.42 0.200 0.0200 0.5300
4486886 $299,083.98 67.42 0.200 0.0200 0.4050
4486889 $261,715.87 75.00 0.200 0.0200 0.6550
4486997 $219,290.69 42.31 0.200 0.0200 0.0000
4487035 $279,097.25 80.00 0.200 0.0200 0.0000
4487083 $398,710.36 68.38 0.200 0.0200 0.0000
225
<PAGE>
<CAPTION>
(i) (ix) (x) (xi) (xii) (xiii) (xiv) (xv)
- ----- -------------- --------------- ---------- -------- ----------- -----------
CUT-OFF
MORTGAGE DATE MORTGAGE MASTER FIXED
LOAN PRINCIPAL INSURANCE SERVICE SERVICE RETAINED
NUMBER BALANCE LTV SUBSIDY CODE FEE FEE YIELD
- -------- -------------- --------------- ---------- -------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
4487139 $388,742.60 42.86 0.200 0.0200 0.0000
4487191 $300,465.58 80.00 0.200 0.0200 0.6550
4487289 $79,768.80 19.51 0.200 0.0200 1.0300
4487305 $320,000.00 80.00 0.200 0.0200 0.0300
4487387 $49,837.04 28.57 0.200 0.0200 0.0000
4487436 $250,073.42 75.07 0.200 0.0200 1.2800
4487485 $344,870.35 73.92 0.200 0.0200 0.1550
4487579 $212,546.44 80.68 06 0.200 0.0200 0.9050
4487687 $583,213.75 62.90 0.200 0.0200 0.4050
4487780 $450,619.86 80.00 0.200 0.0200 0.4050
4487926 $110,625.80 70.00 0.200 0.0200 0.9050
4487950 $117,252.55 80.00 0.200 0.0200 0.7800
4487980 $248,322.60 63.87 0.200 0.0200 0.1550
4488093 $238,561.28 75.97 0.200 0.0200 0.2800
4488134 $353,974.10 51.30 0.200 0.0200 1.0300
4488136 $366,472.79 70.00 0.200 0.0200 1.4050
4488141 $318,061.08 80.00 0.200 0.0200 0.5300
4488200 $633,039.78 38.48 0.200 0.0200 0.2800
4488213 $300,000.00 80.00 0.200 0.0200 0.0000
4488228 $348,895.77 53.03 0.200 0.0200 0.0300
4488284 $247,500.00 75.00 0.200 0.0200 0.5300
4488286 $311,081.38 72.03 0.200 0.0200 0.5300
4488327 $481,509.00 79.18 0.200 0.0200 0.2800
4488380 $490,000.00 74.41 0.200 0.0200 0.0000
4488395 $277,151.15 61.78 0.200 0.0200 0.4050
4488491 $228,799.24 90.00 0.200 0.0200 0.4050
4488532 $283,142.28 84.78 0.200 0.0200 0.5300
4488546 $49,683.58 55.62 0.200 0.0200 0.0300
4488852 $212,983.24 64.55 0.200 0.0200 0.1550
4488884 $248,468.60 55.68 0.200 0.0200 0.4050
4488922 $399,177.41 70.87 0.200 0.0200 0.4050
4488956 $34,891.95 28.00 0.200 0.0200 0.2800
4488971 $600,000.00 61.86 0.200 0.0200 0.0300
4489038 $648,058.36 59.09 0.200 0.0200 0.6550
4489121 $242,305.07 75.00 0.200 0.0200 0.7800
4489247 $63,815.05 79.01 0.200 0.0200 1.0300
4489281 $373,854.97 78.95 0.200 0.0200 0.4050
4489396 $136,850.00 74.99 0.200 0.0200 0.9050
4489540 $490,796.88 67.11 0.200 0.0200 0.5300
4489567 $167,379.64 74.99 0.200 0.0200 0.5300
4489573 $415,400.00 72.24 0.200 0.0200 0.0300
4489595 $238,543.15 75.00 0.200 0.0200 0.7800
4489604 $360,772.91 75.00 0.200 0.0200 0.5300
4489627 $397,495.93 34.78 0.200 0.0200 0.1550
4489645 $304,000.00 80.00 0.200 0.0200 0.4050
4489733 $824,973.31 43.55 0.200 0.0200 0.4050
4489771 $231,550.00 77.18 0.200 0.0200 0.4050
4489772 $161,122.56 78.83 0.200 0.0200 0.7800
4489774 $456,367.54 67.81 0.200 0.0200 0.5300
4490099 $84,496.12 51.20 0.200 0.0200 0.7800
4490203 $249,228.26 29.07 0.200 0.0200 0.2800
4490401 $269,500.00 70.00 0.200 0.0200 0.1550
4490485 $150,000.00 74.26 0.200 0.0200 0.2800
4490487 $215,000.00 79.63 0.200 0.0200 0.4050
4490903 $600,000.00 44.48 0.200 0.0200 0.0300
226
<PAGE>
<CAPTION>
(i) (ix) (x) (xi) (xii) (xiii) (xiv) (xv)
- ----- -------------- --------------- ---------- -------- ----------- -----------
CUT-OFF
MORTGAGE DATE MORTGAGE MASTER FIXED
LOAN PRINCIPAL INSURANCE SERVICE SERVICE RETAINED
NUMBER BALANCE LTV SUBSIDY CODE FEE FEE YIELD
- -------- -------------- --------------- ---------- -------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
4491007 $405,561.48 79.99 0.200 0.0200 0.9050
4491088 $99,701.29 73.53 0.200 0.0200 0.6550
4491216 $127,630.10 80.00 0.200 0.0200 1.0300
4491377 $376,347.33 68.64 0.200 0.0200 0.4050
4491479 $253,454.93 79.94 0.200 0.0200 0.5300
4491502 $238,394.02 61.49 0.200 0.0200 0.9050
4491679 $232,000.00 73.65 0.200 0.0200 0.0300
4491761 $248,000.00 54.51 0.200 0.0200 0.4050
4491831 $131,347.71 74.99 0.200 0.0200 0.4050
4491848 $149,551.93 54.95 0.200 0.0200 0.6550
4492037 $515,937.09 75.00 0.200 0.0200 0.5300
4492094 $230,654.63 80.00 0.200 0.0200 1.0300
4492175 $225,000.00 51.72 0.200 0.0200 0.1550
4492207 $169,000.00 72.22 0.200 0.0200 0.6550
4492235 $481,193.29 68.17 0.200 0.0200 1.0300
4492430 $137,383.82 69.98 0.200 0.0200 0.5300
4492556 $100,000.00 30.30 0.200 0.0200 0.5300
4492558 $149,561.70 71.43 0.200 0.0200 0.9050
4492595 $99,420.11 64.56 0.200 0.0200 1.0300
4492730 $76,500.00 75.00 0.200 0.0200 0.9050
4492817 $236,000.00 78.67 0.200 0.0200 0.6550
4492972 $217,000.00 57.87 0.200 0.0200 0.0000
4493305 $52,344.89 75.00 0.200 0.0200 0.7800
4493852 $472,153.19 80.00 0.200 0.0200 0.6550
4493864 $222,100.00 68.34 0.200 0.0200 0.7800
4493886 $500,000.00 69.93 0.200 0.0200 0.1550
4494634 $237,795.36 90.00 12 0.200 0.0200 0.7800
4494700 $333,000.00 72.71 0.200 0.0200 0.0300
4495024 $367,683.73 53.62 0.200 0.0200 0.1550
4495036 $265,434.52 79.70 0.200 0.0200 0.9050
4495068 $404,235.76 68.93 0.200 0.0200 0.5300
4495076 $225,907.65 79.98 0.200 0.0200 0.4050
4495286 $231,322.09 80.00 0.200 0.0200 0.9050
4495455 $32,000.00 39.51 0.200 0.0200 0.7800
4495641 $388,847.77 79.92 0.200 0.0200 0.7800
4495880 $236,315.10 72.92 0.200 0.0200 1.0300
4497121 $300,966.38 76.50 0.200 0.0200 1.2800
4497688 $260,000.00 55.35 0.200 0.0200 0.0300
===============
$115,375,988.68
<FN>
WAC: 7.4329
WAM: 178.1430
WALTV: 69.1013
</FN>
</TABLE>
227
<PAGE>
EXHIBIT F-2
<TABLE>
<CAPTION>
(i) (ii) (iii) (iv) (v) (vi) (vii) (viii)
- ----- ------------------------ ----- ----- -------- -------- -------- ---------- -------- ----------
NET
MORTGAGE MORTGAGE MORTGAGE CURRENT ORIGINAL SCHEDULED
LOAN ZIP PROPERTY INTEREST INTEREST MONTHLY TERM TO MATURITY
NUMBER CITY STATE CODE TYPE RATE RATE PAYMENT MATURITY DATE
- -------- ---------------------------------------------------- -------- -------- ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
4467363 PARKER CO 80134 SFD 8.875 6.750 $1,312.93 180 1-Sep-10
4472308 NEW CANEY TX 77357 SFD 8 6.750 $542.82 180 1-Nov-10
4473207 LOS ANGELES CA 90049 SFD 6.875 6.605 $3,826.06 180 1-Jul-10
4473225 SEATTLE WA 98112 SFD 7 6.730 $2,202.13 180 1-Sep-10
4475667 INDIAN WELLS CA 92210 SFD 6.375 6.105 $5,021.29 180 1-Nov-08
4475669 REDLANDS CA 92373 SFD 6.95 6.680 $2,007.12 180 1-Feb-09
4475708 REDLANDS CA 92373 SFD 6.5 6.230 $2,953.93 180 1-Mar-09
4476636 CENTER VALLEY PA 18034 SFD 8.75 6.750 $1,055.42 180 1-Nov-10
4480198 ROCKAWAY NJ 7866 SFD 7.875 6.750 $1,327.83 180 1-Nov-10
4481441 DELL RAPIDS SD 57022 SFD 8 6.750 $1,031.15 180 1-Aug-10
4481449 HELENA MT 59601 SFD 7.5 6.750 $1,390.52 180 1-Sep-10
4481460 PUEBLO CO 81005 SFD 7.5 6.750 $1,097.59 180 1-Sep-10
4481527 WESTCLIFFE CO 81252 SFD 7.875 6.750 $834.64 180 1-Sep-10
4483486 HARRISBURG SD 57032 SFD 8.25 6.750 $693.66 180 1-Sep-10
4484535 ROSLYN HEIGHTS NY 11577 SFD 8.25 6.750 $2,105.21 180 1-Nov-10
4484550 MT. POCONO PA 18344 SFD 8.25 6.750 $1,212.68 180 1-Aug-10
4484579 GREEN OAKS MI 48178 SFD 8 6.750 $1,099.00 180 1-Aug-10
4484654 MINNEAPOLIS MN 55414 SFD 7.5 6.750 $742.54 180 1-Sep-10
4484949 LEWIS CENTER OH 43035 SFD 7.875 6.750 $2,541.85 180 1-Nov-10
4484954 KOKOMO IN 46901 SFD 7.125 6.750 $2,065.30 180 1-Nov-10
4490690 NORTH OAKS MN 55127 SFD 7.5 6.750 $3,244.55 180 1-Oct-10
4490697 BILLINGS MT 59102 SFD 8.25 6.750 $3,880.57 180 1-Nov-10
4490699 WILLMAR MN 56201 SFD 8 6.750 $3,344.79 180 1-Nov-10
4490704 BEVERLY MA 1915 SFD 7.125 6.750 $3,543.62 180 1-Oct-10
4490710 BROOKLYN PARK MN 55443 SFD 7.875 6.750 $2,105.56 180 1-Oct-10
4490717 HIGHLAND BEACH FL 33487 HCO 7.5 6.750 $2,261.92 180 1-Sep-10
4490725 EDINA MN 55439 SFD 8 6.750 $2,974.47 180 1-Sep-10
4490731 MONUMENT CO 80132 SFD 7.5 6.750 $2,873.74 180 1-Oct-10
4490732 LONGMONT CO 80503 SFD 8 6.750 $1,210.82 180 1-Nov-10
4490739 BRECKENRIDGE CO 80424 SFD 7.75 6.750 $2,746.18 180 1-Oct-10
4490764 LAKEWOOD CO 80227 LCO 8.25 6.750 $485.08 180 1-Oct-10
4490769 OMAHA NE 68164 SFD 7.125 6.750 $4,257.41 180 1-Sep-10
4490801 WOODBURY MN 55125 SFD 7.5 6.750 $2,345.35 180 1-Oct-10
4490826 PUEBLO CO 81005 SFD 6.875 6.605 $2,461.52 180 1-Sep-10
4494769 HONOLULU HI 96813 SFD 7.125 6.750 $4,456.69 180 1-Dec-10
4494828 HONOLULU HI 96822 SFD 7.125 6.750 $9,058.32 180 1-Dec-10
4496054 HONOLULU HI 96818 SFD 7.25 6.750 $3,476.19 180 1-Dec-10
228
<PAGE>
<CAPTION>
(i) (ix) (x) (xi) (xii) (xiii) (xiv) (xv)
- ----- -------------- ------ --------- ---------- -------- ----------- -----------
CUT-OFF
MORTGAGE DATE MORTGAGE MASTER FIXED
LOAN PRINCIPAL INSURANCE SERVICE SERVICE RETAINED
NUMBER BALANCE LTV SUBSIDY CODE FEE FEE YEILD
- -------- -------------- ------ --------- ---------- -------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
4467363 $128,631.47 80 0.250 0.020 1.8550
4472308 $56,304.28 55.15 0.250 0.020 0.9800
4473207 $391,647.49 74.61 0.250 0.020 0.0000
4473225 $241,089.83 43.21 0.250 0.020 0.0000
4475667 $524,989.75 68.35 0.250 0.020 0.0000
4475669 $205,780.52 58.18 0.250 0.020 0.0000
4475708 $311,816.35 82.71 12 0.250 0.020 0.0000
4476636 $104,737.48 80 0.250 0.020 1.7300
4480198 $138,461.73 38.17 0.250 0.020 0.8550
4481441 $105,997.63 79.05 0.250 0.020 0.9800
4481449 $147,706.41 75 0.250 0.020 0.4800
4481460 $116,589.57 80 0.250 0.020 0.4800
4481527 $86,697.30 80 0.250 0.020 0.8550
4483486 $70,475.52 79.44 0.250 0.020 1.2300
4484535 $215,147.32 70 0.250 0.020 1.2300
4484550 $119,820.37 70.82 0.250 0.0200 1.2300
4484579 $112,364.42 50 0.250 0.0200 0.9800
4484654 $78,875.21 90 01 0.250 0.0200 0.4800
4484949 $263,615.52 80 0.250 0.0200 0.8550
4484954 $225,852.66 80 0.250 0.0200 0.1050
4490690 $345,732.00 89.74 01 0.250 0.0200 0.4800
4490697 $396,584.92 80 0.250 0.0200 1.2300
4490699 $346,945.35 55.56 0.250 0.0200 0.9800
4490704 $386,272.85 80 0.250 0.0200 0.1050
4490710 $219,379.61 72.31 0.250 0.0200 0.8550
4490717 $240,269.05 46.04 0.250 0.0200 0.4800
4490725 $306,692.28 75 0.250 0.0200 0.9800
4490731 $306,083.22 72.94 0.250 0.0200 0.4800
4490732 $125,594.21 70 0.250 0.0200 0.9800
4490739 $288,268.61 75 0.250 0.0200 0.7300
4490764 $44,359.84 43.67 0.250 0.0200 1.2300
4490769 $462,578.48 62.67 0.250 0.0200 0.1050
4490801 $249,914.82 74.77 0.250 0.0200 0.4800
4490826 $271,547.92 80 0.250 0.0200 0.0000
4494769 $488,920.00 80 0.250 0.0200 0.1050
4494828 $993,739.83 45.82 0.250 0.0200 0.1050
4496054 $377,441.85 78.52 0.250 0.0200 0.2300
================
$9,496,925.67
<FN>
WAC: 7.416
WAM: 173.8389
WALTV: 69.3171
</FN>
229
<PAGE>
<CAPTION>
(i) (xvi) (xvii)
- ----- ----------- -----------
MORTGAGE PHMC
LOAN LOAN
NUMBER SERVICER SELLER
- -------- --------------------------------------- ------------------------
<S> <C> <C>
4467363 BARNETT MORTGAGE COMAPNY BARNETT MORTGAGE COMPANY
4472308 FIRST TOWN MORTGAGE CORP. FIRST TOWN MORTGAGE CORP.
4473207 COUNTRYWIDE FUNDING CORP. COUNTRYWIDE FUNDING CORP.
4473225 COUNTRYWIDE FUNDING CORP. COUNTRYWIDE FUNDING CORP.
4475667 COUNTRYWIDE FUNDING CORP. COUNTRYWIDE FUNDING CORP.
4475669 COUNTRYWIDE FUNDING CORP. COUNTRYWIDE FUNDING CORP.
4475708 COUNTRYWIDE FUNDING CORP. COUNTRYWIDE FUNDING CORP.
4476636 FIRST TOWN MORTGAGE CORP. FIRST TOWN MORTGAGE CORP.
4480198 FIRST TOWN MORTGAGE CORP. FIRST TOWN MORTGAGE CORP.
4481441 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4481449 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4481460 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4481527 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4483486 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4484535 BARNETT MORTGAGE COMAPNY BARNETT MORTGAGE COMAPNY
4484550 BARNETT MORTGAGE COMAPNY BARNETT MORTGAGE COMAPNY
4484579 BARNETT MORTGAGE COMAPNY BARNETT MORTGAGE COMAPNY
4484654 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4484949 NATIONAL CITY MORTGAGE CO. NATIONAL CITY MORTGAGE CO.
4484954 NATIONAL CITY MORTGAGE CO. NATIONAL CITY MORTGAGE CO.
4490690 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4490697 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4490699 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4490704 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4490710 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4490717 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4490725 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4490731 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4490732 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4490739 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4490764 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4490769 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4490801 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4490826 FBS MORTGAGE CORPORATION FBS MORTGAGE CORPORATION
4494769 BANK OF HAWAII BANK OF HAWAII
4494828 BANK OF HAWAII BANK OF HAWAII
4496054 BANK OF HAWAII BANK OF HAWAII
</TABLE>
230
<PAGE>
EXHIBIT G
REQUEST FOR RELEASE
(for Trust Administrator/Custodian)
Loan Information
Name of Mortgagor: _____________________________
Servicer
Loan No.: _____________________________
Custodian/Trust Administrator
Name: _____________________________
Address: _____________________________
-----------------------------
Custodian/Trust Administrator
Mortgage File No.: _____________________________
Seller
Name: _____________________________
Address: _____________________________
-----------------------------
Certificates: Mortgage Pass-Through
Certificates, Series 1996-3
The undersigned Master Servicer hereby acknowledges that it has
received from First Bank National Association, as Trust Administrator for the
Holders of Mortgage Pass-Through Certificates, Series 1996-3, the documents
referred to below (the "Documents"). All capitalized terms not otherwise defined
in this Request for Release shall have the meanings given them in the Pooling
and Servicing Agreement dated as of February 28, 1996 (the "Pooling and
Servicing Agreement") among the Trust Administrator, the Seller, the Master
Servicer and Firstar Trust Company, as Trustee.
( ) Promissory Note dated ______________, 199__, in the original
principal sum of $___________, made by ____________________, payable to, or
endorsed to the order of, the Trustee.
231
<PAGE>
( ) Mortgage recorded on _____________________ as instrument no.
______________ in the County Recorder's Office of the County of
____________________, State of _______________________ in book/reel/docket
____________________ of official records at page/image ____________.
( ) Deed of Trust recorded on ____________________ as instrument
no. _________________ in the County Recorder's Office of the County of
___________________, State of _________________ in book/reel/docket
____________________ of official records at page/image ____________.
( ) Assignment of Mortgage or Deed of Trust to the Trustee,
recorded on ______________________________ as instrument no. ______________ in
the County Recorder's Office of the County of ______________________, State of
_____________________ in book/reel/docket ____________________ of official
records at page/image ____________.
( ) Other documents, including any amendments, assignments or
other assumptions of the Mortgage Note or Mortgage.
( ) ---------------------------------------------
( ) ---------------------------------------------
( ) ---------------------------------------------
( ) ---------------------------------------------
The undersigned Master Servicer hereby acknowledges and agrees as
follows:
(1) The Master Servicer shall hold and retain possession of the
Documents in trust for the benefit of the Trustee, solely for the
purposes provided in the Agreement.
(2) The Master Servicer shall not cause or permit the Documents
to become subject to, or encumbered by, any claim, liens, security
interest, charges, writs of attachment or other impositions nor shall
the Master Servicer assert or seek to assert any claims or rights of
setoff to or against the Documents or any proceeds thereof.
(3) The Master Servicer shall return the Documents to the Trustee
when the need therefor no longer exists, unless the Mortgage Loan
relating to the Documents has been liquidated and the proceeds thereof
have been remitted to the Certificate Account and except as expressly
provided in the Agreement.
232
<PAGE>
(4) The Documents and any proceeds thereof, including any
proceeds of proceeds, coming into the possession or control of the
Master Servicer shall at all times be earmarked for the account of the
Trustee, and the Master Servicer shall keep the Documents and any
proceeds separate and distinct from all other property in the Master
Servicer's possession, custody or control.
SECURITIZED ASSET SERVICES CORPORATION
By: __________________________
Title: ________________________
Date: ________________, 19__
233
<PAGE>
EXHIBIT H
AFFIDAVIT PURSUANT TO SECTION 860E(e)(4) OF
THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED, AND FOR NON-ERISA INVESTORS
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 Purchaser] (the
"Purchaser"), a [description of type of entity] duly organized and existing
under the laws of the [State of ] [United States], on behalf of which he makes
this affidavit.
2. That the Purchaser's Taxpayer Identification Number is [ ].
3. That the Purchaser is not a "disqualified organization" within
the meaning of Section 860E(e)(5),of the Internal Revenue Code of 1986, as
amended (the "Code"), or an ERISA Prohibited Holder, and will not be a
"disqualified organization" or an ERISA Prohibited Holder, as of [date of
transfer], and that the Purchaser is not acquiring The Prudential Home Mortgage
Securities Company, Inc. Mortgage Pass-Through Certificates, Series 1996-3,
Class A-R Certificate (the "Class A-R Certificate") for the account of, or as
agent (including a broker, nominee, or other middleman) for, any person or
entity from which it has not received an affidavit substantially in the form of
this affidavit. For these purposes, a "disqualified organization" means the
United States, any state or political subdivision thereof, any foreign
government, any international organization, any agency or instrumentality of any
of the foregoing (other than an instrumentality if all of its activities are
subject to tax and a majority of its board of directors is not selected by such
governmental entity), any cooperative organization furnishing electric energy or
providing telephone service to persons in rural areas as described in Code
Section 1381(a)(2)(C), or any organization (other than a farmers' cooperative
described in Code Section 521) that is exempt from taxation under the Code
unless such organization is subject to the tax on unrelated business income
imposed by Code Section 511. For these purposes, an "ERISA Prohibited Holder"
means an employee benefit plan subject to the fiduciary provisions of the
Employee Retirement Income Security Act of 1974, as amended, ("ERISA") and/or
Code Section 4975 or any governmental plan, as defined in Section 3(32) of
ERISA, subject to any federal, state or local law which is, to a material
extent, similar to the foregoing provisions of ERISA or the Code (collectively,
a "Plan") or a Person investing the assets of such a Plan.
234
<PAGE>
4. That the Purchaser historically has paid its debts as they
have come due and intends to pay its debts as they come due in the future and
the Purchaser intends to pay taxes associated with holding the Class A-R
Certificate as they become due.
5. That the Purchaser understands that it may incur tax
liabilities with respect to the Class A-R Certificate in excess of cash flows
generated by the Class A-R Certificate.
6. That the Purchaser will not transfer the Class A-R Certificate
to any person or entity from which the Purchaser has not received an affidavit
substantially in the form of this affidavit and as to which the Purchaser has
actual knowledge that the requirements set forth in paragraph 3, 4 or 7 hereof
are not satisfied or that the Purchaser has reason to know does not satisfy the
requirements set forth in paragraph 4 hereof.
7. That the Purchaser (i) is not a Non-U.S. Person or (ii) is a
Non-U.S. Person that holds the Class A-R Certificate in connection with the
conduct of a trade or business within the United States and has furnished the
transferor and the Trust Administrator with an effective Internal Revenue
Service Form 4224 or successor form at the time and in the manner required by
the Code or (iii) is a Non-U.S. Person that has delivered to both the transferor
and the Trust Administrator an opinion of a nationally recognized tax counsel to
the effect that the transfer of the Class A-R Certificate to it is in accordance
with the requirements of the Code and the regulations promulgated thereunder and
that such transfer of the Class A-R Certificate will not be disregarded for
federal income tax purposes. "Non-U.S. Person" means an individual, corporation,
partnership or other person other than 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 that is subject to U.S. federal income tax regardless of the
source of its income.
8. That the Purchaser agrees to such amendments of the Pooling
and Servicing Agreement as may be required to further effectuate the
restrictions on transfer of the Class A-R Certificate to such a "disqualified
organization," an agent thereof, an ERISA Prohibited Holder or a person that
does not satisfy the requirements of paragraph 4, paragraph 5 and paragraph 7
hereof.
9. That the Purchaser consents to the designation of the Master
Servicer as its agent to act as "tax matters person" of the REMIC pursuant to
Section 3.01 of the Pooling and Servicing Agreement, and if such designation is
not permitted by the Code and applicable law, to act as tax matters person if
requested to do so.
235
<PAGE>
IN WITNESS WHEREOF, the Purchaser has caused this instrument to
be executed on its behalf, pursuant to authority of its Board of Directors, by
its [Title of Officer] this ___ day of , 19 __.
[NAME OF PURCHASER]
By:__________________________
[Name of Officer]
[Title of Officer]
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 Purchaser, and acknowledged
to me that he [she] executed the same as his [her] free act and deed and the
free act and deed of the Purchaser.
Subscribed and sworn before me this __ day of , 19 __.
----------
- -----------------------------
NOTARY PUBLIC
COUNTY OF____________________
STATE OF_____________________
My commission expires the __ day of __________, 19__.
236
<PAGE>
EXHIBIT I
[Letter from Transferor of Class A-R Certificate]
[Date]
First Bank National Association
180 East Fifth Street
St. Paul, Minnesota 55101
Re: The Prudential Home Mortgage
Securities Company, Inc.
Mortgage Pass-Through Certificates,
Series 1996-3, Class A-R
Ladies and Gentlemen:
[Transferor] has reviewed the attached affidavit of [Transferee],
and has no actual knowledge that such affidavit is not true and has no reason to
know that the information contained in paragraph 4 thereof is not true.
Very truly yours,
[Transferor]
----------------------
237
<PAGE>
EXHIBIT J
THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC.
MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1996-3
CLASS [B-3] [B-4] [B-5] CERTIFICATES
TRANSFEREE'S LETTER
----------------- --, ----
First Bank National Association
180 East Fifth Street
St. Paul, Minnesota 55101
The Prudential Home Mortgage Securities Company, Inc.
5325 Spectrum Drive
Frederick, Maryland 21701
The undersigned (the "Purchaser") proposes to purchase The
Prudential Home Mortgage Securities Company, Inc. Mortgage Pass-Through
Certificates, Series 1996-3, Class [B-3] [B-4] [B-5] Certificates (the "Class
[B-3] [B-4] [B-5] Certificates") in the principal amount of $___________. In
doing so, the Purchaser hereby acknowledges and agrees as follows:
Section 1. Definitions. Each capitalized term used herein and not
otherwise defined herein shall have the meaning ascribed to it in the Pooling
and Servicing Agreement, dated as of February 28, 1996 (the "Pooling and
Servicing Agreement") among The Prudential Home Mortgage Securities Company,
Inc., as seller ("PHMSC"), Securitized Asset Services Corporation, as master
servicer (the "Master Servicer"), First Bank National Association, as trust
administrator (the "Trust Administrator") and Firstar Trust Company, as trustee
(the "Trustee"), of The Prudential Home Mortgage Securities Company, Inc.
Mortgage Pass-Through Certificates, Series 1996-3.
Section 2. Representations and Warranties of the Purchaser. In
connection with the proposed transfer, the Purchaser represents and warrants to
PHMSC, the Master Servicer and the Trust Administrator that:
(a) The Purchaser is duly organized, validly existing and in good
standing under the laws of the jurisdiction in which the Purchaser is organized,
is authorized to invest in the Class [B-3] [B-4] [B-5] Certificates, and to
enter into this Agreement, and duly executed and delivered this Agreement.
238
<PAGE>
(b) The Purchaser is acquiring the Class [B-3] [B-4] [B-5]
Certificates for its own account as principal and not with a view to the
distribution thereof, in whole or in part.
[(c) The Purchaser has knowledge of financial and business
matters and is capable of evaluating the merits and risks of an investment in
the Class [B-3] [B-4] [B-5] Certificates; the Purchaser has sought such
accounting, legal and tax advice as it has considered necessary to make an
informed investment decision; and the Purchaser is able to bear the economic
risk of an investment in the Class [B-3] [B-4] [B-5] Certificates and can afford
a complete loss of such investment.]
[(c) The Purchaser is a "Qualified Institutional Buyer" within
the meaning of Rule 144A of the Act.]
(d) The Purchaser confirms that (a) it has received and reviewed
a copy of the Private Placement Memorandum dated February __, 1996, relating to
the Class [B-3] [B-4] [B-5] Certificates and reviewed, to the extent it deemed
appropriate, the documents attached thereto or incorporated by reference
therein, (b) it has had the opportunity to ask questions of, and receive answers
from PHMSC concerning the Class [B-3] [B-4] [B-5] Certificates and all matters
relating thereto, and obtain any additional information (including documents)
relevant to its decision to purchase the Class [B-3] [B-4] [B-5] Certificates
that PHMSC possesses or can possess without unreasonable effort or expense and
(c) it has undertaken its own independent analysis of the investment in the
Class [B-3] [B-4] [B-5] Certificates. The Purchaser will not use or disclose any
information it receives in connection with its purchase of the Class [B-3] [B-4]
[B-5] Certificates other than in connection with a subsequent sale of Class
[B-3] [B-4] [B-5] Certificates.
(e) Either (i) the Purchaser is not an employee benefit plan
subject to the fiduciary responsibility provisions of the Employee Retirement
Income Security Act of 1974, as amended, ("ERISA") or Section 4975 of the
Internal Revenue Code of 1986, as amended (the "Code") or any governmental plan,
as defined in Section 3(32) of ERISA subject to any federal, state or local law
("Similar Law") which is, to a material extent, similar to the foregoing
provisions of ERISA or the Code (collectively, a "Plan"), an agent acting on
behalf of a Plan, or a person utilizing the assets of a Plan or (ii) if the
Purchaser is an insurance company, the source of funds used to purchase the
Class B Certificate is an "insurance company general account" (as such term is
defined in Section V(e) of Prohibited Transaction Class Exemption 95-60 ("PTE
95-60"), 60 Fed. Reg. 35925 (July 12, 1995) and there is no Plan with respect to
which the amount of such general account's reserves and liabilities for the
contract(s) held by or on behalf of such Plan and all other Plans maintained by
the same employer (or affiliate thereof as defined in Section V(a)(1) of PTE
95-60) or by the same employee organization, exceed 10% of the total of all
reserves and liabilities of such general account (as such amounts are determined
under Section I(a) of PTE 95-60) at the date of acquisition or (iii) the
Purchaser has provided a "Benefit Plan Opinion" satisfactory to The Prudential
239
<PAGE>
Home Mortgage Securities Company, Inc. and the Trust Administrator of the Trust
Estate. A Benefit Plan Opinion is an opinion of counsel to the effect that the
proposed transfer will not (a) cause the assets of the Trust Estate to be
regarded as "plan assets" and subject to the fiduciary responsibility provisions
of ERISA or the prohibited transaction provisions of the Code or Similar Law,
(b) give rise to a fiduciary duty under ERISA, Section 4975 of the Code or
Similar Law on the part of The Prudential Home Mortgage Securities Company,
Inc., the Master Servicer or the Trust Administrator with respect to any Plan or
(c) constitute a prohibited transaction under ERISA or Section 4975 of the Code
or Similar Law
(f) If the Purchaser is a depository institution subject to the
jurisdiction of the Office of the Comptroller of the Currency ("OCC"), the Board
of Governors of the Federal Reserve System ("FRB"), the Federal Deposit
Insurance Corporation ("FDIC"), the Office of Thrift Supervision ("OTS") or the
National Credit Union Administration ("NCUA"), the Purchaser has reviewed the
"Supervisory Policy Statement on Securities Activities" dated January 28, 1992
of the Federal Financial Institutions Examination Council and the April 15, 1994
Interim Revision thereto as adopted by the OCC, FRB, FDIC, OTS and NCUA (with
modifications as applicable), as appropriate, other applicable investment
authority, rules, supervisory policies and guidelines of these agencies and, to
the extent appropriate, state banking authorities and has concluded that its
purchase of the Class [B-3] [B-4] [B-5] Certificates is in compliance therewith.
Section 3. Transfer of Class [B-3] [B-4] [B-5] Certificates.
(a) The Purchaser understands that the Class [B-3] [B-4] [B-5]
Certificates have not been registered under the Securities Act of 1933 (the
"Act") or any state securities laws and that no transfer may be made unless the
Class [B-3] [B-4] [B-5] Certificates are registered under the Act and applicable
state law or unless an exemption from registration is available. The Purchaser
further understands that neither PHMSC, the Master Servicer nor the Trust
Administrator is under any obligation to register the Class [B-3] [B-4] [B-5]
Certificates or make an exemption available. In the event that such a transfer
is to be made in reliance upon an exemption from the Act or applicable state
securities laws, (i) the Trust Administrator shall require, in order to assure
compliance with such laws, that the Certificateholder's prospective transferee
certify to PHMSC and the Trust Administrator as to the factual basis for the
registration or qualification exemption relied upon, and (ii) unless the
transferee is a "Qualified Institutional Buyer" within the meaning of Rule 144A
of the Act, the Trust Administrator or PHMSC may, if such transfer is made
within three years from the Closing Date, require an Opinion of Counsel that
such transfer may be made pursuant to an exemption from the Act and state
securities laws, which Opinion of Counsel shall not be an expense of the Trust
Administrator or PHMSC. Any such Certificateholder desiring to effect such
transfer shall, and does hereby agree to, indemnify the Trust Administrator, the
Trustee, the Master Servicer and PHMSC against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.
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(b) No transfer of a Class [B-3] [B-4] [B-5] Certificate shall be
made unless the transferee provides the Master Servicer and the Trust
Administrator with a Transferee's Letter, substantially in the form of this
Agreement.
(c) The Purchaser acknowledges that its Class [B-3] [B-4] [B-5]
Certificates bear a legend setting forth the applicable restrictions on
transfer.
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IN WITNESS WHEREOF, the undersigned has caused this Agreement to
the validly executed by its duly authorized representative as of the day and the
year first above written.
[PURCHASER]
By: ______________________________
Its: ______________________________
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EXHIBIT K
THE PRUDENTIAL HOME MORTGAGE SECURITIES COMPANY, INC.
MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1996-3
CLASS [M] [B-1] [B-2] CERTIFICATES
TRANSFEREE'S LETTER
---------------- --, ----
First Bank National Association
180 East Fifth Street
St. Paul, Minnesota 55101
The Prudential Home Mortgage Securities Company, Inc.
5325 Spectrum Drive
Frederick, Maryland 21701
The undersigned (the "Purchaser") proposes to purchase The
Prudential Home Mortgage Securities Company, Inc. Mortgage Pass-Through
Certificates, Series 1996-3, Class [M] [B-1] [B-2] Certificates in the principal
amount of $___________. In doing so, the Purchaser hereby acknowledges and
agrees as follows:
Section 1. Definitions. Each capitalized term used herein and not
otherwise defined herein shall have the meaning ascribed to it in the Pooling
and Servicing Agreement, dated as of February 28, 1996 (the "Pooling and
Servicing Agreement") among The Prudential Home Mortgage Securities Company,
Inc., as seller ("PHMSC"), Securitized Asset Services Corporation, as master
servicer (the "Master Servicer"), First Bank National Association, as trust
administrator (the "Trust Administrator") and Firstar Trust Company, as trustee
(the "Trustee"), of The Prudential Home Mortgage Securities Company, Inc.
Mortgage Pass-Through Certificates, Series 1996-3.
Section 2. Representations and Warranties of the Purchaser. In
connection with the proposed transfer, the Purchaser represents and warrants to
PHMSC, the Master Servicer and the Trust Administrator that:
Either (i) the Purchaser is not an employee benefit plan subject
to the fiduciary responsibility provisions of the Employee Retirement
Income Security Act of 1974, as amended, ("ERISA") or Section 4975 of
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the Internal Revenue Code of 1986, as amended (the "Code") or any
governmental plan, as defined in Section 3(32) of ERISA subject to any
federal, state or local law ("Similar Law") which is, to a material
extent, similar to the foregoing provisions of ERISA or the Code
(collectively, a "Plan"), an agent acting on behalf of a Plan, or a
person utilizing the assets of a Plan or (ii) if the Purchaser is an
insurance company, the source of funds used to purchase the Class [M]
[B-1] [B-2] Certificate is an "insurance company general account" (as
such term is defined in Section V(e) of Prohibited Transaction Class
Exemption 95-60 ("PTE 95-60"), 60 Fed. Reg. 35925 (July 12, 1995) and
there is no Plan with respect to which the amount of such general
account's reserves and liabilities for the contract(s) held by or on
behalf of such Plan and all other Plans maintained by the same employer
(or affiliate thereof as defined in Section V(a)(1) of PTE 95-60) or by
the same employee organization, exceed 10% of the total of all reserves
and liabilities of such general account (as such amounts are determined
under Section I(a) of PTE 95-60) at the date of acquisition or (iii) the
Purchaser has provided a "Benefit Plan Opinion" satisfactory to The
Prudential Home Mortgage Securities Company, Inc. and the Trust
Administrator of the Trust Estate. A Benefit Plan Opinion is an opinion
of counsel to the effect that the proposed transfer will not (a) cause
the assets of the Trust Estate to be regarded as "plan assets" and
subject to the fiduciary responsibility provisions of ERISA or the
prohibited transaction provisions of the Code or Similar Law, (b) give
rise to a fiduciary duty under ERISA, Section 4975 of the Code or
Similar Law on the part of The Prudential Home Mortgage Securities
Company, Inc., the Master Servicer or the Trust Administrator with
respect to any Plan or (c) constitute a prohibited transaction under
ERISA or Section 4975 of the Code or Similar Law.
IN WITNESS WHEREOF, the undersigned has caused this Agreement to
the validly executed by its duly authorized representative as of the day and the
year first above written.
[PURCHASER]
By: _____________________________
Its: _____________________________
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EXHIBIT L
SERVICING AGREEMENTS
(Not Filed)
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EXHIBIT M
[FORM OF SPECIAL SERVICING AGREEMENT]
SPECIAL SERVICING AND COLLATERAL FUND AGREEMENT
This SPECIAL SERVICING AND COLLATERAL FUND AGREEMENT (the "Agreement")
is made and entered into as of , between Securitized Asset Services Corporation
(the "Company" and "SASCOR") and (the "Purchaser").
PRELIMINARY STATEMENT
is the holder of the entire interest in Securitized Asset Sales,
Inc. Mortgage Pass-Through Certificates, Series , Class (the "Class B
Certificates"). The Class B Certificates were issued pursuant to a Pooling and
Servicing Agreement dated as of among The Prudential Home Mortgage Company,
Inc., as Seller, Securitized Asset Services Corporation, as Master Servicer,
First Bank National Association, as Trust Administrator and Firstar Trust
Company, as Trustee.
intends to resell all of the Class B Certificates directly to the
Purchaser on or promptly after the date hereof.
In connection with such sale, the parties hereto have agreed that the
Company will cause, to the extent that the Company as Master Servicer is granted
such authority in the related Servicing Agreements, the related servicers (each
a related "Servicer"), which service the Mortgage Loans which comprise the Trust
Estate related to the above referenced series under the related servicing
agreements (each a related "Servicing Agreement"), to engage in certain special
servicing procedures relating to foreclosures for the benefit of the Purchaser,
and that the Purchaser will deposit funds in a collateral fund to cover any
losses attributable to such procedures as well as all advances and costs in
connection therewith, as set forth herein.
In consideration of the mutual agreements herein contained, the receipt
and sufficiency of which are hereby acknowledged, the Company and the Purchaser
agree that the following provisions shall become effective and shall be binding
on and enforceable by the Company and the Purchaser:
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ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms
Whenever used in this Agreement, the following words and phrases, unless
the context otherwise requires, shall have the following meanings:
Business Day: Any day other than (i) a Saturday or a Sunday or
(ii) a day on which banking institutions in the State of New York are required
or authorized by law or executive order to be closed.
Collateral Fund: The fund established and maintained pursuant to
Section 3.01 hereof.
Collateral Fund Permitted Investments: Either (i) obligations of,
or obligations fully guaranteed as to principal and interest by, the United
States, or any agency or instrumentality thereof, provided such obligations are
backed by the full faith and credit of the United States, (ii) a money market
fund rated in the highest rating category by a nationally recognized rating
agency selected by the Company, (iii) cash, (iv) mortgage pass-through
certificates issued or guaranteed by Government National Mortgage Association,
FNMA or FHLMC, (v) commercial paper (including both non-interest-bearing
discount obligations and interest-bearing obligations payable on demand or on a
specified date), the issuer of which may be an affiliate of the Company, having
at the time of such investment a rating of at least A-1 by Standard and Poor's
Ratings Group ("S&P") or at least P-1 by Moody's Investors Service, Inc.
("Moody's") or (vi) demand and time deposits in, certificates of deposit of, any
depository institution or trust company (which may be an affiliate of the
Company) incorporated under the laws of the United States of America or any
state thereof and subject to supervision and examination by federal and/or state
banking authorities, so long as at the time of such investment either (x) the
long-term debt obligations of such depository institution or trust company have
a rating of at least Aa2 by Moody's or AA by S&P, (y) the certificate of deposit
or other unsecured short-term debt obligations of such depository institution or
trust company have a rating of at least P-1 by Moody's or A-1 by S&P or (z) the
depository institution or trust company is one that is acceptable to either
Moody's or S&P and, for each of the preceding clauses (i), (iv), (v) and (vi),
the maturity thereof shall be not later than the earlier to occur of (A) 30 days
from the date of the related investment and (B) the next succeeding Distribution
Date as defined in the related Pooling and Servicing Agreement.
Commencement of Foreclosure: The first official action required
under local law in order to commence foreclosure proceedings or to schedule a
trustee's sale under a deed of trust, including (i) in the case of a mortgage,
any filing or service of process necessary to commence an action to foreclose,
or (ii) in the case of a deed of trust, posting, the publishing, filing or
delivery of a notice of sale, but not including in either case (x) any notice of
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default, notice of intent to foreclose or sell or any other action prerequisite
to the actions specified in (i) or (ii) above, (y) the acceptance of a
deed-in-lieu of foreclosure (whether in connection with a sale of the related
property or otherwise) or (z) initiation and completion of a short pay-off.
Current Appraisal: With respect to any Mortgage Loan as to which
the Purchaser has made an Election to Delay Foreclosure, an appraisal of the
related Mortgaged Property obtained by the Purchaser at its own expense from an
independent appraiser (which shall not be an affiliate of the Purchaser)
acceptable to the Company as nearly contemporaneously as practicable to the time
of the Purchaser's election, prepared based on the Company's customary
requirements for such appraisals.
Election to Delay Foreclosure: Any election by the Purchaser to
delay the Commencement of Foreclosure, made in accordance with Section 2.02(b).
Election to Foreclose: Any election by the Purchaser to proceed
with the Commencement of Foreclosure, made in accordance with Section 2.03(a).
Monthly Advances: Principal and interest advances and servicing
advances including costs and expenses of foreclosure.
Required Collateral Fund Balance: As of any date of
determination, an amount equal to the aggregate of all amounts previously
required to be deposited in the Collateral Fund pursuant to Section 2.02(d)
(after adjustment for all withdrawals and deposits pursuant to Section 2.02 (e)
and Section 2.03(b) (after adjustment for all withdrawals and deposits pursuant
to Section 2.03(e) and Section 3.02 to be reduced by all withdrawals therefrom
pursuant to Section 2.02(g) and Section 2.03(d).
Section 1.02 Definitions Incorporated by Reference
All capitalized terms not otherwise defined in this Agreement
shall have the meanings assigned in the Pooling and Servicing Agreement.
ARTICLE II
SPECIAL SERVICING PROCEDURES
Section 2.01 Reports and Notices
(a) In connection with the performance of its duties under the
Pooling and Servicing Agreement relating to the realization upon defaulted
Mortgage Loans, the Company as Master Servicer shall provide to the Purchaser
the following notices and reports:
(i) Within five Business Days after each Distribution Date
(or included in or with the monthly statements to Certificateholders
pursuant to the Pooling and Servicing Agreement), the Company, shall
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provide to the Purchaser a report, using the same methodology and
calculations in its standard servicing reports, indicating for the Trust
Estate the number of Mortgage Loans that are (A) thirty days, (B) sixty
days, (C) ninety days or more delinquent or (D) in foreclosure, and
indicating for each such Mortgage Loan the loan number and outstanding
principal balance.
(ii) Prior to the Commencement of Foreclosure in
connection with any Mortgage Loan, the Company shall cause, to the
extent that the Company as Master Servicer is granted such authority in
the related Servicing Agreement, the related Servicer to provide the
Purchaser with a notice (sent by telecopier) of such proposed and
imminent foreclosure, stating the loan number and the aggregate amount
owing under the Mortgage Loan. Such notice may be provided to the
Purchaser in the form of a copy of a referral letter from such Servicer
to an attorney requesting the institution of foreclosure.
(b) If requested by the Purchaser, the Company shall cause, to
the extent that the Company as Master Servicer is granted such authority in the
related Servicing Agreement, the related Servicer to make its servicing
personnel available (during their normal business hours) to respond to
reasonable inquiries, by phone or in writing by facsimile, electronic, or
overnight mail transmission, by the Purchaser in connection with any Mortgage
Loan identified in a report under subsection (a) (i) (B), (a) (i) (C), (a) (i)
(D), or (a) (ii) which has been given to the Purchaser; provided, that (1) the
related Servicer shall only be required to provide information that is readily
accessible to its servicing personnel and is non-confidential and (2) the
related Servicer shall respond within five Business Days orally or in writing by
facsimile transmission.
(c) In addition to the foregoing, the Company shall cause, to the
extent that the Company as Master Servicer is granted such authority in the
related Servicing Agreement, the related Servicer to provide to the Purchaser
such information as the Purchaser may reasonably request provided, however, that
such information is consistent with normal reporting practices, concerning each
Mortgage Loan that is at least ninety days delinquent and each Mortgage Loan
which has become real estate owned, through the final liquidation thereof;
provided, that the related Servicer shall only be required to provide
information that is readily accessible to its servicing personnel and is
non-confidential provided, however, that the Purchaser will reimburse the
Company and the related Servicer for any out of pocket expenses.
Section 2.02 Purchaser's Election to Delay Foreclosure
Proceedings
(a) The Purchaser shall be deemed to direct the Company to cause,
to the extent that the Company as Master Servicer is granted such authority in
the related Servicing Agreement, the related Servicer that in the event that the
Company does not receive written notice of the Purchaser's election pursuant to
subsection (b) below within 24 hours (exclusive of any intervening non-Business
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Days) of transmission of the notice provided by the Company under Section 2.01
(a) (ii) subject to extension as set forth in Section 2.02(b), the related
Servicer may proceed with the Commencement of Foreclosure in respect of such
Mortgage Loan in accordance with its normal foreclosure policies without further
notice to the Purchaser. Any foreclosure that has been initiated may be
discontinued (i) without notice to the Purchaser if the Mortgage Loan has been
brought current or if a refinancing or prepayment occurs with respect to the
Mortgage Loan (including by means of a short payoff approved by the related
Servicer) or (ii) if the related Servicer has reached the terms of a forbearance
agreement with the borrower. In such latter case, the related Servicer may
complete such forbearance agreement unless instructed otherwise by the Purchaser
within two Business Days notification.
(b) In connection with any Mortgage Loan with respect to which a
notice under Section 2.01(a)(ii) has been given to the Purchaser, the Purchaser
may elect to instruct the Company to cause, to the extent that the Company as
Master Servicer is granted such authority in the related Servicing Agreement,
the related Servicer to delay the Commencement of Foreclosure until such time as
the Purchaser determines that the related Servicer may proceed with the
Commencement of Foreclosure. Such election must be evidenced by written notice
received within 24 hours (exclusive of any intervening non-Business Days) of
transmission of the notice provided by the Company under Section 2.01(a)(ii).
Such 24 hour period shall be extended for no longer than an additional four
Business Days after the receipt of the information if the Purchaser requests
additional information related to such foreclosure; provided, however that the
Purchaser will have at least one Business Day to respond to any requested
additional information. Any such additional information shall (i) be provided
only to the extent it is not confidential in nature and (ii) is obtainable by
the related Servicer from existing reports, certificates or statements or
otherwise be readily accessible to its servicing personnel. The Purchaser agrees
that it has no right to deal with the mortgagor during such period. However, if
such servicing activities include acceptance of a deed-in-lieu of foreclosure or
short payoff, the Purchaser will be notified and given two Business Days to
respond.
(c) With respect to any Mortgage Loan as to which the Purchaser
has made an Election to Delay Foreclosure, the Purchaser shall obtain a Current
Appraisal as soon as practicable, but in no event more than 15 business days
thereafter, and shall provide the Company with a copy of such Current Appraisal.
(d) Within two Business Days of making any Election to Delay
Foreclosure, the Purchaser shall remit by wire transfer to the Company, for
deposit in the Collateral Fund, an amount, as calculated by the Company, equal
to the sum of (i) 125% of the greater of the unpaid principal balance of the
Mortgage Loan and the value shown in the Current Appraisal referred to in
subsection (c) above (or, if such Current Appraisal has not yet been obtained,
the Company's estimate thereof, in which case the required deposit under this
subsection shall be adjusted upon obtaining such Current Appraisal), and (ii)
three months' interest on the Mortgage Loan at the applicable Mortgage Interest
Rate. If any Election to Delay Foreclosure extends for a period in excess of
three months (such excess period being referred to herein as the "Excess
Period"), within two Business Days the Purchaser shall remit by wire transfer in
advance to the Company for deposit in the Collateral Fund the amount of each
additional month's interest, as calculated by the Company, equal to interest on
the Mortgage Loan at the applicable Mortgage Interest Rate for the Excess
Period. The terms of this Agreement will no longer apply to the servicing of any
Mortgage Loan upon the failure of the Purchaser to deposit any of the above
amounts relating to the Mortgage Loan within two Business Days of the Election
to Delay Foreclosure or within two Business Days of the commencement of the
Excess Period subject to Section 3.01.
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(e) With respect to any Mortgage Loan as to which the Purchaser
has made an Election to Delay Foreclosure, the Company may withdraw from the
Collateral Fund from time to time amounts necessary to reimburse the related
Servicer for all related Monthly Advances and Liquidation Expenses thereafter
made by such Servicer in accordance with the Pooling and Servicing Agreement and
the related Servicing Agreement. To the extent that the amount of any such
Liquidation Expenses is determined by the Company based on estimated costs, and
the actual costs are subsequently determined to be higher, the Company may
withdraw the additional amount from the Collateral Fund. In the event that the
Mortgage Loan is brought current by the mortgagor and the foreclosure action is
discontinued, the amounts so withdrawn from the Collateral Fund shall be
redeposited therein and to the extent that reimbursement therefor from amounts
paid by the mortgagor is not prohibited pursuant to the Pooling and Servicing
Agreement or the related Servicing Agreement as of the date hereof, applicable
law or the related mortgage note. Except as provided in the preceding sentence,
amounts withdrawn from the Collateral Fund to cover Monthly Advances and
Liquidation Expenses shall not be redeposited therein or otherwise reimbursed to
the Purchaser. If and when any such Mortgage Loan is brought current by the
mortgagor, all amounts remaining in the Collateral Fund in respect of such
Mortgage Loan (after adjustment for all permitted withdrawals and deposits
pursuant to this subsection) shall be released to the Purchaser.
(f) With respect to any Mortgage Loan as to which the Purchaser
has made an Election to Delay Foreclosure, the related Servicer shall continue
to service the Mortgage Loan in accordance with its customary procedures (other
than the delay in Commencement of Foreclosure as provided herein). If and when
the Purchaser shall notify the Company that it believes that it is appropriate
to do so, the related Servicer may proceed with the Commencement of Foreclosure.
In any event, if the Mortgage Loan is not brought current by the mortgagor by
the time the loan becomes 6 months delinquent, the Purchaser's election shall no
longer be effective and at the Purchaser's option, either (I) the Purchaser
shall purchase the Mortgage Loan from the related Trust Estate at a purchase
price equal to the fair market value as shown on the Current Appraisal, to be
paid by (x) applying any balance in the Collateral Fund to such to such purchase
price, and (y) to the extent of any deficiency, by wire transfer if immediately
available funds from the Purchaser to the Company for deposit in the related
Certificate Account or Lower-Tier Certificate Account as applicable; or (ii) the
related Servicer may proceed with the Commencement of Foreclosure.
(g) Upon the occurrence of a liquidation with respect to any
Mortgage Loan as to which the Purchaser made an Election to Delay Foreclosure
and as to which the related Servicer proceeded with the Commencement of
Foreclosure in accordance with subsection (f) above, the Company shall calculate
the amount, if any, by which the value shown on the Current Appraisal obtained
under subsection (c) exceeds the actual sales price obtained for the related
Mortgaged Property (net of Liquidation Expenses and accrued interest related to
the extended foreclosure period), and the Company shall withdraw the amount of
such excess from the Collateral Fund, shall remit the same to the Trust Estate
and in its capacity as Master Servicer shall apply such amount as additional
Liquidation Proceeds pursuant to the Pooling and Servicing Agreement. After
making such withdrawal, all amounts remaining in the Collateral Fund in respect
of such Mortgage Loan (after adjustment for all permitted withdrawals and
deposits pursuant to this Agreement) shall be released to the Purchaser
Section 2.03 Purchaser's Election to Commence Foreclosure
Proceedings
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(a) In connection with any Mortgage Loan identified in a report
under Section 2.01(a)(i)(B), the Purchaser may elect to instruct the Company to
cause, to the extent that the Company as Master Servicer is granted such
authority in the related Servicing Agreement, the related Servicer to proceed
with the Commencement of Foreclosure as soon as practicable. Such election must
be evidenced by written notice received by the Company by 5:00 p.m., New York
City time, on the third Business Day following the delivery of such report under
Section 2.01(a)(i).
(b) Within two Business Days of making any Election to Foreclose,
the Purchaser shall remit to the Company, for deposit in the Collateral Fund, an
amount, as calculated by the Company, equal to 125% of the current unpaid
principal balance of the Mortgage Loan and three months interest on the Mortgage
Loan at the applicable Mortgage Interest Rate. If and when any such Mortgage
Loan is brought current by the mortgagor, all amounts in the Collateral Fund in
respect of such Mortgage Loan (after adjustment for all permitted withdrawals
and deposits pursuant to this Agreement) shall be released to the Purchaser and
to the extent that reimbursement therefor from amounts paid by the mortgagor is
not prohibited pursuant to the Pooling and Servicing Agreement or the related
Servicing Agreement as of the date hereof, applicable law or the related
mortgage note. The terms of this Agreement will no longer apply to the servicing
of any Mortgage Loan upon the failure of the Purchaser to deposit the above
amounts relating to the Mortgage Loan within two Business Days of the Election
to Foreclose subject.to Section 3.01.
(c) With respect to any Mortgage Loan as to which the Purchaser
has made an Election to Foreclose, the related Servicer shall continue to
service the Mortgage Loan in accordance with its customary procedures (other
than Commencement of Foreclosure as provided herein). In connection therewith,
the Company shall have the same rights to make withdrawals for Monthly Advances
and Liquidations Expenses from the Collateral Fund as are provided under Section
2.02(e), and the Company shall make reimbursements thereto to the limited extent
provided under such subsection in accordance with its customary procedures. The
Company shall not be required to cause, to the extent that the Company as Master
Servicer is granted such authority in the related Servicing Agreement, the
related Servicer to proceed with the Commencement of Foreclosure if (i) the same
is stayed as a result of the mortgagor's bankruptcy or is otherwise barred by
applicable law, or to the extent that all legal conditions precedent thereto
have not yet been complied with, or (ii) the Company believes there is a breach
of representations or warranties by the Company, a Servicer, or a Seller, which
may result in a repurchase or substitution of such Mortgage Loan, or (iii) the
Company or related Servicer reasonably believes the Mortgaged Property may be
contaminated with or affected by hazardous wastes or hazardous substances (and,
without limiting the related Servicer's right not to proceed with the
Commencement of Foreclosure, the Company supplies the Purchaser with information
supporting such belief). Any foreclosure that has been initiated may be
discontinued (x) without notice to the Purchaser if the Mortgage Loan has been
brought current or if a refinancing or prepayment occurs with respect to the
Mortgage Loan (including by means of a short payoff approved by the Purchaser)
or (y) with notice to the Purchaser if the related Servicer has reached the
terms of a forbearance agreement unless instructed otherwise by the Purchaser
within two Business Days of such notification. Any such instruction shall be
based upon a decision that such forebearance agreement is not in conformity with
reasonable servicing practices.
(d) Upon the occurrence of a liquidation with respect to any
Mortgage Loan as to which the Purchaser made an Election to Foreclose and as to
which the related Servicer proceeded with the Commencement of Foreclosure in
accordance with subsection (c) above, the Company shall calculate the amount, if
any, by which the unpaid principal balance of the Mortgage Loan at the time of
liquidation (plus all unreimbursed interest and servicing advances and
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Liquidation Expenses in connection therewith other than those paid from the
Collateral Fund) exceeds the actual sales price obtained for the related
Mortgaged Property, and the Company shall withdraw the amount of such excess
from the Collateral Fund, shall remit the same to the Trust Estate and in its
capacity as Master Servicer shall apply such amount as additional Liquidation
Proceeds pursuant to the Pooling and Servicing Agreement. After making such
withdrawal, all amounts remaining in the Collateral Fund (after adjustment for
all withdrawals and deposits pursuant to subsection (c) in respect of such
Mortgage Loan shall be released to the Purchaser.
Section 2.04 Termination
(a) With respect to all Mortgage Loans included in the Trust
Estate, the Purchaser's right to make any Election to Delay Foreclosure or any
Election to Foreclose and the Company's obligations under Section 2.01 shall
terminate (i) at such time as the Principal Balance of the Class B Certificates
has been reduced to zero, (ii) if the greater of (x) 43% (or such lower or
higher percentage that represents the related Servicer's actual historical loss
experience with respect to the Mortgage Loans in the related pool as determined
by the Company) of the aggregate principal balance of all Mortgage Loans that
are in foreclosure or are more than 90 days delinquent on a contractual basis
and REO properties or (y) the aggregate amount that the Company estimates
through the normal servicing practices of the related Servicer will be required
to be withdrawn from the Collateral Fund with respect to Mortgage Loans as to
which the Purchaser has made an Election to Delay Foreclosure or an Election to
Foreclosure, exceeds (z) the then-current principal balance of the Class B
Certificates, (iii) upon any transfer by the Purchaser of any interest (other
than the minority interest therein, but only if the transferee provides written
acknowledgment to the Company of the Purchaser's right hereunder and that such
transferee will have no rights hereunder) in the Class B Certificates (whether
or not such transfer is registered under the Pooling and Servicing Agreement),
including any such transfer in connection with a termination of the Trust Estate
or (iv) any breach of the terms of this Agreement by the Purchaser.
(b) Except as set forth in 2.04(a), this Agreement and the
respective rights, obligations and responsibilities of the Purchaser and the
Company hereunder shall terminate upon the later to occur of (i) the final
liquidation of the last Mortgage Loan as to which the Purchaser made any
Election to Delay Foreclosure or any Election to Foreclose and the withdrawal of
all remaining amounts in the Collateral Fund as provided herein and (ii) ten
Business Days' notice. The Purchaser's right to make an election pursuant to
Section 2.02 or Section 2.03 hereof with respect to a particular Mortgage Loan
shall terminate if the Purchaser fails to make any deposit required pursuant to
Section 2.02(d) or 2.03(b) or if the Purchaser fails to make any other deposit
to the Collateral Fund pursuant to this Agreement.
ARTICLE III
COLLATERAL FUND; SECURITY INTEREST
Section 3.01. Collateral Fund
Upon receipt from the Purchaser of the initial amount required to
be deposited in the Collateral Fund pursuant to Article II, the Company shall
establish and maintain with Bankers Trust Company as a segregated account on its
books and records an account (the "Collateral Fund"), entitled "Securitized
Asset Services Corporation, as Master Servicer, for the benefit of registered
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holders of Securitized Asset Sales, Inc. Mortgage Pass-Through Certificates,
Series ". Amounts held in the Collateral Fund shall continue to be the property
of the Purchaser, subject to the first priority security interest granted
hereunder for the benefit of the Certificateholders, until withdrawn from the
Collateral Fund pursuant to Section 2.02 or 2.03 hereof.
Upon the termination of this Agreement and the liquidation of all
Mortgage Loans as to which the Purchaser has made any Election to Delay
Foreclosure or any Election to Foreclose pursuant to Section 2.04 hereof, the
Company shall distribute to the Purchaser all amounts remaining in the
Collateral Fund (after adjustment for all deposits and permitted withdrawals
pursuant to this Agreement) together with any investment earnings thereonIn the
event the Purchaser has made any Election to Delay Foreclosure or any Election
to Foreclose, prior to any distribution to the Purchaser of all amounts
remaining in the Collateral Fund, funds in the Collateral Fund shall be applied
consistent with the terms of this Agreement.
Section 3.02. Collateral Fund Permitted Investments.
The Company shall, at the written direction of the Purchaser,
invest the funds in the Collateral Fund in Collateral Fund Permitted
Investments. Such direction shall not be changed more frequently than quarterly.
In the absence of any direction, the Company shall select such investments in
accordance with the definition of Collateral Fund Permitted Investments in its
discretion.
All income and gain realized from any investment as well as any
interest earned on deposits in the Collateral Fund (net of any losses on such
investments) and any payments of principal made in respect of any Collateral
Fund Permitted Investment shall be deposited in the Collateral Fund upon
receipt. All costs and realized losses associated with the purchase and sale of
Collateral Fund Permitted Investments shall be borne by the Purchaser and the
amount of net realized losses shall be deposited by the Purchaser in the
Collateral Fund promptly upon realization. The Company shall periodically (but
not more frequently than monthly) distribute to the Purchaser upon request an
amount of cash, to the extent cash is available therefore in the Collateral
Fund, equal to the amount by which the balance of the Collateral Fund, after
giving effect to all other distributions to be made from the Collateral Fund on
such date, exceeds the Required Collateral Fund Balance. Any amounts so
distributed shall be released from the lien and security interest of this
Agreement.
Section 3.03. Grant of Security Interest
The Purchaser hereby grants to the Company for the benefit of the
Certificateholders under the Pooling and Servicing Agreement a security interest
in and lien on all of the Purchaser's right, title and interest, whether now
owned or hereafter acquired, in and to: (1) the Collateral Fund, (2) all amounts
deposited in the Collateral Fund and Collateral Fund Permitted Investments in
which such amounts are invested (and the distributions and proceeds of such
investments) and (3) all cash and non-cash proceeds of any of the foregoing,
including proceeds of the voluntary conversion thereof (all of the foregoing
collectively, the "Collateral").
The Purchaser acknowledges the lien on the security interest in
the Collateral for the benefit of the Certificateholders. The Purchaser shall
take all actions requested by the Company as may be reasonably necessary to
perfect the security interest created under this Agreement in the Collateral and
cause it to be prior to all other security interests and liens, including the
execution and delivery to the Company for filing of appropriate financing
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statements in accordance with applicable law. The Company shall file appropriate
continuation statements, or appoint an agent on its behalf to file such
statements, in accordance with applicable law.
Section 3.04. Collateral Shortfalls.
In the event that amounts on deposit in the Collateral Fund at
any time are insufficient to cover any withdrawals therefrom that the Company is
then entitled to make hereunder, the Purchaser shall be obligated to pay such
amounts to the Company immediately upon demand. Such obligation shall constitute
a general corporate obligation of the Purchaser. The failure to pay such amounts
within two Business Days of such demand (except for amounts to cover interest on
a Mortgage Loan pursuant to Sections 2.02(d) and 2.03 (b)), shall cause an
immediate termination of the Purchaser's right to make any Election to Delay
Foreclosure or Election to Foreclose and the Company's obligations under this
Agreement with respect to all Mortgage Loans to which such insufficiencies
relate, without the necessity of any further notice or demand on the part of the
Company.
ARTICLE IV
MISCELLANEOUS PROVISIONS
Section 4.01. Amendment.
This Agreement may be amended from time to time by the Company
and the Purchaser by written agreement signed by the Company and the Purchaser.
Section 4.02. Counterparts.
This Agreement may be executed simultaneously in any number of
counterparts, each of which counterparts shall be deemed to be an original, and
such counterparts shall constitute but one and the same instrument.
Section 4.03. Governing Law.
This Agreement shall be construed in accordance with the laws of
the State of New York and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws.
Section 4.04. Notices.
All demands, notices and direction hereunder shall be in writing
or by telecopy and shall be deemed effective upon receipt to:
(a) in the case of the Company,
Securitized Asset Services Corporation
7485 New Horizon Way
Frederick, MD 21701
Attention: Vice President, Master Servicing
Phone: 301-696-7800
Fax: 301-815-6365
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(b) in the case of the Purchaser,
Attention:
Section 4.05. Severability of Provisions.
If any one or more of the covenants, agreements, provision or
terms of this Agreement shall be for any reason whatsoever, including
regulatory, held invalid, then such covenants, agreements, provisions or terms
of this Agreement and shall in no way affect the validity or enforceability of
the other provisions of this Agreement.
Section 4.06. Successors and Assigns.
The provisions of this Agreement shall be binding upon and inure
to the benefit of the respective successors and assigns of the parties hereto,
and all such provisions shall inure to the benefit of the Certificateholders;
provided, however, that the rights under this Agreement cannot be assigned by
the Purchaser without the consent of the Company.
Section 4.07. Article and Section Headings.
The article and section headings herein are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
Section 4.08. Confidentiality.
The Purchaser agrees that all information supplied by or on
behalf of the Company pursuant to Sections 2.01 or 2.02, including individual
account information, is the property of the Company and the Purchaser agrees to
hold such information confidential and not to disclose such information.
Each party hereto agrees that neither it, nor any officer,
director, employee, affiliate or independent contractor acting at such party's
direction will disclose the terms of Section 4.09 of this Agreement to any
person or entity other than such party's legal counsel except pursuant to a
final, non-appealable order of court, the pendency of such order the other party
will have received notice of at least five business days prior to the date
thereof, or pursuant to the other party's prior express written consent.
Section 4.09. Indemnification.
The Purchaser agrees to indemnify and hold harmless the Company,
SASCOR, and each Servicer and each person who controls the Company, SASCOR, or a
Servicer and each of their respective officers, directors, affiliates and agents
acting at the Company's, SASCOR's, or a Servicer's direction (the "Indemnified
Parties") against any and all losses, claims, damages or liabilities to which
they may be subject, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of, or are based upon, actions taken by,
or actions not taken by, the Company, SASCOR, or a Servicer, or on their behalf,
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in accordance with the provisions of this Agreement and (i) which actions
conflict with the Company's, SASCOR's, or a Servicer's obligations under the
Pooling and Servicing Agreement or the related Servicing Agreement, or (ii) give
rise to securities law liability under federal or state securities laws with
respect to the Certificates. The Purchaser hereby agrees to reimburse the
Indemnified Parties for the reasonable legal or other expenses incurred by them
in connection with investigating or defending any such loss, claim, damage,
liability or action. The indemnification obligations of the Purchaser hereunder
shall survive the termination or expiration of this Agreement.
IN WITNESS WHEREOF, the Company and the Purchaser have caused
their names to be signed hereto by their respective officers thereunto duly
authorized, all as of the day and year first above written.
Securitized Asset Services Corporation
By:
Name:
Title:
By:
Name:
Title:
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