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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
May 22, 1996
Cargill Financial Services Corporation
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(Exact name of registrant as specified in its charter)
Delaware 33-96500 41-1492786
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(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.)
6000 Clearwater Avenue 55343
Minnetonka, Minnesota ----------
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(Address of Principal
Executive Offices)
Registrant's telephone number, including area code (612) 984-3058
No Change
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(Former name or former address, if changed since last report)
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Item 2. Acquisition or Disposition of Assets
Description of the Certificates and the Mortgage Loans
Cargill Financial Services Corporation (the "Registrant") registered
issuances of up to $1,000,000,000 principal amount of Mortgage Loan Pass-Through
Certificates on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, as amended (the "Act"), by a Registration Statement on
Form S-3 (Registration File No. 33-96500) (as amended, the "Registration
Statement"). Pursuant to the Registration Statement, Access Financial Mortgage
Loan Trust 1996-2 (the "Trust") issued $210,602,000 in aggregate principal
amount of its Mortgage Loan Pass-Through Certificates, Series 1996-2 (the
"Certificates"), on May 22, 1996. This Current Report on Form 8-K is being filed
to satisfy an undertaking to file copies of certain agreements executed in
connection with the issuance of the Certificates, the forms of which were filed
as Exhibits to the Registration Statement.
The Certificates were issued pursuant to a Pooling and Servicing Agreement
(the "Pooling and Servicing Agreement") attached hereto as Exhibit 4.2, dated as
of May 1, 1996, among Cargill Financial Services Corporation, as sponsor (the
"Sponsor"), Access Financial Lending Corp., as seller (the "Seller") and master
servicer (the "Master Servicer"), and Norwest Bank Minnesota, National
Association, as trustee (the "Trustee"). The Certificates consist of four
classes of fixed rate certificates, the Class A-2 Group I Certificates, the
Class A-3 Group I Certificates, the Class A-4 Group I Certificates, the Class
A-5 Group I Certificates (collectively, the "Class A Group I Certificates") and
two classes of variable rate certificates, the Class A-1 Group I Certificates
and the Class A-6 Group II Certificates (together, the "Class A Certificates").
In addition to the Class A Certificates the Trust will also issue a subordinate
Class of Certificates (the "Class B Certificates") and one or more Classes of
Residual Certificates. Only the Class A Certificates were issued pursuant to the
Registration Statement. The Certificates initially evidence, in the aggregate,
100% of the undivided beneficial ownership interests in the Trust.
The assets of the Trust consist primarily of a pool of fixed-rate,
amortizing mortgage loans and adjustable rate amortizing mortgage loans which
are secured by first or second liens on residential properties (the "Mortgage
Loans").
Interest distributions on the Class A Certificates are based on the
Certificate Principal Balance thereof and the then applicable Pass-Through Rate
thereof. The Pass-Through Rate for the Class A-1 Group I Certificates will be
equal to the least of (i) the London interbank offered rate for one-month United
States dollar deposits ("LIBOR") plus 0.125% per annum, (ii) the weighted
average net coupon rate for the fixed rate mortgage loans as of the
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payment date, and (iii) 10% per annum. The Pass-Through Rate for the Class A-2
Group I Certificates, the Class A-3 Group I Certificates, the Class A-4 Group I
Certificates and the Class A-5 Group I Certificates will be 6.925%, 7.300%,
7.625% and 7.925% per annum, respectively. The Pass-Through Rate for the Class
A-6 Group II Certificates will be equal to the lesser of (i) LIBOR plus 0.33%
per annum and (ii) the weighted average net coupon rate of the adjustable rate
mortgage loans.
The Class A-1 Group I Certificates have an aggregate principal amount of
$58,456,000, the Class A-2 Group I Certificates have an aggregate principal
amount of $38,768,000, the Class A-3 Group I Certificates have an aggregate
principal amount of $16,525,000, the Class A-4 Group I Certificates have an
aggregate principal amount of $14,713,000, the Class A-5 Group I Certificates
have an aggregate principal amount of $13,796,000, and the Class A-6 Group II
Certificates have an aggregate principal amount of $68,344,000.
The Class B Certificates represent a beneficial ownership interest in a
portion of the interest payments on the Mortgage Loans. Interest distributions
on the Class B Certificates are calculated as described in the Pooling and
Servicing Agreement.
As of the Closing Date, the Mortgage Loans possessed the characteristics
described in the Prospectus dated October 19, 1995 and the Prospectus Supplement
dated May 15, 1996, filed pursuant to Rule 424(b)(2) of the Act on May 21, 1996.
As of the Closing Date, there is no sub-servicing agreement in effect between
the Master Servicer and Electronic Data Systems Corporation providing for the
servicing and administration of the Mortgage Loans.
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Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Not applicable
(b) Not applicable
(c) Exhibits:
1.1 Underwriting Agreement, dated as of May 15, 1996, among Cargill
Financial Services Corporation, Access Financial Lending Corp., Prudential
Securities Incorporated and J.P. Morgan Securities Inc.
4.1 Securitization Sponsorship Agreement, dated as of May 1, 1996 between
Cargill Financial Services Corporation and Access Financial Lending Corp.
4.2 Pooling and Servicing Agreement, dated as of May 1, 1996, among Cargill
Financial Services Corporation, as sponsor, Access Financial Lending Corp., as
seller and master servicer, and Norwest Bank Minnesota, National Association, as
trustee.
10.1 Indemnification Agreement, dated as of May 1, 1996, among Cargill
Financial Services Corporation, Access Financial Lending Corp., Financial
Guaranty Insurance Company, Prudential Securities Incorporated and J.P. Morgan
Securities Inc.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
CARGILL FINANCIAL SERVICES CORPORATION
as Sponsor and on behalf of ACCESS
FINANCIAL MORTGAGE LOAN TRUST 1996-2
Registrant
By:/s/ Kenneth M. Duncan
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Name: Kenneth M. Duncan
Title: Senior Vice President
Dated: June 6, 1996
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EXHIBIT INDEX
Exhibit No. Description Page No.
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1.1 Underwriting Agreement, dated as of May 15,
1996, among Cargill Financial Services
Corporation, Access Financial Lending Corp.,
Prudential Securities Incorporated and J.P.
Morgan Securities Inc.
4.1 Securitization Sponsorship Agreement, dated
as of May 1, 1996 between Cargill Financial
Services Corporation and Access Financial
Lending Corp.
4.2 Pooling and Servicing Agreement, dated as of
May 1, 1996, among Cargill Financial Services
Corporation, as sponsor, Access Financial
Lending Corp., as seller and master servicer,
and Norwest Bank Minnesota, National
Association, as trustee.
10.1 Indemnification Agreement, dated as of May 1,
1996, among Cargill Financial Services
Corporation, Access Financial Lending Corp.,
Financial Guaranty Insurance Company,
Prudential Securities Incorporated and J.P.
Morgan Securities Inc.
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EXECUTION COPY
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-2
$58,456,000 Class A-1 Variable Rate Certificates
$38,768,000 Class A-2 Fixed Rate Certificates, 6.925% Pass-Through Rate
$16,525,000 Class A-3 Fixed Rate Certificates, 7.300% Pass-Through Rate
$14,713,000 Class A-4 Fixed Rate Certificates, 7.625% Pass-Through Rate
$13,796,000 Class A-5 Fixed Rate Certificates, 7.925% Pass-Through Rate
$68,344,000 Class A-6 Variable Rate Certificates
UNDERWRITING AGREEMENT
PRUDENTIAL SECURITIES INCORPORATED
J.P. MORGAN SECURITIES INC.
May 15, 1996
Dear Sirs:
Cargill Financial Services Corporation, a corporation organized and
existing under the laws of Delaware (the "Sponsor"), and Access Financial
Lending Corp., a corporation organized and existing under the laws of Delaware
(the "Seller") (the Sponsor and the Seller, collectively, the "Companies"),
agree with you (the "Underwriters") as follows:
Section 1. Issuance and Sale of Certificates. The Sponsor has authorized
the issuance and sale of Mortgage Loan Pass-Through Certificates, Series 1996-2,
Class A-1 Variable Rate Certificates in an aggregate principal amount of
$58,456,000, Class A-2 Fixed Rate Certificates in an aggregate principal amount
of $38,768,000, Class A-3 Fixed Rate Certificates in an aggregate principal
amount of $16,525,000, Class A-4 Fixed Rate Certificates in an aggregate
principal amount of $14,713,000, Class A-5 Fixed Rate Certificates in an
aggregate principal amount of $13,796,000, and Class A-6 Variable Rate
Certificates in an aggregate principal amount of $68,344,000 (collectively, the
"Offered Certificates"). The Offered Certificates, Class B Certificates and the
Residual Certificates (the Class B Certificates and the Residual Certificates,
collectively, the "Non-Offered Certificates") (the Non-Offered Certificates and
the Offered Certificates, collectively, the "Certificates"), are to be issued by
Access Financial Mortgage Loan Trust 1996-2 (the "Trust") pursuant to a Pooling
and Servicing Agreement, to be dated as of May 1, 1996 (the "Pooling and
Servicing Agreement"), among the Seller, Access Financial Lending Corp., as
master servicer (the "Master Servicer"), the Sponsor and Norwest Bank Minnesota,
National
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Association, a national banking association, as trustee (the "Trustee"). The
Non-Offered Certificates are not to be sold hereunder. The Certificates evidence
all of the beneficial ownership interests in the assets of the Trust consisting
primarily of a pool of amortizing mortgage loans which are secured by first or
second liens on residential properties (the "Mortgage Loans").
The Offered Certificates will have the benefit of a certificate insurance
policy (the "Certificate Insurance Policy") issued by Financial Guaranty
Insurance Company, a monoline stock insurance corporation organized under the
laws of New York (the "Certificate Insurer").
In connection with the issuance of the Certificate Insurance Policy, (i)
the Seller and the Certificate Insurer will execute and deliver an Insurance
Agreement dated as of May 1, 1996 (the "Insurance Agreement") and (ii) the
Companies, the Underwriters and the Certificate Insurer will execute and deliver
an Indemnification Agreement dated as of May 1, 1996 (the "Indemnification
Agreement").
As used herein, the term "Sponsor Agreements" means the Pooling and
Servicing Agreement, the Sponsorship Agreement, the Indemnification Agreement
and this Agreement; the term "Seller Agreements" means the Pooling and Servicing
Agreement, the Sponsorship Agreement, the Insurance Agreement, the
Indemnification Agreement, the Servicing Agreements and this Agreement.
The Sponsor and the Seller will enter into a Securitization Sponsorship
Agreement dated as of May 1, 1996 (the "Sponsorship Agreement") pursuant to
which the Sponsor will create the Trust, direct the Trust to acquire the
Mortgage Loans from the Seller and cause the Certificates to be issued.
The Master Servicer and the Trustee will enter into a Sub-Servicing
Agreement dated as of May 1, 1996 with Electronic Data Systems Corporation
("EDS") (the "EDS Sub-Servicing Agreement") and a Sub-Servicing Agreement dated
as of May 1, 1996 with LSI Financial Group ("LSI") (the "LSI Sub-Servicing
Agreement") pursuant to which EDS and LSI will agree to service and administer
the Mortgage Loans in accordance with the provisions of the EDS Sub-Servicing
Agreement and the LSI Sub-Servicing Agreement, respectively. EDS and LSI will be
referred to collectively as the "Sub-Servicers" and the EDS Sub-Servicing
Agreement and the LSI Sub-Servicing Agreement will be referred to collectively
as the "Sub-Servicing Agreements".
An election will be made to treat certain of the assets and Accounts of the
Trust as "real estate mortgage investment conduits" ("REMICs") as such term is
defined in the Internal Revenue Code of 1986, as it may be amended from time to
time (the "Code"). The Offered Certificates and the Class B Certificates will be
designated as "regular interests" in a REMIC, and the
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Residual Certificates will be designated as "residual interests" in a REMIC.
The offering of the Offered Certificates will be made by you, and the
Companies understand that you propose to make a public offering of the Offered
Certificates for settlement on May 22, 1996, as you deem advisable.
Defined terms used herein shall have their respective meanings as set forth
in the Pooling and Servicing Agreement.
Section 2. Representations and Warranties. A. The Sponsor represents and
warrants to, and agrees with each of the Underwriters, that:
(i) A Registration Statement on Form S-3 (No. 33-96500) has (a) been
prepared by the Sponsor on such Form in conformity with the requirements of the
Securities Act of 1933, as amended (the "Securities Act") and the rules and
regulations (the "Rules and Regulations") of the United States Securities and
Exchange Commission (the "Commission") thereunder, (b) been filed with the
Commission and (c) been declared effective by the Commission, and no stop order
suspending the effectiveness of the Registration Statement has been issued, and
no proceeding for that purpose has been initiated or threatened, by the
Commission. Copies of such Registration Statement have been delivered by the
Sponsor to the Underwriters. There are no contracts or documents of the Sponsor
which are required to be filed as exhibits to the Registration Statement
pursuant to the Securities Act or the Rules and Regulations which have not been
so filed or incorporated by reference therein on or prior to the Effective Date
of the Registration Statement other than such documents or materials, if any, as
the Underwriters deliver to the Sponsor pursuant to Section 9D hereof for filing
on Form 8-K. The conditions for use of Form S-3, as set forth in the General
Instructions thereto, have been satisfied.
As used herein, the term "Effective Date" means the date on and time at
which the Registration Statement became effective, or the date on and the time
at which the most recent post-effective amendment to such Registration
Statement, if any, was declared effective by the Commission. The term
"Registration Statement" means (i) the registration statement referred to in the
preceding paragraph, including the exhibits thereto, (ii) all documents
incorporated by reference therein pursuant to Item 12 of Form S-3 and (iii) any
post-effective amendment filed and declared effective prior to the date of
issuance of the Certificates. The term "Base Prospectus" means the prospectus
included in the Registration Statement. The term "Prospectus Supplement " means
the prospectus supplement dated the date hereof and specifically relating to the
Offered Certificates (the "Prospectus Supplement"), as first filed with the
Commission pursuant to Rule 424 of the Rules and Regulations. The term "Sponsor
Offering Materials" means,
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collectively, the Registration Statement, the Base Prospectus and the
information set forth under the caption "The Sponsor" in the Prospectus
Supplement. The term "Seller Offering Materials" means the Prospectus Supplement
except for (x) the information set forth under the caption "The Sponsor" therein
and (y) the Underwriter Information. The term "Underwriter Information" means
the information set forth under the caption "Underwriting" in the Prospectus
Supplement and any information in the Prospectus Supplement relating to any
potential market-making, over-allotment or price stabilization activities of the
Underwriters. The term "Prospectus" means, together, the Base Prospectus and the
Prospectus Supplement.
(ii) The Registration Statement and the Prospectus conform, and any further
amendments or supplements to the Registration Statement or the Prospectus will,
when they become effective or are filed with the Commission, as the case may be,
conform in all respects to the requirements of the Securities Act and the Rules
and Regulations. The Sponsor Offering Materials do not and will not, as of the
Effective Date or filing date thereof and of any amendment thereto, as
appropriate, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading.
(iii) The documents incorporated by reference in the Sponsor Offering
Materials, when they were filed with the Commission conformed in all material
respects to the requirements of the Securities Act or the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), as applicable, and the Rules and
Regulations of the Commission thereunder, and none of such documents contained
an untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading; any further documents so filed and incorporated by reference in the
Sponsor Offering Materials, when such documents are filed with the Commission
will conform in all material respects to the requirements of the Exchange Act
and the Rules and Regulations of the Commission thereunder and will not contain
an untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not misleading;
provided that no representation is made as to documents deemed to be Derived
Information.
(iv) Since the respective dates as of which information is given in the
Sponsor Offering Materials, or the Sponsor Offering Materials as amended and
supplemented, (x) there has not been any material adverse change, or any
development involving a prospective material adverse change, in or affecting the
general affairs, business, management, financial condition, stockholders'
equity, results of operations, regulatory situation or business prospects of the
Sponsor and (y) the Sponsor has not entered into any transaction or agreement
(whether or not in the ordinary course of
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business) material to the Sponsor that, in either case, would reasonably be
expected to materially adversely affect the interests of the holders of the
Offered Certificates, otherwise than as set forth or contemplated in the Sponsor
Offering Materials, as so amended or supplemented.
(v) The Sponsor is not aware of (x) any request by the Commission for any
further amendment of the Registration Statement or the Prospectus or for any
additional information, (y) the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the institution or
threatening of any proceeding for that purpose or (z) any notification with
respect to the suspension of the qualification of the Offered Certificates for
the sale in any jurisdiction or the initiation or threatening of any proceeding
for such purpose.
(vi) The Sponsor has been duly incorporated and is validly existing as a
corporation in good standing under the laws of its jurisdiction of
incorporation, is duly qualified to do business and is in good standing as a
foreign corporation in each jurisdiction in which its ownership or lease of
property or the conduct of its business requires such qualification, except
where the failure to be so qualified would not have a material adverse effect on
the business or financial condition of the Sponsor and has all power and
authority necessary to own or hold its properties, to conduct the business in
which it is engaged and to enter into and perform its obligations under each
Sponsor Agreement and to cause the Certificates to be issued.
(vii) There are no actions, proceedings or investigations pending before or
threatened by any court, administrative agency or other tribunal to which the
Sponsor is a party or of which any of its properties is the subject (i) which if
determined adversely to it is likely to have a material adverse effect
individually, or in the aggregate, on the business or financial condition of the
Sponsor, (ii) asserting the invalidity of any Sponsor Agreement, in whole or in
part or the Certificates, (iii) seeking to prevent the issuance of the
Certificates or the consummation by the Sponsor of any of the transactions
contemplated by any Sponsor Agreement, in whole or in part, or (iv) which if
determined adversely it is likely to materially and adversely affect the
performance by the Sponsor of its obligations under, or the validity or
enforceability of, any Sponsor Agreement, in whole or in part or the
Certificates.
(viii) Each Sponsor Agreement has been, or, when executed and delivered
will have been, duly authorized, validly executed and delivered by the Sponsor
and each Sponsor Agreement constitutes, a valid and binding agreement of the
Sponsor, enforceable against the Sponsor in accordance with their respective
terms, except to the extent that the enforceability hereof may be subject (x) to
insolvency, reorganization, moratorium, receivership, conservatorship, or other
similar laws, regulations
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or procedures of general applicability now or hereafter in effect relating to or
affecting creditors' rights generally, (y) to general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity or at
law), and (z) with respect to rights of indemnity under this Agreement, to
limitations of public policy under applicable securities laws.
(ix) The issuance and delivery of the Certificates, and the execution,
delivery and performance of each Sponsor Agreement and the consummation of the
transactions contemplated hereby and thereby, do not and will not conflict with
or result in a breach of or violate any term or provision of or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement, or other
agreement or instrument to which the Sponsor is a party, by which the Sponsor
may be bound or to which any of the property or assets of the Sponsor or any of
its subsidiaries may be subject, nor will such actions result in any violation
of the provisions of the articles of incorporation or by-laws of the Sponsor or
any law, statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Sponsor or any of its respective
properties or assets.
(x) KPMG Peat Marwick is an independent public accountant with respect to
the Sponsor as required by the Securities Act and the Rules and Regulations.
(xi) The direction by the Sponsor to the Trustee to execute, authenticate,
countersign, issue and deliver the Certificates will be duly authorized by the
Sponsor, and, assuming the Trustee has been duly authorized to do so, when
executed, authenticated, countersigned, issued and delivered by the Trustee in
accordance with the Pooling and Servicing Agreement, the Certificates will be
validly issued and outstanding and will be entitled to the benefits of the
Pooling and Servicing Agreement.
(xii) No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body of the United
States is required for the issuance and sale of the Certificates, or the
consummation by the Sponsor of the other transactions contemplated by this
Agreement, except the registration under the Securities Act of the Offered
Certificates and such consents, approvals, authorizations, registrations or
qualifications as may have been obtained or effected or as may be required under
securities or Blue Sky laws in connection with the purchase and distribution of
the Offered Certificates by you.
(xiii) The Sponsor possesses all material licenses, certificates,
authorities or permits issued by the appropriate state, Federal or foreign
regulatory agencies or bodies necessary to conduct the business now conducted by
it and as described in the Sponsor Offering Materials (or is exempt therefrom)
and the Sponsor has not received notice of any proceedings relating to the
revocation or modification of such license, certificate, authority
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or permit which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, is likely to materially and adversely affect the
conduct of its business, operations, financial condition or income.
(xiv) The Sponsor will not conduct its operations while any of the
Certificates are outstanding in a manner that would require the Sponsor or the
Trust to be registered as an "investment company" under the Investment Company
Act of 1940, as amended (the "1940 Act"), as in effect on the date hereof.
(xv) Any taxes, fees and other governmental charges in connection with the
execution, delivery and issuance of any Sponsor Agreement, the Certificate
Insurance Policies and the Certificates that are required to be paid by the
Sponsor at or prior to the Closing Date have been paid or will be paid at or
prior to the Closing Date.
(xvi) At the Closing Date, each of the representations and warranties of
the Sponsor set forth in any Sponsor Agreement will be true and correct in all
material respects.
Any certificate signed by an officer of the Sponsor and delivered to you or
your counsel in connection with an offering of the Offered Certificates shall be
deemed, and shall state that it is, a representation and warranty as to the
matters covered thereby to each person to whom the representations and
warranties in this Section 2A are made.
B. The Seller represents and warrants to, and agrees with each of the
Underwriters, that:
(i) The Seller Offering Materials do not and will not, as of the applicable
filing date therefor and any amendment or supplement thereto, contain any untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements therein not misleading.
(ii) The documents incorporated by reference in the Seller Offering
Materials, when they were filed with the Commission conformed in all material
respects to the requirements of the Securities Act or the Exchange Act and the
Rules and Regulations of the Commission thereunder, and none of such documents
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading; any further documents so filed and incorporated by reference in
the Seller Offering Materials, when such documents are filed with the Commission
will conform in all material respects to the requirements of the Exchange Act
and the Rules and Regulations of the Commission thereunder and will not contain
an untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not misleading;
provided that no
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representation is made as to Derived Information except to the extent such
documents reflect Seller - Provided Information (as defined in Section 9F
hereof).
(iii) Since the respective dates as of which information is given in the
Seller Offering Materials, or the Seller Offering Materials as amended and
supplemented, (x) there has not been any material adverse change, or any
development involving a prospective material adverse change, in or affecting the
general affairs, business, management, financial condition, stockholders'
equity, results of operations, regulatory situation or business prospects of the
Seller and (y) the Seller has not entered into any transaction or agreement
(whether or not in the ordinary course of business) material to the Seller that,
in either case, would reasonably be expected to materially adversely affect the
interests of the holders of the Offered Certificates, otherwise than as set
forth or contemplated in the Seller Offering Materials, as so amended or
supplemented.
(iv) The Seller is not aware of (x) any request by the Commission for any
further amendment of the Registration Statement or the Prospectus or for any
additional information, (y) the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the institution or
threatening of any proceeding for that purpose or (z) any notification with
respect to the suspension of the qualification of the Offered Certificates for
the sale in any jurisdiction or the initiation or threatening of any proceeding
for such purpose.
(v) The Seller has been duly incorporated and is validly existing as a
corporation in good standing under the laws of its jurisdiction of
incorporation, is duly qualified to do business and is in good standing as a
foreign corporation in each jurisdiction in which its ownership or lease of
property or the conduct of its business requires such qualification, except
where the failure to be so qualified would not have a material adverse effect on
the business or financial condition of the Seller and has all power and
authority necessary to own or hold its properties, to conduct the business in
which it is engaged and to enter into and perform its obligations under each
Seller Agreement.
(vi) There are no actions, proceedings or investigations pending before or
threatened by any court, administrative agency or other tribunal to which the
Seller is a party or of which any of its properties is the subject (i) which if
determined adversely to it is likely to have a material adverse effect
individually, or in the aggregate, on the business or financial condition of the
Seller, (ii) asserting the invalidity of any Seller Agreement in whole or in
part, (iii) seeking to prevent the issuance of the Certificates or the
consummation by the Seller of any of the transactions contemplated by any Seller
Agreement in whole or in part, or (iv) which if determined adversely it is
likely to materially and adversely affect the performance by the Seller of
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its obligations under, or the validity or enforceability of, any Seller
Agreement in whole or in part or the Certificates.
(vii) Each Seller Agreement has been, or, when executed and delivered will
have been, duly authorized, validly executed and delivered by the Seller and
each Seller Agreement constitutes, a valid and binding agreement of the Seller,
enforceable against the Seller in accordance with their respective terms, except
to the extent that the enforceability hereof may be subject (x) to insolvency,
reorganization, moratorium, receivership, conservatorship, or other similar
laws, regulations or procedures of general applicability now or hereafter in
effect relating to or affecting creditors' rights generally, (y) to general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law), and (z) with respect to rights of indemnity
under this Agreement, to limitations of public policy under applicable
securities laws.
(viii) The execution, delivery and performance of each Seller Agreement by
the Seller and the consummation of the transactions contemplated hereby and
thereby, do not and will not conflict with or result in a breach of or violate
any term or provision of or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement, or other agreement or instrument to which the
Seller is a party, by which the Seller may be bound or to which any of the
property or assets of the Seller or any of its subsidiaries may be subject, nor
will such actions result in any violation of the provisions of the articles of
incorporation or by-laws of the Seller or any law, statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over
the Seller or any of their respective properties or assets.
(ix) KPMG Peat Marwick is an independent public accountant with respect to
the Seller as required by the Securities Act and the Rules and Regulations.
(x) No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body of the United
States is required for the issuance and sale of the Certificates, or the
consummation by the Seller of the transactions contemplated by each Seller
Agreement except the registration under the Securities Act of the Offered
Certificates and such consents, approvals, authorizations, registrations or
qualifications as may have been obtained or effected or as may be required under
securities or Blue Sky laws in connection with the purchase and distribution of
the Offered Certificates by you.
(xi) The Seller possesses all material licenses, certificates, authorities
or permits issued by the appropriate state, Federal or foreign regulatory
agencies or bodies necessary to conduct the business now conducted by it and as
described in the Seller Offering Materials (or each is exempt therefrom) and the
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Seller has not received notice of any proceedings relating to the revocation or
modification of such license, certificate, authority or permit which, singly or
in the aggregate, if the subject of an unfavorable decision, ruling or finding,
is likely to materially and adversely affect the conduct of its business,
operations, financial condition or income.
(xii) (a) Following the conveyance of the Mortgage Loans to the Trust
pursuant to the Pooling and Servicing Agreement, the Trust will own the Mortgage
Loans free and clear of any lien, mortgage, pledge, charge, encumbrance, adverse
claim or other security interest (collectively, "Liens") other than Liens
created by the Pooling and Servicing Agreement, and (b) the Seller will have the
power and authority to sell such Mortgage Loans to the Trust.
(xiii) As of the Cut-off Date, each of the Mortgage Loans will meet the
eligibility criteria described in the Prospectus.
(xiv) Neither the Seller nor the Trust created by the Pooling and Servicing
Agreement will conduct their operations while any of the Certificates are
outstanding in a manner that would require the Seller or the Trust to be
registered as an "investment company" under the Investment Company Act of 1940,
as amended (the "1940 Act"), as in effect on the date hereof.
(xv) Each of the Certificates, the Pooling and Servicing Agreement, the
Sponsorship Agreement, the Sub-Servicing Agreements, the Indemnification
Agreement and the Certificate Insurance Policies conforms in all material
respects to the descriptions thereof contained in the Prospectus.
(xvi) Any taxes, fees and other governmental charges in connection with the
execution, delivery and issuance of any Seller Agreement, the Certificate
Insurance Policies and the Certificates that are required to be paid by either
the Seller at or prior to the Closing Date have been paid or will be paid at or
prior to the Closing Date.
(xvii) At the Closing Date, each of the representations and warranties of
the Seller set forth in any Seller Agreement will be true and correct in all
material respects.
Any certificate signed by an officer of the Seller and delivered to you or
your counsel in connection with an offering of the Offered Certificates shall be
deemed, and shall state that it is, a representation and warranty as to the
matters covered thereby to each person to whom the representations and
warranties in this Section 2B are made.
Section 3. Purchase and Sale. The Underwriters' commitment to purchase the
Offered Certificates pursuant to this
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Agreement shall be deemed to have been made on the basis of the representations
and warranties of the Sponsor and of the Seller herein contained and shall be
subject to the terms and conditions herein set forth. The Sponsor agrees to
instruct the Trust to issue the Offered Certificates to each Underwriter as set
forth in Schedule 1 hereto, and each Underwriter agrees, severally and not
jointly, to purchase the Offered Certificates set forth by its name on Schedule
1 hereto on the date of issuance thereof. The purchase prices for the Offered
Certificates shall be as set forth on Schedule 1 hereto.
Section 4. Delivery and Payment. Payment of the purchase price for, and
delivery of, any Offered Certificates to be purchased by you shall be made at
the office of Dewey Ballantine, 1301 Avenue of the Americas, New York, New York,
or at such other place as shall be agreed upon by you and the Companies, at
10:00 a.m. New York City time on May 22, 1996 (the "Closing Date"), or at such
other time or date as shall be agreed upon in writing by you and the Companies.
Payment shall be made by wire transfer of same day funds payable to the account
designated by the Sponsor. Each of the Offered Certificates so to be delivered
shall be represented by one or more global certificates registered in the name
of Cede & Co., as nominee for The Depository Trust Company.
The Companies agree to have the Offered Certificates available for
inspection, checking and packaging by the Underwriters in New York, New York,
not later than 12:00 p.m. New York City time on the business day prior to the
Closing Date.
Section 5. Offering by Underwriters. It is understood that the Underwriters
propose to offer the Offered Certificates for sale to the public as set forth in
the Prospectus.
Section 6. Covenants of the Seller. The Seller covenants with each of the
Underwriters as follows:
A. To cause to be prepared a Prospectus in a form approved by the
Underwriters, to file such Prospectus pursuant to Rule 424(b) under the
Securities Act within the time period prescribed by Rule 424(b) and to provide
the Underwriters with evidence satisfactory to the Underwriters of such timely
filing; to cause to be made no further amendment or any supplement to the
Registration Statement or to the Prospectus prior to the 91st day following the
Closing Date except as permitted herein; to advise the Underwriters, promptly
after it receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective prior to the 91st day
following the Closing Date or any supplement to the Prospectus or any amended
Prospectus has been filed prior to the 91st day following the Closing Date and
to furnish the Underwriters with copies thereof; to file promptly all reports
and any global proxy or information statements required to be filed by the
Sponsor with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act
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subsequent to the date of the Prospectus and, until the 91st day following the
Closing Date; to promptly advise the Underwriters of its receipt of notice of
the issuance by the Commission of any stop order or of: (i) any order preventing
or suspending the use of the Prospectus; (ii) the suspension of the
qualification of the Offered Certificates for offering or sale in any
jurisdiction; (iii) the initiation of or threat of any proceeding for any such
purpose; (iv) any request by the Commission for the amending or supplementing of
the Registration Statement or the Prospectus or for additional information. In
the event of the issuance of any stop order or of any order preventing or
suspending the use of the Prospectus or suspending any such qualification, the
Sponsor promptly shall use its best efforts to obtain the withdrawal of such
order by the Commission.
B. To furnish promptly to the Underwriters and to counsel for the
Underwriters a signed copy of the Registration Statement as originally filed
with the Commission, and of each amendment thereto filed with the Commission,
including all consents and exhibits filed therewith.
C. To deliver promptly to the Underwriters such number of the following
documents as the Underwriters shall reasonably request: (i) conformed copies of
the Registration Statement as originally filed with the Commission and each
amendment thereto (in each case including exhibits); (ii) the Prospectus and any
amended or supplemented Prospectus; and (iii) any document incorporated by
reference in the Prospectus (including exhibits thereto). If the delivery of a
prospectus is required at any time in connection with the offering or sale of
the Offered Certificates and if at such time any events shall have occurred as a
result of which the Prospectus as then amended or supplemented would include any
untrue statement of a material fact or omit to state any material fact necessary
in order to make the statements therein, in the light of the circumstances under
which they were made when such Prospectus is delivered, not misleading, or, if
for any other reason it shall be necessary during such same period to amend or
supplement the Prospectus or to file under the Exchange Act any document
incorporated by reference in the Prospectus in order to comply with the
Securities Act or the Exchange Act, the Sponsor shall notify the Underwriters
and, upon the Underwriters' request based upon the advice of counsel, shall file
such document and prepare and furnish without charge to the Underwriters and to
any dealer in securities as many copies as the Underwriters may from time to
time reasonably request of an amended Prospectus or a supplement to the
Prospectus which corrects such statement or omission or effects such compliance.
D. To cause to be filed promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the Prospectus
that may, in the judgment of the Seller or the Underwriters, be required by the
Securities Act or requested by the Commission.
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E. To cause to be furnished to the Underwriters and counsel for the
Underwriters, prior to filing with the Commission, and to obtain the consent of
the Underwriters, which consent will not unreasonably be withheld, for the
filing of the following documents relating to the Certificates: (i) any
amendment to the Registration Statement or supplement to the Prospectus, or
document incorporated by reference in the Prospectus, or (ii) Prospectus
pursuant to Rule 424 of the Rules and Regulations.
F. To cause to be made generally available to holders of the Offered
Certificates as soon as practicable, but in any event not later than 90 days
after the close of the period covered thereby, a statement of earnings of the
Trust (which need not be audited) complying with Section 11(a) of the Securities
Act and the Rules and Regulations (including Rule 158) and covering a period of
at least twelve consecutive months beginning not later than the first day of the
first fiscal quarter following the Closing Date.
G. To use its best efforts, in cooperating with the Sponsor and the
Underwriters, to qualify the Offered Certificates for offering and sale under
the applicable securities laws of such states and other jurisdictions of the
United States as the Underwriters may designate, and maintain or cause to be
maintained such qualifications in effect for as long as may be required for the
distribution of the Offered Certificates. The Seller will cause the filing of
such statements and reports as may be required by the laws of each jurisdiction
in which the Offered Certificates have been so qualified.
H. The Seller will not , without the prior written consent of the
Underwriters, contract to sell any mortgage pass-through certificates, mortgage
pass-through notes or collateralized mortgage obligations or other similar
securities either directly or indirectly (as through the Sponsor) for a period
of five (5) business days prior to the later of termination of the syndicate or
the Closing Date.
I. So long as the Offered Certificates shall be outstanding, the Seller
shall cause the Trustee, pursuant to the Pooling and Servicing Agreement, to
deliver to the Underwriters as soon as such statements are furnished to the
Trustee: (i) the annual statement as to compliance of the Master Servicer under
the Pooling and Servicing Agreement delivered to the Trustee pursuant to Section
10.16 thereof; (ii) the annual statement of a firm of independent public
accountants furnished to the Trustee pursuant to Section 10.17 of the Pooling
and Servicing Agreement; and (iii) the monthly reports furnished to the Owners
pursuant to Section 7.6 of the Pooling and Servicing Agreement.
J. So long as any of the Offered Certificates are outstanding, the Seller
will furnish to the Underwriters (i) as soon as practicable after the end of the
fiscal year of the Trust all documents required to be distributed to
Certificateholders and
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other filings with the Commission pursuant to the Exchange Act, or any order of
the Commission thereunder with respect to any securities issued by the Sponsor
or the Seller that are (A) non-structured equity or debt offering of the Sponsor
or the Seller or (B) the Offered Certificates and (ii) from time to time, any
other information concerning the Sponsor or the Seller filed with any government
or regulatory authority which is otherwise publicly available, as the
Underwriters shall reasonably request in writing.
K. To apply the net proceeds from the sale of the Offered Certificates in
the manner set forth in the Prospectus.
L. If, between the date hereof or, if earlier, the dates as of which
information is given in the Prospectus and the Closing Date, to the knowledge of
the Seller, there shall have been any material change, or any development
involving a prospective material change in or affecting the general affairs,
management, financial position, shareholders' equity or results of operations of
the Sponsor or the Seller, the Seller will give prompt written notice thereof to
the Underwriters.
M. The Trustee will prepare, or cause to be prepared, and file, or cause to
be filed, a timely election to treat the Trust Fund as a REMIC for Federal
income tax purposes and will file, or cause to be filed, such tax returns and
take such actions, all on a timely basis, as are required to elect and maintain
such status.
N. To the extent, if any, that the ratings provided with respect to the
Offered Certificates by the rating agency or agencies that initially rate the
Offered Certificates are conditional upon the furnishing of documents or the
taking of any other actions by the Sponsor or the Seller, the Seller shall use
its best efforts to furnish or cause to be furnished such documents and take any
such other actions.
Section 7. Conditions of the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Offered Certificates pursuant to
this Agreement are subject to (i) the accuracy on and as of the Closing Date of
the representations and warranties on the part of the Companies herein
contained, (ii) the accuracy of the statements of officers of the Companies made
pursuant hereto, (iii) the performance by the Companies of all of their
respective obligations hereunder, and the performance by the Companies of all of
their respective obligations under the Sponsor Agreements and the Seller
Agreements and (iv) the following conditions as of the Closing Date:
A. No stop order suspending the effectiveness of the Registration Statement
shall have been issued, and no proceeding for that purpose shall have been
initiated or threatened by the Commission. Any request of the Commission for
inclusion of
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additional information in the Registration Statement or the Prospectus shall
have been complied with.
B. You shall have received the Pooling and Servicing Agreement, the
Sponsorship Agreement, the Sub-Servicing Agreements, the Indemnification
Agreement and the Offered Certificates in form and substance satisfactory to you
and duly executed by the signatories required pursuant to the respective terms
thereof.
C. You shall have received from Dewey Ballantine, counsel for the Sponsor
and the Seller, a favorable opinion, dated the Closing Date and satisfactory in
form and substance to the Underwriters and counsel for the Underwriters to the
effect that:
(i) The issuance and sale of the Offered Certificates have been duly
authorized and, when executed, authenticated, countersigned and delivered
by the Trustee in accordance with the Pooling and Servicing Agreement and
delivered and paid for pursuant to this Agreement, will be validly issued
and outstanding and will be entitled to the benefits of the Pooling and
Servicing Agreement.
(ii) No authorization, approval, consent or order of, or filing with,
any court or governmental agency or authority is necessary under the
federal law of the United States or the laws of the State of New York in
connection with the execution, delivery and performance by the Sponsor of
the Sponsor Agreements and by the Seller of the Seller Agreements, except
such as may be required under the Act or the Rules and Regulations and Blue
Sky or other state securities laws, filings with respect to the transfer of
the Mortgage Loans to the Trust pursuant to the Pooling and Servicing
Agreement and such other approvals or consents as have been obtained.
(iii) Each Sponsor Agreement and each Seller Agreement constitutes the
legal, valid and binding obligation of the Sponsor or the Seller, as
appropriate, enforceable against each of the Sponsor or the Seller, as
appropriate, in accordance with their respective terms, except that as to
enforceability such enforcement may (A) be subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the rights of creditors generally, (B) be limited by general
principles of equity (whether considered in a proceeding at law or in
equity) and (C) the enforceability as to rights to indemnification may be
subject to limitations of public policy under applicable laws.
(iv) The Pooling and Servicing Agreement is not required to be
qualified under the Trust Indenture Act of 1939, as amended.
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(v) None of the Sponsor, the Seller nor the Trust is required to be
registered as an "investment company" under the Investment Company Act of
1940, as amended.
(vi) The direction by the Sponsor to the Trustee to execute, issue,
countersign and deliver the Offered Certificates has been duly authorized
and, when the Offered Certificates are executed and authenticated by the
Trustee in accordance with the Pooling and Servicing Agreement and
delivered and paid for pursuant to this Agreement, they will be validly
issued and outstanding and entitled to the benefits provided by the Pooling
and Servicing Agreement.
(vii) Immediately prior to the transfer of the Mortgage Loans by the
Seller to the Trust pursuant to the Pooling and Servicing Agreement, the
Seller was the sole owner of all right, title and interest in the Mortgage
Loans and other property to be transferred to the Trust.
(viii) The Seller has full power and authority to sell and assign the
property to be sold and assigned to and deposited with the Trustee as part
of the Trust Estate and has duly authorized such sale and assignment to the
Trustee by all necessary corporate action.
(ix) The Seller has directed the Trustee in its capacity as Trustee of
the Access Financial Loan Purchase Trust to transfer, assign, set over and
otherwise convey without recourse, to the Trust, all right, title and
interest of the Seller in and to each Mortgage Loan listed on the Mortgage
Loan Schedule delivered by the Seller on the Startup Day, and all of its
right, title and interest in and to (A) scheduled payments of interest due
on each Mortgage Loan after the Cut-Off Date, (B) scheduled payments of
principal due, and unscheduled collections of principal received, on each
Mortgage Loan on and after the Cut-off Date and (C) the Certificate
Insurance Policy; such transfer of the Mortgage Loans set forth on the
Mortgage Loan Schedule to the Trust will be absolute and is intended by the
Seller and all parties hereto to be treated as a sale to the Trust.
(x) The Offered Certificates, the Pooling and Servicing Agreement, the
Sponsorship Agreement, the Sub-Servicing Agreements and this Agreement each
conform in all material respects with the respective descriptions thereof
contained in the Registration Statement and the Prospectus.
(xi) The statements in the Prospectus under the captions "Summary of
Prospectus - Certain Federal Income Tax Consequences", "Summary of
Prospectus - ERISA Considerations", "ERISA Considerations" and "Certain
Federal Income Tax Consequences", "Summary - ERISA Considerations",
"Summary Federal Tax Aspects", "ERISA Considerations", "Certain Federal
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Tax Aspects" and "REMICS", to the extent that they constitute matters of
law or legal conclusions with respect thereto, have been reviewed by such
counsel and represent a fair and accurate summary of the matters addressed
therein, under existing law and the assumptions stated therein.
(xii) The statements in the Prospectus under the caption "Certain
Legal Aspects of Mortgage Loans and Related Matters", "Legal Investment
Matters" and "Legal Investment Considerations" to the extent they
constitute matters of law or legal conclusions, are correct in all material
respects.
(xiii) The Offered Certificates will, when issued, be properly
characterized for Federal income tax purposes as indebtedness of the Seller
and the Trust created by the Pooling and Servicing Agreement and will not
constitute a "taxable mortgage pool" within the meaning of Section 7701(i)
of the Code.
(xiv) Assuming compliance with all of the provisions of the Pooling
and Servicing Agreement, the arrangement pursuant to which the Mortgage
Loans will be administered by the Trustee and pursuant to which the Offered
Certificates will be sold will be treated as a REMIC as defined by Section
860D of the Code and the Offered Certificates and the Class B Certificates
will be treated as "regular interests" in a REMIC (or a combination of
"regular interests" in a REMIC), and the Residual Certificates will be
treated as "residual interests" in a REMIC on the date of issuance thereof
and will continue to qualify as a REMIC for so long as such arrangement
continues to comply with any applicable changes in the provisions of the
Code and regulations issued thereunder.
(xv) The Registration Statement is effective under the Act and no stop
order suspending the effectiveness of the Registration Statement has been
issued, and to the best of such counsel's knowledge no proceeding for that
purpose has been instituted or threatened by the Commission under the Act.
(xvi) The conditions to the use by the Sponsor of a registration
statement on Form S-3 under the Act, as set forth in the General
Instructions to Form S-3, have been satisfied with respect to the
Registration Statement and the Prospectus. There are no contracts or
documents which are required to be filed as exhibits to the Registration
Statement pursuant to the Act or the Rules and Regulations thereunder which
have not been so filed.
(xvii) The Registration Statement at the time it became effective, and
any amendments thereto at the time such amendment becomes effective (other
than the information set forth in the financial statements and other
financial and statistical information contained therein, as to which such
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counsel need express no opinion), complied as to form in all material
respects with the applicable requirements of the Act and the Rules and
Regulations thereunder.
(xviii) The execution, delivery and performance of each Sponsor
Agreement by the Sponsor will not conflict with or violate any federal
statute, rule, regulation or order of any federal governmental agency or
body, or any federal court having jurisdiction over the Sponsor or its
properties or assets.
(xix) The execution, delivery and performance of each Seller Agreement
by the Seller will not conflict with or violate any federal statute, rule,
regulation or order of any federal governmental agency or body, or any
federal court having jurisdiction over the Seller or its properties or
assets.
In addition, such counsel shall state that such counsel has participated in
conferences with officers and other representatives of each of the Seller, the
Sponsor, the Servicers, the Certificate Insurer, the Trustee and the
Underwriters at which the contents of the Registration Statement and the
Prospectus and related matters were discussed and on the basis of the foregoing,
no facts have come to such counsel's attention that have led such counsel to
believe the Registration Statement, at the time it became effective and as of
the date of such counsel's opinion contained or contains an untrue statement of
a material fact or omitted or omits to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
that the Prospectus, as of its date and as of the date of such counsel's
opinion, contained or contains an untrue statement of material fact or omitted
or omits to state a material fact necessary to make the statements therein not
misleading; it being understood that such counsel need express no belief with
respect to the financial statements, schedules and other financial and
statistical data included in the Registration Statement or the Prospectus.
D. The Sponsor shall have delivered to the Underwriters a certificate,
dated the Closing Date, of an authorized officer of the Sponsor to the effect
that the signer of such certificate has carefully examined this Agreement and
the Prospectus and that: (i) the representations and warranties of the Sponsor
in each Sponsor Agreement are true and correct in all material respects at and
as of the Closing Date with the same effect as if made on the Closing Date, (ii)
the Sponsor has complied in all material respects with all the agreements and
satisfied in all material respects all the conditions on its part to be
performed or satisfied at or prior to the Closing Date, (iii) no stop order
suspending the effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been instituted or, to such officer's
knowledge, threatened, (iv) there has been no material adverse
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change in the condition (financial or other), earnings, business, properties or
prospects of the Sponsor, whether or not arising from transactions in the
ordinary course of business, except as set forth or contemplated in the
Prospectus and (v) nothing has come to such officer's attention that would lead
such officer to believe that the Sponsor Offering Materials contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
The Sponsor shall attach to such certificate a true and correct copy of its
certificate of incorporation, as appropriate, and bylaws which are in full force
and effect on the date of such certificate and a certified true copy of the
resolutions of its Board of Directors with respect to the transactions
contemplated herein.
E. The Underwriters shall have received from the Seller a certificate dated
the Closing Date, of an authorized officer of the Seller to the effect that the
signer of such certificate has carefully examined this Agreement and the
Prospectus and that: (i) the representations and warranties of the Seller in
each Seller Agreement are true and correct in all material respects at and as of
the Closing Date with the same effect as if made on the Closing Date, (ii) the
Seller has complied in all material respects with all the agreements and
satisfied all the conditions on its part to be performed or satisfied in all
material respects at or prior to the Closing Date, (iii) there has been no
material adverse change in the condition (financial or other), earnings,
business, properties or prospects of the Seller whether or not arising from
transactions in the ordinary course of business, except as set forth or
contemplated in the Prospectus, and (iv) nothing has come to such officers'
attention that would have such officer to believe that the Seller Offering
Materials contain any untrue statement of a material fact or omit to state any
material facts required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
The Seller shall attach to such certificate a true and correct copy of its
certificate of incorporation, as appropriate, and bylaws which are in full force
and effect on the date of such certificate and a certified true copy of the
resolutions of its Board of Directors with respect to the transactions
contemplated herein.
F. The Underwriters shall have received from in-house counsel of the
Sponsor and the Seller, a favorable opinion, dated the Closing Date and
satisfactory in form and substance to the Underwriters and counsel for the
Underwriters to the effect that:
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(i) Each of the Sponsor and the Seller has been duly incorporated and
is validly existing as a corporation in good standing under the laws of the
State of Delaware with full corporate power to own its property or assets
and to conduct its business as presently conducted by it and as described
in the Prospectus, and is in good standing in each jurisdiction in which
the conduct of its business or the ownership of its property or assets
requires such qualification or where the failure to be so qualified would
have a material adverse effect on its condition (financial or otherwise).
(ii) Each Sponsor Agreement and each Seller Agreement has been duly
authorized, executed and delivered by authorized officers or signers of the
Sponsor or the Seller, as appropriate.
(iii) The direction by the Sponsor to the Trustee to execute, issue,
countersign and deliver the Offered Certificates has been duly authorized
by the Sponsor.
(iv) The execution, delivery and performance of each Sponsor Agreement
by the Sponsor will not conflict with or result in a material breach of any
of the terms or provisions of, or constitute a material default under, or
result in the creation or imposition of any lien, charge or encumbrance
upon any of the property or assets of the Sponsor pursuant to the terms of
the certificate of incorporation or the by-laws of the Sponsor or any
statute, rule, regulation or order of any governmental agency or body of
the State of Minnesota, or any Minnesota state court having jurisdiction
over the Sponsor or its property or assets or any material agreement or
instrument known to such counsel to which the Sponsor is a party or by
which the Sponsor or any of its property or assets is bound.
(v) The execution, delivery and performance of each Seller Agreement
by the Seller will not conflict with or result in a material breach of any
of the terms or provisions of, or constitute a material default under, or
result in the creation or imposition of any lien, charge or encumbrance
upon any of the property or assets of the Seller pursuant to the terms of
the certificate of incorporation or the by-laws of the Seller or any
statute, rule, regulation or order of any governmental agency or body of
the State of Minnesota, or any Minnesota state court having jurisdiction
over the Seller or its property or assets or any material agreement or
instrument known to such counsel, to which the Seller is a party or by
which the Seller or any of its property or assets is bound.
(vi) No authorization, approval, consent or order of, or filing with,
any court or governmental agency or authority of the State of Minnesota is
necessary in connection with the execution, delivery and performance by the
Sponsor of any Sponsor Agreement except such as may be required under the
Act
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or the Rules and Regulations and Blue Sky or other state securities laws
filings with respect to the transfer of the Mortgage Loans to the Trust
pursuant to the Pooling and Servicing Agreement and such other approvals or
consents as have been obtained.
(vii) No authorization, approval, consent or order of, or filing with,
any court or governmental agency or authority of the State of Minnesota is
necessary in connection with the execution, delivery and performance by the
Seller of any Seller Agreement, except such as may be required under the
Act or the Rules and Regulations and Blue Sky or other state securities
laws, filings with respect to the transfer of the Mortgage Loans to the
Trust pursuant to the Pooling and Servicing Agreement and such other
approvals or consents as have been obtained.
(viii) To such counsel's knowledge, there are no legal or governmental
proceedings pending to which the Sponsor or the Seller is a party or of
which any property or assets of the Sponsor or the Seller is the subject,
and no such proceedings are to the best of such counsel's knowledge
threatened or contemplated by governmental authorities against the Sponsor,
the Seller or the Trust, that, (A) are required to be disclosed in the
Registration Statement or (B) (i) assert the invalidity against the Sponsor
of all or any part of any Sponsor Agreement or against the Seller of all or
any part of any Seller Agreement, (ii) seek to prevent the issuance of the
Offered Certificates, (iii) could materially adversely affect the Sponsor's
or the Seller's obligations under any Sponsor Agreement or any Seller
Agreement, as appropriate, or (iv) seek to affect adversely the Federal or
state income tax attributes of the Offered Certificates.
G. The Underwriters shall have received from special counsel to the
Certificate Insurer, reasonably acceptable to the Underwriters, a favorable
opinion dated the Closing Date and satisfactory in form and substance to the
Underwriters and counsel for the Underwriters, to the effect that:
(i) The Certificate Insurer is a stock insurance company licensed and
authorized to transact insurance business and to issue, deliver and perform
its obligations under its surety bonds under the laws of the State of New
York. The Certificate Insurer (a) is a stock insurance company validly
existing and in good standing under the laws of the State of New York, (b)
has the corporate power and authority to own its assets and to carry on the
business in which it is currently engaged, and (c) is duly qualified and in
good standing as a foreign corporation under the laws of each jurisdiction
where failure so to qualify or to be in good standing would have a material
and adverse effect on its business or operations.
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(ii) No litigation or administrative proceedings of or before any
court, tribunal or governmental body are currently pending or, to the best
of such counsel's knowledge, threatened against the Certificate Insurer,
which, if adversely determined, would have a material and adverse effect on
the ability of the Certificate Insurer to perform its obligations under the
Certificate Insurance Policy.
(iii) The Certificate Insurance Policy and the Indemnification
Agreement constitute the irrevocable, valid, legal and binding obligations
of the Certificate Insurer in accordance with their respective terms to the
extent provided therein, enforceable against the Certificate Insurer in
accordance with their respective terms, except as the enforceability
thereof and the availability of particular remedies to enforce the
respective terms thereof against the Certificate Insurer may be limited by
applicable laws affecting the rights of creditors of the Certificate
Insurer and by the application of general principles of equity.
(iv) The Certificate Insurer, as an insurance company, is not eligible
for relief under the United States Bankruptcy Code. Any proceedings for the
liquidation, conservation or rehabilitation of the Certificate Insurer
would be governed by the provisions of the Insurance Law of the State of
New York.
(v) The statements set forth in the Prospectus under the caption "The
Certificate Insurance Policy and the Certificate Insurer" are true and
correct, except that no opinion is expressed as to financial statements or
other financial information included in the Prospectus relating to the
Certificate Insurer or FGIC Corporation and, insofar as such statements
constitute a summary of the Certificate Insurance Policy, accurately and
fairly summarize the terms of the Certificate Insurance Policy.
(vi) The Certificate Insurance Policy constitutes an insurance policy
within the meaning of Section 3(a)(8) of the Act.
(vii) Neither the execution or delivery by the Certificate Insurer of
the Certificate Insurance Policy or the Indemnification Agreement, nor the
performance by the Certificate Insurer of its obligations thereunder, will
conflict with any provision of the certificate of incorporation or the
amended by-laws of the Certificate Insurer nor, to the best of such
counsel's knowledge, result in a breach of, or constitute a default under,
any agreement or other instrument to which the Certificate Insurer is a
party or by which any of its property is bound nor, to the best of such
counsel's knowledge, violate any judgment, order or decree applicable to
the Certificate Insurer of any governmental regulatory body, administrative
agency, court or
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arbitrator located in any jurisdiction in which the Certificate Insurer is
licensed or authorized to do business.
H. The Underwriters shall have received from counsel to EDS, reasonably
acceptable to the Underwriters, a favorable opinion dated the Closing Date and
satisfactory in form and substance to the Underwriters and counsel for the
Underwriters, to the effect that:
(i) EDS has been duly incorporated and is validly existing as a
corporation in good standing under the laws of its state of incorporation.
(ii) EDS has full corporate power and authority to enter into and
perform its obligations under the EDS Sub-Servicing Agreement, including,
but not limited to, its obligation to serve in the capacity of servicer
pursuant to the EDS Sub-Servicing Agreement.
(iii) The EDS Sub-Servicing Agreement has been duly authorized,
executed and delivered by EDS and constitutes a legal, valid and binding
obligation of EDS enforceable against EDS in accordance with its terms,
except that as to enforceability such enforcement may (A) be subject to
applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the rights of creditors generally and (B) be limited
by general principles of equity (whether considered in a proceeding at law
or in equity).
(iv) The execution, delivery and performance of the EDS Sub-Servicing
Agreement by EDS will not conflict with or result in a breach of any of the
terms or provisions of, or constitute a default under, or result in the
creation or imposition of any lien, charge or encumbrance upon any of the
property or assets of EDS pursuant to the terms of the certificate of
incorporation or the by-laws of EDS or any statute, rule, regulation or
order of any governmental agency or body, or any court having jurisdiction
over EDS or its property or assets or any agreement or instrument known to
such counsel, to which EDS is a party or by which EDS or any of its
property or assets is bound.
(v) No authorization, approval, consent or order of, or filing with,
any state or federal court or governmental agency or authority is necessary
in connection with the execution, delivery and performance by EDS of the
EDS Sub-Servicing Agreement.
I. The Underwriters shall have received a certificate of EDS signed by an
authorized officer of EDS, dated the Closing Date to the effect that such
officer has examined the information contained under the heading "The Servicers"
with respect to EDS and the EDS Sub-Servicing Agreement in the Prospectus and
that such
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information does not include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading.
J. The Underwriters shall have received from counsel to LSI, reasonably
acceptable to the Underwriters, a favorable opinion dated the Closing Date and
satisfactory in form and substance to the Underwriters and counsel for the
Underwriters, to the effect that:
(i) LSI has been duly incorporated and is validly existing as a
corporation in good standing under the laws of its state of incorporation.
(ii) LSI has full corporate power and authority to enter into and
perform its obligations under the LSI Sub-Servicing Agreement, including,
but not limited to, its obligation to serve in the capacity of servicer
pursuant to the LSI Sub-Servicing Agreement.
(iii) The LSI Sub-Servicing Agreement has been duly authorized,
executed and delivered by LSI and constitutes a legal, valid and binding
obligation of LSI enforceable against LSI in accordance with its terms,
except that as to enforceability such enforcement may (A) be subject to
applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the rights of creditors generally and (B) be limited
by general principles of equity (whether considered in a proceeding at law
or in equity).
(iv) The execution, delivery and performance of the LSI Sub-Servicing
Agreement by LSI will not conflict with or result in a breach of any of the
terms or provisions of, or constitute a default under, or result in the
creation or imposition of any lien, charge or encumbrance upon any of the
property or assets of LSI pursuant to the terms of the certificate of
incorporation or the by-laws of LSI or any statute, rule, regulation or
order of any governmental agency or body, or any court having jurisdiction
over LSI or its property or assets or any agreement or instrument known to
such counsel, to which LSI is a party or by which LSI or any of its
property or assets is bound.
(v) No authorization, approval, consent or order of, or filing with,
any state or federal court or governmental agency or authority is necessary
in connection with the execution, delivery and performance by LSI of the
LSI Sub-Servicing Agreement.
K. The Underwriters shall have received a certificate of LSI signed by an
authorized officer of LSI, dated the Closing Date to the effect that such
officer has examined the information
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contained under the heading "The Servicers" with respect to LSI and the LSI
Sub-Servicing Agreement in the Prospectus and that such information does not
include an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading.
L. The Underwriters shall have received from Dewey Ballantine, counsel for
the Underwriters, such opinion or opinions, dated the Closing Date, with respect
to the validity of the Offered Certificates and such other related matters as
the Underwriters may require.
M. The Underwriters shall have received from counsel to the Trustee a
favorable opinion dated the Closing Date and satisfactory in form and substance
to the Underwriters and counsel for the Underwriters, to the effect that:
(i) The Trustee has been duly incorporated and is validly existing as
a banking corporation in good standing under the laws of the United States
of America.
(ii) The Trustee has full corporate trust power and authority to enter
into and perform its obligations under the Pooling and Servicing Agreement,
including, but not limited to, its obligation to serve in the capacity of
Trustee and to execute, issue, countersign and deliver the Offered
Certificates.
(iii) The Pooling and Servicing Agreement has been duly authorized,
executed and delivered by the Trustee, and constitutes a legal, valid and
binding obligation of the Trustee, enforceable against the Trustee, in
accordance with its terms, except that as to enforceability such
enforcement may (A) be subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the rights of
creditors generally and (B) be limited by general principles of equity
(whether considered in a proceeding at law or in equity).
(iv) The Certificates have been duly authorized, executed and
authenticated by the Trustee on the date hereof on behalf of the Trust in
accordance with the Pooling and Servicing Agreement.
(v) The execution, delivery and performance of the Pooling and
Servicing Agreement and the Certificates by the Trustee will not conflict
with or result in a breach of any of the terms or provisions of, or
constitute a default under, or result in the creation or imposition of any
lien, charge or encumbrance upon any of the property or assets of the
Trustee pursuant to the terms of the articles of association or the by-laws
of the Trustee or any statute, rule, regulation or
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order of any governmental agency or body, or any court having jurisdiction
over the Trustee or its property or assets or any agreement or instrument
known to such counsel, to which the Trustee is a party or by which the
Trustee or any of its respective property or assets is bound.
(vi) No authorization, approval, consent or order of, or filing with,
any state or federal court or governmental agency or authority is necessary
in connection with the execution, delivery and performance by the Trustee
of the Pooling and Servicing Agreement and the Offered Certificates, as
applicable.
(vii) If the Trustee were acting as Master Servicer under the Pooling
and Servicing Agreements on the date hereof, the Trustee would have the
power and authority to perform the obligations of the Master Servicer as
provided in the Pooling and Servicing Agreement.
N. Norwest Bank Minnesota, National Association ("Norwest") shall have
furnished to the Underwriters a certificate of Norwest, signed by one or more
duly authorized officers of Norwest, dated the Closing Date, as to the due
authorization, execution and delivery of the Pooling and Servicing Agreement by
Norwest and the acceptance by the Trustee of the trusts created thereby and the
due execution and delivery of the Certificates by the Trustee thereunder and
such other matters as the Underwriters shall reasonably request.
O. The Indemnification Agreement shall have been executed and delivered, in
which the Certificate Insurer shall represent, among other representations, that
(i) the information under the captions "Certificate Insurer" and "Certificate
Insurance Policy" in the section entitled "Summary" and "The Certificate
Insurance Policy and the Certificate Insurer" in the Prospectus Supplement was
approved by the Certificate Insurer and does not contain any untrue statement of
a material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading and (ii) there has been no change in the financial
condition of the Certificate Insurer since December 31, 1995, which would have a
material adverse effect on the Certificate Insurer's ability to meet its
obligations under the Certificate Insurance Policy.
P. The Certificate Insurance Policy shall have been issued by the
Certificate Insurer and shall have been duly countersigned by an authorized
agent of the Certificate Insurer, if so required under applicable state law or
regulation.
Q. The Offered Certificates shall have been rated "AAA" by Standard &
Poor's Corporation ("S&P") and "Aaa" by Moody's Investors Service, Inc.
("Moody's").
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R. The Underwriters shall have received copies of letters dated as of the
Closing Date, from S&P and Moody's stating the current ratings of the Offered
Certificates as set forth in Section Q above.
S. The Underwriters shall have received from Dewey Ballantine, counsel to
the Sponsor and the Seller, a favorable opinion, dated the Closing Date and
satisfactory in form and substance to the Underwriters and counsel for the
Underwriters, as to true sale matters relating to the transaction, and the
Underwriters shall be addressees of any opinions of counsel supplied to the
rating organizations relating to the Certificates.
T. All proceedings in connection with the transactions contemplated by this
Agreement, and all documents incident hereto, shall be reasonably satisfactory
in form and substance to the Underwriters and counsel for the Underwriters, and
the Underwriters and counsel for the Underwriters shall have received such other
information, opinions, certificates and documents as they may reasonably request
in writing.
U. The Prospectus and any supplements thereto shall have been filed (if
required) with the Commission in accordance with the rules and regulations under
the Act and Section 2 hereof, and prior to the Closing Date, no stop order
suspending the effectiveness of the Registration Statement shall have been
issued and no proceedings for that purpose shall have been instituted or shall
be contemplated by the Commission or by any authority administering any state
securities or Blue Sky law.
If any condition specified in this Section 7 shall not have been fulfilled
when and as required to be fulfilled, (i) this Agreement may be terminated by
you by notice to both of the Companies at any time at or prior to the Closing
Date, and such termination shall be without liability of any party to any other
party except as provided in Section 8 and (ii) the provisions of Section 8, the
indemnity set forth in Section 9, the contribution provisions set forth in
Section 10 and the provisions of Sections 12 and 15 shall remain in effect.
Section 8. Payment of Expenses. The Seller agrees to pay the following
expenses incident to the performance of the Companies' obligations under this
Agreement, (i) the filing of the Registration Statement and all amendments
thereto, (ii) the duplication and delivery to you, in such quantities as you may
reasonably request, of copies of this Agreement, (iii) the preparation, issuance
and delivery of the Certificates, (iv) the fees and disbursements of Dewey
Ballantine, counsel for the Underwriters and special counsel to the Seller, (v)
the fees and disbursements of KPMG Peat Marwick, accountants of the Companies
(excluding fee and disbursements of KPMG Peat Marwick related to providing
comfort in connection with the Seller-Provided Information), (vi) the
qualification of the Offered Certificates
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under securities and Blue Sky laws and the determination of the eligibility of
the Offered Certificates for investment in accordance with the provisions
hereof, including filing fees and the fees and disbursements of Dewey
Ballantine, counsel to the Underwriters, in connection therewith and in
connection with the preparation of any Blue Sky survey, (vii) the printing and
delivery to you, in such quantities as you may reasonably request, of copies of
the Registration Statement and Prospectus and all amendments and supplements
thereto, and of any Blue Sky survey, (viii) the duplication and delivery to you,
in such quantities as you may reasonably request, of copies of the Pooling and
Servicing Agreement and the other transaction documents, (ix) the fees charged
by nationally recognized statistical rating agencies for rating the Offered
Certificates, (x) the fees and expenses of the Trustee and its counsel and (xi)
the fees and expenses of the Certificate Insurer and its counsel.
If this Agreement is terminated by you in accordance with the provisions of
Section 7, the Companies shall reimburse you for all reasonable third-party
out-of-pocket expenses, including the reasonable fees and disbursements of Dewey
Ballantine, your counsel.
Section 9. Indemnification. A. (x) The Sponsor agrees to indemnify and hold
harmless each Underwriter and each person, if any, who controls each Underwriter
within the meaning of the Securities Act or the Exchange Act, from and against
any and all loss, claim, damage or liability, joint or several, or any action in
respect thereof (including, but not limited to, any loss, claim, damage,
liability or action relating to purchases and sales of the Offered
Certificates), to which the Underwriters or any such controlling person may
become subject, under the Securities Act or the Exchange Act or otherwise,
insofar as such loss, claim, damage, liability or action arises out of, or is
based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement, (ii) the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, (iii) any untrue
statement or alleged untrue statement of a material fact contained in the
Sponsor Offering Materials (other than the Registration Statement) or (iv) the
omission or alleged omission to state therein a material fact required to be
stated or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading and shall reimburse
each Underwriter and each such controlling person promptly upon demand for any
documented legal or documented other expenses reasonably incurred by each
Underwriter or such controlling person in connection with investigating or
defending or preparing to defend against any such loss, claim, damage, liability
or action as such expenses are incurred; provided, however, that the foregoing
indemnity with respect to any untrue statement contained in or omission from a
prospectus shall not inure to the benefit of each Underwriter if the Sponsor
shall sustain the burden
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of proving that the person asserting against such Underwriter the loss,
liability, claim, damage or expense purchased any of the Offered Certificates
which are the subject thereof and was not sent or given a copy of the
appropriate Prospectus (or the appropriate Prospectus as amended or
supplemented), if required by law, at or prior to the written confirmation of
the sale of such Offered Certificates to such person and the untrue statement
contained in or omission from such preliminary prospectus was corrected in the
appropriate Prospectus (or the appropriate Prospectus as amended or
supplemented).
(y) The Seller agrees to indemnify and hold harmless each Underwriter and
each person, if any, who controls each Underwriter within the meaning of the
Securities Act or the Exchange Act, from and against any and all loss, claim,
damage or liability, joint or several, or any action in respect thereof
(including, but not limited to, any loss, claim, damage, liability or action
relating to purchases and sales of the Offered Certificates), to which each
Underwriter or any such controlling person may become subject, under the
Securities Act or the Exchange Act or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based upon, (i) any untrue
statement or alleged untrue statement of a material fact contained in the Seller
Offering Materials or (ii) the omission or alleged omission to state therein a
material fact required to be stated or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading and
shall reimburse each Underwriter and each such controlling person promptly upon
demand for any documented legal or documented other expenses reasonably incurred
by each Underwriter or such controlling person in connection with investigating
or defending or preparing to defend against any such loss, claim, damage,
liability or action as such expenses are incurred; provided, however, that the
foregoing indemnity with respect to any untrue statement contained in or
omission from a prospectus shall not inure to the benefit of each Underwriter if
the Seller shall sustain the burden of proving that the person asserting against
such Underwriter the loss, liability, claim, damage or expense purchased any of
the Offered Certificates which are the subject thereof and was not sent or given
a copy of the appropriate Prospectus (or the appropriate Prospectus as amended
or supplemented), if required by law, at or prior to the written confirmation of
the sale of such Offered Certificates to such person and the untrue statement
contained in or omission from such preliminary prospectus was corrected in the
appropriate Prospectus (or the appropriate Prospectus as amended or
supplemented).
The foregoing indemnity agreement is in addition to any liability which the
Sponsor or the Seller may otherwise have to the Underwriters or any controlling
person of any of the Underwriters.
B. Each Underwriter severally, and not jointly, agrees to indemnify and
hold harmless the Sponsor and the Seller, the
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directors and the officers of the Sponsor who signed the Registration Statement,
and each person, if any, who controls the Sponsor or the Seller within the
meaning of the Securities Act or the Exchange Act against any and all loss,
claim, damage or liability, or any action in respect thereof, to which the
Sponsor, the Seller or any such director, officer or controlling person may
become subject, under the Securities Act or the Exchange Act or otherwise,
insofar as such loss, claim, damage, liability or action arises out of, or is
based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained in the Underwriter Information or (ii) the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, and shall reimburse the Sponsor or
the Seller, as the case may be, promptly on demand, and any such director,
officer or controlling person for any documented legal or other documented
expenses reasonably incurred by the Sponsor or the Seller, or any director,
officer or controlling person in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or action as
such expenses are incurred.
The foregoing indemnity agreement is in addition to any liability which
each Underwriter may otherwise have to the Sponsor or the Seller or any such
director, officer or controlling person.
C. Promptly after receipt by any indemnified party under this Section 9 of
notice of any claim or the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against any indemnifying
party under this Section 9, promptly notify the indemnifying party in writing of
the claim or the commencement of that action; provided, however, that the
failure to notify an indemnifying party shall not relieve it from any liability
which it may have under this Section 9 except to the extent it has been
materially prejudiced by such failure; and provided, further, that the failure
to notify any indemnifying party shall not relieve it from any liability which
it may have to any indemnified party otherwise than under this Section 9.
If any such claim or action shall be brought against an indemnified party,
and it shall notify the indemnifying party thereof, the indemnifying party shall
be entitled to participate therein and, to the extent that it wishes, jointly
with any other similarly notified indemnifying party, to assume the defense
thereof with counsel reasonably satisfactory to the indemnified party, unless
such indemnified party reasonably objects to such assumption on the ground that
there may be legal defenses available to it which are different from or in
addition to those available to such indemnifying party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, except to the extent provided in the next
following paragraph, the indemnifying party shall not be liable to the
indemnified party under this Section 9 for any fees and
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expenses of counsel subsequently incurred by the indemnified party in connection
with the defense thereof other than reasonable costs of investigation.
Any indemnified party shall have the right to employ separate counsel in
any such action and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such indemnified party
unless: (i) the employment thereof has been specifically authorized by the
indemnifying party in writing; (ii) such indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party and in the reasonable judgment of such counsel it is
advisable for such indemnified party to employ separate counsel; or (iii) the
indemnifying party has failed to assume the defense of such action and employ
counsel reasonably satisfactory to the indemnified party, in which case, if such
indemnified party notifies the indemnifying party in writing that it elects to
employ separate counsel at the expense of the indemnifying party, the
indemnifying party shall not have the right to assume the defense of such action
on behalf of such indemnified party, it being understood, however, the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to local counsel) at any time for all such indemnified parties, which
firm shall be designated in writing by the Underwriters, if the indemnified
parties under this Section 9 consist of the Underwriters or any of its
controlling persons, or by the Companies, if the indemnified parties under this
Section 9 consist of either of the Companies or any of the Companies' directors,
officers or controlling persons, but in either case reasonably satisfactory to
the indemnified party.
Each indemnified party, as a condition of the indemnity agreements
contained in Sections 9A and B, shall use its best efforts to cooperate with the
indemnifying party in the defense of any such action or claim. No indemnifying
party shall be liable for any settlement of any such action effected without its
written consent (which consent shall not be unreasonably withheld), but if
settled with its written consent or if there be a final judgment for the
plaintiff in any such action, the indemnifying party agrees to indemnify and
hold harmless any indemnified party from and against any loss or liability by
reason of such settlement or judgment. No indemnifying party shall, without
prior written consent of the indemnified party, effect any settlement of any
pending or threatened action in respect of which such indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party unless such settlement includes an unconditional release of
such indemnified party from
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all liability on any claims that are the subject matter of such
action.
Notwithstanding the foregoing, if (x) the indemnified party has made a
proper request to the indemnifying party for the payment of the indemnified
party's legal fees and expenses, as permitted hereby, and (y) such request for
payment has not been honored within thirty days, then, for so long as such
request thereafter remains unhonored, the indemnifying party shall be liable for
any settlement entered into by the indemnified party whether or not the
indemnifying party consents thereto.
D. The Underwriters agree to provide the Companies no later than the date
on which the Prospectus Supplement is required to be filed pursuant to Rule 424
with a copy of any Derived Information (defined below) for filing with the
Commission on Form 8-K.
E. Each Underwriter, severally and not jointly, agrees, assuming all
Seller-Provided Information (defined below) is accurate and complete in all
material respects, to indemnify and hold harmless the Sponsor, the Seller, their
respective officers and directors and each person who controls the Sponsor
and/or the Seller within the meaning of the Securities Act or the Exchange Act
against any and all losses, claims, damages or liabilities, joint or several, to
which they may become subject under the Securities Act or the Exchange Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement of a
material fact contained in the Derived Information provided by such Underwriter,
or arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, and agrees to reimburse each such indemnified party for
any legal or other expenses reasonably incurred by him, her or it in connection
with investigating or defending or preparing to defend any such loss, claim,
damage, liability or action as such expenses are incurred. The obligations of
each Underwriter under this Section 9(E) shall be in addition to any liability
which each Underwriter may otherwise have.
The procedures set forth in Section 9C shall be equally applicable to this
Section 9E.
F. For purposes of this Agreement, the term "Derived Information" means
such portion, if any, of the information delivered to the Companies pursuant to
Section 9D for filing with the Commission on Form 8-K as: (i) is not contained
in the Prospectus without taking into account information incorporated therein
by reference; and (ii) does not constitute Seller-Provided Information.
"Seller-Provided Information" means any computer tape
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furnished to the Underwriters by the Seller concerning the assets
comprising the Trust.
Section 10. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 9 is for any reason held to be unenforceable by the indemnified parties
although applicable in accordance with its terms, the Sponsor, the Seller and
the Underwriters (each, a "Contributing Party") shall contribute to the
aggregate losses, liabilities, claims, damages and expenses of the nature
contemplated by said indemnity agreement incurred by such Contributing Party (i)
in such proportion as is appropriate to reflect the relative benefits received
by such Contributing Party from the offering of the Offered Certificates or (ii)
if the allocation provided by clause (i) above is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of such
Contributing Party in connection with the statements or omissions which resulted
in the losses, liabilities, claims, damages and expenses as well as any other
relevant equitable considerations; provided, however, that no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
Relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Contributing Party and the Contributing Parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such untrue statement or omission and other equitable considerations.
Notwithstanding the provisions of Section 9 or of this Section 10, neither
Underwriter shall be required to be responsible for any amount in excess of the
amount by which the total re-offering price at which the Offered Certificates
underwritten by it and distributed and offered to the public exceeds the amount
paid hereunder by such Underwriter for the Offered Certificates. For purposes of
this Section 10, each person, if any, who controls you within the meaning of the
Securities Act or the Exchange Act shall have the same rights to contribution as
each of the Underwriters and each director of the Sponsor and/or the Seller,
each officer of the Sponsor who signed the Registration Statement, and each
person, if any, who controls the Sponsor and/or the Seller within the meaning of
the Securities Act or the Exchange Act shall have the same rights to
contribution as the Sponsor.
The Companies and the Underwriters agree that it would not be just and
equitable if contributions pursuant to this Section 10 were to be determined by
pro rata allocation or by any other method of allocation which does not take
into account the equitable
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considerations referred to herein. The amount paid or payable by an indemnified
party as a result of the loss, claim, damage or liability, or action in respect
thereof, referred to above in this Section 10 shall be deemed to include, for
purposes of this Section 10, any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claim.
Section 11. Termination. This Agreement shall be subject to termination in
the absolute discretion of the Underwriters, by notice given to the Sponsor and
the Seller prior to delivery of and payment for the Offered Certificates if
prior to such time (i) any change, or any development involving a prospective
change, in or affecting particularly the business or properties of the Trust,
the Sponsor or the Seller which, in the reasonable judgment of the Underwriters,
materially impairs the investment quality of the Certificates or makes it
impractical or inadvisable to market the Offered Certificates; (ii) the Offered
Certificates have been placed on credit watch by S&P or Moody's with negative
implications; (iii) trading in securities generally on the New York Stock
Exchange or the National Association of Securities Dealers National Market
System shall have been suspended or limited, or minimum prices shall have been
established on such exchange or market system; (iv) a banking moratorium shall
have been declared by either Federal or New York State authorities; or (v) there
shall have occurred any outbreak or material escalation of hostilities or other
calamity or crisis, the effect of which makes it, in the reasonable judgment of
the Underwriters, impractical or inadvisable to proceed with the completion of
the sale and payment for the Offered Certificates. Upon such notice being given,
the parties to this Agreement shall (except for any liability arising before or
in relation to such termination) be released and discharged from their
respective obligations under this Agreement.
Section 12. Representations, Warranties and Agreements to Survive Delivery.
All representations, warranties and agreements contained in this Agreement or
contained in certificates of officers of the Companies submitted pursuant
hereto, shall remain operative and in full force and effect, regardless of any
investigation made by or on behalf of you or controlling person of you, or by or
on behalf of the Companies or any officers, directors or controlling persons and
shall survive delivery of any Offered Certificates to you or any controlling
person.
Section 13. Notices. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication to:
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<PAGE>
The Underwriters: Prudential Securities
Incorporated
One New York Plaza
15th Floor
New York, New York 10292-2015
Fax: (212) 778-7401
J.P. Morgan Securities Inc.
60 Wall Street, 18th Floor
New York, New York 10260-0060
Fax: (212) 648-5251
The Sponsor: Cargill Financial Services
Corporation
6000 Clearwater Drive
Minnetonka, MN 55343-9497
Attention: Corporate Capital Group
Fax: (612) 984-3910
The Seller: Access Financial Lending Corp.
12800 Whitewater Drive
Minnetonka, MN 55343-4109
Attention: Operations
Fax: (612) 984-0877
Section 14. Parties. This Agreement shall inure to the benefit of and be
binding upon you and the Companies, and their respective successors or assigns.
Nothing expressed or mentioned in this Agreement is intended nor shall it be
construed to give any person, firm or corporation, other than the parties hereto
or thereto and their respective successors and the controlling persons and
officers and directors referred to in Sections 9 and 10 and their heirs and
legal representatives, any legal or equitable right, remedy or claim under or
with respect to this Agreement or any provision herein contained. This Agreement
and all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the parties and their respective successors and said
controlling persons and officers and directors and their heirs and legal
representatives (to the extent of their rights as specified herein and therein)
and except as provided above for the benefit of no other person, firm or
corporation. No purchaser of Offered Certificates from you shall be deemed to be
a successor by reason merely of such purchase.
SECTION 15. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY THE
LAWS OF THE STATE OF NEW YORK AND SHALL BE CONSTRUED IN ACCORDANCE WITH SUCH
LAWS. SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
Section 16. Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed to be an original, but together they shall
constitute but one instrument.
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<PAGE>
Section 17. Headings. The headings herein are inserted for convenience of
reference only and are not intended to be part of or affect the meaning or
interpretation of, this Agreement.
Section 18. Default of Underwriters. If either Underwriter defaults in its
obligations to purchase the Offered Certificates offered to it hereunder (such
Underwriter, the "Defaulting Underwriter"), then the remaining Underwriter (the
"Performing Underwriter") shall have the option, but not the obligation, to
purchase all, but not less than all, of the Offered Certificates offered to the
Defaulting Underwriter. If the Performing Underwriter elects not to exercise
such option, then this Agreement will terminate without liability on the part of
the Performing Underwriter. Nothing contained herein shall relieve the
Defaulting Underwriter from any and all liabilities to the Sponsor, the Seller
and the Performing Underwriter resulting from the default of the Defaulting
Underwriter.
[remainder of page deliberately left blank]
36
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<PAGE>
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us a counterpart hereof, whereupon this instrument
along with all counterparts will become a binding agreement between you, the
Sponsor and the Seller in accordance with its terms.
Very truly yours,
CARGILL FINANCIAL SERVICES CORPORATION
By: /s/ Kenneth M. Duncan
_________________________________
Name: Kenneth M. Duncan
Title: Senior Vice President
ACCESS FINANCIAL LENDING CORP.
By: /s/ Leslie Zejdlik Foster
__________________________________
Name: Leslie Zejdlik Foster
Title: President
CONFIRMED AND ACCEPTED, as of
the date first above written:
PRUDENTIAL SECURITIES INCORPORATED
By: /s/ Valerie Kay
__________________________________
Name: Valerie Kay
Title: Vice President
J.P. MORGAN SECURITIES INC.
By: /s/ Peggy Wallace
__________________________________
Name: Peggy Wallace
Title: Vice President
[Underwriting Agreement]
<PAGE>
<PAGE>
Schedule 1
Underwriting
Class A-1
--------------------
Purchase Price
Percentage Proceeds
(excluding Principal (excluding
Underwriter accrued interest) Amount accrued interest)
----------- ----------------- ------ -----------------
Prudential 100.000% $43,456,000.00 $43,456,000.00
Securities
Incorporated
J.P. Morgan 100.000 15,000,000.00 15,000,000.00
Securities Inc. ------- ------------- -------------
TOTAL $58,456,000.00 $58,456,000.00
Class A-2
--------------------
Purchase Price
Percentage Proceeds
(excluding Principal (excluding
Underwriter accrued interest) Amount accrued interest)
----------- ----------------- ------ -----------------
Prudential 99.96875% $28,768,000.00 $28,759,010.00
Securities
Incorporated
J.P. Morgan 99.96875 10,000,000.00 9,996,875.00
Securities Inc. -------- ------------- ------------
TOTAL $38,768,000.00 $38,755,885.00
Class A-3
--------------------
Purchase Price
Percentage Proceeds
(excluding Principal (excluding
Underwriter accrued interest) Amount accrued interest)
----------- ----------------- ------ -----------------
Prudential 99.921875% $16,525,000.00 $16,512,089.84
Securities
Incorporated
J.P. Morgan __ __ __
Securities Inc.
----------- -------------- --------------
TOTAL $16,525,000.00 $16,512,089.84
<PAGE>
<PAGE>
Class A-4
--------------------
Purchase Price
Percentage Proceeds
(excluding Principal (excluding
Underwriter accrued interest) Amount accrued interest)
----------- ----------------- ------ -----------------
Prudential 99.9375% $14,713,000.00 $14,703,804.38
Securities
Incorporated
J.P. Morgan __ __ __
Securities Inc.
-------- -------------- --------------
TOTAL $14,713,000.00 $14,703,804.38
Class A-5
--------------------
Purchase Price
Percentage Proceeds
(excluding Principal (excluding
Underwriter accrued interest) Amount accrued interest)
----------- ----------------- ------ -----------------
Prudential 99.90625% $13,796,000.00 $13,783,066.25
Securities
Incorporated
J.P. Morgan __ __ __
Securities Inc.
---------- -------------- --------------
TOTAL $13,796,000.00 $13,783,066.25
Class A-6
--------------------
Purchase Price
Percentage Proceeds
(excluding Principal (excluding
Underwriter accrued interest) Amount accrued interest)
----------- ----------------- ------ -----------------
Prudential 100.000% $51,344,000.00 $51,344,000.00
Securities
Incorporated
J.P. Morgan 100.000 17,000,000.00 17,000,000.00
------- ------------- -------------
Securities Inc.
TOTAL $68,344,000.00 $68,344,000.00
<PAGE>
<PAGE>
EXECUTION COPY
SECURITIZATION SPONSORSHIP AGREEMENT
Between
ACCESS FINANCIAL LENDING CORP.
and
CARGILL FINANCIAL SERVICES CORPORATION
Dated as of May 1, 1996
<PAGE>
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE ONE DEFINITIONS .................................................... 2
Section 1.01. Definitions ............................................. 2
ARTICLE TWO AGREEMENT TO CREATE TRUST; AGREEMENT TO CONVEY
MORTGAGE LOANS; ASSIGNMENT ..................................... 2
Section 2.01. Agreement to Create Trust ............................... 2
Section 2.02. Agreement to Convey Mortgage Loans ...................... 2
Section 2.03. Possession of Files ..................................... 2
Section 2.04. Books and Records ....................................... 3
Section 2.05. Cost of Delivery and Recordation of
Documents ............................................... 3
Section 2.06. Assignment of Agreement ................................. 3
ARTICLE THREE REPRESENTATIONS AND WARRANTIES ............................... 3
Section 3.01. Representations and Warranties of
AFL ..................................................... 3
Section 3.02. Representations and Warranties of
the Sponsor ............................................. 4
ARTICLE FOUR CERTAIN COVENANTS OF AFL ...................................... 5
Section 4.01. Further Assurances ...................................... 5
Section 4.02. Indemnification ......................................... 6
ARTICLE FIVE MISCELLANEOUS ................................................. 6
Section 5.01. Notices ................................................. 6
Section 5.02. Severability of Provisions .............................. 6
Section 5.03. Survival ................................................ 7
Section 5.04. Effect of Headings and Table of
Contents ................................................ 7
Section 5.05. Successors and Assigns .................................. 7
Section 5.06. Miscellaneous ........................................... 7
Section 5.07. Amendments .............................................. 7
Section 5.08. Third-Party Beneficiaries ............................... 8
Section 5.10. GOVERNING LAW; CONSENT TO JURISDICTION;
WAIVER OF JURY TRIAL .................................... 8
Section 5.11. Execution in Counterparts ............................... 9
Exhibit A - Mortgage Loan Schedule
<PAGE>
<PAGE>
This Securitization Sponsorship Agreement, dated as of May 1, 1996 (this
"Agreement"), by and between ACCESS FINANCIAL LENDING CORP., a Delaware
corporation, its successors and assigns ("AFL"), and CARGILL FINANCIAL SERVICES
CORPORATION, a Delaware corporation and its successors and assigns (the
"Sponsor").
W I T N E S S E T H:
WHEREAS, Exhibit A attached hereto and made a part hereof lists certain
mortgage loans (the "Mortgage Loans") owned by AFL that AFL desires to include
in a securitization transaction; and
WHEREAS, the Sponsor has previously filed a Registration Statement with the
Securities and Exchange Commission which allows for the registration of certain
types of asset-backed securities issued by the Sponsor thereunder; and
WHEREAS, the Sponsor is willing to create a trust (the "Trust") for which
Norwest Bank Minnesota, National Association (the "Trustee") is willing to act
as Trustee; and
WHEREAS, the Sponsor is willing to direct the Trust to acquire the Mortgage
Loans from AFL and to issue certain asset-backed securities representing
interests in the Trust (the "Certificates"); and
WHEREAS, the Sponsor is willing to act as the "Issuer" of the Certificates
in its capacity as the "manager" of the Trust, as described and provided in
Section 2(4) of the Securities Act of 1933, as amended, and to assume the
responsibilities, obligations and liabilities appurtenant to its status as an
issuer of securities; and
WHEREAS, AFL is willing to act as the "sponsor" of each "real estate
mortgage investment conduit" ("REMIC") to be created by the Trust within the
meaning of Section 1.860F-1 of the Regulations issued under the Internal Revenue
Code of 1986, as amended, and to assume the responsibilities, obligations and
liabilities appurtenant to its status as the sponsor of such REMICS;
NOW, THEREFORE, in consideration of the premises and the mutual agreements
hereinafter set forth, the parties hereto agree as follows:
<PAGE>
<PAGE>
ARTICLE ONE
DEFINITIONS
Section 1.01. Definitions. Capitalized terms used herein that are not
otherwise defined shall have the respective meanings ascribed thereto in the
Pooling and Servicing Agreement dated as of May 1, 1996 (the "Pooling and
Servicing Agreement") among the Sponsor, AFL as the Seller and Master Servicer,
and the Trustee.
ARTICLE TWO
AGREEMENT TO CREATE TRUST; AGREEMENT TO CONVEY MORTGAGE LOANS; ASSIGNMENT
Section 2.01. Agreement to Create Trust. (a) Subject to the terms and
conditions of this Agreement, the Sponsor agrees to create the Trust under the
Pooling and Servicing Agreement and to direct the Trust to acquire the Mortgage
Loans listed in the Mortgage Loan Schedule, which schedule is attached hereto as
Exhibit A. The Mortgage Loan Schedule shall conform to the requirements of the
Sponsor and to the definition of "Mortgage Loan Schedule" under the Pooling and
Servicing Agreement.
Upon the Trust's acquisition of the Mortgage Loans, the Sponsor will
further direct the Trust to issue the Certificates. The transactions described
in this paragraph (a) are the "Securitization".
(b) The closing for the Securitization shall take place at the offices of
Dewey Ballantine, New York, New York, at 10:00 a.m., New York time, on May 22,
1996 or such other place and time as the parties shall agree (such time being
herein referred to as the "Closing Date").
Section 2.02. Agreement to Convey Mortgage Loans. On the Closing Date, AFL
shall sell, transfer, assign, set over and convey to the Trust, without recourse
but subject to the terms of this Agreement, all of its right, title and interest
in and to the Mortgage Loans (including, without limitation, the security
interests created thereby), and all its right, title and interest in and to (i)
scheduled payments of interest due on each Mortgage Loan after the Cut-Off Date,
(ii) scheduled payments of principal due, and unscheduled collections of
principal received, on each Mortgage Loan on and after the Cut-Off Date, (iii)
the Insurance Policies, and (iv) escrow accounts.
Section 2.03. Possession of Files. Upon the sale of the Mortgage Loans, the
ownership of each related Mortgage Loan and the contents of the related File
shall immediately
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vest in the Trust. The contents of any File in the possession of AFL at any time
after such sale, and any scheduled payments of principal and interest on the
Mortgage Loans due after the Cut-Off Date and received by AFL, shall be held in
trust by AFL for the benefit of the Trust as the owner thereof, and shall be
promptly delivered by AFL to or upon the order of the Sponsor on behalf of the
Trust.
Section 2.04. Books and Records. The conveyance of each Mortgage Loan to
the Trust shall be reflected on AFL's accounting and other records, balance
sheet and other financial statements as a sale of assets by AFL to the Trust.
AFL shall be responsible for maintaining, and shall maintain, a complete set of
books and records for each Mortgage Loan which shall be clearly marked to
reflect the ownership of each Mortgage Loan by the Trust for the benefit of the
Owners.
Section 2.05. Cost of Delivery and Recordation of Documents. The costs
relating to the delivery and recordation of the documents specified in this
Article Two in connection with the Mortgage Loans shall be borne by AFL.
Section 2.06. Assignment of Agreement. AFL hereby acknowledges and agrees
that the Sponsor intends to assign its interest (other than the Unassigned
Rights (as defined in Section 4.02(a) hereof)) under this Agreement to the
Trustee as may be required to effect the purposes of the Pooling and Servicing
Agreement, without further notice to, or consent of, AFL, and the Trustee shall
succeed to such of the rights and obligations of the Sponsor hereunder as shall
be so assigned.
ARTICLE THREE
REPRESENTATIONS AND WARRANTIES
Section 3.01. Representations and Warranties of AFL. AFL hereby represents,
warrants and covenants to the Sponsor as of the Startup Day that:
(a) AFL is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware and is in good standing as
a foreign corporation in each jurisdiction in which the nature of its
business, or the properties owned or leased by it make such qualification
necessary. AFL has all requisite corporate power and authority to own and
operate its properties, to enable it to carry out its business as presently
conducted in a material manner and as proposed to be conducted and to enter
into and discharge its obligations under this Agreement in a material
manner.
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<PAGE>
(b) The execution and delivery of this Agreement by AFL, and its
performance and compliance with the terms of this Agreement have been duly
authorized by all necessary corporate action on the part of AFL and will
not violate AFL's Certificate of Incorporation or Bylaws 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 AFL is a party or by which
AFL is bound, or violate any statute or any order, rule or regulation of
any court, governmental agency or body or other tribunal having
jurisdiction over AFL or any of its properties.
(c) This Agreement, assuming due authorization, execution and delivery
by the other parties hereto and thereto, constitutes a valid, legal and
binding obligation of AFL, enforceable against it in accordance with the
terms hereof, except as the enforcement hereof may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally and by general principles of equity
(whether considered in a proceeding or action in equity or at law).
(d) AFL 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 might have consequences that would materially
and adversely affect the condition (financial or other) or operations of
AFL or its properties or might have consequences that would materially and
adversely affect its performance hereunder.
(e) No litigation is pending or, to the best of AFL's knowledge,
threatened against AFL which litigation might have consequences that would
prohibit its entering into this Agreement or that would materially and
adversely affect the condition (financial or otherwise) or operations of
AFL or its properties or might have consequences that would materially and
adversely affect its performance hereunder.
Section 3.02. Representations and Warranties of the Sponsor. The Sponsor
hereby represents and warrants to AFL, as of the date of execution of this
Agreement and the Startup Date, that:
(a) The Sponsor is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware;
(b) The Sponsor has the corporate power and authority to create the Trust,
cause the Trust to acquire the
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<PAGE>
Mortgage Loans and issue the Certificates and to execute, deliver and perform,
and to enter into and consummate all the transactions contemplated by this
Agreement;
(c) This Agreement has been duly and validly authorized, executed and
delivered by the Sponsor, and, assuming the due authorization, execution and
delivery hereof by AFL, constitutes the legal, valid and binding agreement of
the Sponsor, enforceable against the Sponsor in accordance with its terms,
except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the
rights of creditors generally, and by general equity principles (regardless of
whether such enforcement is considered in a proceeding in equity or at law);
(d) No consent, approval, authorization or order of or registration or
filing with, or notice to, any governmental authority or court is required for
the execution, delivery and performance of or compliance by the Sponsor with
this Agreement or the consummation by the Sponsor of any of the transactions
contemplated hereby, except such as have been made on or prior to the Closing
Date; and
(e) None of the execution and delivery of this Agreement, the consummation
of the other transactions contemplated hereby, or the fulfillment of or
compliance with the terms and conditions of this Agreement, (i) conflicts or
will conflict with the charter or bylaws of the Sponsor or conflicts or will
conflict with or results or will result in a breach of, or constitutes or will
constitute a default or results or will result in an acceleration under, any
term, condition or provision of any indenture, deed of trust, contract or other
agreement or other instrument to which the Sponsor is a party or by which it is
bound and which is material to the Sponsor, or (ii) results or will result in a
violation of any law, rule, regulation, order, judgment or decree of any court
or governmental authority having jurisdiction over the Sponsor.
ARTICLE FOUR
CERTAIN COVENANTS OF AFL
Section 4.01. Further Assurances. AFL hereby agrees to do all acts,
transactions, and things and to execute and deliver all agreements, documents,
instruments, and papers by and on behalf of AFL as the Sponsor or its counsel
may reasonably request in order to consummate the transfer of the Mortgage Loans
to the Trust and the rating, issuance and sale of the Certificates.
5
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<PAGE>
Section 4.02. Indemnification. (a) AFL agrees to indemnify the Sponsor, its
officers and directors and "controlling persons" within the meaning of the
Federal securities laws from and against any losses, claims, actions or
liabilities suffered or incurred by the Sponsor in connection with the
Securitization, except to the extent any such losses, claims, etc., relate to
the "Sponsor Offering Materials", as defined in the Underwriting Agreement dated
as of May 15, 1996 (the "Underwriting Agreement") among AFL, the Sponsor,
Prudential Securities Incorporated and J.P. Morgan Securities Inc. The rights of
the Sponsor under this Section 4.02(a) are the "Unassigned Rights" which are not
being assigned to the Trustee.
(b) The Sponsor agrees to indemnify AFL, its officers and directors and
"controlling persons" within the meaning of the federal securities laws from and
against any losses, claims, actions or liabilities suffered or incurred by AFL
relating to the Sponsor Offering Materials, as defined in the Underwriting
Agreement.
ARTICLE FIVE
MISCELLANEOUS
Section 5.01. Notices. All demands, notices and communications hereunder
shall be given as follows, until any superseding instructions are given to all
other persons listed below:
AFL: Access Financial Lending Corp.
12800 Whitewater Drive, Suite 200
Minnetonka, Minnesota 55343
Attention: Operations
Tel: (612) 984-0979
Fax: (612) 984-0877
The Sponsor: Cargill Financial Services Corporation
6000 Clearwater Drive
Minnetonka, Minnesota 55343-9497
Attention: Corporate Capital Group
Tel: (612) 984-3058
Fax: (612) 984-3910
Section 5.02. Severability of Provisions. Any part, provision,
representation, warranty or covenant of this Agreement which is prohibited or
which is held to be void or unenforceable shall be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof. Any part, provision, representation, warranty or covenant of
this Agreement which is prohibited or unenforceable or is held to be void or
unenforceable in any jurisdiction shall, as to such
6
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<PAGE>
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction as to any Mortgage Loan
shall not invalidate or render unenforceable such provision in any other
jurisdiction. To the extent permitted by applicable law, the parties hereto
waive any provision of law which prohibits or renders void or unenforceable any
provision hereof.
Section 5.03. Survival. The parties to this Agreement agree that the
representations, warranties and agreements made by each of them herein and in
any certificate or other instrument delivered pursuant hereto shall be deemed to
be relied upon by the other party hereto, notwithstanding any investigation
heretofore or hereafter made by such other party or on such other party's
behalf, and that the representations, warranties and agreements made by the
parties hereto in this Agreement or in any such certificate or other instrument
shall survive the execution and delivery of this Agreement and the delivery of
and payment for the Mortgage Loans pursuant to the Pooling and Servicing
Agreement.
Section 5.04. Effect of Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.
Section 5.05. Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective
successors and permitted assigns. Except as expressly permitted by the terms
hereof, this Agreement may not be assigned, pledged or hypothecated by any party
hereto to a third party without the written consent of the other party to this
Agreement; provided, however, that the Sponsor may assign its rights hereunder
without the consent of AFL.
Section 5.06. Miscellaneous. This Agreement supersedes all prior agreements
and understandings relating to the subject matter hereof.
Section 5.07. Amendments. (a) This Agreement may be amended from time to
time by AFL and the Sponsor by written agreement without notice to or consent of
the Owners, but with the consent of the Certificate Insurer, to cure any
ambiguity, to correct or supplement any provisions herein, to comply with any
changes in the Code, or to make any other provisions with respect to matters or
questions arising under this Agreement which shall not be inconsistent with the
provisions of this Agreement; provided, however, that such action shall not, as
evidenced by an Opinion of Counsel, at the expense of the party requesting the
change, delivered to the Trustee and the Certificate Insurer, adversely affect
in any material respect
7
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<PAGE>
the interests of any Owner; provided, further, that no such amendment shall
reduce in any manner the amount of, or delay the timing of, payments received on
Mortgage Loans which are required to be distributed on any Certificate without
the consent of the Owner of such Certificate, or change the rights or
obligations of any other party hereto without the consent of such party.
(b) It shall not be necessary for the consent of Owners under this Section
to approve the particular form of any proposed amendment, but it shall be
sufficient if such consent shall approve the substance thereof.
(c) The Owners, if they so request, shall be provided with copies of any
amendments to this Agreement, together with copies of any opinions or other
documents or instruments executed in connection therewith.
Section 5.08. Third-Party Beneficiaries. The parties agree that each of the
Certificate Insurer and the Trustee is an intended third-party beneficiary of
this Agreement to the extent necessary to enforce the rights and to obtain the
benefit of the remedies of the Sponsor under this Agreement which are assigned
to the Trustee for the benefit of the Owners pursuant to the Pooling and
Servicing Agreement and to the extent necessary to obtain the benefit of the
enforcement of the obligations and covenants of AFL under Section 4.01 of this
Agreement.
Section 5.10. GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
INTERNAL LAWS (AS OPPOSED TO CONFLICT OF LAWS PROVISIONS) OF THE STATE OF NEW
YORK.
(b) THE SPONSOR AND AFL EACH HEREBY SUBMITS TO THE NON-EXCLUSIVE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND THE UNITED STATES
DISTRICT COURT LOCATED IN THE BOROUGH OF MANHATTAN IN NEW YORK CITY, AND EACH
WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS UPON IT AND CONSENTS THAT ALL
SUCH SERVICE OF PROCESS BE MADE BY REGISTERED MAIL DIRECTED TO THE ADDRESS SET
FORTH IN SECTION 5.01 OF THIS AGREEMENT AND SERVICE SO MADE SHALL BE DEEMED TO
BE COMPLETED FIVE DAYS AFTER THE SAME SHALL HAVE BEEN DEPOSITED IN THE U.S.
MAILS, POSTAGE PREPAID. THE SPONSOR AND AFL EACH HEREBY WAIVES ANY OBJECTION
BASED ON FORUM NON CONVENIENS, AND ANY OBJECTION TO VENUE OF ANY ACTION
INSTITUTED HEREUNDER AND CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE
RELIEF AS IS DEEMED APPROPRIATE BY THE COURT. NOTHING IN THIS SECTION SHALL
AFFECT THE RIGHT OF THE SPONSOR AND AFL TO SERVE LEGAL PROCESS IN ANY OTHER
MANNER PERMITTED BY LAW OR AFFECT EITHER'S RIGHT TO BRING ANY ACTION OR
PROCEEDING IN THE COURTS OF ANY OTHER JURISDICTION.
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(c) THE SPONSOR AND AFL EACH HEREBY WAIVES ANY RIGHT TO HAVE A JURY
PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT, OR
OTHERWISE ARISING OUT OF, CONNECTED WITH, RELATED TO, OR IN CONNECTION WITH THIS
AGREEMENT. INSTEAD, ANY DISPUTE RESOLVED IN COURT WILL BE RESOLVED IN A BENCH
TRIAL WITHOUT A JURY.
Section 5.11. Execution in Counterparts. This Agreement may be executed in
any number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.
[Signatures Commence on Following Page]
9
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused their names to be signed
by their respective officers thereunto duly authorized as of the date first
above written.
ACCESS FINANCIAL LENDING CORP.
By: /s/ Leslie Zejdlik Foster
________________________________
Name: Leslie Zejdlik Foster
Title: President
CARGILL FINANCIAL SERVICES
CORPORATION
By: /s/ Kenneth M. Duncan
________________________________
Name: Kenneth M. Duncan
Title: Senior Vice President
[Securitization Sponsorship Agreement]
<PAGE>
<PAGE>
EXHIBIT A
MORTGAGE LOAN SCHEDULE
[On file with Access Financial Lending Corp.]
A-1
<PAGE>
<PAGE>
EXECUTION COPY
POOLING AND SERVICING AGREEMENT
Relating to
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-2
Among
CARGILL FINANCIAL SERVICES CORPORATION,
as Sponsor,
ACCESS FINANCIAL LENDING CORP.,
as Seller and Master Servicer,
and
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
as Trustee
Dated as of May 1, 1996
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TABLE OF CONTENTS
(Not a Part of this Agreement)
Page
Parties.............................................................. 1
Recitals............................................................. 1
ARTICLE I DEFINITIONS; RULES OF CONSTRUCTION.................. 1
1.1. Definitions............................................ 1
Access Financial Loan Purchase Trust................ 1
Account............................................. 2
Accrual Period...................................... 2
Affiliate........................................... 2
Agreement........................................... 2
Appraised Value..................................... 2
Auction Call........................................ 2
Authorized Officer.................................. 2
Base Group I Principal Distribution
Amount........................................... 2
Base Group II Principal Distribution
Amount........................................... 3
Business Day........................................ 3
Carry-Forward Amount................................ 3
Certificate......................................... 3
Certificate Account................................. 4
Certificate Insurance Policy........................ 4
Certificate Insurer................................. 4
Certificateholder................................... 4
Class............................................... 4
Class A Certificates................................ 4
Class A Group I Certificates........................ 4
Class A Group I Distribution Account................ 4
Class A Group II Distribution Account............... 4
Class A-1 Distribution Amount....................... 4
Class A-1 Group I Certificates...................... 5
Class A-1 Interest Carry-Forward Amount............. 5
Class A-1 Interest Distribution Amount.............. 5
Class A-1 Pass-Through Rate......................... 5
Class A-1 Principal Balance......................... 5
Class A-1 Principal Carry-Forward
Amount........................................... 5
Class A-1 Principal Distribution Amount............. 6
Class A-1 Termination Date.......................... 6
Class A-2 Distribution Amount....................... 6
Class A-2 Group I Certificates...................... 6
Class A-2 Interest Carry-Forward Amount............. 6
Class A-2 Interest Distribution Amount.............. 6
Class A-2 Pass-Through Rate......................... 6
Class A-2 Principal Balance......................... 6
Class A-2 Principal Carry-Forward
Amount........................................... 7
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Class A-2 Principal Distribution Amount............. 7
Class A-2 Termination Date.......................... 7
Class A-3 Distribution Amount....................... 7
Class A-3 Group I Certificates...................... 7
Class A-3 Interest Carry-Forward Amount............. 7
Class A-3 Interest Distribution Amount.............. 8
Class A-3 Pass-Through Rate......................... 8
Class A-3 Principal Balance......................... 8
Class A-3 Principal Carry-Forward
Amount........................................... 8
Class A-3 Principal Distribution Amount............. 8
Class A-3 Termination Date.......................... 9
Class A-4 Distribution Amount....................... 9
Class A-4 Group I Certificates...................... 9
Class A-4 Interest Carry-Forward Amount............. 9
Class A-4 Interest Distribution Amount.............. 9
Class A-4 Pass-Through Rate......................... 9
Class A-4 Principal Balance......................... 9
Class A-4 Principal Carry-Forward
Amount........................................... 9
Class A-4 Principal Distribution Amount............. 10
Class A-5 Distribution Amount....................... 10
Class A-5 Group I Certificates...................... 10
Class A-5 Interest Carry-Forward Amount............. 10
Class A-5 Interest Distribution Amount.............. 10
Class A-5 Pass-Through Rate......................... 10
Class A-5 Principal Balance......................... 11
Class A-5 Principal Carry-Forward
Amount........................................... 11
Class A-5 Principal Distribution Amount............. 11
Class A-6 Distribution Account...................... 11
Class A-6 Distribution Amount....................... 11
Class A-6 Formula Distribution Amount............... 11
Class A-6 Formula Pass-Through Rate................. 12
Class A-6 Full Distribution Amount.................. 12
Class A-6 Full Interest Distribution
Amount........................................... 12
Class A-6 Interest Carry-Forward Amount............. 12
Class A-6 Interest Distribution Amount.............. 12
Class A-6 Pass-Through Rate......................... 12
Class A-6 Principal Balance......................... 12
Class A-6 Principal Carry-Forward
Amount........................................... 13
Class A-6 Principal Distribution Amount............. 13
Class A-6 Group II Certificates..................... 13
Class B Certificates................................ 13
Class B Group I Carry-Forward Amount................ 13
Class B Group I Certificates........................ 13
Class B Group I Distribution Account................ 13
Class B Group I Distribution Amount................. 13
Class B Group I Interest............................ 14
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Class B Group I Interest Distribution
Amount........................................... 14
Class B Group I Principal Balance................... 14
Class B Group II Carry-Forward Amount............... 15
Class B Group II Certificates....................... 15
Class B Group II Distribution Account............... 15
Class B Group II Distribution Amount................ 15
Class B Group II Interest........................... 15
Class B Group II Interest Distribution
Amount........................................... 15
Class B Group II Principal Balance.................. 15
Class BI-S Certificate.............................. 16
Class BII-S Certificate............................. 16
Class LT1 Certificates.............................. 16
Class LT2 Certificates.............................. 16
Class LT3 Certificates.............................. 16
Class LT4 Certificates.............................. 16
Class LT5 Certificates.............................. 17
Class LT6 Certificates.............................. 17
Class RL Certificates............................... 17
Class RU Certificates............................... 17
Code................................................ 17
Compensating Interest............................... 17
Coupon Rate......................................... 17
Cumulative Net Realized Losses...................... 17
Cut-Off Date........................................ 17
Delinquency Advance................................. 17
Delinquent.......................................... 17
Delivery Order...................................... 17
Depository.......................................... 18
Designated Depository Institution................... 18
Designated Residual Holder.......................... 18
Determination Date.................................. 18
Disqualified Organization........................... 18
Distribution Accounts............................... 18
Eligible Investments................................ 19
Event of Default.................................... 19
FDIC................................................ 19
FHLMC............................................... 19
File................................................ 19
First Mortgage Loan................................. 19
FNMA................................................ 19
Group I Allocable Losses............................ 19
Group I Available Funds............................. 19
Group I Certificates................................ 19
Group I Cumulative Crossover Amount................. 20
Group I Cumulative Net Realized Losses.............. 20
Group I Excess Subordinated Amount.................. 20
Group I............................................. 20
Group I Insured Distribution Amount................. 20
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Group I Insured Interest Distribution
Amount........................................... 20
Group I Insured Payment............................. 20
Group I Insured Principal Distribution
Amount........................................... 20
Group I Interest Remittance Amount.................. 21
Group I Monthly Remittance.......................... 21
Group I Mortgage Loans.............................. 21
Group I Pool Delinquency Rate....................... 21
Group I Pool Principal Balance...................... 21
Group I Premium Amount.............................. 21
Group I Principal Distribution Amount............... 21
Group I Principal Remittance Amount................. 22
Group I Rolling Three Month Delinquency
Rate............................................. 22
Group I Shortfall Amount............................ 22
Group I Specified Subordinated Amount............... 22
Group I Subordinated Amount......................... 22
Group I Subordination Deficiency Amount............. 23
Group I Subordination Deficit....................... 23
Group I Subordination Increase Amount............... 23
Group I Subordination Reduction Amount.............. 23
Supplemental Interest Payment Account............... 23
Group I Total Available Funds....................... 23
Group I Trustee's Fee............................... 24
Group II Allocable Losses........................... 24
Group II Available Funds............................ 24
Group II Base Subordinated Amount................... 24
Group II Certificates............................... 24
Group II Cumulative Crossover Amount................ 24
Group II Cumulative Net Realized Losses............. 24
Group II Excess Subordinated Amount................. 24
Group II............................................ 24
Group II Insured Distribution Amount................ 25
Group II Insured Interest Distribution
Amount........................................... 25
Group II Insured Payment............................ 25
Group II Insured Principal Distribution
Amount........................................... 25
Group II Interest Remittance Amount................. 25
Group II Monthly Remittance......................... 25
Group II Mortgage Loans............................. 25
Group II Pool Delinquency Rate...................... 25
Group II Pool Principal Balance..................... 26
Group II Premium Amount............................. 26
Group II Principal Distribution Amount.............. 26
Group II Principal Remittance Amount................ 26
Group II Rolling Three Month Delinquency
Rate............................................. 26
Group II Shortfall Amount........................... 26
Group II Specified Subordinated Amount.............. 27
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Group II Subordinated Amount........................ 27
Group II Subordination Deficiency
Amount........................................... 27
Group II Subordination Deficit...................... 27
Group II Subordination Increase Amount.............. 27
Group II Subordination Reduction Amount............. 27
Supplemental Interest Payment Account............... 27
Group II Total Available Funds...................... 28
Group II Trigger Event.............................. 28
Group II Trustee's Fee.............................. 28
Highest Lawful Rate................................. 28
Insurance Agreement................................. 28
Insurance Policy.................................... 28
Insurance Proceeds.................................. 28
Insured Payment..................................... 28
Interest Advance.................................... 28
Interest Advance Reimbursement Amount............... 28
Interest Determination Date......................... 28
LIBOR............................................... 28
Liquidated Loan..................................... 29
Liquidation Expenses................................ 29
Liquidation Proceeds................................ 29
Loan Purchase Price................................. 29
Loan-to-Value Ratio................................. 30
London Business Day................................. 30
Lower Tier Distribution Amount...................... 30
Lower-Tier Interests................................ 30
Lower-Tier REMIC.................................... 30
Master Servicer..................................... 30
Master Servicer's Trust Receipt..................... 30
Master Servicing Fee................................ 30
Monthly Remittance.................................. 30
Moody's............................................. 31
Mortgage............................................ 31
Mortgage Loan....................................... 31
Mortgage Loan Group................................. 31
Mortgage Loan Schedules............................. 31
Mortgagor........................................... 31
Net Insurance Proceeds.............................. 32
Net Liquidation Proceeds............................ 32
Net Proceeds........................................ 32
Net Realized Loss................................... 32
Net Released Mortgage Property Proceeds............. 32
Net Weighted Average Coupon Rate.................... 32
Nonrecoverable Advances............................. 32
Note................................................ 32
Officer's Certificate............................... 33
Operative Documents................................. 33
Original Group I Pool Principal Balance............. 33
Original Group II Pool Principal
Balance.......................................... 33
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Original Pool Principal Balance..................... 33
Original Principal Balance.......................... 33
Outstanding......................................... 33
Owner............................................... 34
Payment Date........................................ 34
Percentage Interest................................. 34
Person.............................................. 34
Pool Delinquency Rate............................... 34
Pool Principal Balance.............................. 34
Pool Rolling Three Month Delinquency
Rate............................................. 34
Preference Amount................................... 34
Premium Amount...................................... 36
Prepayment.......................................... 36
Preservation Expenses............................... 36
Principal and Interest Account...................... 36
Principal Balance................................... 36
Principal Remittance Amounts........................ 36
Prohibited Transaction.............................. 37
Property............................................ 37
Prospectus.......................................... 37
Prospectus Supplement............................... 37
Qualified Liquidation............................... 37
Qualified Mortgage.................................. 37
Qualified Replacement Mortgage...................... 37
Rating Agency....................................... 38
Record Date......................................... 38
Reference Banks..................................... 38
Register............................................ 38
Registration Statement.............................. 39
Reimbursable Advances............................... 39
Released Mortgaged Property Proceeds................ 39
REMIC............................................... 39
REMIC Provisions.................................... 39
REMIC Reporting Fee................................. 39
REMIC Trust......................................... 39
Remittance Date..................................... 39
Remittance Period................................... 39
REO Property........................................ 39
Replacement Cut-Off Date............................ 40
Representation Letter............................... 40
Reserve Interest Rate............................... 40
Residual Certificate................................ 40
S&P................................................. 40
Second Mortgage Loan................................ 40
Seller.............................................. 40
Senior Lien......................................... 40
Servicing Advance................................... 40
Servicing Standards................................. 40
Sponsor............................................. 40
Sponsorship Agreement............................... 41
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Startup Day......................................... 41
Sub-Servicer........................................ 41
Sub-Servicing Agreement............................. 41
Substitution Amount................................. 41
Supplemental Interest Payment Amount................ 41
Supplemental Interest Trust......................... 41
Tax Matters Person.................................. 41
Trust............................................... 41
Trust Estate........................................ 41
Trustee............................................. 42
Trustee's Fee....................................... 42
Underwriters........................................ 42
Unregistered Certificate............................ 42
Upper-Tier REMIC.................................... 42
1.2. Use of Words and Phrases............................... 42
1.3. Captions; Table of Contents............................ 42
1.4. Opinions............................................... 42
1.5. Calculations........................................... 43
ARTICLE II THE TRUST........................................... 43
2.1. Establishment of the Trust............................. 43
2.2. Office................................................. 43
2.3. Purpose and Powers..................................... 43
2.4. Appointment of the Trustee; Declaration of
Trust............................................... 43
2.5. Expenses of the Trust.................................. 44
2.6. Ownership of the Trust................................. 44
2.7. Receipt of Trust Estate................................ 44
2.8. Miscellaneous REMIC Provisions......................... 44
ARTICLE III REPRESENTATIONS, WARRANTIES AND
COVENANTS OF THE SPONSOR, THE SELLER AND
THE MASTER SERVICER; CONVEYANCE OF
MORTGAGE LOANS...................................... 46
3.1. Representations and Warranties of the
Sponsor, the Seller and the Master
Servicer............................................ 46
3.2. Covenants of the Seller to Take Certain
Actions with Respect to the Mortgage
Loans in Certain Situations......................... 53
3.3. Conveyance of the Mortgage Loans and
Qualified Replacement Mortgages..................... 65
3.4. Acceptance by Trustee; Certain
Substitutions of Mortgage Loans;
Certification by Trustee............................ 68
3.5. Cooperation Procedures................................. 71
ARTICLE IV ISSUANCE AND SALE OF CERTIFICATES................... 71
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4.1. Issuance of Certificates............................... 71
4.2. Sale of Certificates................................... 71
ARTICLE V CERTIFICATES AND TRANSFER OF INTERESTS.............. 72
5.1. Terms.................................................. 72
5.2. Forms.................................................. 72
5.3. Execution, Authentication and Delivery................. 72
5.4. Registration and Transfer of Certificates.............. 73
5.5. Mutilated, Destroyed, Lost or Stolen
Certificates........................................ 75
5.6. Persons Deemed Owners.................................. 76
5.7. Cancellation........................................... 76
5.8. Limitation on Transfer of Ownership
Rights.............................................. 76
5.9. Assignment of Rights................................... 77
ARTICLE VI COVENANTS........................................... 78
6.1. Distributions.......................................... 78
6.2. Money for Distributions to be Held in
Trust; Withholding.................................. 78
6.3. Protection of Trust Estate............................. 79
6.4. Performance of Obligations............................. 80
6.5. Negative Covenants..................................... 80
6.6. No Other Powers........................................ 80
6.7. Limitation of Suits.................................... 80
6.8. Unconditional Rights of Owners to Receive
Distributions....................................... 81
6.9. Rights and Remedies Cumulative......................... 81
6.10. Delay or Omission Not Waiver.......................... 82
6.11. Control by Owners..................................... 82
ARTICLE VII ACCOUNTS, FLOW OF FUNDS, DISTRIBUTIONS
AND REPORTS......................................... 82
7.1. Collection of Money.................................... 82
7.2. Establishment of Accounts.............................. 83
7.3. Flow of Funds.......................................... 83
7.4. Investment of Accounts................................. 90
7.5. Eligible Investments................................... 90
7.6. Reports by Trustee..................................... 92
7.7. Drawings under the Certificate Insurance
Policy and Reports by Trustee....................... 96
7.8. Allocation of Realized Losses.......................... 97
7.9. Supplemental Interest Payments......................... 97
ARTICLE VIII TERMINATION OF TRUST................................ 99
8.1. Termination of Trust................................... 99
8.2. Termination Upon Option of the Seller..................100
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8.3. Auction Call...........................................101
8.4. Disposition of Proceeds................................102
ARTICLE IX THE TRUSTEE.........................................102
9.1. Certain Duties and Responsibilities....................102
9.2. Removal of Trustee for Cause...........................105
9.3. Certain Rights of the Trustee..........................106
9.4. Not Responsible for Recitals or Issuance
of Certificates.....................................107
9.5. May Hold Certificates..................................107
9.6. Money Held in Trust....................................107
9.7. Compensation and Reimbursement.........................108
9.8. Corporate Trustee Required; Eligibility................108
9.9. Resignation and Removal; Appointment of
Successor...........................................108
9.10. Acceptance of Appointment by Successor
Trustee.............................................109
9.11. Merger, Conversion, Consolidation or
Succession to Business of the Trustee...............110
9.12. Reporting; Withholding................................110
9.13. Liability of the Trustee..............................111
9.14. Appointment of Co-Trustee or Separate
Trustee.............................................112
ARTICLE X SERVICING AND ADMINISTRATION OF MORTGAGE
LOANS...............................................113
10.1. General Servicing Procedures..........................113
10.2. Collection of Certain Mortgage Loan
Payments............................................116
10.3. Sub-Servicing Agreements Between Master
Servicer and Sub-Servicers..........................116
10.4. Successor Sub-Servicers...............................117
10.5. Liability of Master Servicer..........................117
10.6. No Contractual Relationship Between
Sub-Servicer and Trustee or the Owners..............117
10.7. Assumption or Termination of
Sub-Servicing Agreement by Trustee..................118
10.8. Principal and Interest Account........................118
10.9. Delinquency Advances and Servicing
Advances............................................121
10.10. Compensating Interest................................122
10.11. Maintenance of Insurance.............................122
10.12. Due-on-Sale Clauses; Assumption and
Substitution Agreements.............................124
10.13. Realization Upon Defaulted Mortgage
Loans...............................................125
10.14. Trustee to Cooperate; Release of Files...............126
10.15. Master Servicing Compensation........................128
10.16. Annual Statement as to Compliance....................128
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10.17. Annual Independent Certified Public
Accountants' Reports................................128
10.18. Access to Certain Documentation and
Information Regarding the Mortgage
Loans; Confidentiality..............................129
10.19. Assignment of Agreement..............................129
10.20. Inspections by Certificate Insurer and
Account Parties; Errors and Omissions
Insurance...........................................130
10.21. Financial Statements.................................130
10.22. REMIC................................................131
10.23. The Designated Depository Institution................131
10.24. Appointment of Custodian.............................131
ARTICLE XI EVENTS OF DEFAULT; REMOVAL OF MASTER
SERVICER; MERGER....................................131
11.1. Removal of Master Servicer; Resignation
of Master Servicer..................................131
11.2. Merger, Conversion, Consolidation or
Succession to Business of Master
Servicer............................................136
ARTICLE XII MISCELLANEOUS.......................................137
12.1. Compliance Certificates and Opinions..................137
12.2. Form of Documents Delivered to the
Trustee.............................................137
12.3. Acts of Owners........................................138
12.4. Notices, etc. to Trustee..............................139
12.5. Notices and Reports to Owners; Waiver of
Notices.............................................139
12.6. Rules by Trustee and Sponsor..........................140
12.7. Successors and Assigns................................140
12.8. Severability..........................................140
12.9. Benefits of Agreement.................................140
12.10. Legal Holidays.......................................140
12.11. Governing Law........................................141
12.12. Counterparts.........................................141
12.13. Usury................................................141
12.14. Amendment............................................141
12.15. The Certificate Insurer..............................142
12.16. REMIC Status; Taxes..................................143
12.17. Additional Limitation on Action and
Imposition of Tax...................................144
12.18. Appointment of Tax Matters Person....................145
12.19. Notices..............................................145
12.20. Grant of Security Interest...........................146
12.21. Indemnification......................................147
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EXHIBIT A-1 -- Form of Class A-1 Group I Certificate
EXHIBIT A-2 -- Form of Class A-2 Group I Certificate
EXHIBIT A-3 -- Form of Class A-3 Group I Certificate
EXHIBIT A-4 -- Form of Class A-4 Group I Certificate
EXHIBIT A-5 -- Form of Class A-5 Group I Certificate
EXHIBIT A-6 -- Form of Class A-6 Group II Certificate
EXHIBIT B-1 -- Form of Class B Group I Certificate
EXHIBIT B-2 -- Form of Class B Group II Certificate
EXHIBIT B-3 -- Form of Class BI-S Certificate
EXHIBIT B-4 -- Form of Class BII-S Certificate
EXHIBIT C-1 -- Form of Class RL Certificate
EXHIBIT C-2 -- Form of Class RU Certificate
EXHIBIT D -- Form of Transfer Certificate
EXHIBIT E -- Form of Residual Certificate Tax Matters
Transfer Certificate
EXHIBIT F -- Form of Master Servicer's Trust Receipt
EXHIBIT G -- Form of Liquidation Report
EXHIBIT H -- Form of Delivery Order
EXHIBIT I -- Officer's Certificate
EXHIBIT J -- Form of Certificate Regarding Prepaid Loans
EXHIBIT K -- Form of Initial Trustee Certification
EXHIBIT L -- Form of Interim Trustee Certification
EXHIBIT M -- Form of Final Trustee Certification
EXHIBIT N -- Auction Procedures
EXHIBIT O -- Form of Trustee Request for Class A-6
Formula Interest Shortfall
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POOLING AND SERVICING AGREEMENT, relating to ACCESS FINANCIAL MORTGAGE LOAN
TRUST 1996-2, dated as of May 1, 1996, by and among CARGILL FINANCIAL SERVICES
CORPORATION, a Delaware corporation (the "Sponsor"), ACCESS FINANCIAL LENDING
CORP., a Delaware corporation, as Seller (in such capacity, the "Seller") and as
Master Servicer (in such capacity, the "Master Servicer"), and NORWEST BANK
MINNESOTA, NATIONAL ASSOCIATION, a national banking association, in its capacity
as trustee (the "Trustee").
WHEREAS, the Sponsor wishes to establish a trust and two sub-trusts and
provide for the allocation and sale of the beneficial interests therein and the
maintenance and distribution of the trust estate;
WHEREAS, the Seller wishes to convey the Mortgage Loans to the Trust;
WHEREAS, the Master Servicer has agreed to service the Mortgage Loans,
which constitute the principal assets of the trust estate;
WHEREAS, all things necessary to make the Certificates, when executed and
authenticated by the Trustee, valid instruments, and to make this Agreement a
valid agreement, in accordance with their and its terms, have been done; and
WHEREAS, Norwest Bank Minnesota, National Association, is willing to serve
in the capacity of Trustee hereunder.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein contained, the Sponsor, the Seller, the Master Servicer and the Trustee
hereby agree as follows:
ARTICLE I
DEFINITIONS; RULES OF CONSTRUCTION
Section 1.1. Definitions. For all purposes of this Agreement, the following
terms shall have the meanings set forth below, unless the context clearly
indicates otherwise:
"Access Financial Loan Purchase Trust": The trusts, collectively, created
by the Second Amended and Restated Pooling and Servicing Agreement dated as of
February 1, 1994, among the Trustee, the Seller and Electronic Data Systems
Corporation and the Pooling and Servicing Agreement, dated as of January 1, 1995
among the Trustee, the Seller and LSI.
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"Account": The Certificate Account, each Principal and Interest Account and
each Distribution Account including any sub-Accounts created pursuant to Section
7.2.
"Accrual Period": With respect to the Class A-2, A- 3, A-4 and A-5
Certificates and any Payment Date, the period from and including the second day
of the calendar month immediately preceding such Payment Date to and including
the first day of the calendar month in which such Payment Date occurs; with
respect to the Class A-1 and A-6 Certificates and any Payment Date, the period
from and including the prior Payment Date (or, in the case of the first Payment
Date, from and including the Startup Day) to and including the day immediately
preceding such Payment Date.
"Affiliate": With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise, and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Agreement": This Pooling and Servicing Agreement, as it may be amended
from time to time, and including the Exhibits hereto.
"Appraised Value": The appraised value of any Property based upon the
appraisal made at the time of the origination of the related Mortgage Loan, or,
in the case of a Mortgage Loan which is a purchase money mortgage, the sales
price of the Property at such time of origination, if such sales price is less
than such appraised value.
"Auction Call": As defined in Section 8.3 hereof.
"Authorized Officer": With respect to any Person, any person who is
authorized to act for such Person in matters relating to this Agreement, and
whose action is binding upon such Person and, with respect to the Trustee, the
Sponsor, the Seller, and the Master Servicer, initially including those
individuals whose names appear on the lists of Authorized Officers delivered on
the Startup Day.
"Base Group I Principal Distribution Amount": As to any Payment Date, an
amount equal to (x) the sum, without duplication, of (i) the principal portion
of all scheduled and unscheduled payments received by the Master Servicer on the
Group I Mortgage Loans during the related Remittance Period, including any
Prepayments and any Net Proceeds, (ii) the principal portion of all Substitution
Amounts and the
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principal portion of all Loan Purchase Prices deposited into the Principal and
Interest Accounts with respect to the Group I Mortgage Loans on the related
Remittance Date, and (iii) the proceeds received by the Trustee with respect to
the Group I Mortgage Loans in connection with any termination of the Trust
pursuant to Article VIII hereof, to the extent such proceeds relate to
principal, minus (y) the amount of any Group I Subordination Reduction Amount
for such Payment Date.
"Base Group II Principal Distribution Amount": As to any Payment Date, an
amount equal to (x) the sum, without duplication, of (i) the principal portion
of all scheduled and unscheduled payments received by the Master Servicer on the
Group II Mortgage Loans during the related Remittance Period, including any
Prepayments and any Net Proceeds, (ii) the principal portion of all Substitution
Amounts and the principal portion of all Loan Purchase Prices deposited into the
Principal and Interest Accounts with respect to the Group II Mortgage Loans on
the related Remittance Date, and (iii) the proceeds received by the Trustee with
respect to the Group II Mortgage Loans in connection with any termination of the
Trust pursuant to Article VIII hereof, to the extent such proceeds relate to
principal, minus (y) the amount of any Group II Subordination Reduction Amount
for such Payment Date.
"Business Day": Any day that is not a Saturday, Sunday or other day on
which commercial banking institutions in the State of New York, the state in
which the principal corporate office or bank of the Master Servicer is located
or in the state in which the principal corporate trust office of the Trustee is
located, which initially is Minneapolis, Minnesota, are authorized or obligated
by law or executive order to be closed.
"Carry-Forward Amount": The Class A-1 Interest Carry-Forward Amount, the
Class A-2 Interest Carry-Forward Amount, the Class A-3 Interest Carry-Forward
Amount, the Class A-4 Interest Carry-Forward Amount, the Class A-5 Interest
Carry-Forward Amount, the Class A-6 Interest Carry-Forward Amount, the Class A-1
Principal Carry-Forward Amount, the Class A-2 Principal Carry-Forward Amount,
the Class A-3 Principal Carry-Forward Amount, the Class A-4 Principal
Carry-Forward Amount, the Class A-5 Principal Carry-Forward Amount, the Class
A-6 Principal Carry-Forward Amount, the Class B Group I Carry-Forward Amount or
the Class B Group II Carry-Forward Amount.
"Certificate": Any one of the Class A-1 Group I Certificates, Class A-2
Group I Certificates, Class A-3 Group I Certificates, Class A-4 Group I
Certificates, Class A-5 Group I Certificates, Class A-6 Group II Certificates,
Class B Group I Certificates, Class B Group II Certificates, Class
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BI-S Certificates, Class BII-S Certificates or the Residual Certificates.
"Certificate Account": The account designated as the Certificate Account
pursuant to Section 7.2 hereof.
"Certificate Insurance Policy": The certificate guaranty surety bond number
96010246 issued by the Certificate Insurer to the Trustee for the benefit of the
Owners of the Class A Certificates.
"Certificate Insurer": Financial Guaranty Insurance Company, a New York
stock insurance company.
"Certificateholder": As of any date and with respect to any Certificate,
the Person in whose name such Certificate is registered on the Register on such
date.
"Class": All of the Class A-1 Group I Certificates, the Class A-2 Group I
Certificates, the Class A-3 Group I Certificates, the Class A-4 Group I
Certificates, the Class A-5 Group I Certificates, the Class A-6 Group II
Certificates, the Class B Group I Certificates, the Class B Group II
Certificates, or all of the Residual Certificates, as applicable.
"Class A Certificates": Collectively, the Class A-1 Group I Certificates,
the Class A-2 Group I Certificates, the Class A-3 Group I Certificates, the
Class A-4 Group I Certificates, the Class A-5 Group I Certificates, and the
Class A-6 Group II Certificates.
"Class A Group I Certificates": All of the Class A-1 Group I Certificates,
the Class A-2 Group I Certificates, the Class A-3 Group I Certificates, the
Class A-4 Group I Certificates and the Class A-5 Group I Certificates.
"Class A Group I Distribution Account": The Class A Group I Distribution
Account created pursuant to Section 7.2 hereof.
"Class A Group II Distribution Account": The Class A Group II Distribution
Account created pursuant to Section 7.2 hereof.
"Class A-1 Distribution Amount": As of any Payment Date, the sum of (i) the
Class A-1 Principal Distribution Amount for such Payment Date, (ii) the Class
A-1 Interest Distribution Amount for such Payment Date, (iii) the Class A-1
Interest Carry-Forward Amount for such Payment Date and (iv) the Class A-1
Principal Carry-Forward Amount for such Payment Date.
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"Class A-1 Group I Certificates": Those certificates in substantially the
form set forth in Exhibit A-1 hereto.
"Class A-1 Interest Carry-Forward Amount": As of any Payment Date, the sum
of (i) the amount, if any, by which (x) the Class A-1 Interest Distribution
Amount as of the immediately preceding Payment Date exceeded (y) the amount of
the actual distribution, exclusive of any portion of any Insured Payment, made
to the Owners of the Class A-1 Group I Certificates pursuant to Section
7.3(c)(i)(A) hereof on such immediately preceding Payment Date and allocable to
the Class A-1 Interest Distribution Amount on such immediately preceding Payment
Date and (ii) interest on the amount, if any, described in clause (i) at
one-twelfth of the Class A-1 Pass-Through Rate from such immediately preceding
Payment Date.
"Class A-1 Interest Distribution Amount": As of any Payment Date, interest
accrued during the related Accrual Period at the Class A-1 Pass-Through Rate on
the Class A-1 Principal Balance immediately prior to such Payment Date.
"Class A-1 Pass-Through Rate": the least of (i) LIBOR as of the second to
last Business Day prior to the immediately preceding Payment Date (or prior to
the Startup Day, in the case of the initial Payment Date) plus 0.125% per annum,
(ii) the Net Weighted Average Coupon Rate for the Variable Rate Mortgage Loans
for such Payment Date, and (iii) 10% per annum.
"Class A-1 Principal Balance": The original Class A-1 Principal Balance of
$58,456,000 reduced by the sum of all amounts previously distributed to the
Owners of the Class A-1 Group I Certificates in respect of principal on all
previous Payment Dates, but shall not be reduced below zero.
"Class A-1 Principal Carry-Forward Amount": As of any Payment Date, the sum
of (i) the amount, if any, by which (x) the Class A-1 Principal Distribution
Amount as of the immediately preceding Payment Date exceeded (y) the amount of
the actual distribution, exclusive of any portion of any Insured Payment, made
to the Owners of the Class A-1 Group I Certificates pursuant to Section
7.3(c)(i)(A) hereof on such immediately preceding Payment Date and allocable to
the Class A-1 Principal Distribution Amount on such immediately preceding
Payment Date and (ii) interest on the amount, if any, described in clause (i) at
one-twelfth of the Class A-1 Pass-Through Rate from such immediately preceding
Payment Date.
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"Class A-1 Principal Distribution Amount": With respect to any Payment Date
on or prior to the Class A-1 Termination Date, an amount equal to the lesser of
(x) the Group I Principal Distribution Amount for such Payment Date and (y) the
amount necessary to reduce the Class A-1 Principal Balance (as it was
immediately prior to such Payment Date) to zero. On the Class A-1 Termination
Date any portion of the Group I Principal Distribution Amount for such Payment
Date remaining on such Payment Date following the reduction to zero of the Class
A-1 Principal Balance shall be distributed as the initial principal distribution
on the Class A-2 Group I Certificates.
"Class A-1 Termination Date": The Payment Date on which the Class A-1
Principal Balance is reduced to zero.
"Class A-2 Distribution Amount": As of any Payment Date, the sum of (i) the
Class A-2 Principal Distribution Amount for such Payment Date, (ii) the Class
A-2 Interest Distribution Amount for such Payment Date, (iii) the Class A-2
Interest Carry-Forward Amount for such Payment Date and (iv) the Class A-2
Principal Carry-Forward Amount for such Payment Date.
"Class A-2 Group I Certificates": Those certificates in substantially the
form set forth in Exhibit A-2 hereto.
"Class A-2 Interest Carry-Forward Amount": As of any Payment Date, the sum
of (i) the amount, if any, by which (x) the Class A-2 Interest Distribution
Amount as of the immediately preceding Payment Date exceeded (y) the amount of
the actual distribution, exclusive of any portion of any Insured Payment, made
to the Owners of the Class A-2 Group I Certificates pursuant to Section
7.3(c)(i)(B) hereof on such immediately preceding Payment Date and allocable to
the Class A-2 Interest Distribution Amount on such immediately preceding Payment
Date and (ii) interest on the amount, if any, described in clause (i) at
one-twelfth of the Class A-2 Pass-Through Rate from such immediately preceding
Payment Date.
"Class A-2 Interest Distribution Amount": As of any Payment Date, interest
accrued during the related Accrual Period at the Class A-2 Pass-Through Rate on
the Class A-2 Principal Balance immediately prior to such Payment Date.
"Class A-2 Pass-Through Rate": 6.925% per annum.
"Class A-2 Principal Balance": The original Class A-2 Principal Balance of
$38,714,000 reduced by the sum of all amounts previously distributed to the
Owners of the
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Class A-2 Group I Certificates in respect of principal on all previous Payment
Dates, but shall not be reduced below zero.
"Class A-2 Principal Carry-Forward Amount": As of any Payment Date, the sum
of (i) the amount, if any, by which (x) the Class A-2 Principal Distribution
Amount as of the immediately preceding Payment Date exceeded (y) the amount of
the actual distribution, exclusive of any portion of any Insured Payment, to the
Owners of the Class A-2 Group I Certificates made pursuant to Section
7.3(c)(i)(B) hereof on such immediately preceding Payment Date and allocable to
the Class A-2 Principal Distribution Amount on such immediately preceding
Payment Date and (ii) interest on the amount, if any, described in clause (i) at
one-twelfth of the Class A-2 Pass-Through Rate from such immediately preceding
Payment Date.
"Class A-2 Principal Distribution Amount": With respect to any Payment Date
following the Class A-1 Termination Date, an amount equal to the lesser of (x)
the Group I Principal Distribution Amount for such Payment Date and (y) the
amount necessary to reduce the Class A-2 Principal Balance (as it was
immediately prior to such Payment Date) to zero. On the Class A-1 Termination
Date any portion of the Group I Principal Distribution Amount for such Payment
Date remaining on such Payment Date following the reduction to zero of the Class
A-1 Principal Balance shall be distributed as the initial principal distribution
on the Class A-2 Group I Certificates. On the Class A-2 Termination Date any
portion of the Group I Principal Distribution Amount remaining on such Payment
Date following the reduction to zero of the Class A-2 Principal Balance shall be
distributed as the initial principal distribution on the Class A-3 Group I
Certificates.
"Class A-2 Termination Date": The Payment Date on which the Class A-2
Principal Balance is reduced to zero.
"Class A-3 Distribution Amount": As of any Payment Date, the sum of (i) the
Class A-3 Principal Distribution Amount for such Payment Date, (ii) the Class
A-3 Interest Distribution Amount for such Payment Date, (iii) the Class A-3
Interest Carry-Forward Amount for such Payment Date and (iv) the Class A-3
Principal Carry-Forward Amount for such Payment Date.
"Class A-3 Group I Certificates": Those certificates in substantially the
form set forth in Exhibit A-3 hereto.
"Class A-3 Interest Carry-Forward Amount": As of any Payment Date, the sum
of (i) the amount, if any, by which (x) the Class A-3 Interest Distribution
Amount as of the immediately preceding Payment Date exceeded (y) the amount of
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the actual distribution, exclusive of any portion of any Insured Payment, made
to the Owners of the Class A-3 Group I Certificates pursuant to Section
7.3(c)(i)(C) hereof on such immediately preceding Payment Date and allocable to
the Class A-3 Interest Distribution Amount on such immediately preceding Payment
Date and (ii) interest on the amount, if any, described in clause (i) at
one-twelfth of the Class A-3 Pass-Through Rate from such immediately preceding
Payment Date.
"Class A-3 Interest Distribution Amount": As of any Payment Date, interest
accrued during the related Accrual Period at the Class A-3 Pass-Through Rate on
the Class A-3 Principal Balance immediately prior to such Payment Date.
"Class A-3 Pass-Through Rate": 7.300% per annum.
"Class A-3 Principal Balance": The original Class A-3 Principal Balance of
$16,525,000 reduced by the sum of all amounts previously distributed to the
Owners of the Class A-3 Group I Certificates in respect of principal on all
previous Payment Dates, but shall not be reduced below zero.
"Class A-3 Principal Carry-Forward Amount": As of any Payment Date, the sum
of (i) the amount, if any, by which (x) the Class A-3 Principal Distribution
Amount as of the immediately preceding Payment Date exceeded (y) the amount of
the actual distribution, exclusive of any portion of any Insured Payment, to the
Owners of the Class A-3 Group I Certificates made pursuant to Section
7.3(c)(i)(C) hereof on such immediately preceding Payment Date and allocable to
the Class A-3 Principal Distribution Amount on such immediately preceding
Payment Date and (ii) interest on the amount, if any, described in clause (i) at
one-twelfth of the Class A-3 Pass-Through Rate from such immediately preceding
Payment Date.
"Class A-3 Principal Distribution Amount": With respect to any Payment Date
following the Class A-2 Termination Date, an amount equal to the lesser of (x)
the Group I Principal Distribution Amount for such Payment Date and (y) the
amount necessary to reduce the Class A-3 Principal Balance (as it was
immediately prior to such Payment Date) to zero. On the Class A-2 Termination
Date any portion of the Group I Principal Distribution Amount for such Payment
Date remaining on such Payment Date following the reduction to zero of the Class
A-2 Principal Balance shall be distributed as the initial principal distribution
on the Class A-3 Group I Certificates. On the Class A-3 Termination Date any
portion of the Group I Principal Distribution Amount remaining on such Payment
Date following the reduction to zero of the Class A-3 Principal Balance shall be
distributed as the initial principal distribution on the Class A-4 Group I
Certificates.
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"Class A-3 Termination Date": The Payment Date on which the Class A-3
Principal Balance is reduced to zero.
"Class A-4 Distribution Amount": As of any Payment Date, the sum of (i) the
Class A-4 Principal Distribution Amount for such Payment Date, (ii) the Class
A-4 Interest Distribution Amount for such Payment Date, (iii) the Class A-4
Interest Carry-Forward Amount for such Payment Date and (iv) the Class A-4
Principal Carry-Forward Amount for such Payment Date.
"Class A-4 Group I Certificates": Those certificates in substantially the
form set forth in Exhibit A-4 hereto.
"Class A-4 Interest Carry-Forward Amount": As of any Payment Date, the sum
of (i) the amount, if any, by which (x) the Class A-4 Interest Distribution
Amount as of the immediately preceding Payment Date exceeded (y) the amount of
the actual distribution, exclusive of any portion of any Insured Payment, made
to the Owners of the Class A-4 Group I Certificates pursuant to Section
7.3(c)(i)(D) hereof on such immediately preceding Payment Date and allocable to
the Class A-4 Interest Distribution Amount on such immediately preceding Payment
Date and (ii) interest on the amount, if any, described in clause (i) at
one-twelfth of the Class A-4 Pass-Through Rate from such immediately preceding
Payment Date.
"Class A-4 Interest Distribution Amount": As of any Payment Date, interest
accrued during the related Accrual Period at the Class A-4 Pass-Through Rate on
the Class A-4 Principal Balance immediately prior to such Payment Date.
"Class A-4 Pass-Through Rate": 7.625% per annum.
"Class A-4 Principal Balance": The original Class A-4 Principal Balance of
$14,713,000 reduced by the sum of all amounts previously distributed to the
Owners of the Class A-4 Group I Certificates in respect of principal on all
previous Payment Dates, but shall not be reduced below zero.
"Class A-4 Principal Carry-Forward Amount": As of any Payment Date, the sum
of (i) the amount, if any, by which (x) the Class A-4 Principal Distribution
Amount as of the immediately preceding Payment Date exceeded (y) the amount of
the actual distribution, exclusive of any portion of any Insured Payment, to the
Owners of the Class A-4 Group I Certificates made pursuant to Section
7.3(c)(i)(D) hereof on such immediately preceding Payment Date and allocable to
the Class A-4 Principal Distribution Amount on such immediately preceding
Payment Date and (ii) interest on the amount, if any, described in clause (i) at
one-twelfth of the Class A-4
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Pass-Through Rate from such immediately preceding Payment Date.
"Class A-4 Principal Distribution Amount": With respect to any Payment Date
following the Class A-3 Termination Date, an amount equal to the lesser of (x)
the Group I Principal Distribution Amount for such Payment Date and (y) the
amount necessary to reduce the Class A-4 Principal Balance (as it was
immediately prior to such Payment Date) to zero. On the Class A-3 Termination
Date any portion of the Group I Principal Distribution Amount for such Payment
Date remaining on such Payment Date following the reduction to zero of the Class
A-3 Principal Balance shall be distributed as the initial principal distribution
on the Class A-4 Group I Certificates. On the Class A-4 Termination Date any
portion of the Group I Principal Distribution Amount remaining on such Payment
Date following the reduction to zero of the Class A-4 Principal Balance shall be
distributed as the initial principal distribution on the Class A-5 Group I
Certificates.
"Class A-5 Distribution Amount": As of any Payment Date, the sum of (i) the
Class A-5 Principal Distribution Amount for such Payment Date, (ii) the Class
A-5 Interest Distribution Amount for such Payment Date, (iii) the Class A-5
Interest Carry-Forward Amount for such Payment Date and (iv) the Class A-5
Principal Carry-Forward Amount for such Payment Date.
"Class A-5 Group I Certificates": Those certificates in substantially the
form set forth in Exhibit A-5 hereto.
"Class A-5 Interest Carry-Forward Amount": As of any Payment Date, the sum
of (i) the amount, if any, by which (x) the Class A-5 Interest Distribution
Amount as of the immediately preceding Payment Date exceeded (y) the amount of
the actual distribution, exclusive of any portion of any Insured Payment, made
to the Owners of the Class A-5 Group I Certificates pursuant to Section
7.3(c)(i)(E) hereof on such immediately preceding Payment Date and allocable to
the Class A-5 Interest Distribution Amount on such immediately preceding Payment
Date and (ii) interest on the amount, if any, described in clause (i) at
one-twelfth of the Class A-5 Pass-Through Rate from such immediately preceding
Payment Date.
"Class A-5 Interest Distribution Amount": As of any Payment Date, interest
accrued during the related Accrual Period at the Class A-5 Pass-Through Rate on
the Class A-5 Principal Balance immediately prior to such Payment Date.
"Class A-5 Pass-Through Rate": 7.925% per annum.
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"Class A-5 Principal Balance": The original Class A-5 Principal Balance of
$13,796,000 reduced by the sum of all amounts previously distributed to the
Owners of the Class A-5 Group I Certificates in respect of principal on all
previous Payment Dates, but shall not be reduced below zero.
"Class A-5 Principal Carry-Forward Amount": As of any Payment Date, the sum
of (i) the amount, if any, by which (x) the Class A-5 Principal Distribution
Amount as of the immediately preceding Payment Date exceeded (y) the amount of
the actual distribution, exclusive of any portion of any Insured Payment, to the
Owners of the Class A-5 Group I Certificates made pursuant to Section
7.3(c)(i)(E) hereof on such immediately preceding Payment Date and allocable to
the Class A-5 Principal Distribution Amount on such immediately preceding
Payment Date and (ii) interest on the amount, if any, described in clause (i) at
one-twelfth of the Class A-5 Pass-Through Rate from such immediately preceding
Payment Date.
"Class A-5 Principal Distribution Amount": With respect to any Payment Date
following the Class A-4 Termination Date, an amount equal to the lesser of (x)
the Group I Principal Distribution Amount for such Payment Date and (y) the
amount necessary to reduce the Class A-5 Principal Balance (as it was
immediately prior to such Payment Date) to zero. On the Class A-4 Termination
Date any portion of the Group I Principal Distribution Amount for such Payment
Date remaining on such Payment Date following the reduction to zero of the Class
A-4 Principal Balance shall be distributed as the initial principal distribution
on the Class A-5 Group I Certificates.
"Class A-6 Distribution Account": The Class A-6 Distribution Account
created by Section 7.2 hereof.
"Class A-6 Distribution Amount": As of any Payment Date, the sum of (i) the
Class A-6 Principal Distribution Amount for such Payment Date, (ii) the Class
A-6 Interest Distribution Amount for such Payment Date, (iii) the Class A-6
Interest Carry-Forward Amount for such Payment Date and (iv) the Class A-6
Principal Carry-Forward Amount for such Payment Date.
"Class A-6 Formula Distribution Amount": With respect to the Class A-6
Certificates for any Payment Date, the sum of (x) the Class A-6 Interest
Distribution Amount for such Payment Date and (y) the Class A-6 Principal
Distribution Amount for such Payment Date.
"Class A-6 Formula Interest Shortfall": As defined in Section 7.9(b)
hereof.
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"Class A-6 Formula Pass-Through Rate": As of any Payment Date, the rate
described in clause (i) of the definition of "Class A-6 Pass-Through Rate".
"Class A-6 Full Distribution Amount": With respect to any Payment Date, the
sum of (x) the Class A-6 Full Interest Distribution Amount for such Payment Date
and (y) the Class A-6 Principal Distribution Amount for such Payment Date.
"Class A-6 Full Interest Distribution Amount": With respect to any Payment
Date, the Class A-6 Interest Distribution Amount for such Payment Date
calculated using the Class A-6 Formula Pass-Through Rate for such Payment Date
rather than the Class A-6 Pass-Through Rate for such Payment Date plus, if the
full amount of the Class A-6 Formula Interest Shortfall, if any, was not funded
on any prior Payment Date and remains unpaid on such Payment Date, such amount,
together with interest thereon (from the Payment Date on which such Class A-6
Formula Interest Shortfall was calculated) at the Class A-6 Formula Pass-Through
Rate for such Payment Date.
"Class A-6 Interest Carry-Forward Amount": As of any Payment Date, the sum
of (i) the amount, if any, by which (x) the Class A-6 Interest Distribution
Amount as of the immediately preceding Payment Date exceeded (y) the amount of
the actual distribution, exclusive of any portion of any Insured Payment, made
to the Owners of the Class A-6 Group II Certificates pursuant to Section
7.3(c)(ii) hereof on such immediately preceding Payment Date and allocable to
the Class A-6 Interest Distribution Amount on such immediately preceding Payment
Date and (ii) interest on the amount, if any, described in clause (i) at
one-twelfth of the Class A-6 Pass-Through Rate from such immediately preceding
Payment Date.
"Class A-6 Interest Distribution Amount": As of any Payment Date, interest
accrued during the related Accrual Period at the Class A-6 Pass-Through Rate on
the Class A-6 Principal Balance immediately prior to such Payment Date.
"Class A-6 Pass-Through Rate": With respect to any Payment Date and Accrual
Period, the lesser of (i) LIBOR as of the second to last Business Day prior to
the immediately preceding Payment Date (or prior to the Startup Day, in the case
of the initial Payment Date) plus 0.33% per annum, or (ii) the Net Weighted
Average Coupon Rate for the Group II Mortgage Loans for such Payment Date.
"Class A-6 Principal Balance": The original Class A-6 Principal Balance of
$68,344,000 reduced by the sum of all amounts previously distributed to the
Owners of the Class A-6 Group II Certificates in respect of principal on all
previous Payment Dates, but shall not be reduced below zero.
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"Class A-6 Principal Carry-Forward Amount": As of any Payment Date, the sum
of (i) the amount, if any, by which (x) the Class A-6 Principal Distribution
Amount as of the immediately preceding Payment Date exceeded (y) the amount of
the actual distribution, exclusive of any portion of any Insured Payment, made
to the Owners of the Class A-6 Group II Certificates made pursuant to Section
7.3(c)(ii) hereof on such immediately preceding Payment Date and allocable to
the Class A-6 Principal Distribution Amount on such immediately preceding
Payment Date and (ii) interest on the amount, if any, described in clause (i) at
one-twelfth of the Class A-6 Pass-Through Rate from such immediately preceding
Payment Date.
"Class A-6 Principal Distribution Amount": With respect to any Payment
Date, an amount equal to the lesser of (x) the Group II Principal Distribution
Amount for such Payment Date and (y) the amount necessary to reduce the Class
A-6 Principal Balance (as it was immediately prior to such Payment Date) to
zero.
"Class A-6 Group II Certificates": Those certificates in substantially the
form set forth in Exhibit A-6 hereto.
"Class B Certificates": Collectively, the Class B Group I Certificates, the
Class B Group II Certificates, the Class BI-S Certificates and the Class BII-S
Certificates.
"Class B Group I Carry-Forward Amount": As of any Payment Date, the amount,
if any, by which (x) the Class B Group I Distribution Amount as of the
immediately preceding Payment Date exceeded (y) the amount of the actual
distribution to the Owners of the Class B Group I Certificates made pursuant to
Section 7.3(c)(iv) hereof on such immediately preceding Payment Date.
"Class B Group I Certificates": Those certificates in substantially the
form set forth in Exhibit B-1 hereto.
"Class B Group I Distribution Account": The Class B Group I Distribution
Account created pursuant to Section 7.2 hereof.
"Class B Group I Distribution Amount": As of any Payment Date, the sum of
(i) the Class B Group I Interest Distribution Amount for such Payment Date, (ii)
the Group I Subordination Reduction Amount, if any, for such Payment Date, (iii)
any portion of the Group II Subordination Reduction Amount described in Section
7.3(b)(iv)(E)(ii) hereof and (iv) the Class B Group I Carry-Forward Amount, if
any, as of such Payment Date.
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"Class B Group I Interest": As of any Payment Date, the excess of (i) the
product of (x) the Net Weighted Average Coupon Rate of the Group I Mortgage
Loans for the immediately preceding Remittance Period, times the actual number
of days in such Remittance Period divided by 365 (or 366, as appropriate), and
(y) the Group I Pool Principal Balance as of the opening of business on the
first day of the immediately preceding Remittance Period over (ii) the Group I
Insured Interest Distribution Amount on such Payment Date.
"Class B Group I Interest Distribution Amount": As of any Payment Date, the
Class B Group I Interest for such Payment Date minus the sum of (i) the amount
of any Group I Subordination Increase Amount actually paid to the Owners of the
Class A Group I Certificates on such Payment Date as all or a portion of the
Group I Subordination Increase Amount on such Payment Date pursuant to Section
7.3(b)(iv)(C)(i) hereof and (ii) the amount of any Class B Group I Interest
actually paid to the Owners of the Class A-6 Group II Certificates as all or a
portion of (x) the Group II Insured Distribution Amount on such Payment Date,
pursuant to Section 7.3(b)(iv)(B)(i) hereof or (y) the portion of any Group II
Subordination Increase Amount allocated to the Class A Group II Distribution
Account with respect to a Group II Subordination Deficiency on such Payment
Date, pursuant to Section 7.3(b)(iv)(D)(i) hereof.
"Class B Group I Principal Balance": The Class B Group I Principal Balance
shall be (x) increased on each Payment Date by the amounts, if any, of the Class
B Group I Interest (i) actually paid to the Owners of the Class A Group I
Certificates on such Payment Date as all or a portion of the Group I Insured
Principal Distribution Amount or as all or a portion of the Group I
Subordination Increase Amount on such Payment Date pursuant to Sections
7.3(b)(iv)(A)(iii) and 7.3(b)(iv)(C)(i) hereof or (ii) actually paid to the
Owners of the Class A-6 Group II Certificates on such Payment Date as all or a
portion of the Group II Insured Distribution Amount or as all or a portion of
the Group II Subordination Deficiency Amount on such Payment Date, pursuant to
Sections 7.3(b)(iv)(B)(i) and 7.3(b)(iv)(D)(i) hereof and (y) decreased on each
Payment Date by the amounts of (i) any Group I Subordination Reduction Amount
paid to the Owners of the Class B Group I Certificates on such Payment Date
pursuant to Section 7.3(b)(iv)(G)(i) hereof, (ii) any Group II Subordination
Reduction Amount paid to the Owners of the Class B Group I Certificates on such
Payment Date pursuant to Section 7.3(b)(iv)(E)(ii) hereof and (iii) the amount
of any Group I Allocable Losses allocated as a reduction of the Class B Group I
Principal Balance on such Payment Date pursuant to Section 7.8(a) hereof. The
Class B Group I Principal Balance shall in no event be less than zero.
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"Class B Group II Carry-Forward Amount": As of any Payment Date, the
amount, if any, by which (x) the Class B Group II Distribution Amount as of the
immediately preceding Payment Date exceeded (y) the amount of the actual
distribution to the Owners of the Class B Group II Certificates made pursuant to
Section 7.3(c)(v) hereof on such immediately preceding Payment Date.
"Class B Group II Certificates": Those certificates in substantially the
form set forth in Exhibit B-2 hereto.
"Class B Group II Distribution Account": The Class B Group II Distribution
Account created pursuant to Section 7.2 hereof.
"Class B Group II Distribution Amount": As of any Payment Date, the sum of
(i) the Class B Group II Interest Distribution Amount for such Payment Date,
(ii) the Group II Subordination Reduction Amount, if any, for such Payment Date,
(iii) any portion of the Group I Subordination Reduction Amount described in
Section 7.3(b)(iv)(E)(i) hereof and (iv) the Class B Group II Carry-Forward
Amount, if any, as of such Payment Date.
"Class B Group II Interest": As of any Payment Date, the excess of (i) the
product of (x) the Net Weighted Average Coupon Rate of the Group II Mortgage
Loans for the immediately preceding Remittance Period, times the actual number
of days in such Remittance Period divided by 360 and (y) the Group II Pool
Principal Balance as of the opening of business on the first day of the
immediately preceding Remittance Period over (ii) the Group II Insured Interest
Distribution Amount on such Payment Date.
"Class B Group II Interest Distribution Amount": As of any Payment Date,
the Class B Group II Interest for such Payment Date minus the sum of (i) the
amount of any Group II Subordination Increase Amount actually paid to the Owners
of the Class A-6 Group II Certificates on such Payment Date as all or a portion
of the Group II Subordination Increase Amount on such Payment Date pursuant to
Section 7.3(b)(iv)(C)(ii) hereof and (ii) the amount of any Class B Group II
Interest actually paid to the Owners of the Class A Group I Certificates as all
or a portion of (x) the Group I Insured Distribution Amount on such Payment Date
pursuant to Section 7.3(b)(iv)(B)(ii) hereof or (y) the portion of any Group I
Subordination Increase Amount made with respect to a Group I Subordination
Deficiency on such Payment Date, pursuant to Section 7.3(b)(iv)(D)(ii) hereof.
"Class B Group II Principal Balance": The Class B Group II Principal
Balance shall be (x) increased on each Payment Date by the amounts, if any, of
the Class B Group II
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Interest (i) actually paid to the Owners of the Class A-6 Group II Certificates
on such Payment Date as all or a portion of the Group II Insured Principal
Distribution Amount or all or a portion of the Group II Subordination Increase
Amount on such Payment Date pursuant to Sections 7.3(b)(iv)(A)(v) and
7.3(b)(iv)(C)(ii) hereof or (ii) actually paid to the Owners of the Class A
Group I Certificates on such Payment Date as all or a portion of the Group I
Insured Distribution Amount or as all or a portion of the Group I Subordination
Deficiency Amount on such Payment Date, pursuant to Section 7.3(b)(iv)(B)(ii)
and 7.3(b)(iv)(D)(ii) hereof and (y) decreased on each Payment Date by the
amounts of (i) any Group II Subordination Reduction Amount paid to the Owners of
the Class B Group II Certificates on such Payment Date pursuant to Section
7.3(b)(iv)(G)(ii) hereof, (ii) any Group I Subordination Reduction Amount paid
to the Owners of the Class B Group II Certificates on such Payment Date pursuant
to Section 7.3(b)(iv)(E)(i) hereof and (iii) the amount of any Group II
Allocable Losses allocated as a reduction of the Class B Group II Principal
Balance on such Payment Date pursuant to Section 7.8(b) hereof. The Class B
Group II Principal Balance shall in no event be less than zero.
"Class BI-S Certificate": Any of those Certificates representing the right
to receive excess amounts in the Group I Supplemental Interest Payment Account,
and designated as a "Class BI-S Certificate" on the face thereof, in the form of
Exhibit B-3 hereto.
"Class BII-S Certificate": Any of those Certificates representing the right
to receive excess amounts on the Group II Supplemental Interest Payment Account,
and designated as a "Class BII-S Certificate" on the face thereof, in the form
of Exhibit B-3 hereto.
"Class LT1 Certificates": The uncertificated class of interests in the
Lower-Tier REMIC, as described in and designated in Section 2.8 hereof.
"Class LT2 Certificates": The uncertificated class of interests in the
Lower-Tier REMIC, as described in and designated in Section 2.8 hereof.
"Class LT3 Certificates": The uncertificated class of interests in the
Lower-Tier REMIC, as described in and designated in Section 2.8 hereof.
"Class LT4 Certificates": The uncertificated class of interests in the
Lower-Tier REMIC, as described in and designated in Section 2.8 hereof.
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"Class LT5 Certificates": The uncertificated class of interests in the
Lower-Tier REMIC, as described in and designated in Section 2.8 hereof.
"Class LT6 Certificates": The uncertificated class of interests in the
Lower-Tier REMIC, as described in and designated in Section 2.8 hereof.
"Class RL Certificates": Those certificates representing certain residual
rights to distributions from the Lower-Tier REMIC in substantially the form set
forth as Exhibit C-1 hereto.
"Class RU Certificates": Those certificates representing certain residual
rights to distributions from the Upper-Tier REMIC in substantially the form set
forth as Exhibit C-2 hereto.
"Code": The Internal Revenue Code of 1986, as amended.
"Compensating Interest": As defined in Section 10.10 of this Agreement.
"Coupon Rate": With respect to any Note and Remittance Period, the rate of
interest borne by such Note at the opening of business on the first day of such
Remittance Period.
"Cumulative Net Realized Losses": As of any Payment Date, the sum of all
Net Realized Losses with respect to the Mortgage Loans experienced on all prior
Payment Dates.
"Cut-Off Date": The close of business on May 1, 1996.
"Delinquency Advance": As defined in Section 10.9(a) of this Agreement.
"Delinquent": A Mortgage Loan is "delinquent" if any payment due thereon is
not made by the close of business on the day such payment is scheduled to be
due. A Mortgage Loan is "30 days delinquent" if such payment has not been
received by the close of business on the corresponding day of the month
immediately succeeding the month in which such payment was due, or, if there is
no such corresponding day (e.g., as when a 30-day month follows a 31-day month
in which a payment was due on the 31st day of such month) then on the last day
of such immediately succeeding month. Similarly for "60 days delinquent," "90
days delinquent" and so on.
"Delivery Order": The Delivery Order from the Sponsor to the Trustee
directing the Trustee to issue the
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Certificates on the Startup Day, in substantially the form of Exhibit H hereto.
"Depository": The Depository Trust Company, 55 Water Street, New York, New
York 10041, and any successor depository hereafter named.
"Designated Depository Institution": With respect to any Account, an
institution whose deposits are insured by the Bank Insurance Fund or the Savings
Association Insurance Fund of the FDIC, the long-term deposits of which shall be
rated A or better by S&P and A1 or better by Moody's and in one of the two
highest short-term rating categories by S&P and the highest short-term rating
category by Moody's, unless otherwise approved in writing by the Certificate
Insurer, and which is any of the following: (i) a federal savings and loan
association duly organized, validly existing and in good standing under the
federal banking laws, (ii) an institution duly organized, validly existing and
in good standing under the applicable banking laws of any state, (iii) a
national banking association duly organized, validly existing and in good
standing under the federal banking laws, (iv) a principal subsidiary of a bank
holding company meeting the standards of (i)-(iii) above, or (v) approved in
writing by the Certificate Insurer and the Rating Agencies and, in each case
acting or designated by the Master Servicer or the Trustee as the depository
institution for such Account; provided, however, that any such institution,
association or subsidiary shall have combined capital, surplus and individual
profits of at least $100,000,000. Notwithstanding the foregoing, an Account may
be held by an institution otherwise meeting the preceding requirements except
that the only applicable rating requirement shall be that the unsecured and
uncollateralized debt obligations thereof shall be rated Baa2 or better by
Moody's and BBB or better by S&P if such institution has capital and surplus of
not less than $50,000,000 and has trust powers and the Account is held by such
institution in its trust capacity and not in its commercial capacity.
"Designated Residual Holder": Access Financial Receivables Corp.
"Determination Date": The second Business Day preceding each Payment Date.
"Disqualified Organization": "Disqualified Organization" shall have the
meaning set forth from time to time in the definition thereof at Section
860E(e)(5) of the Code (or any successor statute thereto) and applicable to the
Trust.
"Distribution Accounts": The Class A Group I Distribution Account, the
Class A Group II Distribution
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Account, the Class B Group I Distribution Account and the Class B Group II
Distribution Account.
"Eligible Investments": Those investments so designated pursuant to Section
7.5 hereof.
"ERISA": As defined in Section 5.8(a) hereof.
"Event of Default": As defined in Section 11.1 of this Agreement.
"FDIC": The Federal Deposit Insurance Corporation, or any successor
thereto.
"FHLMC": The Federal Home Loan Mortgage Corporation, a corporate
instrumentality of the United States created pursuant to the Emergency Home
Finance Act of 1970, as amended, or any successor thereof.
"File": The documents pertaining to a particular Mortgage Loan pursuant to
Section 3.3(b) hereof and any additional documents required to be added to the
File pursuant to this Agreement.
"First Mortgage Loan": A Mortgage Loan which constitutes a first priority
mortgage lien with respect to any Property.
"FNMA": The Federal National Mortgage Association, a federally-chartered
and privately-owned corporation existing under the Federal National Mortgage
Association Charter Act, as amended, or any successor thereof.
"Group I Allocable Losses": As defined in Section 7.8(a) hereof.
"Group I Available Funds": As of any Payment Date, the amount on deposit in
the Certificate Account with respect to the Group I Mortgage Loans on such
Payment Date after making the deposits to the Certificate Account pursuant to
Sections 7.3(a)(i) hereof on such Payment Date. The term "Group I Available
Funds" does not include Insured Payments and does not include any amounts that
cannot be distributed to the Owners of the Certificates by the Trustee as a
result of proceedings under the United States Bankruptcy Code.
"Group I Certificates": Any of the Class A-1 Group I Certificates, the
Class A-2 Group I Certificates, the Class A-3 Group I Certificates, the Class
A-4 Group I Certificates, the Class A-5 Group I Certificates and the Class B
Group I Certificates.
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"Group I Cumulative Crossover Amount": As of any Payment Date, the excess
of (x) the aggregate, cumulative amounts allocated to the Class A Group I
Distribution Account on all prior Payment Dates pursuant to sections
7.3(b)(iv)(B)(ii) and 7.3(b)(iv)(D)(ii) over (y) the aggregate, cumulative
amounts allocated to the Class B Group II Distribution Account on all prior
Payment Dates pursuant to Section 7.3(b)(iv)(E)(i) hereof.
"Group I Cumulative Net Realized Losses": As of any Payment Date, the sum
of all Net Realized Losses with respect to the Group I Mortgage Loans
experienced on all prior Payment Dates.
"Group I Excess Subordinated Amount": With respect to any Payment Date, the
excess, if any, of (x) the Group I Subordinated Amount that would apply on such
Payment Date after taking into account the payment of the Group I Principal
Distribution Amount on such Payment Date (except for any distributions of
related Group I Subordination Reduction Amounts on such Payment Date) over (y)
the Group I Specified Subordinated Amount for such Payment Date.
"Group I": The group of Mortgage Loans that are the Group I Mortgage Loans.
"Group I Insured Distribution Amount": With respect to any Payment Date,
the sum of (i) Group I Insured Interest Distribution Amount for such Payment
Date and (ii) the Group I Insured Principal Distribution Amount for such Payment
Date.
"Group I Insured Interest Distribution Amount": With respect to any Payment
Date, the sum of (i) the Class A-1 Interest Distribution Amount, (ii) the Class
A-2 Interest Distribution Amount, (iii) the Class A-3 Interest Distribution
Amount, (iv) the Class A-4 Interest Distribution Amount, (v) the Class A-5
Interest Distribution Amount, (vi) the Class A-1 Interest Carry-Forward Amount,
(vii) the Class A-2 Interest Carry-Forward Amount, (viii) the Class A-3 Interest
Carry-Forward Amount, (ix) the Class A-4 Interest Carry-Forward Amount and (x)
the Class A-5 Interest Carry-Forward Amount, in each case for such Payment Date.
"Group I Insured Payment": As of any Payment Date, the sum of (x) the Group
I Shortfall Amount for such Payment Date and (y) any Preference Amounts with
respect to the Group I Certificates with respect to which the affected Owners
have complied with the provisions of Section 7.3(g) hereof during the related
Remittance Period.
"Group I Insured Principal Distribution Amount": With respect to any
Payment Date, the sum of (i) the Group I Subordination Deficit, (ii) the Class
A-1 Principal Carry-
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Forward Amount, (iii) the Class A-2 Principal Carry-Forward Amount, (iv) the
Class A-3 Principal Carry-Forward Amount, (v) the Class A-4 Principal
Carry-Forward Amount and (vi) the Class A-5 Principal Carry-Forward Amount, in
each case for such Payment Date.
"Group I Interest Remittance Amount": For any Remittance Date, the amount
equal to (x) the sum, without duplication, of (i) the aggregate interest
portions of the payments (whether or not collected) becoming due on the Group I
Mortgage Loans during the immediately preceding Remittance Period and (ii)
Compensating Interest with respect to the Group I Mortgage Loans minus (y) the
aggregate Master Servicing Fee due to the Master Servicer with respect to Group
I Mortgage Loans for such Remittance Period to the extent not previously paid
to, or withheld by, the Master Servicer.
"Group I Monthly Remittance": The sum of (i) the Group I Interest
Remittance Amount and the Group I Principal Remittance Amount required to be
remitted to the Trustee on each Remittance Date and (ii) the amount of any
Substitution Amounts and Loan Purchase Prices on deposit in the Principal and
Interest Account with respect to the Group I Mortgage Loans on such Remittance
Date.
"Group I Mortgage Loans": The Mortgage Loans held by the Trust and assigned
to the Group I, as indicated on the related Mortgage Loan Schedule, as
supplemented and amended from time to time.
"Group I Pool Delinquency Rate": With respect to any Remittance Period, the
fraction, expressed as a percentage, equal to (x) the aggregate Principal
Balances of all Group I Mortgage Loans 90 or more days Delinquent as of the
close of business on the last day of such Remittance Period over (y) the Group I
Pool Principal Balance as of the close of business on the last day of such
Remittance Period.
"Group I Pool Principal Balance": As of any date of determination, the
aggregate Principal Balances of all of the Group I Mortgage Loans as of the
close of business on such date.
"Group I Premium Amount": With respect to each Payment Date, an amount
equal to the product of (x) one twelfth of the Premium Rate set forth in the
Certificate Insurance Policy and (y) the Group I Pool Principal Balance as of
the close of business on the last day of the preceding Remittance Period.
"Group I Principal Distribution Amount": As of any Payment Date, the sum of
(i) the Base Group I Principal Distribution Amount, (ii) the Group I
Subordination Deficit,
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(iii) the Group I Subordination Increase Amount, (iv) the Class A-1 Principal
Carry-Forward Amount, (v) the Class A-2 Principal Carry-Forward Amount, (vi) the
Class A-3 Principal Carry-Forward Amount, (vii) the Class A-4 Principal
Carry-Forward Amount and (viii) the Class A-5 Principal Carry-Forward Amount, in
each case, for such Payment Date.
"Group I Principal Remittance Amount": For any Remittance Date, without
duplication, the amount equal to the sum of (i) the aggregate principal portions
of the payments received by the Master Servicer with respect to the Group I
Mortgage Loans during the immediately preceding Remittance Period and (ii) any
Prepayments, Net Proceeds (but only to the extent that such Net Proceeds do not
exceed the Principal Balance of the related Mortgage Loan), in each case
described in clauses (i) and (ii) only to the extent collected on the Group I
Mortgage Loans during the preceding Remittance Period.
"Group I Rolling Three Month Delinquency Rate": As of any Payment Date the
fraction, expressed as a percentage, equal to the average of the Group I Pool
Delinquency Rates for each of the three (or one and two, in the case of the
first and second Payment Dates) immediately preceding Remittance Periods.
"Group I Shortfall Amount": As of any Payment Date, the excess, if any, of
(x) the Group I Insured Distribution Amount, as of such Payment Date and less
any portion of the Class A-1 Interest Carry-Forward Amount, the Class A-2
Interest Carry-Forward Amount, the Class A-3 Interest Carry-Forward Amount, the
Class A-4 Interest Carry-Forward Amount, the Class A-5 Interest Carry-Forward
Amount, the Class A-1 Principal Carry-Forward Amount, the Class A-2 Principal
Carry-Forward Amount, the Class A-3 Principal Carry-Forward Amount, the Class
A-4 Principal Carry-Forward Amount or the Class A-5 Principal Carry-Forward
Amount owed to the Certificate Insurer on such Payment Date on account of its
subrogation rights over (y) the Group I Total Available Funds on deposit in the
Class A Group I Distribution Account on such Payment Date.
"Group I Specified Subordinated Amount": As defined in the Insurance
Agreement.
"Group I Subordinated Amount": With respect to any Payment Date, the
excess, if any, of (x) the Group I Pool Principal Balance as of the close of
business on the last day of the preceding Remittance Period over (y) the sum of
the Class A-1 Principal Balance, the Class A-2 Principal Balance, the Class A-3
Principal Balance, the Class A-4 Principal Balance and the Class A-5 Principal
Balance as of such Payment Date (after taking into account the payment on such
Payment Date of the Group I Principal Distribution Amount, except for any
portions thereof related to payment of Group I Insured
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Payments applied as payments of the Group I Principal Distribution Amount on
such Payment Date or on any prior Payment Date and not previously reimbursed to
the Certificate Insurer pursuant to Section 7.3(f) hereof).
"Group I Subordination Deficiency Amount": As of any Payment Date, the
excess, if any, of (i) the Group I Specified Subordinated Amount applicable to
such Payment Date over (ii) the Group I Subordinated Amount applicable to such
Payment Date prior to taking into account the payment of any related Group I
Subordination Increase Amounts on such Payment Date.
"Group I Subordination Deficit": As of any Payment Date, the excess, if
any, of (x) the sum of the Class A-1 Principal Balance, the Class A-2 Principal
Balance, the Class A-3 Principal Balance, the Class A-4 Principal Balance and
the Class A-5 Principal Balance after taking into account the payment of the
Group I Principal Distribution Amount on such Payment Date, over (y) the Group I
Pool Principal Balance as of the close of business on the last day of the
preceding Remittance Period.
"Group I Subordination Increase Amount": With respect to any Payment Date,
the lesser of (x) the Group I Subordination Deficiency Amount as of such Payment
Date and (y) the sum of (i) the Class B Group I Interest as of such Payment Date
and (ii) any portion of the Class B Group II Interest applied to the funding of
a Group I Subordination Increase Amount on such Payment Date pursuant to Section
7.3(b)(iv)(D)(ii) hereof.
"Group I Subordination Reduction Amount": With respect to any Payment Date,
an amount equal to the lesser of (x) the Group I Excess Subordinated Amount and
(y) the amount described in clause (x) of the definition of Base Group I
Principal Distribution Amount, in each case as of such Payment Date.
"Group I Supplemental Interest Payment Account": The Group I Supplemental
Interest Payment Account established in accordance with Section 7.9(a) hereof
and maintained by the Trustee.
"Group I Total Available Funds": As of any Payment Date, the amount on
deposit in the Class A Group I Distribution Account on such Payment Date after
making the allocations, transfers and disbursements from the Certificate Account
pursuant to Section 7.3(b) hereof on such Payment Date. The term "Group I Total
Available Funds" does not include Insured Payments and does not include any
amounts that cannot be distributed to the Owners of the Certificates by the
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Trustee as a result of proceedings under the United States Bankruptcy Code.
"Group I Trustee's Fee": With respect to any Payment Date, the product of
(i) one-twelfth of .0275% and (ii) the Group I Pool Principal Balance as of the
last day of the preceding Remittance Period.
"Group II Allocable Losses": As defined in Section 7.8(b) hereof.
"Group II Available Funds": As of any Payment Date, the amount on deposit
in the Certificate Account with respect to the Group II Mortgage Loans on such
Payment Date after making the deposit to the Certificate Account pursuant to
Section 7.3(a)(ii) hereof on such Payment Date. The term "Group II Available
Funds" does not include Insured Payments and does not include any amounts that
cannot be distributed to the Owners of the Certificates by the Trustee as a
result of proceedings under the United States Bankruptcy Code.
"Group II Base Subordinated Amount: As defined in the Insurance Agreement.
"Group II Certificates": Any of the Class A-6 Group II Certificates and the
Class B Group II Certificates.
"Group II Cumulative Crossover Amount": As of any Payment Date, the excess
of (x) the aggregate, cumulative amounts allocated to the Class A Group II
Distribution Account on all prior Payment Dates pursuant to sections
7.3(b)(iv)(B)(i) and 7.3(b)(iv)(D)(i) over (y) the aggregate, cumulative amounts
allocated to the Class A Group I Distribution Account on all prior Payment Dates
pursuant to Section 7.3(b)(iv)(E)(ii) hereof.
"Group II Cumulative Net Realized Losses": As of any Payment Date, the sum
of all Net Realized Losses with respect to the Group II Mortgage Loans
experienced on all prior Payment Dates.
"Group II Excess Subordinated Amount": With respect to any Payment Date,
the excess, if any, of (x) the Group II Subordinated Amount that would apply on
such Payment Date after taking into account the payment of the Group II
Principal Distribution Amount on such Payment Date (except for any distributions
of related Group II Subordination Reduction Amounts on such Payment Date) over
(y) the Group II Specified Subordinated Amount for such Payment Date.
"Group II": The group of Mortgage Loans that are the Group II Mortgage
Loans.
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"Group II Insured Distribution Amount": With respect to any Payment Date,
the sum of (i) Group II Insured Interest Distribution Amount for such Payment
Date and (ii) the Group II Insured Principal Distribution Amount for such
Payment Date.
"Group II Insured Interest Distribution Amount": With respect to any
Payment Date, the sum of (i) the Class A-6 Interest Distribution Amount and (ii)
the Class A-6 Interest Carry-Forward Amount.
"Group II Insured Payment": As of any Payment Date, the sum of (x) the
Group II Shortfall Amount for such Payment Date and (y) any Preference Amounts
with respect to the Class A-6 Group II Certificates with respect to which the
affected Owners have complied with the provisions of Section 7.3(g) hereof
during the related Remittance Period.
"Group II Insured Principal Distribution Amount": With respect to any
Payment Date, the sum of (i) the Group II Subordination Deficit and (ii) the
Class A-6 Group II Principal Carry-Forward Amount, in each case for such Payment
Date.
"Group II Interest Remittance Amount": For any Remittance Date, the amount
equal to (x) the sum, without duplication, of (i) the aggregate interest
portions of the payments (whether or not collected) becoming due on the Group II
Mortgage Loans during the immediately preceding Remittance Period and (ii)
Compensating Interest with respect to the Group II Mortgage Loans minus (y) the
aggregate Master Servicing Fee due to the Master Servicer with respect to the
Group II Mortgage Loans for such Remittance Period to the extent not previously
paid to, or withheld by, the Master Servicer.
"Group II Monthly Remittance": The sum of (i) the Group II Interest
Remittance Amount and the Group II Principal Remittance Amount required to be
remitted to the Trustee on each Remittance Date and (ii) the amount of any
Substitution Amounts and Loan Purchase Prices on deposit in the Principal and
Interest Account with respect to the Group II Mortgage Loans on such Remittance
Date.
"Group II Mortgage Loans": The Mortgage Loans held by the Trust and
assigned to Group II, as indicated on the related Mortgage Loan Schedule, as
supplemented and amended from time to time.
"Group II Pool Delinquency Rate": With respect to any Remittance Period,
the fraction, expressed as a percentage, equal to (x) the aggregate Principal
Balances of all Group II Mortgage Loans 90 or more days Delinquent as of
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the close of business on the last day of such Remittance Period over (y) the
Group II Pool Principal Balance as of close of business on the last day of such
Remittance Period.
"Group II Pool Principal Balance": As of any date of determination, the
aggregate Principal Balances of all of the Group II Mortgage Loans as of the
close of business on such date.
"Group II Premium Amount": With respect to each Payment Date, an amount
equal to the product of (x) one twelfth of the Premium Rate set forth in the
Certificate Insurance Policy and (y) the Group II Pool Principal Balance as of
the close of business on the last day of the preceding Remittance Period.
"Group II Principal Distribution Amount": As of any Payment Date, the sum
of (i) the Base Group II Principal Distribution Amount, (ii) the Group II
Subordination Deficit, (iii) the Group II Subordination Increase Amount, and
(iv) the Class A-6 Principal Carry-Forward Amount, in each case for such Payment
Date.
"Group II Principal Remittance Amount": For any Remittance Date, without
duplication, the amount equal to the sum of (i) the aggregate principal portions
of the payments received by the Master Servicer with respect to the Group II
Mortgage Loans during the immediately preceding Remittance Period and (ii) any
Prepayments, Net Proceeds (but only to the extent that such Net Proceeds do not
exceed the Principal Balance of the related Mortgage Loan), in each case
described in clauses (i) and (ii) only to the extent collected on the Group II
Mortgage Loans during the preceding Remittance Period.
"Group II Rolling Three Month Delinquency Rate": As of any Payment Date the
fraction, expressed as a percentage, equal to the average of the Group II Pool
Delinquency Rates for each of the three (or one and two, in the case of the
first and second Payment Dates), immediately preceding Remittance Periods.
"Group II Shortfall Amount": As of any Payment Date, the excess, if any, of
(x) the Group II Insured Distribution Amount, as of such Payment Date and less
any portion of the Class A-6 Interest Carry-Forward Amount or the Class A-6
Principal Carry-Forward Amount, owed to the Certificate Insurer on such Payment
Date on account of its subrogation rights over (y) the Group II Total Available
Funds on deposit in the Class A-6 Group II Distribution Account on such Payment
Date.
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"Group II Specified Subordinated Amount": As defined in the Insurance
Agreement.
"Group II Subordinated Amount": With respect to any Payment Date, the
excess, if any, of (x) the Group II Pool Principal Balance as of the close of
business on the last day of the preceding Remittance Period over (y) the sum of
the Class A-6 Group II Principal Balance as of such Payment Date (after taking
into account the payment on such Payment Date of the Group II Principal
Distribution Amount on such Payment Date, except for any portion thereof related
to payment of Group II Insured Payments applied as payments of the Group II
Principal Distribution Amount on such Payment Date or on any prior Payment Date
and not previously reimbursed to the Certificate Insurer pursuant to Section
7.3(f) hereof).
"Group II Subordination Deficiency Amount": As of any Payment Date, the
excess, if any, of (i) the Group II Specified Subordinated Amount applicable to
such Payment Date over (ii) the Group II Subordinated Amount applicable to such
Payment Date prior to taking into account the payment of any related Group II
Subordination Increase Amounts on such Payment Date.
"Group II Subordination Deficit": As of any Payment Date, the excess, if
any, of (x) the Class A-6 Group II Principal Balance after taking into account
the payment of the Group II Principal Distribution Amount on such Payment Date,
over (y) the Group II Pool Principal Balance as of the close of business on the
last day of the preceding Remittance Period.
"Group II Subordination Increase Amount": With respect to any Payment Date,
the lesser of (x) the Group II Subordination Deficiency Amount as of such
Payment Date and (y) the sum of (i) the Class B Group II Interest as of such
Payment Date and (ii) any portion of the Class B Group I Interest applied to the
funding of a Group II Subordination Increase Amount on such Payment Date
pursuant to Sections 7.3(b)(iv)(D)(i) hereof.
"Group II Subordination Reduction Amount": With respect to any Payment
Date, an amount equal to the lesser of (x) the Group II Excess Subordinated
Amount for such Payment Date and (y) the amount described in clause (x) of the
definition of Base Group II Principal Distribution Amount for such Payment Date.
"Group II Supplemental Interest Payment Account": The Group II Supplemental
Interest Payment Account established in accordance with Section 7.9(a) hereof
and maintained by the Trustee.
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"Group II Total Available Funds": As of any Payment Date, the amount on
deposit in the Class A Group II Distribution Account on such Payment Date after
making the allocations, transfers and disbursements from the Certificate Account
pursuant to Section 7.3(b) hereof on such Payment Date. The term "Group II Total
Available Funds" does not include Insured Payments and does not include any
amounts that cannot be distributed to the Owners of the Certificates by the
Trustee as a result of proceedings under the United States Bankruptcy Code.
"Group II Trigger Event": As defined in the Insurance Agreement.
"Group II Trustee's Fee": With respect to any Payment Date, the product of
(i) one-twelfth of .0275% and (ii) the Group II Pool Principal Balance as of the
last day of the preceding Remittance Period.
"Highest Lawful Rate": As defined in Section 12.13.
"Insurance Agreement": The Insurance Agreement dated as of May 1, 1996
among the Certificate Insurer, the Sponsor and the Seller.
"Insurance Policy": Any hazard or title insurance policy relating to a
Mortgage Loan.
"Insurance Proceeds": The proceeds of any Insurance Policy relating to a
Mortgage Loan, a Property or an REO Property, net of proceeds to be applied to
the repair of the Property or released to the Mortgagor and net of expenses
reimbursable therefrom, but excluding any Insured Payment.
"Insured Payment": The Group I Insured Payment or the Group II Insured
Payment, as the case may be.
"Interest Advance": As defined in Section 7.9(a) hereof.
"Interest Advance Reimbursement Amount": As defined in Section 7.9(b)
hereof.
"Interest Determination Date": With respect to any Accrual Period for the
Class A-6 Group II Certificates, the second London Business Day preceding the
first day of such Accrual Period.
"LIBOR": With respect to any Accrual Period for the Class A-1 Group I
Certificates or the Class A-6 Group II Certificates, the rate determined by the
Trustee on the related Interest Determination Date on the basis of the offered
rates of the Reference Banks for one-month U.S. dollar
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deposits, as such rates appear on the Reuters Screen LIBO Page, as of 11:00 a.m.
(London time) on such Interest Determination Date. On each Interest
Determination Date, LIBOR for the related Accrual Period will be established by
the Trustee as follows:
(i) If on such Interest Determination Date two or more Reference Banks
provide such offered quotations, LIBOR for the related Accrual Period
shall be the arithmetic mean of such offered quotations (rounded
upwards if necessary to the nearest whole multiple of 1/16%).
(ii) If on such Interest Determination Date fewer than two Reference Banks
provide such offered quotations, LIBOR for the related Accrual Period
shall be the higher of (i) LIBOR as determined on the previous
Interest Determination Date and (ii) the Reserve Interest Rate.
"Liquidated Loan": As to any Payment Date, any Mortgage Loan as to which
the Master Servicer has determined, in accordance with the servicing procedures
specified herein, during the related Remittance Period that all Liquidation
Proceeds which it expects to recover from or on account of such Mortgage Loan
have been recovered. Any such determination shall be evidenced by an Officer's
Certificate in the form of Exhibit I to this Agreement.
"Liquidation Expenses": Expenses which are incurred by the Master Servicer
in connection with the liquidation of any defaulted Mortgage Loan, such
expenses, including, without limitation, legal fees and expenses, and any
unreimbursed Servicing Advances expended by the Master Servicer pursuant to
Sections 10.9(b) and 10.13 of this Agreement with respect to the related
Mortgage Loan.
"Liquidation Proceeds": With respect to any Liquidated Loan, any amounts
(including the proceeds of any Insurance Policy) recovered by the Master
Servicer in connection with such Liquidated Loan, whether through trustee's
sale, foreclosure sale or otherwise, and including, without limitation, sale
proceeds received upon the sale of REO Property.
"Loan Purchase Price": With respect to any Mortgage Loan purchased from the
Trust on a Remittance Date pursuant to Sections 3.2, 3.3, 3.4, or 10.13(f)
hereof, an amount equal to the Principal Balance of such Mortgage Loan as of the
date of purchase (after giving effect to the related Monthly Remittance remitted
by the Master Servicer on such Remittance Date), plus interest on the
outstanding Principal Balance thereof as of the beginning of the preceding
Remittance Period
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computed at the related Coupon Rate less the rate at which the Master Servicing
Fee is calculated, plus the aggregate amounts of (i) all unreimbursed
Reimbursable Advances and (ii) all Delinquency Advances which the Master
Servicer has theretofore failed to remit with respect to such Mortgage Loan.
"Loan-to-Value Ratio": As of any particular date (i) with respect to any
First Mortgage Loan, the percentage of Appraised Value represented by the
original principal balance of the Note relating to such First Mortgage Loan and
(ii) with respect to any Second Mortgage Loan, the percentage of Appraised Value
as of the date of origination of such Second Mortgage Loan represented by an
amount equal to the sum of (a) the remaining principal balance of the Senior
Lien note relating to such First Mortgage Loan and (b) the original principal
balance of the Note relating to such Second Mortgage Loan.
"London Business Day": A day on which banks are open for dealing in foreign
currency and exchange in London and New York City.
"Lower Tier Distribution Amount": As of any Payment Date, the sum of (i)
the Group I Available Funds and (ii) the Group II Available Funds.
"Lower-Tier Interests": As defined in Section 2.8(c) hereof.
"Lower-Tier REMIC": The segregated pool of assets held by the Trust
consisting of the Mortgage Loans.
"Master Servicer": Access Financial Lending Corp., a Delaware corporation.
"Master Servicer's Trust Receipt": The Master Servicer's trust receipt in
the form set forth in Exhibit F hereto.
"Master Servicing Fee": With respect to any Mortgage Loan, an amount
retained by the Master Servicer from collections of interest on the Mortgage
Loans as compensation for its servicing duties relating to such Mortgage Loan
pursuant to Section 10.15 hereof and equal to .45% per annum of the then
outstanding principal amount of such Mortgage Loan as of the first day of each
Remittance Period payable on a monthly basis; provided, that if the Seller is no
longer the Master Servicer, such rate may be increased to a rate not in excess
of .50% and if the Trustee is acting as Master Servicer such rate shall be equal
to .50%.
"Monthly Remittance": The Group I Monthly Remittance, or the Group II
Monthly Remittance, as the case may be.
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"Moody's": Moody's Investors Service, Inc.
"Mortgage": The mortgage, deed of trust or other instrument creating a
first or second lien on an estate in fee simple interest in real property
securing a Note.
"Mortgage Loan": Each of the mortgage loans sold by the Seller to the Trust
on the Startup Day, together with any Qualified Replacement Mortgages
substituted therefor by the Seller in accordance with Section 3.2, 3.3 or 3.4
hereof as from time to time are held as a part of the Trust Estate, the Mortgage
Loans originally so held being identified in the related Mortgage Loan Schedule.
The term "Mortgage Loan" includes the terms "First Mortgage Loan" and "Second
Mortgage Loan". The term "Mortgage Loan" includes any Mortgage Loan which is
Delinquent, which relates to a foreclosure or which relates to a Property which
is REO Property prior to such Property's disposition by the Trust. Any mortgage
loan which, although intended by the parties hereto to have been, and which
purportedly was, transferred and assigned to the Trust by the Seller, in fact
was not transferred and assigned to the Trust for any reason whatsoever,
including, without limitation, the incorrectness of the statement set forth in
Section 3.3(b)(i) hereof with respect to such mortgage loan, shall nevertheless
be considered a "Mortgage Loan" for all purposes of this Agreement.
"Mortgage Loan Group": Each of Group I and Group II.
"Mortgage Loan Schedules": The schedules of Mortgage Loans, separated by
Mortgage Loan Group and by Sub-Servicer, listing each Mortgage Loan conveyed on
the Startup Day and setting forth as to each Mortgage Loan the following
information: (i) the name of the Mortgagor, (ii) the street address of the
Property, (iii) the town or city in which the Property is located, (iv) the
Principal Balance as of the CutOff Date, (v) the account number, (vi) the
original principal amount, (vii) the current Coupon Rate, (viii) the first date
on which a scheduled monthly payment is due under the Note, (ix) the original
stated maturity date of the Note, (x) the State in which the Property is
located, (xi) the zip code of the Property, (xii) the Loan-to-Value Ratio,
(xiii) the Loan-to-Value Ratio of any Second Mortgage Loan calculated by
disregarding the amount described in clause (ii)(a) of the definition of
"Loan-to-Value Ratio", (xiv) whether the Property is owner-occupied or non-owner
occupied, (xv) whether the Property is a single family residence, two-to-four
family residence, a condominium, a townhouse or a rowhouse and (xvi) if such
Mortgage Loan is a "balloon loan", the amortization terms (e.g., 30 year
amortization due in 15 years).
"Mortgagor": The obligor on a Note.
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"Net Insurance Proceeds": As to any Mortgage Loan, Insurance Proceeds net
of unreimbursed Reimbursable Advances relating thereto. In no event shall Net
Insurance Proceeds with respect to any Mortgage Loan be less than zero.
"Net Liquidation Proceeds": As to any Liquidated Loan, Liquidation Proceeds
net of unreimbursed Reimbursable Advances relating to such Mortgage Loan. In no
event shall Net Liquidation Proceeds with respect to any Liquidated Loan be less
than zero.
"Net Proceeds": The sum of, without duplication, Net Liquidation Proceeds,
Net Insurance Proceeds and Net Released Mortgage Property Proceeds.
"Net Realized Loss": With respect to any Liquidated Loan the excess, if
any, of (x) the Principal Balance thereof at the time the Mortgage Loan became a
Liquidated Loan over (y) the related Net Liquidation Proceeds.
"Net Released Mortgage Property Proceeds": As to any Mortgage Loan,
Released Mortgage Property Proceeds net of unreimbursed Reimbursable Advances
relating thereto. In no event shall Net Released Mortgage Property Proceeds with
respect to any Mortgage Loan be less than zero.
"Net Weighted Average Coupon Rate": With respect to any Mortgage Loan Group
and Remittance Period, the weighted average Coupon Rates (weighted by Principal
Balances) of the related Mortgage Loans, calculated at the opening of business
on the first day of such Remittance Period, less the rate at which the Master
Servicing Fee is then calculated and less the Trustee Fee, REMIC Reporting Fee
and Certificate Insurer premium.
"Nonrecoverable Advances": With respect to any Mortgage Loan, any Servicing
Advance or Delinquency Advance proposed to be made by the Master Servicer in
respect of a Mortgage Loan or REO Property which, in the good faith business
judgment of the Master Servicer, would not be ultimately recoverable from late
collections, Insurance Proceeds, Liquidation Proceeds or Released Mortgage
Property Proceeds on such Mortgage Loan or REO Property or otherwise.
Notwithstanding anything to the contrary contained in this Agreement, no
Delinquency Advance or Servicing Advance shall be required to be made by the
Master Servicer if such Delinquency Advance or Servicing Advance would, if made,
constitute a Nonrecoverable Advance.
"Note": The note or other evidence of indebtedness evidencing the
indebtedness of a Mortgagor under a Mortgage Loan.
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"Officer's Certificate": A certificate signed by any Authorized Officer of
any Person delivering such certificate and delivered to the Trustee.
"Operative Documents": This Agreement, the Securitization Sponsorship
Agreement dated as of May 1, 1996 between the Sponsor and the Seller, the
Underwriting Agreement dated as of May 15, 1996 between the Sponsor and the
Underwriters, and the Indemnification Agreement dated as of May 1, 1996 among
the Sponsor, the Underwriters and the Certificate Insurer.
"Original Group I Pool Principal Balance": The aggregate Principal Balances
of all Group I Mortgage Loans as of the Cut-Off Date, i.e., $142,266,561.52.
"Original Group II Pool Principal Balance": The aggregate Principal
Balances of all Group II Mortgage Loans as of the Cut-Off Date, i.e.,
$68,344,659.70.
"Original Pool Principal Balance": The aggregate Principal Balances of all
Mortgage Loans as of the Cut-Off Date, i.e., $210,611,221.22.
"Original Principal Balance": With respect to each Note, the outstanding
principal amount of such Note as of the Cut-Off Date.
"Outstanding": With respect to all Certificates of a Class, as of any date
of determination, all such Certificates theretofore executed and delivered
hereunder except:
(i) Certificates theretofore cancelled by the Trustee or delivered to
the Trustee for cancellation;
(ii) Certificates or portions thereof for which full and final payment
of money in the necessary amount has been theretofore deposited with the
Trustee in trust for the Owners of such Certificates;
(iii) Certificates in exchange for or in lieu of which other
Certificates have been executed and delivered pursuant to this Agreement,
unless proof satisfactory to the Trustee is presented that any such
Certificates are held by a bona fide purchaser;
(iv) Certificates alleged to have been destroyed, lost or stolen for
which replacement Certificates have been issued as provided for in Section
5.5 hereof; and
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(v) With respect to voting rights, any Class A Certificates held by
the Seller, the Sponsor, the Master Servicer or any affiliate of any
thereof, unless all other Class A Certificates have been paid in full.
Any Certificates in which the Certificate Insurer has an interest
pursuant to its right of subrogation shall be "Outstanding Certificates".
"Owner": The Person in whose name a Certificate is registered in the
Register.
"Payment Date": The 18th day of each month (or, if such day is not a
Business Day, the next following Business Day), commencing in the month
following the Startup Day.
"Percentage Interest": As to any Class A Certificate or Class B
Certificate, that percentage, expressed as a fraction, the numerator of which is
the original principal balance of such Certificate as of the Cut-Off Date and
the denominator of which is the original principal balance of all Certificates
of the same Class as of the Cut-Off Date; as to any Residual Certificate, that
Percentage Interest set forth on such Residual Certificate.
"Person": Any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.
"Pool Delinquency Rate": With respect to any Remittance Period, the
fraction, expressed as a percentage, equal to (x) the aggregate Principal
Balances of all Mortgage Loans 90 or more days Delinquent as of the close of
business on the last day of such Remittance Period over (y) the Pool Principal
Balance as of the close of business on the last day of such Remittance Period.
"Pool Principal Balance": As to any Payment Date, the aggregate principal
balance of the Mortgage Loans as of the close of business on the last day of the
related Remittance Period.
"Pool Rolling Three Month Delinquency Rate": As of any Payment Date the
fraction, expressed as a percentage, equal to the average of the Pool
Delinquency Rates for each of the three (or one and two, in the case of the
first and second Payment Dates), immediately preceding Remittance Periods.
"Preference Amount": As to any Payment Date:
(i) with respect to the Class A-1 Group I Certificates, any amounts
included in previous distributions
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to Class A-1 Group I Certificateholders of Class A-1 Distribution Amounts
(exclusive of Group I Insured Payments) which are recovered from such Class A-1
Group I Certificateholders as a voidable preference by a trustee in bankruptcy
pursuant to the United States Bankruptcy Code in accordance with a final,
nonappealable order of a court having competent jurisdiction and which have not
theretofore been repaid to such Class A-1 Group I Certificateholders provided
such Class A-1 Group I Certificateholders have complied with the provisions of
Section 7.3(g);
(ii) with respect to the Class A-2 Group I Certificates, any amounts
included in previous distributions to Class A-2 Group I Certificateholders of
Class A-2 Distribution Amounts (exclusive of Group I Insured Payments) which are
recovered from such Class A-2 Group I Certificateholders as a voidable
preference by a trustee in bankruptcy pursuant to the United States Bankruptcy
Code in accordance with a final, nonappealable order of a court having competent
jurisdiction and which have not heretofore been repaid to such Class A-2 Group I
Certificateholders provided such Class A-2 Group I Certificateholders have
complied with the provisions of Section 7.3(g);
(iii) with respect to the Class A-3 Group I Certificates, any amounts
included in previous distributions to Class A-3 Group I Certificateholders of
Class A-3 Distribution Amounts (exclusive of Group I Insured Payments) which are
recovered from such Class A-3 Group I Certificateholders as a voidable
preference by a trustee in bankruptcy pursuant to the United States Bankruptcy
Code in accordance with a final, nonappealable order of a court having competent
jurisdiction and which have not theretofore been repaid to such Class A-3 Group
I Certificateholders provided such Class A-3 Group I Certificateholders have
complied with the provisions of Section 7.3(g);
(iv) with respect to the Class A-4 Group I Certificates, any amounts
included in previous distributions to Class A-4 Group I Certificateholders of
Class A-4 Distribution Amounts (exclusive of Group I Insured Payments) which are
recovered from such Class A-4 Group I Certificateholders as a voidable
preference by a trustee in bankruptcy pursuant to the United States Bankruptcy
Code in accordance with a final, nonappealable order of a court having competent
jurisdiction and which have not heretofore been repaid to such Class A-4 Group I
Certificateholders provided such Class A-4 Group I Certificateholders have
complied with the provisions of Section 7.3(g);
(v) with respect to the Class A-5 Group I Certificates, any amounts
included in previous distributions to Class A-5 Group I Certificateholders of
Class A-5
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Distribution Amounts (exclusive of Group I Insured Payments) which are recovered
from such Class A-5 Group I Certificateholders as a voidable preference by a
trustee in bankruptcy pursuant to the United States Bankruptcy Code in
accordance with a final, nonappealable order of a court having competent
jurisdiction and which have not heretofore been repaid to such Class A-5 Group I
Certificateholders provided such Class A-5 Group I Certificateholders have
complied with the provisions of Section 7.3(g); and
(vi) with respect to the Class A-6 Group II Certificates, any amounts
included in previous distributions to Class A-6 Group II Certificateholders of
Class A-6 Distribution Amounts (exclusive of Group II Insured Payments) which
are recovered from such Class A-6 Group II Certificateholders as a voidable
preference by a trustee in bankruptcy pursuant to the United States Bankruptcy
Code in accordance with a final, nonappealable order of a court having competent
jurisdiction and which have not heretofore been repaid to such Class A-6 Group
II Certificateholders provided such Class A-6 Group II Certificateholders have
complied with the provisions of Section 7.3(g).
"Premium Amount": The Group I Premium Amount or the Group II Premium
Amount, as the case may be.
"Prepayment": Any payment of principal of a Mortgage Loan by a Mortgagor
which is received by the Master Servicer in advance of the scheduled due date
for the payment of such principal.
"Preservation Expenses": Expenditures made by the Master Servicer in
connection with a foreclosed Mortgage Loan prior to the liquidation thereof,
including, without limitation, expenditures for real estate property taxes,
hazard insurance premiums, property restoration or preservation. Preservation
Expenses shall constitute "Servicing Advances" for all purposes of this
Agreement.
"Principal and Interest Account": The principal and interest account
created by the Master Servicer pursuant to Section 10.8 hereof.
"Principal Balance": As of any date of calculation and with respect to each
Mortgage Loan, the Original Principal Balance thereof less any related Principal
Remittance Amounts relating to such Mortgage Loan included in previous related
Monthly Remittances and, if applicable, the related Monthly Remittance as of
such date.
"Principal Remittance Amounts": The Group I Principal Remittance Amount or
the Group II Principal Remittance Amount, as the case may be.
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"Prohibited Transaction": Has the meaning as defined in Section 860F of the
Code.
"Property": The underlying real property, including the improvements
thereon, securing a Mortgage Loan.
"Prospectus": The Prospectus dated October 19, 1995 relating to Mortgage
Loan Asset Backed Securities, issuable in Series.
"Prospectus Supplement": The Prospectus Supplement dated May 15, 1996
relating to the Class A Certificates.
"Qualified Liquidation": "Qualified Liquidation" shall have the meaning set
forth from time to time in the definition thereof at Section 860F(a)(4) of the
Code (or any successor statute thereto) and applicable to the Trust.
"Qualified Mortgage": "Qualified mortgage" shall have the meaning set forth
from time to time in the definition thereof at Section 860G(a)(3) of the Code
(or any successor statute thereto) and applicable to the Trust.
"Qualified Replacement Mortgage": A Mortgage Loan substituted for another
by the Seller pursuant to Section 3.2, 3.3 or 3.4 hereof, which (i) has a fixed
rate of interest if the Mortgage Loan being replaced is a Group I Mortgage Loan
and has a variable rate of interest if the Mortgage Loan being replaced is a
Group II Mortgage Loan, (ii) has a Coupon Rate at least equal to the Coupon Rate
of the Mortgage Loan being replaced (which, in the case of a Group II Mortgage
Loan, shall be deemed to mean the same index and a margin equal to or greater
than the margin applicable to the Group II Mortgage Loan being replaced), (iii)
is of the same or better property type and the same or better occupancy status
as the replaced Mortgage Loan, (iv) shall mature no later than the latest
maturity date of any Mortgage Loan then held in the related Mortgage Loan Group
(v) has a Loan-to-Value Ratio as of the Replacement Cut-Off Date no higher than
the Loan-to-Value Ratio of the replaced Mortgage Loan at such time, (vi) shall
be a First Mortgage Loan if the Mortgage Loan being replaced was a First
Mortgage Loan, and shall have the same or higher lien priority if the Mortgage
Loan being replaced was a junior Mortgage Loan, (vii) has a Principal Balance as
of the related Replacement Cut-Off Date equal to or less than the Principal
Balance of the replaced Mortgage Loan as of such Replacement Cut-Off Date,
(viii) shall be of the same or higher credit quality classification (determined
in accordance with the Seller's underwriting guidelines) as the Mortgage Loan
which such Qualified Replacement Mortgage replaces, (ix) satisfies the criteria
set forth from time to time in the definition of "qualified replacement
mortgage" at Section 860G(a)(4) of the Code (or any successor statute thereto)
and applicable to the
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Trust, and (x) complies as of the date of substitution with each representation
and warranty set forth in Section 3.2(b) hereof, all as evidenced by any
Officer's Certificate of the Seller delivered to the Trustee prior to any such
substitution. In the event that one or more mortgage loans are proposed to be
substituted for one or more Mortgage Loans, the Certificate Insurer may allow
the foregoing tests to be met on a weighted average basis or other aggregate
basis acceptable to the Certificate Insurer, as evidenced by a written approval
delivered to the Trustee by the Certificate Insurer, except that the requirement
of clause (ix) hereof must be satisfied as to each Qualified Replacement
Mortgage.
"Rating Agency": Any nationally recognized statistical credit rating
agency, or its successor, that rates any Certificates at the request of the
Seller at the time of the initial issuance of the Certificates. If 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
Certificate Insurer and the Master Servicer. References herein to the highest
rating category of a rating agency shall mean AAA (with respect to long-term
ratings) or A-1+ (with respect to short-term ratings), in the case of S&P, and
Aaa (with respect to long-term ratings) or P-1 (with respect to short-term
ratings), in the case of Moody's, and in the case of any other Rating Agency
shall mean such equivalent ratings.
"Record Date": With respect to the Group I Certificates and any Payment
Date, the close of business on the first Business Day of the calendar month in
which such Payment Date occurs. With respect to the Group II Certificates and
any Payment Date, the close of business on the Business Day immediately
preceding such Payment Date.
"Reference Banks": Bankers Trust Company, Barclay's Bank PLC, The Bank of
Tokyo and National Westminster Bank PLC; provided that if any of the foregoing
banks are not suitable to serve as a Reference Bank, then any leading banks
selected by the Trustee which are engaged in transactions in Eurodollar deposits
in the international Eurocurrency market (i) with an established place of
business in London, (ii) not controlling, under the control of or under common
control with the Sponsor or any affiliate thereof, (iii) whose quotations appear
on the Reuters Screen LIBO Page on the relevant Interest Determination Date and
(iv) which have been designated as such by the Trustee.
"Register": The register maintained by the Trustee in accordance with
Section 5.4 hereof, in which the names of the Owners are set forth.
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"Registration Statement": The Sponsor's Registration Statement number
33-96500, filed on Form S-3.
"Reimbursable Advances": As to any Mortgage Loan, all Delinquency Advances
and Servicing Advances made by the Master Servicer with respect thereto, to the
extent not previously paid to or withheld by the Master Servicer.
"Released Mortgaged Property Proceeds": Proceeds received in connection
with a taking of a Property by condemnation or the exercise of eminent domain or
in connection with a release of part of the Property.
"REMIC": A "real estate mortgage investment conduit" within the meaning of
Section 860D of the Code.
"REMIC Provisions": Provisions of the federal income tax law relating to
real estate mortgage investment conduits, which appear at Sections 860A through
860G of the Code, and related provisions, and regulations and rulings
promulgated thereunder, as the foregoing may be in effect from time to time.
"REMIC Reporting Fee": For any Payment Date, one-twelfth of .01% of the
Pool Principal Balance paid to the Trustee who in turn shall pay to the
accountants designated by the Seller for REMIC reporting done in connection with
the Trust.
"REMIC Trust": The segregated pool of assets consisting of the Trust Estate
except for the Supplemental Interest Payment Account and the Class A-6
Distribution Account.
"Remittance Date": Any date on which the Master Servicer is required to
remit moneys on deposit in a Principal and Interest Account to the Trustee,
which shall be the 13th day of each month, commencing in the month following the
Startup Day or if such day is not a Business Day the following Business Day.
"Remittance Period": The period (inclusive) beginning at the opening of
business on the second day of the calendar month immediately preceding the
calendar month in which a Remittance Date occurs and ending at the close of
business on the first day of the calendar month in which such Remittance Date
occurs.
"REO Property": A Property acquired by the Master Servicer in the name of
and on behalf of the Trust through foreclosure or deed-in-lieu of foreclosure in
connection with a defaulted Mortgage Loan.
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"Replacement Cut-Off Date": With respect to any Qualified Replacement
Mortgage, the second day of the calendar month in which such Qualified
Replacement Mortgage is conveyed to the Trust.
"Representation Letter": Letters to, or agreements with, the Depository to
effectuate a book entry system with respect to the Class A Certificates
registered in the Register under the nominee name of the Depository.
"Representative": Prudential Securities Incorporated.
"Reserve Interest Rate": With respect to any Interest Determination Date,
the rate per annum that the Trustee determines to be either (i) the arithmetic
mean (rounded upwards if necessary to the nearest whole multiple of 1/16%) of
the one-month U.S. dollar lending rates which three New York City banks selected
by the Trustee are quoting on the relevant Interest Determination Date to the
principal London offices of leading banks in the London interbank market or (ii)
in the event that the Trustee can determine no such arithmetic mean, the lowest
one-month U.S. dollar lending rate which three New York City banks selected by
the Trustee are quoting on such Interest Determination Date to leading European
banks.
"Residual Certificate": Any Class RL Certificate or any Class RU
Certificate.
"S&P": Standard & Poor's, a division of The McGraw Hill Companies.
"Second Mortgage Loan": A Mortgage Loan which constitutes a second priority
mortgage lien with respect to the related Property.
"Seller": Access Financial Lending Corp., a Delaware corporation.
"Senior Lien": With respect to any Second Mortgage Loan, the mortgage loan
relating to the corresponding Property having a first priority lien.
"Servicing Advance": As defined in Sections 10.9(b) and 10.13 hereof.
"Servicing Standards": As defined in Section 10.2 hereof.
"Sponsor": Cargill Financial Services Corporation, a Delaware corporation.
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"Sponsorship Agreement": The Securitization Sponsorship Agreement dated as
of May 1, 1996 between the Seller and Sponsor.
"Startup Day": May 22, 1996.
"Sub-Servicer": Any Person with whom the Master Servicer has entered into a
Sub-Servicing Agreement and who satisfies the requirements set forth in Section
10.3 hereof in respect of the qualification of a Sub-Servicer.
"Sub-Servicing Agreement": The written contract between the Master Servicer
and any Sub-Servicer relating to servicing and/or administration of certain
Mortgage Loans as permitted by Section 10.3 hereof.
"Substitution Amount": As defined in Section 3.2(a) hereof.
"Supplemental Interest Payment Amount": As defined in Section 7.9(a)
hereof.
"Supplemental Interest Trust": The Access Financial Supplemental Interest
Trust 1996-2 created pursuant to Section 7.9(a) hereof.
"Tax Matters Person": The tax matters person, as defined in Section
1.860F-4(d) of the Treasury Regulations, appointed with respect to the Trust
pursuant to Section 12.18 hereof.
"Trust": Access Financial Mortgage Loan Trust 1996-2, the trust created
under Article II of this Agreement.
"Trust Estate": Collectively, all money, instruments, and other property to
the extent such money, instruments and other property, are subject hereto or
intended to be held in trust for the benefit of the Owners, including all
proceeds thereof, including, without limitation, (i) the Mortgage Loans, (ii)
such amounts, including Eligible Investments, as from time to time may be held
by the Trustee in any Account, and by the Master Servicer in the Principal and
Interest Account or otherwise held by the Master Servicer in trust for the
Owners (except as otherwise provided herein), (iii) any Property, the ownership
of which has been effected in the name of the Trust as a result of foreclosure
or acceptance by the Master Servicer of a deed in lieu of foreclosure and that
has not been withdrawn from the Trust, (iv) the rights, if any, of the Trust in
any Insurance Policies relating to the Mortgage Loans, (v) Net Liquidation
Proceeds (but only to the extent that such Net Liquidation Proceeds do not
exceed the Principal Balance of the related Mortgage Loan plus accrued and
unpaid interest on such
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Mortgage Loan) with respect to any Liquidated Loan, (vi)
Released Mortgaged Property Proceeds and (vii) the Certificate
Insurance Policy.
"Trustee": Norwest Bank Minnesota, National Association, a national banking
association located on the date of execution of this Agreement at Sixth Street
and Marquette Avenue, Minneapolis, Minnesota 55479-0069, not in its individual
capacity but solely as Trustee under this Agreement, and any successor
hereunder.
"Trustee's Fee": The total of the Group I Trustee's Fee and the Group II
Trustee's Fee.
"Underwriters": Prudential Securities Incorporated and J.P. Morgan
Securities Inc.
"Unregistered Certificates": Certificates which are not registered as
evidenced by inclusion in the Register.
"Upper-Tier REMIC": The segregated pool of assets held by the Trust
consisting of the Lower Tier Interests (except for the RL Lower-Tier Interest,
as set forth in the chart in Section 2.8(c) hereof), the Distribution Accounts
and the Certificate Insurance Policy.
Section 1.2. Use of Words and Phrases. "Herein", "hereby", "hereunder",
"hereof", "hereinbefore", "hereinafter" and other equivalent words refer to this
Agreement as a whole and not solely to the particular section of this Agreement
in which any such word is used. The definitions set forth in Section 1.1 hereof
include both the singular and the plural. Whenever used in this Agreement, any
pronoun shall be deemed to include both singular and plural and to cover all
genders.
Section 1.3. Captions; Table of Contents. The captions or headings in this
Agreement and the Table of Contents are for convenience only and in no way
define, limit or describe the scope and intent of any provisions of this
Agreement.
Section 1.4. Opinions. Each opinion with respect to the validity, binding
nature and enforceability of documents or Certificates may be qualified to the
extent that the same may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally and by general principles of equity (whether
considered in a proceeding or action in equity or at law) and may state that no
opinion is expressed on the availability of the remedy of specific enforcement,
injunctive relief or any other equitable remedy. Any opinion required to be
furnished by any Person hereunder must be delivered by counsel upon whose
opinion the addressee
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of such opinion may reasonably rely, and such opinion may state that it is given
in reasonable reliance upon an opinion of another, a copy of which must be
attached, concerning the laws of a foreign jurisdiction. Opinions regarding
REMIC matters must be furnished by special counsel to the Seller.
Section 1.5. Calculations. All calculations of accrued interest made
pursuant to the Agreement shall be made assuming a 360-day year consisting of
twelve 30-day months, except for interest on the Group II Certificates which
calculations shall be made based on the actual number of days over a 360-day
year, or as otherwise specifically provided herein.
ARTICLE II
THE TRUST
Section 2.1. Establishment of the Trust. The Sponsor does hereby create and
establish, pursuant to the laws of the State of New York and this Agreement, the
Trust, which, for convenience, shall be known as "Access Financial Mortgage Loan
Trust 1996-2". The Trust shall be deemed to consist of two sub-trusts, one with
respect to each Mortgage Loan Group.
Section 2.2. Office. The office of the Trust shall be in care of the
Trustee, Sixth Street and Marquette Avenue, Minneapolis, Minnesota 55479-0069 or
at such other address as the Trustee may designate by notice to the Sponsor, the
Seller, the Master Servicer, the Certificate Insurer and the Owners.
Section 2.3. Purpose and Powers. The purpose of the Trust is to engage in
the following activities, and only such activities: (i) the purchase of the
Mortgage Loans; (ii) the holding of the Mortgage Loans and the Trust Estate
related thereto; (iii) the issuance of the Certificates; (iv) activities that
are necessary, suitable or convenient to accomplish the foregoing or are
incidental thereto or connected therewith, including the investment of moneys in
accordance with this Agreement; and (v) such other activities as may be required
in connection with conservation of the Trust Estate and distributions to the
Owners; provided, however, that nothing contained herein shall be construed to
permit the Trustee to take any action which would adversely affect the status of
any interest held by the Trust which is intended to be treated as a REMIC.
Section 2.4. Appointment of the Trustee; Declaration of Trust. The Sponsor
hereby appoints the Trustee as trustee of the Trust effective as of the Startup
Day, to have all the rights, powers and duties set forth herein. The
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Trustee hereby acknowledges and accepts such appointment, represents and
warrants its eligibility as of the Startup Day to serve as Trustee pursuant to
Section 9.8 hereof and declares that it will hold the Trust Estate in trust upon
and subject to the conditions set forth herein for the benefit of the Owners.
Section 2.5. Expenses of the Trust. The Master Servicer shall retain its
monthly aggregate Master Servicing Fees as provided in Section 10.15 herein; the
Trustee's Fee shall be paid monthly as provided in Section 7.3(b)(i) hereof; the
REMIC Reporting Fee shall be paid monthly as provided in Section 7.3(b)(ii)
hereof and the premiums due to the Certificate Insurer shall be paid monthly as
provided in Section 7.3(b)(iii) hereof; all other expenses of the Trust
including any fees and expenses incurred by the Trustee in connection with a
termination of the Trust pursuant to Article VIII shall be submitted to the
Seller or the Sponsor for its approval, and, if so approved, shall be paid by
the Seller. The reasonable fees and expenses of the Trustee's counsel in
connection with the review and delivery of this Agreement and related
documentation shall be due as of the Startup Day and shall be paid by the
Seller.
Section 2.6. Ownership of the Trust. On the Startup Day, the ownership
interests in the Trust shall be transferred as set forth in Section 4.2 hereof,
such transfer to be evidenced by issuance of the Certificates as described
therein. Thereafter, transfer of any ownership interest shall be governed by
Section 5.4 hereof.
Section 2.7. Receipt of Trust Estate. The Sponsor hereby directs the
Trustee to accept the property conveyed to it pursuant to Section 3.3 hereof in
connection with the establishment of the Trust, and the Trustee hereby
acknowledges receipt of such property. The Sponsor further directs the Trustee
to issue the Certificates, to hold the Class A Certificates as transfer agent
for the Depository as provided in Section 5.4, and to deliver the Class B
Certificates and the Residual Certificates to the Seller.
Section 2.8. Miscellaneous REMIC Provisions. (a) The Trust shall elect that
the Upper-Tier REMIC and the Lower-Tier REMIC shall be treated as REMICs under
Section 860D of the Code. Any inconsistencies or ambiguities in this Agreement
or in the administration of the Trust shall be resolved in a manner that
preserves the validity of such REMIC elections.
(b) The Class A-1 Group I Certificates, the Class A-2 Group I Certificates,
the Class A-3 Group I Certificates, the Class A-4 Group I Certificates, the
Class A-5 Group I Certificates, the uncertificated right of the
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Group I Supplemental Interest Account to receive the distributions described in
Section 7.3(c)(iv) and the uncertificated right of the Group II Supplemental
Interest Account to receive the distributions described in Section 7.3(c)(v) of
(the "Uncertificated Interest") are hereby designated as "regular interests"
with respect to the Upper-Tier REMIC and the Class RU Certificates are hereby
designated as the single class of "residual interest" with respect to the
Upper-Tier REMIC. The Class LT1, LT2, LT3, LT4, LT5 and LT6 Certificates are
hereby designated as "regular interests" with respect to the Lower-Tier REMIC
and the Class RL Certificates are hereby designated as the single class of
"residual interest" with respect to the Lower-Tier REMIC.
(c) The beneficial ownership interest of the Lower-Tier REMIC shall be
evidenced by the interests (the "Lower-Tier Interests") having the
characteristics and terms as follows:
Original Final
Class Companion Principal Interest Payment
Designation Classes Balance Rate Date
- ----------- -------------- ----------- ------- ------------------
LT-1 A-1, B Group I $58,456,000 (1) March 18, 2011
LT-2 A-2, B Group I $38,680,000 (1) March 18, 2011
LT-3 A-3, B Group I $16,525,000 (1) June 18, 2014
LT-4 A-4, B Group I $14,713,000 (1) September 18, 2021
LT-5 A-5, B Group I $13,796,000 (1) June 18, 2027
LT-6 A-6, B Group II $68,344,000 (2) June 18, 2027
RL (3) (3) June 18, 2027
(1) The Net Weighted Average Coupon Rate of the Group I Mortgage Loans.
(2) The Net Weighted Average Coupon Rate of the Group II Mortgage Loans.
(3) The RL Certificate has no principal balance and does not bear interest.
The Lower-Tier Interests LT-1, LT-2, LT-3, LT-4, LT-5 and LT-6 shall be issued
as non-certificated interests and recorded on the records of the Lower-Tier
REMIC as being issued to and held by the Trustee on behalf of the Upper-Tier
REMIC.
On each Payment Date, the Lower Tier Distribution Amount shall be applied
as principal and interest of particular Lower Tier Interests, other than the RL
Certificate, in amounts corresponding to the aggregate respective amounts
required to be applied as principal and interest of their related Companion
Classes (as set forth above) pursuant to the priorities set forth in section 7.3
hereof.
No distributions will be made on the Class RL Certificate, except that any
distribution of the proceeds of the final remaining assets of the Lower Tier
REMIC shall be distributed to the holder thereof upon presentation and surrender
of the Class RL Certificate.
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(d) The Startup Day is hereby designated as the "startup day" of each REMIC
within the meaning of Section 860G(a)(9) of the Code.
ARTICLE III
REPRESENTATIONS, WARRANTIES AND COVENANTS
OF THE SPONSOR, THE SELLER AND THE MASTER SERVICER;
CONVEYANCE OF MORTGAGE LOANS
Section 3.1. Representations and Warranties of the Sponsor, the Seller and
the Master Servicer. (a) The Sponsor hereby represents and warrants to the
Trustee, the Master Servicer, the Seller, the Certificate Insurer and to the
Owners as of the Startup Day that:
(i) The Sponsor is a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware and is in good
standing as a foreign corporation in each jurisdiction in which the nature
of its business, or the properties owned or leased by it make such
qualification necessary. The Sponsor has all requisite corporate power and
authority to own and operate its properties, to enable it to carry out its
business as presently conducted, and as proposed to be conducted, in a
material manner and to enter into and discharge its obligations under this
Agreement and the other Operative Documents to which it is a party in a
material manner.
(ii) The execution and delivery of this Agreement and the other
Operative Documents to which the Sponsor is a party by the Sponsor and its
performance and compliance with the terms of this Agreement and of the
other Operative Documents to which it is a party have been duly authorized
by all necessary corporate action on the part of the Sponsor and will not
violate the Sponsor's Certificate of Incorporation or Bylaws 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 Sponsor is a party or
by which the Sponsor is bound, or violate any statute or any order, rule or
regulation of any court, governmental agency or body or other tribunal
having jurisdiction over the Sponsor or any of its properties.
(iii) This Agreement and the other Operative Documents to which the
Sponsor is a party, assuming due authorization, execution and delivery by
the other parties hereto and thereto, each constitutes a valid, legal and
binding obligation of the Sponsor, enforceable against it in accordance
with the terms hereof and thereof, except as the enforcement hereof and
thereof may be limited by applicable
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bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally and by general principles of equity
(whether considered in a proceeding or action in equity or at law).
(iv) The Sponsor 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 might have consequences that would
materially and adversely affect the condition (financial or other) or
operations of the Sponsor or its properties or might have consequences that
would materially and adversely affect its performance hereunder and under
the other Operative Documents to which it is a party.
(v) No litigation is pending or, to the best of the Sponsor's
knowledge, threatened against the Sponsor which litigation might have
consequences that would prohibit its entering into this Agreement or any
other Operative Document to which it is a party or that would materially
and adversely affect the condition (financial or otherwise) or operations
of the Sponsor or its properties or might have consequences that would
materially and adversely affect its performance hereunder and under the
other Operative Documents to which it is a party.
(vi) No certificate of an officer, statement furnished in writing or
report delivered pursuant to the terms hereof by the Sponsor contains any
untrue statement of a material fact.
(vii) The statements contained in the Registration Statement which
describe the Sponsor or matters or activities for which the Sponsor is
responsible in accordance with the Operative Documents or which are
attributed to the Sponsor therein are true and correct in all material
respects, and the Registration Statement does not contain any untrue
statement of a material fact with respect to the Sponsor or omit to state a
material fact required to be stated therein or necessary in order to
prevent the statements contained therein with respect to the Sponsor from
being misleading. To the best of the Sponsor's knowledge and belief, the
Registration Statement does not contain any untrue statement of a material
fact required to be stated therein or omit to state any material fact
required to be stated therein or necessary to make the statements contained
therein not misleading.
(viii) All actions, approvals, consents, waivers, exemptions,
variances, franchises, orders, permits, authorizations, rights and licenses
required to be taken, given or obtained, as the case may be, by or from any
federal, state or other governmental authority or agency (other than any
such actions, approvals, etc. under any state securities laws, real estate
syndication or "Blue Sky" statutes, as to
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which the Sponsor makes no such representation or warranty), that are
necessary or advisable in connection with the purchase and sale of the
Certificates and the execution and delivery by the Sponsor of the Operative
Documents to which it is a party, have been duly taken, given or obtained,
as the case may be, are in full force and effect on the date hereof, are
not subject to any pending proceedings or appeals (administrative, judicial
or otherwise) and either the time within which any appeal therefrom may be
taken or review thereof may be obtained has expired or no review thereof
may be obtained or appeal therefrom taken, and are adequate to authorize
the consummation of the transactions contemplated by this Agreement and the
other Operative Documents on the part of the Sponsor and the performance by
the Sponsor of its obligations under this Agreement and such of the other
Operative Documents to which it is a party.
(ix) The transactions contemplated by this Agreement are in the
ordinary course of business of the Sponsor.
(b) The Seller hereby represents, warrants and covenants to the Sponsor,
the Trustee, the Master Servicer, the Certificate Insurer and to the Owners as
of the Startup Day that:
(i) The Seller is a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware and is in good
standing as a foreign corporation in each jurisdiction in which the nature
of its business, or the properties owned or leased by it make such
qualification necessary. The Seller has all requisite corporate power and
authority to own and operate its properties, to enable it to carry out its
business as presently conducted in a material manner and as proposed to be
conducted and to enter into and discharge its obligations under this
Agreement and the other Operative Documents to which it is a party in a
material manner.
(ii) The execution and delivery of this Agreement and the other
Operative Documents to which the Seller is a party, by the Seller, and its
performance and compliance with the terms of this Agreement and of the
other Operative Documents to which it is a party have been duly authorized
by all necessary corporate action on the part of the Seller and will not
violate the Seller's Certificate of Incorporation or Bylaws 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 Seller is a party or
by which the Seller is bound, or violate any statute or any order, rule or
regulation of any court, governmental agency or body or other tribunal
having jurisdiction over the Seller or any of its properties.
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(iii) This Agreement and the other Operative Documents to which the
Seller is a party, assuming due authorization, execution and delivery by
the other parties hereto and thereto, each constitutes a valid, legal and
binding obligation of the Seller, enforceable against it in accordance with
the terms hereof and thereof, except as the enforcement hereof and thereof
may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting creditors' rights generally and
by general principles of equity (whether considered in a proceeding or
action in equity or at law).
(iv) The Seller 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 might have consequences that would
materially and adversely affect the condition (financial or other) or
operations of the Seller or its properties or might have consequences that
would materially and adversely affect its performance hereunder and under
the other Operative Documents to which it is a party.
(v) No litigation is pending or, to the best of the Seller's
knowledge, threatened against the Seller which litigation might have
consequences that would prohibit its entering into this Agreement or any
other Operative Document to which it is a party or that would materially
and adversely affect the condition (financial or otherwise) or operations
of the Seller or its properties or might have consequences that would
materially and adversely affect its performance hereunder and under the
other Operative Documents to which it is a party.
(vi) No certificate of an officer, statement furnished in writing or
report delivered pursuant to the terms hereof by the Seller contains any
untrue statement of a material fact or omits to state a material fact
necessary to make the certificate, statement or report not misleading.
(vii) The statements contained in the Registration Statement which
describe the Seller or matters or activities for which the Seller is
responsible in accordance with the Operative Documents or which are
attributed to the Seller therein are true and correct in all material
respects, and the Registration Statement does not contain any untrue
statement of a material fact with respect to the Seller or omit to state a
material fact required to be stated therein or necessary in order to
prevent the statements contained therein with respect to the Seller from
being misleading. To the best of the Seller's knowledge and belief, the
Registration Statement does not contain any untrue statement of a material
fact required to be stated therein or omit to state any material fact
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required to be stated therein or necessary to make the statements contained
therein not misleading.
(viii) All actions, approvals, consents, waivers, exemptions,
variances, franchises, orders, permits, authorizations, rights and licenses
required to be taken, given or obtained, as the case may be, by or from any
federal, state or other governmental authority or agency (other than any
such actions, approvals, etc. under any state securities laws, real estate
syndication or "Blue Sky" statutes, as to which the Seller makes no such
representation or warranty), that are necessary or advisable in connection
with the purchase and sale of the Certificates and the execution and
delivery by the Seller of the Operative Documents to which it is a party,
have been duly taken, given or obtained, as the case may be, are in full
force and effect on the date hereof, are not subject to any pending
proceedings or appeals (administrative, judicial or otherwise) and either
the time within which any appeal therefrom may be taken or review thereof
may be obtained has expired or no review thereof may be obtained or appeal
therefrom taken, and are adequate to authorize the consummation of the
transactions contemplated by this Agreement and the other Operative
Documents on the part of the Seller and the performance by the Seller of
its obligations under this Agreement and such of the other Operative
Documents to which it is a party.
(ix) The transactions contemplated by this Agreement are in the
ordinary course of business of the Seller.
(x) The Seller received fair consideration and reasonably equivalent
value in exchange for the sale of the interests in the Mortgage Loans.
(xi) The Seller did not sell any interest in any Mortgage Loan with
any intent to hinder, delay or defraud any of its creditors.
(xii) The Seller is solvent and the Seller will not be rendered
insolvent as a result of the sale of the Mortgage Loans to the Trust.
(c) The Master Servicer hereby represents and warrants to the Trustee, the
Certificate Insurer, the Seller, the Sponsor and to the Owners as of the Startup
Day that:
(i) The Master Servicer is a corporation duly organized, validly
existing and in good standing under the laws of Delaware, and is, or a
Sub-Servicer is, in compliance with the laws of each state in which any
Property is located to the extent necessary to enable the Master Servicer
to perform its obligations hereunder. The Master Servicer and each
Sub-Servicer is in good standing as a foreign corporation in each
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jurisdiction in which the nature of its business, or the properties owned
or leased by it make such qualification necessary to enable the Master
Servicer to perform its obligations hereunder. The Master Servicer has all
requisite corporate power and authority to own and operate its properties,
to carry out its business as presently conducted and as proposed to be
conducted and to enter into and discharge, either directly or through
Sub-Servicers, its obligations under this Agreement. The Master Servicer
and each Sub-Servicer (except LSI Financial Group) has equity of at least
$15,000,000 as determined in accordance with generally accepted accounting
principles. Each Sub-Servicer appointed by the Master Servicer will have
all requisite corporate power and authority to own and operate its
properties, to carry out its business as presently conducted and as
proposed to be conducted.
(ii) The execution and delivery of this Agreement by the Master
Servicer and its performance and compliance with the terms of this
Agreement and any Sub-Servicing Agreement have been duly authorized by all
necessary corporate action on the part of the Master Servicer and will not
violate the Master Servicer's Certificate of Incorporation or Bylaws 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 by which the Master Servicer is bound or violate any
statute or any order, rule or regulation of any court, governmental agency
or body or other tribunal having jurisdiction over the Master Servicer or
any of its properties.
(iii) This Agreement and any Sub-Servicing Agreement, assuming due
authorization, execution and delivery by the other parties hereto and
thereto, each constitutes a valid, legal and binding obligation of the
Master Servicer, enforceable against it in accordance with the terms
hereof, except as the enforcement hereof may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally and by general principles of equity
(whether considered in a proceeding or action 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 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 materially and adversely affect its performance
hereunder and under any Sub-Servicing Agreement.
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(v) No litigation is pending or, to the best of the Master Servicer's
knowledge, threatened against the Master Servicer which litigation might
have consequences that would prohibit its entering into this Agreement or
any Sub-Servicing Agreement or that would materially and adversely affect
the condition (financial or otherwise) or operations of the Master Servicer
or its properties or might have consequences that would materially and
adversely affect its performance hereunder.
(vi) Each certificate of an officer, statement furnished in writing or
report delivered pursuant to the terms hereof by the Master Servicer is
true and correct in all material respects.
(vii) The statements contained in the Prospectus Supplement which
describe the Master Servicer under the caption "The Master Servicer" are
true and correct in all material respects.
(viii) The Master Servicing Fee is a "current (normal) servicing fee
rate" as that term is used in Statement of Financial Accounting Standards
No. 65 issued by the Financial Accounting Standards Board. Neither the
Master Servicer nor any affiliate thereof will report on any financial
statements any part of the Master Servicing Fee as an adjustment to the
sales price of the Mortgage Loans.
(ix) All actions, approvals, consents, waivers, exemptions, variances,
franchises, orders, permits, authorizations, rights and licenses required
to be taken, given or obtained, as the case may be, by or from any federal,
state or other governmental authority or agency (other than any such
actions, approvals, etc. under any state securities laws, real estate
syndication or "Blue Sky" statutes, as to which the Master Servicer makes
no such representation or warranty), that are necessary or advisable in
connection with the execution and delivery by, and the performance of the
obligations of, the Master Servicer, either directly or through a
Sub-Servicer, of this Agreement and each Sub-Servicing Agreement, have been
duly taken, given or obtained, as the case may be, are in full force and
effect on the date hereof, are not subject to any pending proceedings or
appeals (administrative, judicial or otherwise) and either the time within
which any appeal therefrom may be taken or review thereof may be obtained
has expired or no review thereof may be obtained or appeal therefrom taken,
and are adequate to authorize the consummation of the transactions
contemplated by this Agreement and each Sub-Servicing Agreement on the part
of the Master Servicer and the performance by the Master Servicer, either
directly or through a Sub-Servicer, of its obligations under this Agreement
and each Sub-Servicing Agreement.
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(x) The collection practices used by the Master Servicer with respect
to the Mortgage Loans have been, in all material respects, legal, proper,
prudent and customary in the non-conforming credit residential loan
servicing business.
(xi) The transactions contemplated by this Agreement are in the
ordinary course of business of the Master Servicer.
It is understood and agreed that the representations and warranties set
forth in this Section 3.1 shall survive delivery of the Mortgage Loans to the
Trustee.
Upon discovery by any of the Seller, the Master Servicer, the Sponsor, the
Certificate Insurer or the Trustee of a breach of any of the representations and
warranties set forth in this Section 3.1(c) which materially and adversely
affects the interests of the Owners or of the Certificate Insurer, the party
discovering such breach shall give prompt written notice to the other parties
and the Certificate Insurer; provided that, the Trustee shall have no duty or
responsibility to inquire, investigate, determine or obtain actual knowledge of
facts or events constituting a breach of any such representations or warranties.
Within 30 days of its discovery or its receipt of notice of breach, the Master
Servicer shall cure such breach in all material respects and, upon the Master
Servicer's continued failure to cure such breach, may thereafter be removed
pursuant to Section 11.1 hereof.
Section 3.2. Covenants of the Seller to Take Certain Actions with Respect
to the Mortgage Loans in Certain Situations. (a) Upon the actual knowledge of
the Seller, the Sponsor, the Certificate Insurer, the Master Servicer or the
Trustee that the statements set forth in (ii), (x), (xiii), (xix), (xxxii),
(xxxiii) or (xxxix) of subsection (b) below were untrue in any material respect
as of the Startup Day or that any of the other statements set forth in
subsection (b) below were untrue as of the Startup Day with the result that the
interests of the Owners or the interests of the Certificate Insurer are
materially and adversely affected, the party discovering such breach shall give
prompt written notice to the other parties and the Certificate Insurer.
Upon the earliest to occur of the Seller's discovery, its receipt of notice
of breach from any one of the other parties or the Certificate Insurer or such
time as a situation resulting from an existing statement which is untrue
materially and adversely affects the interests of the Owners or of the
Certificate Insurer as set forth above, the Seller hereby covenants and warrants
that it shall promptly cure such breach in all material respects or it shall,
subject to the further requirements of this paragraph, on the second Remittance
Date next succeeding such discovery, receipt of notice or such time (i)
substitute in lieu of each Mortgage Loan which has given rise to the requirement
for action by the Seller a Qualified Replacement Mortgage and, if the
outstanding principal amount of such Qualified Replacement Mortgage as of the
applicable
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Replacement Cut-Off Date is less than the Principal Balance of such Mortgage
Loan as of such Replacement Cut-Off Date, deliver an amount equal to such
difference together with accrued and unpaid interest on such amount calculated
at the related Coupon Rate less the rate at which the Master Servicing Fee is
calculated, if any, of the Mortgage Loan being replaced (such aggregate amount,
the "Substitution Amount"), together with the aggregate amount of all
unreimbursed Delinquency Advances and Servicing Advances theretofore made with
respect to such Mortgage Loan to the Master Servicer for deposit in the
Principal and Interest Account or (ii) purchase such Mortgage Loan from the
Trust at a purchase price equal to the Loan Purchase Price thereof, which
purchase price shall be delivered to the Master Servicer for deposit in the
Principal and Interest Account. In connection with any such proposed purchase or
substitution, the Seller at its expense, shall cause to be delivered to the
Trustee and to the Certificate Insurer an opinion of counsel experienced in
federal income tax matters stating whether or not such a proposed purchase or
substitution would constitute a Prohibited Transaction for the Trust or would
jeopardize the status of either REMIC as a REMIC and the Seller shall only be
required to take either such action to the extent such action would not
constitute a Prohibited Transaction for the Trust or would not jeopardize the
status of either the Upper-Tier REMIC or the Lower-Tier REMIC as a REMIC. It is
understood and agreed that the obligation of the Seller so to cure the defect,
substitute or purchase any Mortgage Loan as to which such a statement set forth
below is untrue in any material respect and has not been remedied shall
constitute the sole remedy available to the Owners, the Trustee or the
Certificate Insurer respecting any such statement.
(b) (i) The information with respect to each Mortgage Loan set forth
in the related Mortgage Loan Schedule is true and correct in all material
respects as of the Cut-Off Date;
(ii) Each Mortgage Loan File has been or will be delivered to the
Trustee on the Startup Day;
(iii) Each Mortgage Loan being transferred to the Trustee is a
Qualified Mortgage and is a Mortgage;
(iv) 91.69% of the Original Group I Pool Principal Balance and 90.77%
of the Original Group II Pool Principal Balance have corresponding
Properties that are improved by a one-to-four family residential dwelling
and the remaining Mortgage Loans have corresponding Properties that are
improved by modular housing, manufactured housing, PUD, SF row houses,
townhouses or duplexes;
(v) As of the Cut-Off Date, no Mortgage Loan in Group I had a
Loan-to-Value Ratio in excess of 90.00% and the weighted average
Loan-to-Value Ratio for Group I was approximately 74.37% and no Mortgage
Loan in Group II had a
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Loan-to-Value Ratio in excess of 90.00% and the weighted average
Loan-to-Value Ratio for Group II was approximately 75.33%.
(vi) Each Mortgage Loan is being serviced by or on behalf of the
Master Servicer;
(vii) The Note related to each Group I Mortgage Loan bears a fixed
Coupon Rate of at least 7.75% per annum; the Note related to each Group II
Mortgage Loan bears interest based on an index of six-month LIBOR, adjusts
either every sixth month or every twenty-fourth month or every thirty-sixth
month, has a margin of at least 3.375%, an adjustment cap of at least
1.00%, a lifetime cap of at least 13.50% and a Coupon Rate as of the
Cut-Off Date of at least 6.70%;
(viii) Notes representing not more than 49.74% of the Original Group I
Pool Principal Balance of the Mortgage Loans provide for a "balloon"
payment at the end of the 15th year and notes representing not more than
1.18% of the Original Group II Pool Principal Balance of the Mortgage Loans
provide for a "balloon" payment at the end of the 15th year (such Mortgage
Loans having 30-year amortization schedules);
(ix) As of the Cut-Off Date, each Mortgage is a valid and subsisting
first or second lien of record on the Property subject in the case of any
Second Mortgage Loan only to a Senior Lien on such Property and subject in
all cases to the exceptions to title set forth in the title insurance
policy with respect to the related Mortgage Loan, which exceptions are
generally acceptable to banking institutions in connection with their
regular mortgage lending activities, and such other exceptions to which
similar properties are commonly subject and which do not individually, or
in the aggregate, materially and adversely affect the benefits of the
security intended to be provided by such Mortgage;
(x) Immediately prior to the transfer and assignment herein
contemplated, the Seller held good and indefeasible title to, and was the
sole owner of, each Mortgage Loan conveyed by the Seller subject to no
liens, charges, mortgages, encumbrances or rights of others except as set
forth in paragraph (ix) or other liens which will be released
simultaneously with such transfer and assignment; and immediately upon the
transfer and assignment herein contemplated, the Trust will hold good and
indefeasible title to, and be the sole owner of, each Mortgage Loan subject
to no liens, charges, mortgages, encumbrances or rights of others except as
set forth in paragraph (ix) or other liens which will be released
simultaneously with such transfer and assignment;
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(xi) As of the Cut-Off Date, no Mortgage Loan is more than 59 days
delinquent, and Mortgage Loans (in the aggregate) representing no more than
3.86% of the Original Group I Pool Principal Balance of the Mortgage Loans
are 30-59 days delinquent and no more than 3.31% of the Original Group II
Pool Principal Balance of the Mortgage Loans are 30-59 days delinquent;
(xii) As of the Startup Day, each Property is free of substantial
damage and is in good repair;
(xiii) As of the Startup Day, there is no valid and enforceable
offset, defense or counterclaim to any Note or Mortgage, including the
obligation of the related Mortgagor to pay the unpaid principal of or
interest on such Note;
(xiv) As of the Startup Day, there is no delinquent tax or assessment
lien on any Property, nor is there any claim for work, labor or material
affecting any Property which is or may be a lien prior to, or equal with,
the lien of the related Mortgage except, in each case, those which are
insured against by any title insurance policy referred to in paragraph
(xvi) below;
(xv) Each Mortgage Loan at the time it was made complied in all
material respects with all applicable state and federal laws and
regulations, including, without limitation, the federal Truth-in-Lending
Act, Real Estate Settlement Procedure Act and other consumer protection
laws, usury, equal credit opportunity, disclosure and recording laws;
(xvi) With respect to each Mortgage Loan, a lender's title insurance
policy, issued in standard California Land Title Association form or
American Land Title Association form in the state in which the related
Property is situated, in an amount at least equal to the Original Principal
Balance of such Mortgage Loan insuring the mortgagee's interest under the
related Mortgage Loan as the holder of a valid first mortgage lien of
record in the case of each First Mortgage Loan or second mortgage lien of
record in the case of each Second Mortgage Loan on the real property
described in the related Mortgage, as the case may be, subject only to
exceptions of the character referred to in paragraph (ix) above, was
effective on the date of the origination of such Mortgage Loan, and, as of
the Startup Day, such policy will be valid and thereafter such policy shall
continue in full force and effect. The assignment to the Trust of the
benefits of the mortgage title insurance does not require the consent of or
notification to the insurer. No claims have been made under such mortgage
title insurance policies and no prior holder of the related mortgage has
done, by act or omission, anything
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that would impair the coverage of such mortgage title insurance policy;
(xvii) At the Startup Day, the improvements upon each Property are
covered by a valid and existing hazard insurance policy (which may be a
blanket policy of the type described in Section 10.11(c) hereof) with a
generally acceptable carrier that provides for fire and extended coverage
representing coverage not less than the least of (A) the outstanding
principal balance of the related Mortgage Loan (together, in the case of a
Second Mortgage Loan, with the outstanding principal balance of the Senior
Lien), (B) the minimum amount required to compensate for damage or loss on
a replacement cost basis or (C) the full insurable value of the Property
and in any event which is not less than the amount necessary to avoid the
operation of any coinsurance provisions with respect to the Property in the
event of any loss less than the amount of the insurance coverage and
consistent with the amount that would have been required as of the date of
origination by the related originator in its normal residential mortgage
lending activities with respect to similar properties in the same locality.
All hazard insurance policies are the valid and binding obligation of the
insurer and contain a standard mortgagee clause naming the originator, its
successors and assigns, as mortgagee. All premiums thereon have been paid.
Such insurance policy requires prior notice to the insured of termination
or cancellation, and no such notice has been received. The Mortgage
obligates the Mortgagor thereunder to maintain all such insurance at the
Mortgagor's cost and expense, and upon the Mortgagor's failure to do so,
authorizes the holder of the Mortgage to obtain and maintain such insurance
at the Mortgagor's cost and expense and to seek reimbursement therefor from
the Mortgagor;
(xviii) If any Property is in an area identified in the Federal
Register by the Federal Emergency Management Agency as having special flood
hazards, a flood insurance policy (which may be a blanket policy of the
type described in Sections 10.11(b) and 10.11(c) hereof) in a form meeting
the requirements of the current guidelines of the Federal Insurance
Administration is in effect with respect to such Property with a generally
acceptable carrier in an amount representing coverage not less than the
least of (A) the outstanding principal balance of the related Mortgage Loan
(together, in the case of a Second Mortgage Loan, with the outstanding
principal balance of the Senior Lien), (B) the minimum amount required to
compensate for damage or loss on a replacement cost basis or (C) the
maximum amount of insurance that is available under the Flood Disaster
Protection Act of 1973, as amended. All flood insurance policies are the
valid and binding obligation of the insurer and contain a standard
mortgagee clause naming the originator, its successors and assigns, as
mortgagee. All premiums thereon have been paid.
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Such flood insurance policy requires prior notice to the insured of
termination or cancellation, and no such notice has been received. The
Mortgage obligates the Mortgagor thereunder to maintain all such flood
insurance at the Mortgagor's cost and expense, and upon the Mortgagor's
failure to do so, authorizes the holder of the Mortgage to obtain and
maintain such flood insurance at the Mortgagor's cost and expense and to
seek reimbursement therefor from the Mortgagor;
(xix) Each Mortgage and Note is the legal, valid and binding
obligation of the maker thereof and is enforceable in accordance with its
terms, except only as such enforcement may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and by general principles of
equity (whether considered in a proceeding or action in equity or at law),
and all parties to each Mortgage Loan had full legal capacity to execute
all documents relating to such Mortgage Loan and convey the estate therein
purported to be conveyed; there is only one original Note with respect to
each Mortgage Loan;
(xx) The Seller has caused and will cause to be performed any and all
acts required to be performed to preserve the rights and remedies of the
Trust in any Insurance Policies applicable to any Mortgage Loans delivered
by the Seller including, to the extent such Mortgage Loan is not covered by
a blanket policy described in Section 10.11(c) hereof, any necessary
notifications of insurers, assignments of policies or interests therein,
and establishments of co-insured, joint loss payee and mortgagee rights in
favor of the Trustee;
(xxi) Each original Mortgage was recorded or is in the process of
being recorded, and all subsequent assignments of the original Mortgage
have been recorded in the appropriate jurisdictions wherein such
recordation is necessary to perfect the lien thereof for the benefit of the
Trustee (or, subject to Section 3.3 hereof, are in the process of being
recorded);
(xxii) The terms of each Note and each Mortgage have not been
impaired, altered or modified in any respect, except by a written
instrument which has been recorded, if necessary, to protect the interests
of the Owners and which has been delivered to the Trustee. The substance of
any such alteration or modification is reflected on the related Mortgage
Loan Schedule;
(xxiii) The proceeds of each Mortgage Loan have been fully disbursed,
and there is no obligation on the part of the mortgagee to make future
advances thereunder. Any and all requirements as to completion of any
on-site or off-site improvements and as to disbursements of any escrow
funds
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therefor have been complied with. All costs, fees and expenses incurred in
making or closing or recording such Mortgage Loans were paid;
(xxiv) No Mortgage Loan was originated under a buydown plan;
(xxv) No Mortgage Loan has a shared appreciation feature, or other
contingent interest feature;
(xxvi) Each Property is located in the state identified in the related
Mortgage Loan Schedule and consists of one parcel of real property (or
several parcels secured by a blanket mortgage) with a residential dwelling
erected thereon;
(xxvii) Each Mortgage contains a provision for the acceleration of the
payment of the unpaid principal balance of the related Mortgage Loan in the
event the related Property is sold without the prior consent of the
mortgagee thereunder;
(xxviii) Any advances made after the date of origination of a Mortgage
Loan but prior to the Cut-Off Date have been consolidated with the
outstanding principal amount secured by the related Mortgage, and the
secured principal amount, as consolidated, bears a single interest rate and
single repayment term reflected on the Mortgage Loan Schedule. The
consolidated principal amount does not exceed the original principal amount
of the related Mortgage Loan. No Note permits or obligates the Master
Servicer to make future advances to the related Mortgagor at the option of
the Mortgagor;
(xxix) There is no proceeding pending or threatened for the total or
partial condemnation of any Property, nor is such a proceeding currently
occurring, and each Property is undamaged by waste, fire, earthquake or
earth movement;
(xxx) All of the improvements which were included for the purposes of
determining the Appraised Value of any Property lie wholly within the
boundaries and building restriction lines of such Property, and no
improvements on adjoining properties encroach upon such Property, except in
each case exceptions which are stated in the title insurance policy and
affirmatively insured;
(xxxi) With respect to each Mortgage constituting a deed of trust, a
trustee, duly qualified under applicable law to serve as such, has been
properly designated and currently so serves and is named in such Mortgage,
and no fees or expenses are or will become payable by the Owners or the
Trust to the trustee under the deed of trust, except in connection with a
trustee's sale after default by the related Mortgagor;
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(xxxii) Each Mortgage contains customary and enforceable provisions
which render the rights and remedies of the holder thereof adequate for the
realization against the related Property of the benefits of the security,
including (A) in the case of a Mortgage designated as a deed of trust, by
trustee's sale and (B) otherwise by judicial foreclosure. There is no
homestead or other exemption available that would materially interfere with
the right to sell the related Property at a trustee's sale or the right to
foreclose on the related Mortgage;
(xxxiii) Except as provided by clause (xi) of this subsection 3.2(b),
there is no default, breach, violation or event of acceleration existing
under any Mortgage or the related Note and no event which, with the passage
of time or with notice and the expiration of any grace or cure period,
would constitute a default, breach, violation or event of acceleration; and
the Seller has not waived any default, breach, violation or event of
acceleration;
(xxxiv) No instrument of release or waiver has been executed in
connection with any Mortgage Loan, and no Mortgagor has been released, in
whole or in part;
(xxxv) Each Mortgage Loan conforms, and all such Mortgage Loans in the
aggregate conform, in all material respects to the description thereof set
forth in the Registration Statement;
(xxxvi) A full appraisal was performed with respect to each Mortgage
Loan; such appraisal was performed in material compliance with the
appraisal description set forth in the Prospectus;
(xxxvii) No more than 3.01% of the Original Pool Principal Balance of
the Mortgage Loans in Group I is secured by condominiums, townhouses or
rowhouses and no more than 5.47% of the Original Pool Principal Balance of
the Mortgage Loans in Group II is secured by condominiums, townhouses or
rowhouses;
(xxxviii) The credit underwriting guidelines applicable to each
Mortgage Loan conform in all material respects to the description thereof
set forth in the Prospectus and the Prospectus Supplement and each Mortgage
Loan was underwritten in accordance therewith;
(xxxix) As of the Startup Day, the Seller had no actual knowledge that
there exists on any Property any hazardous substances, hazardous wastes or
solid wastes, as such terms are defined in the Comprehensive Environmental
Response Compensation and Liability Act, the Resource Conservation and
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Recovery Act of 1976, or other federal, state or local environmental
legislation;
(xl) No more than .39% of the Original Pool Principal Balance of the
Mortgage Loans in Group I is secured by Properties located within any
single zip code area and no more than 1.27% of the Original Pool Principal
Balance of the Mortgage Loans in Group II is secured by Properties located
within any single zip code area; no more than 15.06% of the Original Pool
Principal Balance of the Mortgage Loans in Group I is located within any
single state and no more than 25.81% of the Original Pool Principal Balance
of the Mortgage Loans in Group II is located within any single state.
(xli) At least 93.46% of the Original Group I Pool Principal Balance
and at least 94.26% of the Original Group II Pool Principal Balance is
secured by Properties that are owner occupied;
(xlii) All taxes, governmental assessments, insurance premiums, water,
sewer and municipal charges, leasehold payments or ground rents which
previously became due and owing have been paid;
(xliii) Except for payments in the nature of escrow payments,
including, without limitation, taxes and insurance payments, the Seller has
not advanced funds, or induced, solicited or knowingly received any advance
of funds by a party other than the Mortgagor, directly or indirectly, for
the payment of any amount required by the Mortgage, except for interest
accruing from the date of the Mortgage Note or date of disbursement of the
Mortgage proceeds, whichever is greater, to the day which precedes by one
month the due date of the first installment of principal and interest;
(xliv) No improvement located on or being part of the Mortgaged
Property is in violation of any applicable zoning law or regulation. All
inspections, licenses and certificates required to be made or issued with
respect to all occupied portions of the Mortgaged Property and, with
respect to the use and occupancy of the same, including but not limited to
certificates of occupancy and fire underwriting certificates, have been
made or obtained from the appropriate authorities and the Mortgaged
Property is lawfully occupied under applicable law;
(xlv) The related Mortgage Note is not and has not been secured by any
collateral, pledged account or other security except the lien of the
corresponding Mortgage;
(xlvi) There is no obligation on the part of the Sponsor, the Seller,
the originator, the Master Servicer, the Trustee
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or any other Person to make payments in addition to those made by the
Mortgagor;
(xlvii) With respect to each Second Mortgage Loan, the related Senior
Lien requires equal monthly payments, or if it bears an adjustable interest
rate, the monthly payments for the related Senior Lien may be adjusted no
more frequently than monthly;
(xlviii) With respect to each Second Mortgage Loan, either (i) no
consent for the Mortgage Loan is required by the holder of the related
Senior Lien or (ii) such consent has been obtained and is contained in the
File;
(xlix) With respect to any Senior Lien that provided for negative
amortization or deferred interest, the balance of such Senior Lien used to
calculate the Loan-to-Value Ratio for the Second Mortgage Loan is based on
the maximum amount of negative amortization or deferred interest possible
under such Senior Lien;
(l) The maturity date of each Second Mortgage Loan is prior to the
maturity date of the related Senior Lien if such Senior Lien provides for a
balloon payment;
(li) All parties which have had any interest in the Mortgage Loan,
whether as mortgagee, assignee, pledgee or otherwise, are (or, during the
period in which they held and disposed of such interest, were) (1) in
compliance with any and all applicable licensing requirements of the laws
of the state wherein the Property is located, and (2)(A) organized under
the laws of such state, or (B) qualified to do business in such state, or
(C) federal savings and loans associations or national banks having
principal offices in such state or (D) not doing business in such state so
as to require qualification or licensing;
(lii) All amounts received on and after the Cut-Off Date with respect
to the Mortgage Loans to which the Master Servicer is not entitled have
been deposited into the Principal and Interest Account and are, as of the
Startup Day, in the Principal and Interest Account;
(liii) The Mortgage Loans were not selected for inclusion in the Trust
on any basis intended to adversely affect the Trust;
(liv) With respect to each Property subject to a land trust (a "Land
Trust Mortgage") (a) a trustee, duly qualified under applicable law to
serve as such, has been properly designated and currently so serves and is
named as such in the land trust agreement and such trustee is named in the
Land Trust Mortgage as Mortgagor; (b) all fees and expenses of the
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land trustee which have previously become due and owing have been paid and
no fees or expenses are or will become payable by the Owners or the Trust
to the land trustee under the land trust agreement; (c) the beneficiary is
solely obligated to pay any fees and expenses of the land trustee and the
priority of the lien of the Land Trust Mortgage is not and will not be
primed by the land trustee; (d) the Mortgaged Property is occupied by the
beneficiary under the land trust agreement and, if such land trust
agreement terminates, the beneficiary will become the owner of the
Mortgaged Property; (e) the beneficiary is obligated to make payments under
the Note and will have personal liability for deficiency judgments; (f) the
Land Trust Mortgage and assignment of beneficial interest relating to such
land trust held by the Trust was made in compliance with the related land
trust agreement, was validly entered into by the related land trust trustee
or beneficiary and, does not currently, and will not in the future, violate
any provision of the related land trust agreement, nor any agreement
between or amongst the beneficiaries of such land trust; (g) a UCC
financing statement has been filed, continued, and will be continued,
without intervening liens, as the first lien upon any assignment of
beneficial interest in the Land Trust Mortgage; (h) the assignment of
beneficial interest with respect to such Land Trust Mortgage held by the
Trust was at the time of such assignment the only assignment of such
beneficial interest in the Land Trust Mortgage, such assignment was
accepted by, and noted in the records of the land trust trustee, subsequent
assignment of the beneficial interest in whole or in part has not been
made, and such subsequent assignment of the beneficial interest or any part
thereof is not permitted pursuant to a written agreement between the
respective beneficiary and the Mortgagee, until the expiration of the Note
relating to the Land Trust Mortgage; (i) the Land Trust Mortgage is the
first or second lien on the Property; no lien is in place against the
beneficial interests, or any part thereof, of such Land Trust Mortgage or
collateral assignment of beneficial interest, which liens are superior to
the interest held by the Seller and the beneficial interest, or any part
thereof, of any such Land Trust Mortgage or collateral assignment of
beneficial interest has not been pledged as security for any other debt;
and the beneficiary or land trust trustee is forbidden, pursuant to a
written agreement between the beneficiary or the land trust trustee (as
applicable) and the Mortgagee, from using the land trust property or
beneficial interest, or any part of either, as security for any other debt
until the expiration date of its respective Note; and (x) the terms and
conditions of the land trust agreement do not prevent the free and absolute
marketability of the Mortgaged Property. As of the Cut-Off Date, the
aggregate Principal Balances of Land Trust Mortgage Loans with related
Mortgaged Properties subject to land trusts does not exceed 2.50% of the
Original Pool Principal Balance.
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(lv) With respect to each Property subject to a ground lease (a) the
current ground lessor has been identified and all ground rents which
previously became due and owing have been paid; (b) the ground lease term
extends, or is automatically renewable, for at least five years beyond the
maturity date of the related Mortgage Loan; (c) the ground lease has been
duly executed and recorded; (d) the amount of the ground rent and any
increases therein are clearly identified in the lease and are for
predetermined amounts at predetermined times; (e) the ground rent payment
is included in the Mortgagor's monthly payment as an expense item; (f) the
Trust has the right to cure defaults on the ground lease; and (g) the terms
and conditions of the leasehold do not prevent the free and absolute
marketability of the Property. As of the Cut-Off Date, the aggregate
Principal Balance of Mortgage Loans with related Mortgaged Properties
subject to ground leases does not exceed 5% of the Original Pool Principal
Balance.
(lvi) None of the Mortgage Loans are subject to a plan of bankruptcy
or have borrowers that have sought protection or relief under any state or
federal bankruptcy or insolvency law during the term of the related
Mortgage. With respect to each Mortgage Loan which has been the subject of
bankruptcy or insolvency proceedings, (a) as of the Cut-Off Date, the
Mortgagor is not contractually delinquent more than 30 days with respect to
any payment due under the related plan, (b) the current Loan-to-Value Ratio
is less than or equal to 85% and (c) either (i) if the current
Loan-to-Value Ratio is between 60% and 85%, as of the Cut-Off Date, the
Mortgagor has made at least six consecutive payments under the related Plan
or (ii) if the current Loan-to-Value Ratio is less than 60% as of the
Cut-Off Date, the Mortgagor has made at least three consecutive payments
under the related plan.
(c) In the event that any Qualified Replacement Mortgage is delivered by
the Seller to the Trust pursuant to this Section 3.2, the Seller shall be
obligated to take the actions described in subsection (a) above with respect to
such Qualified Replacement Mortgage upon the discovery by any of the Owners, the
Seller, the Sponsor, the Master Servicer, the Certificate Insurer, any
Sub-Servicer or the Trustee that the statements set forth in subsections (ii),
(x), (xiii), (xix), (xxxii), (xxxiii) or (xxxix) of subsection (b) above are
untrue in any material respect on the date such Qualified Replacement Mortgage
is conveyed to the Trust or that any of the other statements set forth in
subsection (b) hereof are untrue on the date such Qualified Replacement Mortgage
is conveyed to the Trust such that the interests of the Owners or the
Certificate Insurer in the related Qualified Replacement Mortgage are materially
and adversely affected; provided, however, that for the purposes of this
subsection (c) the statements in subsection (b) hereof referring to items "as of
the Cut-Off Date" or "as of the Startup Day" shall be deemed to refer to such
items
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as of the date such Qualified Replacement Mortgage is conveyed to the Trust.
(d) It is understood and agreed that the covenants set forth in this
Section 3.2 shall survive delivery of the respective Mortgage Loans (including
Qualified Replacement Mortgage Loans) to the Trustee.
Section 3.3. Conveyance of the Mortgage Loans and Qualified Replacement
Mortgages. (a) The Seller hereby directs the Trustee in its capacity as trustee
of Access Financial Loan Purchase Trust to transfer, assign, set over and
otherwise convey without representation, warranty or recourse, to the Trust, all
right, title and interest of the Seller in and to each Mortgage Loan listed on
the Mortgage Loan Schedule delivered by the Seller on the Startup Day, and all
its right, title and interest in and to (i) scheduled payments of interest due
on each Mortgage Loan after the Cut-Off Date, (ii) scheduled payments of
principal due, and unscheduled collections of principal received, on each
Mortgage Loan on and after the Cut-Off Date, and (iii) its Insurance Policies;
such transfer of the Mortgage Loans set forth on the Mortgage Loan Schedule to
the Trust is absolute and is intended by the Owners and all parties hereto to be
treated as a sale to the Trust.
(b) In connection with the transfer and assignment of the Mortgage Loans on
the Startup Day, the Seller agrees to:
(i) deliver, or cause to be delivered, without recourse to the Trustee
on behalf of the Trust on the Startup Day with respect to each Mortgage
Loan listed on the Mortgage Loan Schedule (A) the original Notes or, if any
original Note has been lost or destroyed, certified copies thereof,
endorsed without recourse by the originator (or most recent payee) thereof
"Pay to the order of Norwest Bank Minnesota, National Association, as
Trustee", (B) originals (subject to the provisions of paragraph (d) below
relating to items in the process of being recorded) of all intervening
assignments, showing a complete chain of assignment from origination to
assignment to the Trustee, including warehousing assignments, with evidence
of recording thereon, (C) originals of all assumption and modification
agreements, if any, and (D) either: (1) the original Mortgage (subject to
the provisions of paragraph (d) below relating to items in the process of
being recorded), with evidence of recording thereon, or (2) a copy of the
Mortgage certified by the public recording office in those instances where
the original recorded Mortgage has been lost and (E) the original lender's
title insurance policy issued on the date of origination of such Mortgage
Loan, together with any endorsements thereto; provided, however, that,
subject to Section 3.4(b), the Seller shall not be required to prepare an
assignment for any Mortgage as to which the original recording information
is
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lacking; and provided, further, that pending the issuance of the final
title policy, the Seller shall deliver the title commitment or title binder
to insure same; and
(ii) cause, within 10 Business Days following the Startup Day,
assignments of the Mortgages from the related originator to Norwest Bank
Minnesota, National Association to be submitted for recording in the
appropriate jurisdictions wherein such recordation is necessary to perfect
the Trustee's lien thereunder as against creditors of or purchasers from
the Seller, the above-listed items constituting the "File" for the related
Mortgage Loan;
(c) Notwithstanding anything to the contrary contained in this Section 3.3,
in those instances where the public recording office retains the original
Mortgage, the assignment of a Mortgage or the intervening assignments of the
Mortgage after it has been recorded, the Seller shall be deemed to have
satisfied its obligations hereunder upon delivery to the Trustee of a copy of
such Mortgage, such assignment or assignments of Mortgage certified by the
public recording office to be a true copy of the recorded original thereof.
(d) Not later than ten days following the end of the 10-Business Day
period referred to in clause (b)(ii) above, the Seller shall deliver, or cause
to be delivered, to the Trustee copies of all Mortgage assignments submitted for
recording, together with a list of all Mortgages for which no Mortgage
assignment has yet been submitted for recording, which list shall state the
reason why such Mortgage assignments have not been submitted for recording. With
respect to any Mortgage assignment disclosed on such list as not yet submitted
for recording for a reason other than a lack of original recording information,
the Trustee shall make an immediate demand on the Seller to prepare, or cause to
be prepared, such Mortgage assignments, and shall inform the Certificate Insurer
of the Seller's failure to prepare such Mortgage assignments. Thereafter, the
Trustee shall cooperate in executing any documents submitted to the Trustee in
connection with this provision. Thereafter, the Seller shall prepare, or cause
to be prepared, a Mortgage assignment for any Mortgage for which original
recording information is subsequently received by the Seller, and shall promptly
deliver a copy of such Mortgage assignment to the Trustee.
Neither the Master Servicer nor the Trustee shall be responsible for the
costs of recording any Mortgage or any assignment of Mortgage pursuant to this
Section 3.3.
Copies of all Mortgage assignments received by the Trustee shall be kept in
the related File. The Seller shall promptly deliver, or cause to be delivered,
to the Trustee such original Mortgage or intervening mortgage assignment with
evidence of recording indicated thereon upon receipt thereof from the public
recording official. If the Seller within nine months from the
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Startup Day shall not have received such original Mortgage or intervening
mortgage assignment from the public recording official, it shall obtain and
deliver, or cause to be delivered, to the Trustee within ten months from the
Startup Day, a copy of such original Mortgage or mortgage assignment certified
by such public recording official to be a true and complete copy of such
original Mortgage or mortgage assignment as recorded by such public recording
office.
(e) In the case of Mortgage Loans which have been prepaid in full on or
after the Cut-Off Date and prior to the Startup Day, the Seller, in lieu of the
foregoing, will deliver within 15 days after the Startup Day to the Trustee a
certification of an Authorized Officer in the form set forth in Exhibit J.
(f) The Seller (or an affiliate thereof) shall sell, transfer, assign, set
over and otherwise convey without recourse, to the Trustee all its right, title
and interest in and to any Qualified Replacement Mortgage delivered by it to the
Trustee on behalf of the Trust pursuant to Section 3.2 or 3.4 hereof and all its
right, title and interest to principal collected and interest accruing on such
Qualified Replacement Mortgage on and after the applicable Replacement Cut-Off
Date; provided, however, that the Seller (or such affiliate) shall reserve and
retain all right, title and interest in and to payments of principal and
interest due on such Qualified Replacement Mortgage prior to the applicable
Replacement Cut-Off Date.
(g) As to each Mortgage Loan released from the Trust in connection with the
conveyance of a Qualified Replacement Mortgage therefor, the Trustee will
transfer, assign, set over and otherwise convey without representation, warranty
or recourse, on the Seller's order, all of its right, title and interest in and
to such released Mortgage Loan and all the Trust's right, title and interest in
and to principal collected and interest accruing on such released Mortgage Loan
on and after the applicable Replacement Cut-Off Date; provided, however, that
the Trust shall reserve and retain all right, title and interest in and to
payments of principal collected and interest accruing on such released Mortgage
Loan prior to the applicable Replacement Cut-Off Date.
(h) In connection with any transfer and assignment of a Qualified
Replacement Mortgage to the Trustee on behalf of the Trust, the Seller agrees to
deliver to the Trustee the items described in Section 3.3(b) on the date of such
transfer and assignment or, if a later delivery time is permitted by Section
3.3(b), then no later than such later delivery time.
(i) As to each Mortgage Loan released from the Trust in connection with the
conveyance of a Qualified Replacement Mortgage the Trustee shall deliver on the
date of conveyance of such Qualified Replacement Mortgage and on the order of
the Seller (i) the original Note, or the certified copy, relating thereto,
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endorsed without recourse, to the Seller, and (ii) such other documents as
constituted the File with respect thereto.
(j) If a Mortgage assignment is lost during the process of recording, or is
returned from the recorder's office unrecorded due to a defect therein, the
Seller shall prepare or cause to be prepared a substitute assignment or cure
such defect, as the case may be, and thereafter cause each such assignment to be
duly recorded.
(k) The Seller shall reflect on its records that the Mortgage Loans have
been sold to the Trust.
Section 3.4. Acceptance by Trustee; Certain Substitutions of Mortgage
Loans; Certification by Trustee. (a) The Trustee agrees to execute and deliver
on the Startup Day an acknowledgment of receipt of the items delivered by the
Seller in the form attached as Exhibit K hereto (the "Initial Trustee
Certification"), and declares that it will hold such documents and any
amendments, replacement or supplements thereto, as well as any other assets
included in the definition of Trust Estate and delivered to the Trustee, as
Trustee in trust upon and subject to the conditions set forth herein for the
benefit of the Owners. The Trustee agrees, for the benefit of the Owners, to
review such items within 45 days after the Startup Day (or, with respect to any
document delivered after the Startup Day, within 45 days of receipt and with
respect to any Qualified Replacement Mortgage, within 45 days after the
assignment thereof) and to deliver to the Sponsor, the related Sub-Servicer, the
Master Servicer, the Seller and the Certificate Insurer a Pool Certification in
the form attached hereto as Exhibit L (the "Interim Trustee Certification").
Within 12 months from the Startup Day, the Trustee shall review the contents of
the Files and deliver to the Sponsor, the Sub-Servicers, the Master Servicer,
the Seller and the Certificate Insurer a Pool Certification in the form attached
hereto as Exhibit M (the "Final Trustee Certification").
The Trustee shall certify in the Initial Trustee Certification that it has
examined each Note to confirm that except as otherwise described in such
certification it is in possession of an executed original Note endorsed to the
Trustee. The Trustee shall certify in the Interim and Final Trustee
Certifications that except as described in such certification, as to each
Mortgage Loan listed in the Mortgage Loan Schedule (other than any Mortgage Loan
paid in full or any Mortgage Loan specifically identified in such Certification
as not covered by such Certification), (i) all documents required to be
delivered to it pursuant to this Agreement are in its possession and have been
executed, (ii) the original Note bearing an original endorsement to the Trustee
from the original payee (or set of original endorsements evidencing a complete
chain of title from the original payee to the Trustee) is in its possession;
(iii) such documents have been reviewed by it and have not been mutilated,
damaged, torn or otherwise physically
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altered and relate to such Mortgage Loan identified in the Mortgage Loan
Schedule and (iv) based on its examination and only as to the foregoing
documents, the information set forth on the Mortgage Loan Schedule as to loan
number, name of mortgagor and address, date of origination, the original stated
maturity date, the Original Principal Balance, the Coupon Rate, the scheduled
monthly payment of principal and interest and the date in each month or which
the related payments are due, accurately reflects the information set forth in
the File. The Trustee shall be under no duty or obligation pursuant to this
Section 3.4 to inspect, review or examine any such documents, instruments,
certificates or other papers to determine that they are genuine, enforceable, or
appropriate for the represented purpose or that they are other than what they
purport to be on their face, nor shall the Trustee be under any duty to
determine independently whether there are any intervening assignments or
assumption or modification agreements with respect to any Mortgage Loan. In the
Interim and Final Trustee Certifications, the Trustee based on its examination
of the Files shall also either confirm, or list as an exception that:
(i) each Note and Mortgage bears an original signature or signatures
purporting to be that of the person or persons named as the maker and
mortgagor/trustor;
(ii) the principal amount of the indebtedness secured by the Mortgage is
identical to the original principal amount of the Note;
(iii) the assignment of Mortgage is in the form "Norwest Bank Minnesota,
National Association, as Trustee" and bears a signature that purports to be the
signature of an authorized officer of the Person which the related File suggests
was the immediately prior record holder of such Mortgage;
(iv) if intervening assignments are included in the File, each such
intervening assignment bears a signature that purports to be the signature of
the mortgagee/beneficiary and/or the assignee;
(v) the address of the real property set forth in the title insurance
policy or preliminary title report or commitment to issue a title policy is
identical to the real property address contained in the Mortgage and such policy
or commitment is for an amount equal to the original principal amount of the
Note; and
(vi) it has received an original Mortgage with evidence of recordation and
assignment, in each case, with evidence of recordation thereon or a copy thereof
certified to be true and correct by the public recording office in possession of
such Mortgage and assignment.
Following the delivery of the Final Trustee Certification, the Trustee shall
provide to the Sponsor, the Seller, the Master Servicer and the Certificate
Insurer no less frequently than
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monthly, updated certifications indicating the then current status of
exceptions, until all such exceptions have been eliminated.
(b) If the Trustee during such 45-day period in connection with the Interim
Trustee Certification, or 12-month period in connection with the Final Trustee
Certification finds any document constituting a part of a File which is not
properly executed, has not been received, or is unrelated to the Mortgage Loans
identified in the Mortgage Loan Schedule or the Trustee is unable to make any of
the other required certifications, or that any Mortgage Loan does not conform in
a material respect to the description thereof as set forth in the Mortgage Loan
Schedule, the Trustee shall promptly so notify the Seller, the Sponsor and the
Certificate Insurer. In performing any such review, the Trustee may conclusively
rely on the Seller as to the purported genuineness of any such document and any
signature thereon. It is understood that the scope of the Trustee's review of
the items delivered by the Seller pursuant to Section 3.3(b)(i) is limited
solely to such procedures as are necessary to enable the Trustee to complete
Exhibits K, L and M hereto.
The Seller agrees to use reasonable efforts to remedy a material defect in
a document constituting part of a File of which it is so notified by the
Trustee. If, however, (i) in the case of a defect consisting of the failure of
the Seller to deliver an original Mortgage and any intervening mortgage
assignment evidencing a complete chain of title to the Trustee with evidence of
recording thereon, on the first Remittance Date following the 12 month period
from the Startup Day and (ii) in the case of all other defects within 60 days
after the Trustee's notice to it respecting such defect the Seller has not
remedied the defect and the defect materially and adversely affects the interest
in the related Mortgage Loan of the Owners or of the Certificate Insurer, the
Seller will on the next succeeding Remittance Date (i) substitute in lieu of
such Mortgage Loan a Qualified Replacement Mortgage and, deliver the
Substitution Amount applicable thereto to the Master Servicer for deposit in the
Principal and Interest Account or (ii) purchase such Mortgage Loan at a purchase
price equal to the Loan Purchase Price thereof, which purchase price shall be
delivered to the Master Servicer for deposit in the Principal and Interest
Account.
In connection with any such proposed purchase or substitution the Seller
shall cause at the Seller's expense to be delivered to the Trustee and to the
Certificate Insurer an opinion of counsel experienced in federal income tax
matters stating whether or not such a proposed purchase or substitution would
constitute a Prohibited Transaction for the Trust or would jeopardize the status
of either the Upper-Tier REMIC or the Lower-Tier REMIC as a REMIC, and the
Seller shall only be required to take either such action to the extent such
action would not constitute a Prohibited Transaction for either the Upper-Tier
REMIC or the Lower-Tier REMIC as a REMIC or would not jeopardize the
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status of either the Upper-Tier REMIC or the Lower-Tier REMIC as a REMIC. Any
required purchase or substitution, if delayed by the absence of such opinion
shall nonetheless occur upon the earlier of (i) the occurrence of a default or
imminent default with respect to the Mortgage Loan or (ii) the delivery of such
opinion.
Section 3.5. Cooperation Procedures. (a) The Seller shall, in connection
with the delivery of each Qualified Replacement Mortgage to the Trustee, provide
the Trustee with the information set forth in the related Mortgage Loan Schedule
with respect to such Qualified Replacement Mortgage.
(b) The Seller and the Trustee covenant to provide each other and the
Certificate Insurer with all data and information required to be provided by
them hereunder at the times required hereunder, and additionally covenant
reasonably to cooperate with each other in providing any additional information
required by any of them or the Certificate Insurer in connection with their
respective duties hereunder.
ARTICLE IV
ISSUANCE AND SALE OF CERTIFICATES
Section 4.1. Issuance of Certificates. On the Startup Day, upon the
Trustee's receipt from the Sponsor of an executed Delivery Order in the form set
forth as Exhibit H hereto, the Trustee shall execute, authenticate and deliver
the Certificates on behalf of the Trust in accordance with the directions set
forth in such Delivery Order.
Section 4.2. Sale of Certificates. At 11 a.m. New York City time on the
Startup Day, at the offices of Dewey Ballantine, 1301 Sixth Avenue, New York,
New York, the Seller will sell and convey the Mortgage Loans and the money,
instruments and other property related thereto to the Trustee, and the Trustee
will (i) hold the Class A Certificates as transfer agent for the Depository,
with an aggregate Percentage Interest in each Class equal to 100%, registered in
the name of Cede & Co. or in such other names as the Underwriters shall direct
against payment of the purchase price thereof by wire transfer of immediately
available funds to the Trustee for disbursement to the Seller and (ii) deliver
to the Seller, the Class B Certificates and the Residual Certificates, with an
aggregate Percentage Interest equal to 100%, registered as the Seller shall
request. Upon receipt of the proceeds of the sale of the Certificates, the
Seller shall (a) pay the initial premiums due to the Certificate Insurer and (b)
pay other fees and expenses identified by the Seller.
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ARTICLE V
CERTIFICATES AND TRANSFER OF INTERESTS
Section 5.1. Terms. (a) The Certificates are pass-through securities having
the rights described therein and herein. Distributions on the Certificates are
payable solely from payments received on or with respect to the Mortgage Loans
(other than the Master Servicing Fees), moneys in the Certificate Account, the
Principal and Interest Account, the Supplemental Interest Payment Account,
Insured Payments made by the Certificate Insurer, Delinquency Advances and
Compensating Interest payments made by the Master Servicer or otherwise held by
the Master Servicer in trust for the Owners, except as otherwise provided
herein, and from earnings on moneys and the proceeds of property held as a part
of the Trust Estate. Each Certificate entitles the Owner thereof to receive
distributions in accordance with this Agreement and in a specified portion of
the aggregate distribution due to the related Class of Certificates, pro rata in
accordance with such Owner's Percentage Interest and in the case of the Class
A-6 Certificates, certain amounts payable from the Supplemental Interest Payment
Account and from the Class A-6 Distribution Account.
(b) Each Owner is required, and hereby agrees, to return to the Trustee any
Certificate with respect to which the Trustee has made the final distribution
due thereon. Any such Certificate as to which the Trustee has made the final
distribution thereon shall be deemed cancelled and shall no longer be
Outstanding for any purpose of this Agreement, whether or not such Certificate
is ever returned to the Trustee.
Section 5.2. Forms. The Certificates of each Class shall be in
substantially the forms set forth as the related Exhibits to this Agreement,
with such appropriate insertions, omissions, substitutions and other variations
as are required or permitted by this Agreement or as may in the Sponsor's
judgment be necessary, appropriate or convenient to comply, or facilitate
compliance, with applicable laws, and may have such letters, numbers or other
marks of identification and such legends or endorsements placed thereon as may
be required to comply with the rules of any applicable securities laws or as
may, consistently herewith, be determined necessary by the Authorized Officer of
the Trustee executing such Certificates, as evidenced by his execution thereof.
Section 5.3. Execution, Authentication and Delivery. Each Certificate shall
be executed on behalf of the Trust, by the manual signature of one of the
Trustee's Authorized Officers and shall be authenticated by the manual signature
of one of the Trustee's Authorized Officers.
Certificates bearing the manual signature of individuals who were at any
time the proper officers of the Trustee shall bind
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the Trust, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the execution and delivery of such Certificates or
did not hold such offices at the date of authentication of such Certificates.
No Certificate shall be valid until executed and authenticated as set forth
above.
Certificates delivered on the Startup Day shall be dated the Startup Day;
all Certificates delivered thereafter shall be dated the date of authentication.
Section 5.4. Registration and Transfer of Certificates. (a) The Trustee
shall cause to be kept a register (the "Register") in which, subject to such
reasonable regulations as it may prescribe, the Trustee shall provide for the
registration of Certificates and the registration of transfer of Certificates.
(b) Subject to the provisions of Section 5.8 hereof with respect to the
Unregistered Certificates, upon surrender for registration of transfer of any
Certificate at the office designated as the location of the Register, the
Trustee shall execute and authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Certificates of a like
Class and in the aggregate principal or notional amount of the Certificate so
surrendered.
(c) At the option of any Owner, Certificates of any Class owned by such
Owner may be exchanged for other Certificates authorized of like Class, tenor
and a like aggregate original principal or notional amount and bearing numbers
not contemporaneously outstanding, upon surrender of the Certificates to be
exchanged at the office designated as the location of the Register. Whenever any
Certificate is so surrendered for exchange, the Trustee shall execute and
authenticate and deliver the Certificate or Certificates which the Owner making
the exchange is entitled to receive.
(d) All Certificates issued upon any registration of transfer or exchange
of Certificates shall be valid evidence of the same ownership interests in the
Trust and entitled to the same benefits under this Agreement as the Certificates
surrendered upon such registration of transfer or exchange.
(e) Every Certificate presented or surrendered for registration of transfer
or exchange shall be duly endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Trustee duly executed by the Owner thereof
or his attorney duly authorized in writing.
(f) No service charge shall be made to an Owner for any registration of
transfer or exchange of Certificates, but the Trustee may require payment of a
sum sufficient to cover any tax or
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other governmental charge that may be imposed in connection with any
registration of transfer or exchange of Certificates; any other expenses in
connection with such transfer or exchange shall be an expense of the Trust.
(g) It is intended that the Class A Certificates be registered so as to
participate in a global book-entry system with the Depository, as set forth
herein. Each Class of Class A Certificates shall be initially issued in the form
of a single fully registered Class A Certificate of the related Class with a
denomination equal to the original principal balance of the related Class. Upon
initial issuance, the ownership of such Class A Certificates shall be registered
in the Register in the name of Cede & Co., or any successor thereto, as nominee
for the Depository.
The minimum denominations shall be $1,000 for any Class A Certificate,
$100,000 for any Class B Certificate, and 10% Percentage Interest for any
Residual Certificate.
The Sponsor and the Trustee are hereby authorized to execute and deliver
the Representation Letter with the Depository.
With respect to Class A Certificates registered in the Register in the name
of Cede & Co., as nominee of the Depository, the Sponsor, the Seller, the Master
Servicer, and the Trustee shall have no responsibility or obligation to the
Depository's "Direct Participants" or "Indirect Participants" or beneficial
owners for which the Depository holds Class A Certificates from time to time as
a Depository. Without limiting the immediately preceding sentence, the Sponsor,
the Seller, the Master Servicer and the Trustee shall have no responsibility or
obligation with respect to (i) the accuracy of the records of the Depository,
Cede & Co., or any Direct or Indirect Participant with respect to the ownership
interest in the Class A Certificates, (ii) the delivery to any Direct or
Indirect Participant or any other Person, other than a registered Owner of a
Class A Certificate as shown in the Register, of any notice with respect to the
Class A Certificates or (iii) the payment to, or withholding with respect to,
any Direct or Indirect Participant or any other Person, other than a registered
Owner of a Class A Certificate as shown in the Register, of any amount with
respect to any distribution of principal or interest on the Class A
Certificates. No Person other than a registered Owner of a Class A Certificate
as shown in the Register shall receive a certificate evidencing such Class A
Certificate.
Upon delivery by the Depository to the Trustee of written notice to the
effect that the Depository has determined to substitute a new nominee in place
of Cede & Co., and subject to the provisions hereof with respect to the payment
of interest by the mailing of checks or drafts to the registered Owners of Class
A Certificates appearing as registered Owners in the registration books
maintained by the Trustee at the close of business on a
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Record Date, the name "Cede & Co." in this Agreement shall refer to such new
nominee of the Depository.
(h) In the event that (i) the Depository or the Sponsor advises the Trustee
in writing that the Depository is no longer willing or able to discharge
properly its responsibilities as nominee and depository with respect to the
Class A Certificates and the Sponsor or the Trustee is unable to locate a
qualified successor, (ii) the Sponsor at its sole option elects to terminate the
book-entry system through the Depository or (iii) after an Event of Default,
Owners of Certificates evidencing at least 51% Percentage Interests of any Class
affected thereby notify the Sponsor that the continuation of a book-entry system
is not in the best interests of such Class of Owners, the Class A Certificates
or any Class, as applicable, shall no longer be restricted to being registered
in the Register in the name of Cede & Co. (or a successor nominee) as nominee of
the Depository. At that time, the Class A Certificates shall be registered in
the name of and deposited with a successor depository operating a global
book-entry system, as may be acceptable to the Sponsor, or such depository's
agent or designee but, if the Sponsor does not select such alternative global
book-entry system, then the Trustee shall notify the Owners of the Class A
Certificates in writing of the termination of the book-entry system and the
Class A Certificates may be registered in whatever name or names registered
Owners of Class A Certificates transferring Class A Certificates shall
designate, in accordance with the provisions hereof.
(i) Notwithstanding any other provision of this Agreement to the contrary,
so long as any Class A Certificate is registered in the name of Cede & Co., as
nominee of the Depository, all distributions of principal or interest on such
Class A Certificates and all notices with respect to such Class A Certificates
shall be made and given, respectively, in the manner provided in the
Representation Letter.
Section 5.5. Mutilated, Destroyed, Lost or Stolen Certificates. If (i) any
mutilated Certificate is surrendered to the Trustee, or the Trustee receives
evidence to its satisfaction of the destruction, loss or theft of any
Certificate, and (ii) in the case of any mutilated Certificate, such mutilated
Certificate shall first be surrendered to the Trustee, and in the case of any
destroyed, lost or stolen Certificate, there shall be first delivered to the
Trustee such security or indemnity as may be reasonably required by it to hold
the Trustee harmless, then, in the absence of notice to the Trustee that such
Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute and authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
Class, tenor and aggregate principal amount, bearing a number not
contemporaneously outstanding.
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Upon the issuance of any new Certificate under this Section, the Trustee
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto; any other expense
in connection with such issuance shall be an expense of the Owner.
Every new Certificate issued pursuant to this Section in exchange for or in
lieu of any mutilated, destroyed, lost or stolen Certificate shall constitute
evidence of a substitute interest in the Trust, and shall be entitled to all the
benefits of this Agreement equally and proportionately with any and all other
Certificates of the same Class duly issued hereunder and such mutilated,
destroyed, lost or stolen Certificate shall not be valid for any purpose.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Certificates.
Section 5.6. Persons Deemed Owners. The Trustee and the Certificate Insurer
and any of their respective agents may treat the Person in whose name any
Certificate is registered as the Owner of such Certificate for the purpose of
receiving distributions with respect to such Certificate and for all other
purposes whatsoever, and neither the Trustee nor the Certificate Insurer nor any
of their respective agents shall be affected by notice to the contrary.
Section 5.7. Cancellation. All Certificates surrendered for registration of
transfer or exchange shall, if surrendered to any Person other than the Trustee,
be delivered to the Trustee and shall be promptly cancelled by it. No
Certificate shall be authenticated in lieu of or in exchange for any Certificate
cancelled as provided in this Section, except as expressly permitted by this
Agreement. All cancelled Certificates may be held or destroyed by the Trustee in
accordance with its standard policies.
Section 5.8. Limitation on Transfer of Ownership Rights. (a) No sale or
other transfer of any Unregistered Certificate (other than the initial sale of
the Unregistered Certificates upon the issuance thereof) shall be made to any
Person unless such Person delivers to the Trustee (i) a completed certificate in
the form attached as Exhibit D hereto, (ii) if required by the terms of such
certificate, an opinion to the effect that such sale or other transfer will not
violate any applicable federal or state securities laws and (iii) an opinion
that such transfer will not jeopardize the REMIC status of either REMIC or the
deductibility of interest with respect to the Certificates; no sale or other
transfer of any Unregistered Certificate shall be made to any Person until such
Person delivers to the Trustee either (i) an opinion of counsel from the
prospective transferee of such
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Certificate, acceptable to, and in form and substance satisfactory to the
Seller, to the effect that such transferee is not a pension or benefit plan or
individual retirement arrangement that is subject to the Employee Retirement
Income Security Act of 1974, as amended ("ERISA") or to Section 4975 of the Code
or an entity whose underlying assets are deemed to be assets of such a plan or
arrangement by reason of such plan's or arrangement's investments in the entity,
as determined under U.S. Department of Labor Regulations 29 C.F.R. ss.
2510.3-101 or otherwise, collectively, a "Plan" or (ii) the representation set
forth in Paragraph D of Exhibit D hereto.
(b) No sale or other transfer of record or beneficial ownership of a
Residual Certificate (whether pursuant to a purchase, a transfer resulting from
a default under a secured lending agreement or otherwise) shall be made to a
Disqualified Organization. The transfer, sale or other disposition of a Residual
Certificate (whether pursuant to a purchase, a transfer resulting from a default
under a secured lending agreement or otherwise) to a Disqualified Organization
shall be deemed to be of no legal force or effect whatsoever and such transferee
shall not be deemed to be an Owner for any purpose hereunder, including, but not
limited to, the receipt of distributions on such Residual Certificate.
Furthermore, in no event shall the Trustee accept surrender for transfer,
registration of transfer, or register the transfer, of any Residual Certificate
nor authenticate and make available any new Residual Certificate unless the
Trustee has received an affidavit from the proposed transferee in the form
attached hereto as Exhibit E. Each holder of a Residual Certificate by his
acceptance thereof, shall be deemed for all purposes to have consented to the
provisions of this Section 5.8(b).
(c) Notwithstanding anything to the contrary herein, no sale or other
transfer of record or beneficial ownership of a Class B Certificate or a
Residual Certificate shall be made to any Person until such Person delivers to
the Trustee either (i) an opinion of counsel from the prospective transferee of
such Certificate, acceptable to, and in form and substance satisfactory to the
Seller, to the effect that such transferee is not a Plan or (ii) the
representation set forth in Paragraph D of Exhibit D hereto. Any such
Certificateholder desiring to effect such transfer shall, and does hereby agree
to, indemnify the Sponsor, the Trustee, the Certificate Insurer and the Seller
against any liability, cost or expense (including attorney's fees) that may
result if the transfer is in violation of such statute.
Section 5.9. Assignment of Rights. An Owner may pledge, encumber,
hypothecate or assign all or any part of its right to receive distributions
hereunder, but such pledge, encumbrance, hypothecation or assignment shall not
constitute a transfer of an ownership interest sufficient to render the
transferee an Owner of
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the Trust without compliance with the provisions of Section 5.4 and Section 5.8
hereof.
ARTICLE VI
COVENANTS
Section 6.1. Distributions. On each Payment Date, the Trustee will
distribute, from funds comprising the Trust Estate, to the Owners of record of
the Certificates as of the related Record Date, such Owners' Percentage
Interests in the amounts required to be distributed to the Owners of each Class
of Certificates on such Payment Date. For so long as the Class A Certificates
are in book-entry form with the Depository, the only "Owner" of the Class A
Certificates will be the Depository.
Section 6.2. Money for Distributions to be Held in Trust; Withholding. (a)
All payments of amounts due and payable with respect to any Certificate that are
to be made from amounts withdrawn from the Certificate Account pursuant to
Section 7.3 hereof shall be made by and on behalf of the Trustee.
(b) The Trustee on behalf of the Trust shall comply with all requirements
of the Code and applicable state and local law with respect to the withholding
from any distributions made by it to any Owner of any applicable withholding
taxes imposed thereon and with respect to any applicable reporting requirements
in connection therewith.
(c) Any money held by the Trustee in trust for the payment of any amount
due with respect to any Class A Certificate, Class B Certificate or Residual
Certificate and remaining unclaimed by the Owner of such certificate for three
years after such amount has become due and payable shall be discharged from such
trust and be paid to the Seller; and the Owner of such Class A Certificate,
Class B Certificate or Residual Certificate shall thereafter, as an unsecured
general creditor, look only to the Seller for payment thereof (but only to the
extent of the amounts so paid to the Seller), and all liability of the Trustee
with respect to such trust money shall thereupon cease; provided, however, that
the Trustee, before being required to make any such payment, shall at the
expense of the Seller cause to be published once, in the eastern edition of The
Wall Street Journal, notice that such money remains unclaimed and that, after a
date specified therein, which shall be not fewer than 30 days from the date of
such publication, any unclaimed balance of such money then remaining will be
paid to the Seller. The Trustee shall, at the direction of the Seller, also
adopt and employ, at the expense of the Seller, any other reasonable means of
notification of such payment (including, but not limited to, mailing notice of
such payment to Owners whose right to or interest in moneys due and payable but
not claimed is
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determinable from the records of the Trustee at the last address of record for
each such Owner).
Section 6.3. Protection of Trust Estate. (a) The Trustee will hold the
Trust Estate in trust for the benefit of the Owners and, upon request of the
Certificate Insurer or the Sponsor and at the expense of the Sponsor, will from
time to time execute and deliver all such supplements and amendments hereto
pursuant to Section 12.14 hereof and all instruments of further assurance and
other instruments, and will take such other action upon such reasonable request,
to:
(i) more effectively hold in trust all or any portion of the Trust
Estate;
(ii) perfect, publish notice of, or protect the validity of any grant
made or to be made by this Agreement;
(iii) enforce any of the Mortgage Loans;
(iv) preserve and defend title to the Trust Estate and the rights of
the Trustee, and the ownership interests of the Owners represented thereby,
in such Trust Estate against the claims of all Persons and parties; or
(v) perfect a security interest in the Mortgage Loans, in the event
that the conveyance by the Seller did not constitute a sale.
(b) The Trustee shall have the power to enforce, and shall enforce the
obligations of the other parties to this Agreement by action, suit or proceeding
at law or equity, and shall also have the power to enjoin, by action or suit in
equity, any acts or occurrences which may be unlawful or in violation of the
rights of the Owners; provided, however, that nothing in this Section shall
require any action by the Trustee unless the Trustee shall first (i) have been
furnished indemnity satisfactory to it against the costs, expenses and
liabilities to be incurred in compliance with such action and (ii) when required
by this Agreement, have been requested to take such action by the Certificate
Insurer, or, with the consent of the Certificate Insurer by a majority of the
Percentage Interests represented by any Class of Class A Certificates, or, if
there are no longer any Class A Certificates then Outstanding, by such
percentage of the Percentage Interests represented by any Class of Class B
Certificates then Outstanding.
(c) The Trustee shall execute any instrument reasonably required pursuant
to this Section so long as such instrument does not conflict with this Agreement
or with the Trustee's fiduciary duties.
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Section 6.4. Performance of Obligations. The Trustee will not take any
action that would release the Sponsor, the Seller or the Master Servicer, from
any of their respective covenants or obligations under any instrument or
document relating to the Trust Estate or the Certificates or which would result
in the amendment, hypothecation, subordination, termination or discharge of, or
impair the validity or effectiveness of, any such instrument or document, except
with the prior written consent of the Certificate Insurer, or as expressly
provided in this Agreement or such other instrument or document.
Section 6.5. Negative Covenants. The Trustee will not, to the extent within
the control of the Trustee, take any of the following actions:
(i) sell, transfer, exchange or otherwise dispose of any of the Trust
Estate except as expressly permitted by this Agreement;
(ii) claim any credit on or make any deduction from the distributions
payable in respect of the Certificates (other than amounts properly
withheld from such payments under the Code) or assert any claim against any
present or former Owner by reason of the payment of any taxes levied or
assessed upon any of the Trust Estate;
(iii) incur, assume or guaranty on behalf of the Trust any
indebtedness of any Person except pursuant to this Agreement;
(iv) dissolve or liquidate in whole or in part the Trust Estate,
except pursuant to Article VIII hereof; or
(v) (A) impair the validity or effectiveness of this Agreement, or
release any Person from any covenants or obligations with respect to the
Trust or to the Certificates under this Agreement, except as may be
expressly permitted hereby or (B) create or extend any lien, charge,
adverse claim, security interest, mortgage or other encumbrance to or upon
the Trust Estate or any part thereof or any interest therein or the
proceeds thereof.
Section 6.6. No Other Powers. The Trustee will not, to the extent within
the control of the Trustee, permit the Trust to engage in any business activity
or transaction other than those activities permitted by Section 2.3 hereof.
Section 6.7. Limitation of Suits. No Owner shall have any right to
institute any proceeding, judicial or otherwise, with respect to this Agreement
or the Certificate Insurance Policy, or for the appointment of a receiver or
trustee, or for any other remedy hereunder, unless:
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(1) such Owner has previously given written notice to the Sponsor, the
Seller, the Certificate Insurer and the Trustee of such Owner's
intention to institute such proceeding;
(2) the Owners of not less than 25% of the Percentage Interests
represented by any Class of Class A Certificates, or, if there are no
Class A Certificates then Outstanding, by such percentage of the
Percentage Interests of any Class of Class B Certificates then
Outstanding, shall have made written request to the Trustee to
institute such proceeding in its own name as representative of the
Owners;
(3) the Trustee for 30 days after its receipt of such notice, request and
offer of indemnity has failed to institute such proceeding; and
(4) no direction inconsistent with such written request has been given to
the Trustee during such 30-day period by the Certificate Insurer or by
the Owners of a majority of the Percentage Interests represented by
each Class of Class A Certificates or, if there are no Class A
Certificates then Outstanding, by such percentage of the Percentage
Interests represented by any Class of Class B Certificates then
Outstanding;
it being understood and intended that no one or more Owners shall have any right
in any manner whatever by virtue of, or by availing themselves of, any provision
of this Agreement to affect, disturb or prejudice the rights of any other Owner
of the same Class or to obtain or to seek to obtain priority or preference over
any other Owner of the same Class or to enforce any right under this Agreement,
except in the manner herein provided and for the equal and ratable benefit of
all the Owners of the same Class.
In the event the Trustee shall receive conflicting or inconsistent requests
and indemnity from two or more groups of Owners, each representing less than a
majority of the applicable Class of Certificates, the Trustee shall act at the
direction of the Certificate Insurer.
Section 6.8. Unconditional Rights of Owners to Receive Distributions.
Notwithstanding any other provision in this Agreement, the Owner of any
Certificate shall have the right, which is absolute and unconditional, to
receive distributions to the extent provided herein and therein with respect to
such Certificate or to institute suit for the enforcement of any such
distribution, and such right shall not be impaired without the consent of such
Owner.
Section 6.9. Rights and Remedies Cumulative. Except as otherwise provided
herein, no right or remedy herein conferred upon
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or reserved to the Seller, the Sponsor, the Trustee, the Master Servicer, to the
Owners or to the Certificate Insurer is intended to be exclusive of any other
right or remedy, and every right and remedy shall, to the extent permitted by
law, be cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise. Except
as otherwise provided herein, the assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
Section 6.10. Delay or Omission Not Waiver. No delay of the Seller,
Sponsor, the Trustee, the Master Servicer, or any Owner of any Certificate or
the Certificate Insurer to exercise any right or remedy under this Agreement
shall impair any such right or remedy or constitute a waiver of any such right
or remedy. Every right and remedy given by this Article VI or by law to the
Sponsor or to the Owners or the Certificate Insurer may be exercised from time
to time, and as often as may be deemed expedient, by the Sponsor or by the
Owners or the Certificate Insurer, as the case may be.
Section 6.11. Control by Owners. Either (x) the Certificate Insurer or (y)
with the consent of the Certificate Insurer, the Owners of a majority of the
Percentage Interests represented by each Class of Class A Certificates then
Outstanding or, if there are no Class A Certificates then Outstanding, by such
majority of the Percentage Interests represented by any Class of Class B
Certificates then Outstanding, may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, provided
that:
(1) such direction shall not be in conflict with any rule of law or with
this Agreement;
(2) the Trustee shall have been provided with indemnity satisfactory to
it; and
(3) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction; provided, however, that
the Trustee need not take any action which it determines might involve
it in liability or may be unjustly prejudicial to the Owners not so
directing.
ARTICLE VII
ACCOUNTS, FLOW OF FUNDS,
DISTRIBUTIONS AND REPORTS
Section 7.1. Collection of Money. Except as otherwise expressly provided
herein, the Trustee may demand payment or delivery of all money and other
property payable to or receivable
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by the Trustee pursuant to this Agreement, including (a) all payments due on the
Mortgage Loans in accordance with the respective terms and conditions of such
Mortgage Loans and required to be paid over to the Trustee by the Master
Servicer, or by any Sub-Servicer and (b) Insured Payments in accordance with the
terms of the Certificate Insurance Policy. The Trustee shall hold all such money
and property received by it as part of the Trust Estate and shall apply it as
provided in this Agreement.
Section 7.2. Establishment of Accounts. The Trustee shall establish and
maintain, at the corporate trust office of the Trustee, a Certificate Account, a
Class A Group I Distribution Account, a Class A Group II Distribution Account, a
Class A-6 Distribution Account, a Class B Group I Distribution Account and a
Class B Group II Distribution Account, each to be held by the Trustee as a
segregated trust account so long as the Trustee qualifies as a Designated
Depository Institution and if the Trustee does not so qualify, then by any
Designated Depository Institution in the name of the Trust for the benefit of
the Owners of the Certificates and the Certificate Insurer, as their interests
may appear.
In administering the Accounts the Trustee may establish such sub-Accounts
as the Trustee deems desirable.
Section 7.3. Flow of Funds. (a) The Trustee shall deposit to the
Certificate Account
(i) with respect to the Group I Mortgage Loans, without duplication, upon
receipt, each Group I Monthly Remittance remitted by the Master Servicer or
any Sub-Servicer, together with any amounts received by the Trustee in
connection with the termination of the Trust insofar as such amounts relate
to the Group I Mortgage Loans.
(ii) with respect to the Group II Mortgage Loans, without duplication, upon
receipt, each Group II Monthly Remittance remitted by the Master Servicer
or any Sub-Servicer, together with any amounts received by the Trustee in
connection with the termination of the Trust, insofar as such amounts
relate to the Group II Mortgage Loans.
(b) On each Payment Date, the Trustee shall make the following allocations,
disbursements and transfers from the Group I Available Funds and from the Group
II Available Funds in the following order of priority, and each such allocation,
transfer and disbursement shall be treated as having occurred only after all
preceding allocations, transfers and disbursements have occurred:
(i) first, the Trustee shall pay first, to itself the related Trustee's
Fee then due;
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(ii) second, the Trustee shall pay to itself the REMIC Reporting Fee;
(iii) third, the Trustee shall pay to the Certificate Insurer the related
Premium Amount then due;
(iv) fourth, the Trustee shall allocate the following amounts in the
following order of priority:
(A)(i) From the Group I Available Funds then on deposit in the
Certificate Account, the lesser of (x) the Group I Available
Funds and (y) the Group I Insured Interest Distribution Amount
shall be allocated to the Class A Group I Distribution Account;
(ii) From the Group II Available Funds then on deposit in the
Certificate Account, the lesser of (x) the Group II Available
Funds and (y) the Group II Insured Interest Distribution Amount
shall be allocated to the Class A Group II Distribution Account;
(iii) From the remaining Group I Available Funds then on deposit in
the Certificate Account, the lesser of (x) such remaining Group I
Available Funds and (y) the Group I Insured Principal
Distribution Amount shall be allocated to the Class A Group I
Distribution Account;
(iv) [reserved];
(v) From the remaining Group II Available Funds then on deposit in
the Certificate Account, the lesser of (x) such remaining Group
II Available Funds and (y) the Group II Insured Principal
Distribution Amount shall be allocated to the Class A Group II
Distribution Account;
(B)(i) From the remaining Group I Available Funds then on deposit in
the Certificate Account, the lesser of (x) such remaining Group I
Available Funds, and (y) the excess of (i) the Group II Insured
Distribution Amount over (ii) the amount then on deposit in the
Class A Group II Distribution Account, shall be allocated to the
Class A Group II Distribution Account;
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(ii) From the remaining Group II Available Funds then on deposit in
the Certificate Account, the lesser of (x) such remaining Group
II Available Funds and (y) the excess of (i) the Group I Insured
Distribution Amount over (ii) the amount then on deposit in the
Class A Group I Distribution Account, shall be allocated to the
Class A Group I Distribution Account;
(C)(i) From the remaining Group I Available Funds then on deposit in
the Certificate Account, the lesser of (x) such remaining Group I
Available Funds and (y) the excess of (i) the Group I Principal
Distribution Amount applicable to such Payment Date over (ii) all
amounts then on deposit in the Class A Group I Distribution
Account and allocable to principal, shall be allocated to the
Class A Group I Distribution Account;
(ii) From the remaining Group II Available Funds then on deposit in
the Certificate Account, the lesser of (x) such remaining Group
II Available Funds and (y) the excess of (i) the Group II
Principal Distribution Amount applicable to such Payment Date
over (ii) all amounts then on deposit in the Class A Group II
Distribution Account and allocable to principal, shall be
allocated to the Class A Group II Distribution Account;
(D)(i) From the remaining Group I Available Funds then on deposit in
the Certificate Account, the lesser of (x) such remaining Group I
Available Funds and (y) the Group II Subordination Deficiency
Amount applicable to such Payment Date, shall be allocated to the
Class A Group II Distribution Account as a Group II Subordination
Increase Amount;
(ii) From the remaining Group II Available Funds then on deposit in
the Certificate Account, the lesser of (x) such remaining Group
II Available Funds and (y) the Group I Subordination Deficiency
Amount applicable to such Payment Date, shall be allocated to the
Class A Group I
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Distribution Account as a Group I Subordination Increase Amount;
(E)(i) From the remaining Group I Available Funds then on deposit in
the Certificate Account, the lesser of (x) such remaining Group I
Available Funds and (y) the Group I Cumulative Crossover Amount,
shall be allocated to the Class B Group II Distribution Account
and applied as a distribution of principal on account of the
Class B Group II Principal Balance;
(ii) From the remaining Group II Available Funds then on deposit in
the Certificate Account, the lesser of (x) such remaining Group
II Available Funds and (y) the Group II Cumulative Crossover
Amount, shall be allocated to the Class B Group I Distribution
Account and applied as a distribution of principal on account of
the Class B Group I Principal Balance;
(F)(i) From the remaining Group I Available Funds then on deposit in
the Certificate Account, the lesser of (x) such remaining Group I
Available Funds and (y) the Class B Group I Interest, shall be
allocated to the Class B Group I Distribution Account and applied
as a distribution of interest on account of the Class B Group I
Certificates;
(ii) From the remaining Group II Available Funds then on deposit in
the Certificate Account, the lesser of (x) such remaining Group
II Available Funds and (y) the Class B Group II Interest, shall
be allocated to the Class B Group II Distribution Account and
applied as a distribution of interest on the Class B Group II
Certificates;
(G) (i) From the remaining Group I Available Funds then on deposit in
the Certificate Account, the lesser of (x) such remaining Group I
Available Funds and (y) the Class B Group I Principal Balance as
of such Payment Date, assuming that the amount then on deposit in
the Class B Group I Distribution Account as a result of the
application of clause (E)(ii) above has been applied as a
distribution of
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principal on account of the Class B Group I Principal Balance on
such Payment Date, shall be allocated to the Class B Group I
Distribution Account and applied as a distribution of principal
on the Class B Group I Principal Balance;
(ii) From the remaining Group II Available Funds then on deposit in
the Certificate Account, the lesser of (x) such remaining Group
II Available Funds and (y) the Class B Group II Principal Balance
as of such Payment Date, assuming that all amounts then on
deposit in the Class B Group II Distribution Account as a result
of the application of (E)(i) above have been applied as a
distribution of principal on account of the Class B Group II
Principal Balance on such Payment Date, shall be allocated to the
Class B Group II Distribution Account and applied as a
distribution of principal on the Class B Group II Principal
Balance;
(H) All remaining amounts then remaining on deposit in the
Certificate Account shall be distributed to the Owners of the
Residual Certificates on such Payment Date;
(c) On each Payment Date, the Trustee shall make the following
disbursements from amounts deposited in the Distribution Accounts pursuant to
Subsection (b) above, together with the amount of any Group I Insured Payment
deposited to the Class A Group I Distribution Account and the amount of any
Group II Insured Payment deposited to the Class A Group II Distribution Account:
(i) the Trustee shall pay, pari passu from the amount then on deposit in
the Class A Group I Distribution Account:
(A) to the Owners of the Class A-1 Group I Certificates, the Class
A-1 Distribution Amount for such Payment Date;
(B) to the Owners of the Class A-2 Group I Certificates, the Class
A-2 Distribution Amount for such Payment Date;
(C) to the Owners of the Class A-3 Group I Certificates, the Class
A-3 Distribution Amount for such Payment Date;
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(D) to the Owners of the Class A-4 Group I Certificates, the Class
A-4 Distribution Amount for such Payment Date; and
(E) to the Owners of the Class A-5 Group I Certificates, the Class
A-5 Distribution Amount for such Payment Date;
provided, however, that if, on any Payment Date, (x) the Certificate
Insurer is then in default under the Certificate Insurance Policy and
(y) a Group I Subordination Deficit exists, then any distribution of
the Group I Principal Distribution Amount on such Payment Date shall
be made pro rata to the Owners of each of the Class A-1 Group I
Certificates, the Class A-2 Group I Certificates, the Class A-3 Group
I Certificates, the Class A-4 Group I Certificates and the Class A-5
Group I Certificates on such Payment Date.
(ii) the Trustee shall pay from the amount then on deposit in the Class A
Group II Distribution Account, to the Owners of the Class A-6 Group II
Certificates, the Class A-6 Distribution Amount for such Payment Date;
(iii) [reserved];
(iv) the Trustee shall transfer from the amounts then on deposit in the
Class B Group I Distribution Account, to the Group I Supplemental
Interest Payment Account, the Class B Group I Distribution Amount for
such Payment Date; such transfer shall be deemed a distribution on the
Class B Group I Certificates; and
(v) the Trustee shall transfer from the amounts then on deposit in the
Class B Group II Distribution Account, to the Group II Supplemental
Interest Payment Account, the Class B Group II Distribution Amount for
such Payment Date; such transfer shall be deemed a distribution on the
Class B Group II Certificates.
(d) Any amounts properly distributed to the Owners of the Class B
Certificates or to the Owners of the Residual Certificates pursuant to the terms
of this Agreement shall be distributed free of the subordination described
herein, and any such amounts shall in no event be required to be returned to the
Trustee or paid over to the Owners of the Class A Certificates.
(e) Whenever, during the administration of the Trust, there comes into the
possession of the Trustee any money or
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property which this Agreement does not otherwise require to be distributed on
account of the Class A Certificates or the Class B Certificates, the Trustee
shall distribute such money or other property to the Owners of the Class RU
Certificates.
(f) The Trustee shall (i) receive as attorney-in-fact of the Owners of the
Class A Certificates any Insured Payment from the Certificate Insurer and (ii)
disburse the same to such Owners as set forth in paragraphs (c)(i) and (c)(ii)
above. Insured Payments disbursed by the Trustee from proceeds of the
Certificate Insurance Policy shall not be considered payment by the Trust with
respect to the Class A Certificates, and the Certificate Insurer shall become
the owner of such unpaid amounts due from the Trust in respect of Insured
Payments as the deemed assignee of such Owners, as hereinafter provided. The
Trust and the Trustee hereby agree on behalf of each Owner of Class A
Certificates for the benefit of the Certificate Insurer that they recognize that
to the extent the Certificate Insurer pays Insured Payments, either directly or
indirectly (as by paying through the Trustee), to the Owners of the Class A
Certificates, the Certificate Insurer will be entitled to receive the amount of
any Class A-1 Interest Carry-Forward Amount, Class A-1 Principal Carry-Forward
Amount, Class A-2 Interest Carry-Forward Amount, Class A-2 Principal
Carry-Forward Amount, Class A-3 Interest Carry-Forward Amount, Class A-3
Principal Carry-Forward Amount, Class A-4 Interest Carry-Forward Amount, Class
A-4 Principal Carry-Forward Amount, Class A-5 Interest Carry-Forward Amount,
Class A-5 Principal Carry-Forward Amount, Class A-6 Interest Carry-Forward
Amount and Class A-6 Principal Carry-Forward Amount, and will be subrogated to
the rights of the Owners of the Class A Certificates with respect to such
Insured Payments, shall be deemed to the extent of the payments so made to be an
Owner of such Class A-1 Group I Certificates, Class A-2 Group I Certificates,
Class A-3 Group I Certificates, Class A-4 Group I Certificates, Class A-5 Group
I Certificates or Class A-6 Group II Certificates and shall receive future
distributions of the Class A-1 Distribution Amount, Class A-2 Distribution
Amount, Class A-3 Distribution Amount, Class A-4 Distribution Amount, Class A-5
Distribution Amount and of the Class A-6 Distribution Amount until all such
Insured Payments by the Certificate Insurer have been fully reimbursed, as
described in the following paragraph. To evidence such subrogation, the Trustee
shall note the Certificate Insurer's rights as subrogee on the Register upon
receipt from the Certificate Insurer of proof of the payment of any Insured
Payment, after making the distribution on any such future Payment Date to Owners
of the Class A Certificates other than to the Certificate Insurer. The
Certificate Insurer shall not acquire any voting rights hereunder as a result of
such subrogation, except as otherwise described herein.
It is understood and agreed that the intention of the parties is that the
Certificate Insurer shall not be entitled to reimbursement on any Payment Date
for amounts previously paid by it unless on such Payment Date the Owners of the
Class A Certificates
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shall also have received the full amount of the Group I Insured Distribution
Amount and of the Group II Insured Distribution Amount (exclusive of any Class
A-1 Interest Carry-Forward Amount, Class A-1 Principal Carry-Forward Amount,
Class A-2 Interest Carry-Forward Amount, Class A-2 Principal Carry-Forward
Amount, Class A-3 Interest Carry-Forward Amount, Class A-3 Principal
Carry-Forward Amount, Class A-4 Interest Carry-Forward Amount, Class A-4
Principal Carry-Forward Amount, Class A-5 Interest Carry-Forward Amount, Class
A-5 Principal Carry-Forward Amount, Class A-6 Interest Carry-Forward Amount or
any Class A-6 Principal Carry-Forward Amount representing amounts previously
paid to the Owners of the Class A Certificates as Insured Payments) for such
Payment Date.
(g) Each Owner of a Class A Certificate which pays any Preference Amounts
theretofore received by such Owner on account of such Class A Certificate will
be entitled to receive reimbursement for such amounts from the Certificate
Insurer in accordance with the terms of the Certificate Insurance Policy, but
only after (i) delivering a copy to the Trustee of a final, nonappealable order
(a "Preference Order") of a court having competent jurisdiction under the United
States Bankruptcy Code demanding payment of such amount to the bankruptcy court
and (ii) irrevocably assigning such Owner's claim with respect to such
Preference Order to the Certificate Insurer in such form as is required by the
Certificate Insurer. In no event shall the Certificate Insurer pay more than one
Insured Payment in respect of any Preference Amount.
Section 7.4. Investment of Accounts. (a) All or a portion of any Account
held by the Trustee shall be invested and reinvested by the Trustee in the name
of the Trustee for the benefit of the Owners, as described in Section 7.4(c)
hereof. No investment in any Account shall mature later than the Business Day
immediately preceding the next Payment Date and shall be held until maturity.
(b) Subject to Section 9.1 hereof, the Trustee shall not in any way be held
liable by reason of any insufficiency in any Account held by the Trustee
resulting from any loss on any Eligible Investment included therein (except to
the extent that the bank serving as Trustee is the obligor thereon).
(c) The Trustee shall invest in Eligible Investments described in paragraph
(h) of Section 7.5 hereof.
(d) All income or other gain from investments in any Account held by the
Trustee shall be deposited in such Account immediately on receipt, and any loss
resulting from such investments shall be charged to such Account.
Section 7.5. Eligible Investments. The following are Eligible Investments:
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(a) Direct general obligations of the United States or the obligations of
any agency or instrumentality of the United States, the timely payment or the
guarantee of which constitutes a full faith and credit obligation of the United
States.
(b) Federal Housing Administration debentures, but excluding any such
securities whose terms do not provide for payment of a fixed dollar amount upon
maturity or call for redemption.
(c) FHLMC senior debt obligations, but excluding any such securities whose
terms do not provide for payment of a fixed dollar amount upon maturity or call
for redemption.
(d) FNMA senior debt obligations, but excluding any such securities whose
terms do not provide for payment of a fixed dollar amount upon maturity or call
for redemption.
(e) Federal funds, certificates of deposit, time and demand deposits, and
bankers' acceptances (having original maturities of not more than 365 days) of
any domestic bank, the short-term debt obligations of which have been rated A-1
or better by S&P and P-1 by Moody's.
(f) Deposits of any bank or savings and loan association which has combined
capital, surplus and undivided profits of at least $50,000,000 which deposits
are not in excess of the applicable limits insured by the Bank Insurance Fund or
the Savings Association Insurance Fund of the FDIC, provided that the long-term
deposits of such bank or savings and loan association are rated at least "BBB"
by S&P and "Baa3" by Moody's.
(g) Commercial paper (having original maturities of not more than 270 days)
rated A-1 or better by S&P and P-1 by Moody's.
(h) Investments in money market funds rated at least AAAm or AAAm-G by S&P
and Aaa or P-1 by Moody's.
(i) Such other investments as have been approved in writing by S&P, Moody's
and the Certificate Insurer;
provided that no instrument described above is permitted to evidence either the
right to receive (a) only interest with respect to obligations underlying such
instrument or (b) both principal and interest payments derived from obligations
underlying such instrument and the interest and principal payments with respect
to such instrument provide a yield to maturity at par greater than 120% of the
yield to maturity at par of the underlying obligations; and provided, further,
that no instrument described above may be purchased at a price greater than par
if such instrument may be prepaid or called at a price less than its purchase
price prior to stated maturity. Any Eligible Investment may be purchased by or
through the Trustee or any of its affiliates.
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Section 7.6. Reports by Trustee. (a) On each Payment Date the Trustee shall
report in writing to each Owner and to the Sponsor, the Seller and the Master
Servicer with a copy to the Certificate Insurer and S&P and Moody's:
(i) the amount of the distribution with respect to each Class of
Certificates;
(ii) the amount of such distributions allocable to principal,
separately identifying the aggregate amount of any Prepayments or other
unscheduled recoveries of principal included therein;
(iii) the amount of such distributions allocable to interest;
(iv) the amount of such distributions allocable to any Carry-Forward
Amount;
(v) the then-outstanding principal balance of each Class of Class A
Certificates as of such Payment Date, together with the principal amount,
by class, of each Class A Certificate (based on a Certificate in the
original principal amount of $1,000) then Outstanding, in each case after
giving effect to any payment of principal on such Payment Date;
(vi) the then-outstanding principal balance of each class of Class B
Certificates, together with the principal amount, by class, of each Class B
Certificate (based on a Certificate in the original principal amount of
$1,000) then Outstanding, in each case after giving effect to any payment
of principal on such Payment Date;
(vii) the total of any Substitution Amounts and any Loan Purchase
Prices included in such distribution;
(viii) the amount of any Supplemental Interest Payment Amount, Class
BI-S and Class BII-S Certificate distribution and any Interest Advance on
such Distribution Date, together with the amount of any unreimbursed
Interest Advance then owed to the Trustee;
(ix) the amount of the Master Servicing Fee paid with respect to each
of the two Mortgage Loan Groups with respect to the related Remittance
Period;
(x) the amount of any Group I Insured Payment or any Group II Insured
Payment made with respect to such Payment Date;
(xi) as of such Payment Date, the Group I Subordinated Amount and the
Group II Subordinated Amount; and
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(xii) the amount of the REMIC Reporting Fee paid with respect to such
Payment Date.
In preparing the report under this Section 7.6, the Trustee shall rely
solely upon the electronic report described in Section 10.8(d)(ii) hereof being
received from the Master Servicer or any Sub-Servicer. The Trustee shall not be
responsible for its obligations under Section 7.06 unless and until it receives
such report from the Master Servicer.
(b) On each Payment Date the Trustee will additionally inform the Sponsor,
the Seller, the Master Servicer, the Certificate Insurer, S&P and Moody's with
respect to the following:
(i) the Group I Available Funds and the Group II Available Funds for
the related Payment Date;
(ii) the Pool Principal Balance with respect to each of the two
Mortgage Loan Groups as of the end of the related Remittance Period;
(iii) the number and Principal Balances of all Mortgage Loans in each
of the two Mortgage Loan Groups which were the subject of Prepayments
during the related Remittance Period;
(iv) the total amount of payments in respect of or allocable to
interest on the Mortgage Loans in each of the two Mortgage Loan Groups
received or deemed to have been received from the related Mortgagors by the
Master Servicer or any Sub-Servicer during the related Remittance Period
(including any net income from REO Properties received during the related
Remittance Period);
(v) the aggregate of all principal payments received or deemed to have
been received from the related Mortgagors in each of the two Mortgage Loan
Groups by the Master Servicer or any Sub-Servicer during the related
Remittance Period;
(vi) the aggregate of any Insurance Proceeds received or deemed to
have been received by the Master Servicer or any Sub-Servicer during the
related Remittance Period with respect to each of the two Mortgage Loan
Groups;
(vii) the aggregate of any Released Mortgaged Property Proceeds
received or deemed to have been received by the Master Servicer or any
Sub-Servicer during the related Remittance Period with respect to each of
the two Mortgage Loan Groups;
(viii) the aggregate of any Liquidation Proceeds, Liquidation Expenses
and Net Liquidation Proceeds received or
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deemed to have been received by the Master Servicer or any Sub-Servicer,
and Net Realized Losses incurred, during the related Remittance Period with
respect to each of the two Mortgage Loan Groups, the Group I Cumulative Net
Realized Losses, the Group II Cumulative Net Realized Losses and the
aggregate Cumulative Net Realized Losses since the Startup Day and during
the prior 12-month period and the Group I Rolling Three Month Delinquency
Rate and the Group II Rolling Three Month Delinquency Rate with respect to
each of the two Mortgage Loan Groups;
(ix) the total amount of Compensating Interest payments paid or to be
paid by the Master Servicer or any Sub-Servicer pursuant to Section 10.10
hereof with respect to each of the two Mortgage Loan Groups;
(x) the amount of Delinquency Advances made by the Master Servicer or
any Sub-Servicer pursuant to Section 10.9 hereof with respect to such
Payment Date with respect to each of the two Mortgage Loan Groups;
(xi) the monthly Master Servicing Fee and any additional servicing
fees paid to the Master Servicer or any Sub-Servicer pursuant to Section
10.15 hereof with respect to each of the two Mortgage Loan Groups;
(xii) the amount of Delinquency Advances with respect to each of the
two Mortgage Loan Groups reimbursable to the Master Servicer or any
Sub-Servicer during such Remittance Period pursuant to Section 10.9 hereof
and not previously reimbursed;
(xiii) the amount of any Servicing Advance made by the Master Servicer
or any Sub-Servicer pursuant to Sections 10.9 and 10.13 hereof with respect
to each of the two Mortgage Loan Groups and not previously reimbursed;
(xiv) the Class A-1 Distribution Amount, the Class A-2 Distribution
Amount, the Class A-3 Distribution Amount, the Class A-4 Distribution
Amount, the Class A-5 Distribution Amount, the Class A-6 Distribution
Amount, the Class B Group I Distribution Amount and the Class B Group II
Distribution Amount, with the components thereof stated separately;
(xv) the weighted average remaining term to maturity and Net Weighted
Average Coupon Rate of the Mortgage Loans with respect to each of the two
Mortgage Loan Groups as of the close of business on the last day of the
related Remittance Period;
(xvi) the Group I Subordinated Amount, Group I Subordination
Deficiency Amount, Group I Specified
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Subordinated Amount, Group I Subordination Increase Amount, Group II
Subordinated Amount, Group II Subordination Deficiency Amount, Group II
Specified Subordinated Amount and Group II Subordination Increase Amount
for the related Payment Date;
(xvii) the Group I Excess Subordinated Amount, Group I Subordination
Reduction Amount, Group I Cumulative Crossover Amount, Group II Excess
Subordinated Amount, Group II Subordination Reduction Amount, and Group II
Cumulative Crossover Amount for the related Payment Date;
(xviii) the number of Mortgage Loans in each of the two Mortgage Loan
Groups at the beginning and end of the related Remittance Period;
(xix) the Group I Shortfall Amount and the Group II Shortfall Amount
for the related Payment Date; and
(xx) such other information as the Certificate Insurer or the Seller
may reasonably request and which is derived from information which is
produced or available in the ordinary course of the Master Servicer's or
any Sub-Servicer's business or which otherwise materially relates to the
transactions contemplated hereby.
(c) In addition, on each Payment Date the Trustee will disseminate to each
Owner, the Master Servicer and to the Seller with a copy to the Sponsor, the
Certificate Insurer, S & P and Moody's, together with the information described
in Subsection (a) preceding, the following information with respect to each of
the two Mortgage Loan Groups as of the close of business on the last day of the
related Remittance Period, which is required to be prepared by the Master
Servicer or a Sub-Servicer and furnished to the Trustee pursuant to Section
10.8(d)(ii) hereof for such purpose on or prior to the related Remittance Date:
(i) the total number of Mortgage Loans and the aggregate Principal
Balances thereof, together with the number and aggregate principal balances
of Mortgage Loans (a) 30-59 days Delinquent, (b) 60-89 days Delinquent and
(c) 90 or more days Delinquent;
(ii) the number and aggregate principal balances of all Mortgage Loans
in foreclosure proceedings (and whether any such Mortgage Loans are also
included in any of the statistics described in the foregoing clause (i));
(iii) the number and aggregate principal balances of all Mortgage
Loans relating to Mortgagors in bankruptcy proceedings (and whether any
such Mortgage Loans are also included in any of the statistics described in
the foregoing clauses (i) and (ii));
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(iv) the number and aggregate principal balances of all Mortgage Loans
relating to REO Properties (and whether any such Mortgage Loans are also
included in any of the statistics described in the foregoing clauses (i),
(ii) and (iii));
(v) the number and aggregate principal balances of all Mortgage Loans
as to which foreclosure proceedings were commenced during the prior
Remittance Period;
(vi) a schedule regarding cumulative foreclosures since the Cut-Off
Date; and
(vii) the book value of any REO Property and any income received from
REO Properties during the prior Remittance Period.
The Sponsor, the Seller, the Master Servicer and the Trustee on behalf of
Certificateholders and the Trust (the "Trust Parties") hereby authorize the
Certificate Insurer to include the information contained in reports provided to
the Certificate Insurer hereunder (the "Information") on The Bloomberg, an
on-line computer based information network maintained by Bloomberg L.P.
("Bloomberg"), or in other electronic or print information services. The Trust
Parties agree not to commence any actions or proceedings, or otherwise assert
any claims, against the Certificate Insurer or its affiliates or any of the
Certificate Insurer's or its affiliates' respective agents, representatives,
directors, officers or employees (collectively, the "Certificate Insurer
Parties"), arising out of, or related to or in connection with the dissemination
and/or use of any Information by the Certificate Insurer, including, but not
limited to, claims based on allegations of inaccurate, incomplete or erroneous
transfer of information by the Certificate Insurer to Bloomberg or otherwise
(other than in connection with the Certificate Insurer's gross negligence or
willful misconduct). The Trust Parties waive their rights to assert any such
claims against the Certificate Insurer Parties and fully and finally release the
Certificate Insurer Parties from any and all such claims, demands, obligations,
actions and liabilities (other than in connection with the Certificate Insurer's
gross negligence or willful misconduct). The Certificate Insurer makes no
representations or warranties, expressed or implied, of any kind whatsoever with
respect to the accuracy, adequacy, timeliness, completeness, merchantability or
fitness for any particular purpose of any Information in any form or manner. The
Certificate Insurer reserves the right at any time to withdraw or suspend the
dissemination of the Information by the Certificate Insurer. The authorizations,
covenants and obligations of the Trust Parties under this section shall be
irrevocable and shall survive the termination of this Agreement.
Section 7.7. Drawings under the Certificate Insurance Policy and Reports by
Trustee. (a) On each Determination Date the Trustee shall determine, no later
than 12:00 noon on such
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Determination Date, whether a Group I Shortfall Amount or a Group II Shortfall
Amount has theretofore occurred and will remain uncured on the following Payment
Date, and whether a Group I Shortfall Amount or a Group II Shortfall Amount with
respect to either the Group I Mortgage Loans or the Group II Mortgage Loans will
occur on the following Payment Date. If the Trustee determines that a Group I
Shortfall Amount or a Group II Shortfall Amount has theretofore occurred and
will remain uncured or will occur, the Trustee shall furnish the Certificate
Insurer and the Sponsor with a completed Notice in the form set forth as Exhibit
A to the Certificate Insurance Policy. The Notice shall specify the amount of
the Insured Payment and shall constitute a claim for an Insured Payment pursuant
to the Certificate Insurance Policy.
(b) The Trustee shall report to the Sponsor, the Seller, the Master
Servicer and the Certificate Insurer with respect to the amounts then held in
each Account held by the Trustee and the identity of the investments included
therein, as the Seller, the Master Servicer or the Certificate Insurer may from
time to time request. Without limiting the generality of the foregoing, the
Trustee shall, at the request of the Sponsor, the Seller, the Master Servicer or
the Certificate Insurer transmit promptly to the Certificate Insurer, the
Sponsor, the Seller and the Master Servicer copies of all accountings of
receipts in respect of the Mortgage Loans furnished to it by the Master Servicer
or a Sub-Servicer.
Section 7.8. Allocation of Realized Losses. (a) If, on any Payment Date,
and following the making of all allocations, transfers and distributions (other
than as provided in this Section) on such Payment Date (x) the sum of the Class
A-1 Principal Balance, the Class A-2 Principal Balance, the Class A-3 Principal
Balance, the Class A-4 Principal Balance, the Class A-5 Principal Balance and
the Class B Group I Principal Balance exceeds (y) the Group I Pool Principal
Balance as of the close of business on the last day of the related Remittance
Period (any such excess, "Group I Allocable Losses"), such Group I Allocable
Losses shall be applied as a reduction of the Class B Group I Principal Balance
until the Class B Group I Principal Balance has been reduced to zero.
(b) If, on any Payment Date, and following the making of all allocations,
transfers and distributions (other than as provided in this Section) on such
Payment Date (x) the sum of the Class A-6 Principal Balance and the Class B
Group II Principal Balance exceeds the Group II Pool Principal Balance as of the
close of business on the last day of the related Remittance Period (any such
excess, "Group II Allocable Losses"), such Group II Allocable Losses shall be
applied as a reduction of the Class B Group II Principal Balance until the Class
B Group II Principal Balance has been reduced to zero.
Section 7.9. Supplemental Interest Payments.
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(a) The parties hereto do hereby create and establish a trust, the "Access
Financial Supplemental Interest Trust 1996-2" (the "Supplemental Interest
Trust"). The Supplemental Interest Trust shall hold two trust accounts, the
"Group I Supplemental Interest Payment Account" and the "Group II Supplemental
Interest Payment Account", each to be held by the Trustee in its name on behalf
of the Supplemental Interest Trust.
If, on any Determination Date, the Trustee determines that the amount to be
available on the next Payment Date in both the Group I Supplemental Interest
Payment Account and the Group II Supplemental Interest Payment Account (such
amounts, together, the "Supplemental Interest Payment Amount") is less than the
excess of (i) the Class A-6 Full Interest Distribution Amount over (ii) the
Class A-6 Interest Distribution Amount as of such Payment Date (the "Class A-6
Formula Interest Shortfall"), the Trustee shall deliver a notice in the form of
Exhibit O hereto to the Designated Residual Owner demanding that the Designated
Residual Owner fund the Class A-6 Formula Interest Shortfall on the related
Payment Date. The amount so funded by the Designated Residual Owner on any such
Payment Date is the "Interest Advance" for such Payment Date. The Trustee shall
deposit any Interest Advance received by it into the Class A-6 Distribution
Account.
On each Payment Date the Trustee shall withdraw from the Group I
Supplemental Interest Payment Account and from the Group II Supplemental
Interest Payment Account and deposit in the Class A-6 Distribution Account the
lesser of (x) the Class A-6 Formula Interest Shortfall and (y) the Supplemental
Interest Payment Amount (such amount, the "Funded Amount"). Such amount shall be
withdrawn as follows:
(i) from the Group I Supplemental Interest Payment Account, the product of
(x) the Funded Amount and (y) a fraction, the numerator of which is the amount
then on deposit in the Group I Supplemental Interest Payment Account and the
denominator of which is the sum of the amount then on deposit in the Group I
Supplemental Interest Payment Account and in the Group II Supplemental Interest
Payment Account.
(ii) from the Group II Supplemental Interest Payment Account the product of
(x) the Funded Amount and (y) a fraction, the numerator of which is the amount
then on deposit in the Group II Supplemental Interest Payment Account and the
denominator of which is the sum of the amount then on deposit in the Group I
Supplemental Interest Payment Account and in the Group II Supplemental Interest
Payment Account.
(b) Any portion of the Supplemental Interest Payment Amount after
application of clause (a) above (the "Remaining Amount") shall be applied in the
following order of priority:
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(i) first, to the Designated Residual Owner, as reimbursement for
unpaid Interest Advances, together with interest thereon (the "Interest
Advance Reimbursement Amount"), with the earliest Interest Advances being
deemed to be paid first, such amount to be paid as follows:
(x) from the remaining amount then on deposit in the Group I
Supplemental Interest Payment Account, the product of (x) the
Funded Amount and (y) a fraction, the numerator of which is the
amount remaining on deposit in the Group I Supplemental Interest
Payment Account and the denominator of which is the Remaining
Amount; and
(y) from the remaining amount then on deposit in the Group II
Supplemental Interest Payment Account, the product of (x) the
Funded Amount and (y) a fraction, the numerator of which is the
amount remaining on deposit in the Group I Supplemental Interest
Payment Account and the denominator of which is the Remaining
Amount.
(ii) second, to the Owners of the Class BI-S Certificates, all
remaining amounts then on deposit in the Group I Supplemental Interest
Payment Account, and to the Owners of the Class BII-S Certificates, all
remaining amounts then on deposit in the Group II Supplemental Interest
Payment Account, in each case to such Owners pro rata in accordance with
the Percentage Interests.
ARTICLE VIII
TERMINATION OF TRUST
Section 8.1. Termination of Trust. The Trust created hereunder and all
obligations created by this Agreement will terminate upon the earlier of (i) the
payment to the Owners of all Certificates of all amounts held by the Trustee and
required to be paid to such Owners pursuant to this Agreement upon the later to
occur of (a) the final payment or other liquidation (or any advance made with
respect thereto) of the last Mortgage Loan in the Trust Estate or (b) the
disposition of all property acquired in respect of any Mortgage Loan remaining
in the Trust Estate or (ii) at any time when a Qualified Liquidation of the
Trust is effected as described below. To effect a termination of this Agreement
pursuant to clause (b) above, the Owners of all Certificates then Outstanding
shall (x) unanimously direct the Trustee on behalf of the Trust to adopt a plan
of complete liquidation with respect to each REMIC, as contemplated by Section
860F(a)(4) of the Code and (y) provide to the Trustee an opinion of counsel
experienced in federal income tax matters to the effect that such liquidation
constitutes a Qualified Liquidation and the Trustee either shall
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sell the Mortgage Loans and distribute the proceeds of the liquidation of the
Trust Estate, or shall distribute equitably in kind all of the assets of the
Trust Estate to the remaining Owners of the Certificates each in accordance with
such plan, so that the liquidation or distribution of the Trust Estate, the
distribution of any proceeds of the liquidation and the termination of this
Agreement occur no later than the close of the 90th day after the date of
adoption of the plan of liquidation and such liquidation qualifies as a
Qualified Liquidation. In no event, however, will the Trust created by this
Agreement continue beyond the expiration of twenty-one (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 United Kingdom, living on the date
hereof. The Trustee shall give written notice of termination of the Agreement to
the Certificate Insurer and each Owner in the manner set forth in Section 10.5
hereof.
Section 8.2. Termination Upon Option of the Seller.
(a) On any Remittance Date on or after the Remittance Date on which the
then-outstanding aggregate Principal Balances of the Mortgage Loans is ten
percent or less of the Original Pool Principal Balance, the Seller may determine
to purchase and may cause the purchase from the Trust of all (but not fewer than
all) Mortgage Loans and all property theretofore acquired in respect of any
Mortgage Loan by foreclosure, deed in lieu of foreclosure, or otherwise then
remaining in the Trust Estate at a price equal to 100% of the aggregate
Principal Balances of the related Mortgage Loans as of the day of termination
minus amounts remitted from the Principal and Interest Account to the
Certificate Account representing collections of principal on the Mortgage Loans
during the current Remittance Period, plus one month's interest on such amount
computed at the weighted average Coupon Rate for the related Mortgage Loan
Group, and plus the aggregate amount of any unreimbursed Delinquency Advances,
including amounts which would be Delinquency Advances which the Master Servicer
has theretofore failed to remit plus any amount owing to the Certificate Insurer
and the Trustee. The Seller shall pay such termination price to the Trustee for
deposit in the Certificate Account. In connection with such termination, the
Master Servicer shall remit to the Trustee all amounts (net of investment
earnings and providing for investment losses pursuant to Section 10.8(b) hereof,
net of the Master Servicing Fee and net of amounts reimbursable for Delinquency
Advances and Servicing Advances) then on deposit in the Principal and Interest
Account for deposit to the Certificate Account, which deposit shall be deemed to
have occurred immediately preceding such purchase.
(b) In connection with any such purchase, the Seller shall provide to the
Trustee an opinion of counsel experienced in federal income tax matters to the
effect that such purchase constitutes a Qualified Liquidation with respect to
each REMIC.
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(c) Promptly following any such purchase, the Trustee will release the
Files, with appropriate endorsements and transfer documents, to the Seller or
otherwise upon its order.
Section 8.3. Auction Call. If the Seller fails, by the ninetieth day
following the first Remittance Date on which such option may be exercised, to
exercise its purchase option pursuant to Section 8.2 hereof, then upon receipt
of written notice and direction from the Seller, the Trustee will notify the
Representative (or, if the Representative is unable or unwilling, another
investment banking or whole-loan trading firm selected by the Seller (the
Representative or such other investment bank or trading firm, the "Advisor") who
will solicit on behalf of the Trustee competitive bids for the purchase of the
Mortgage Loans for fair market value. Such solicitation shall be conducted
substantially in the manner described in Exhibit N hereto. In the event that
satisfactory bids are received as described below, the proceeds of the sale of
such assets shall be deposited into the Certificate Account. The Trustee will
ask the Advisor to solicit, on behalf of the Trustee, good-faith bids from no
fewer than two prospective purchasers that are considered at the time to be
competitive participants in the home equity market. The Advisor will consult
with any securities brokerage houses identified by the Seller as then making a
market in the Class A Certificates to obtain a determination as to whether the
fair market value of such assets has been offered.
Any purchaser of such Mortgage Loans must agree to the continuation of the
Master Servicer or any successor Master Servicer as servicer of the assets on
terms substantially similar to those in this Agreement.
If the highest good-faith bid received by the Advisor from a qualified
bidder is, in the judgment of the Representative, not less than the fair market
value of such Mortgage Loans and if such bid would equal the amount set forth in
the following sentence, the Trustee, following consultation with and written
direction from the Advisor and the Seller, will sell and assign such Mortgage
Loans without representation, warranty or recourse to such highest bidder and
will redeem the Class A Certificates. For the Trustee to consummate the sale,
the bid must be at least equal to the termination price set forth in Section
8.2(a) hereof. In addition, the bid must be in an amount sufficient to pay the
fees and expenses of the Trustee owing hereunder. If such conditions are not
met, the Trustee will, following consultation with the Advisor and the Seller,
decline to consummate such sale. In addition, the Trustee will decline to
consummate such sale unless it receives from the Advisor an opinion of counsel
addressed to it and the Certificate Insurer that such sale will not give rise
either to any "prohibited transaction" tax under section 860F(a)(1) of the Code
or to any tax on contributions to the REMIC after the "startup day" under
section 860G(d)(1) of the Code. In the event such sale is not consummated in
accordance with the foregoing, the
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Trustee will not be under any obligation to solicit any further bids or
otherwise to negotiate any further sale of the Mortgage Loans. In such event,
however, if directed by the Seller, the Trustee may solicit bids from time to
time in the future for the purchase of the Mortgage Loans upon the same terms
described above. The Trustee may consult with the Advisor and the advice of the
Advisor shall be full and complete authorization and protection in respect of
any action taken, suffered or omitted by it hereunder.
Section 8.4. Disposition of Proceeds. The Trustee shall, upon receipt
thereof, deposit the proceeds of any liquidation or termination of the Trust
Estate pursuant to this Article VIII to the Certificate Account for application
as provided in Section 7.3 hereof.
ARTICLE IX
THE TRUSTEE
Section 9.1. Certain Duties and Responsibilities.
(a) The Trustee (i) except during the continuance of an Event of Default,
undertakes to perform such duties and only such duties as are specifically set
forth in this Agreement, and no implied covenants or obligations shall be read
into this Agreement against the Trustee and (ii) in the absence of bad faith on
its part, may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or opinions
furnished pursuant to and conforming to the requirements of this Agreement; but
in the case of any such certificates or opinions which by any provision hereof
are specifically required to be furnished to the Trustee, shall be under a duty
to examine the same to determine whether or not they conform to the requirements
of this Agreement.
During the continuance of an Event of Default, the Trustee shall exercise
such of the rights and powers vested in it by this Agreement, and use the same
degree of care and skill in their exercise as a prudent person would exercise or
use under the circumstances with respect to such person's property or affairs.
(b) Notwithstanding the retention of the Master Servicer pursuant hereto
and subject to the provisions of Section 11.1 hereof, the Trustee is hereby
empowered (but not obligated) to perform the duties of the Master Servicer
hereunder following the failure of the Master Servicer to perform pursuant
hereto. Specifically, and not in limitation of the foregoing, the Trustee shall
have the power (but not the obligation):
(i) to collect Mortgagor payments;
(ii) to foreclose on defaulted Mortgage Loans;
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(iii) to enforce due-on-sale clauses and to enter into assumption and
substitution agreements as permitted by Article X hereof;
(iv) to deliver instruments of satisfaction pursuant to Article X hereof;
(v) to enforce the Mortgage Loans; and
(vi) to make Delinquency Advances and Servicing Advances and to pay
Compensating Interest, all as required hereby.
(c) 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, except that:
(i) this subsection shall not be construed to limit the effect of clause
(a) of this Section;
(ii) the Trustee shall not be liable for any error of judgment made in good
faith by an Authorized Officer, unless it shall be proved that the
Trustee was negligent in ascertaining the pertinent facts;
(iii) the Trustee shall not be liable with respect to any action taken,
suffered or omitted to be taken by it in good faith in accordance with
the direction of the Sponsor, the Seller or the Certificate Insurer
or, with the Certificate Insurer's consent, of the Owners of a
majority in Percentage Interest of the Certificates of the affected
Class or Classes 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
relating to such Certificates;
(iv) The Trustee shall not be required to take notice or be deemed to have
notice or knowledge of any default by the Sponsor or by the Master
Servicer unless the Trustee shall have received written notice
thereof. In the absence of actual receipt of such notice, the Trustee
may conclusively assume that there is no such default; and
(v) Subject to the other provisions of this Agreement and without limiting
the generality of this Section, the Trustee shall have no duty (A) to
see to any recording, filing, or depositing of this Agreement, any
Mortgage or any agreement referred to herein or any financing
statement or
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continuation statement evidencing a security interest, or to see to
the maintenance of any such recording or filing or depositing or to
any rerecording, refiling or redepositing of any thereof, (B) to see
to any insurance, (C) to see the payment or discharge of any tax,
assessment, or other governmental charge or any lien or encumbrance of
any kind owing with respect to, assessed or levied against, any
property of the Trust, (D) to confirm or verify the contents of any
reports or certificates of the Master Servicer or any Sub-Servicer
delivered to the Trustee pursuant to this Agreement or any
Sub-Servicing Agreement believed by the Trustee to be genuine and to
have been signed or presented by the proper party or parties.
(d) Whether or not therein expressly so provided, every provision of this
Agreement relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section.
(e) No provision of this Agreement shall require the Trustee to expend or
risk its own funds or otherwise incur any financial liability in the performance
of any of its duties hereunder, or in the exercise of any of its rights or
powers, if it shall have reasonable grounds for believing that repayment of such
funds or adequate indemnity against such risk or liability is not reasonably
assured to it and none of the provisions contained in this Agreement shall in
any event require the Trustee to perform, or be responsible for the manner of
performance of, any of the obligations of the Master Servicer hereunder except
during such time, if any, as the Trustee shall be the successor to, and be
vested with the rights, duties and powers and privileges of, the Master Servicer
in accordance with the terms of this Agreement.
(f) The permissive right of the Trustee to take actions enumerated in this
Agreement shall not be construed as a duty and the Trustee shall not be
answerable for other than its own negligence or willful misconduct.
(g) The Trustee shall be under no obligation to institute any suit, or to
take any remedial proceeding under this Agreement, or to take any steps in the
execution of the trusts hereby created or in the enforcement of any rights and
powers hereunder until it shall be indemnified to its reasonable satisfaction
against any and all costs and expenses, outlays and counsel fees and other
reasonable disbursements and against all liability, except liability which is
adjudicated to have resulted from its negligence or willful misconduct, in
connection with any action so taken.
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Section 9.2. Removal of Trustee for Cause. (a) The Trustee may be removed
pursuant to clause (b) hereof upon the occurrence of any of the following events
(whatever the reason for such event and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(1) the Trustee shall fail to distribute to the Owners entitled thereto on
any Payment Date amounts available for distribution in accordance with
the terms hereof; or
(2) the Trustee shall fail in the performance of, or breach, any covenant
or agreement of the Trustee in this Agreement, or if any
representation or warranty of the Trustee made in this Agreement or in
any certificate or other writing delivered pursuant hereto or in
connection herewith shall prove to be incorrect in any material
respect as of the time when the same shall have been made, and such
failure or breach shall continue or not be cured for a period of 30
days after there shall have been given, by registered or certified
mail, to the Trustee by the Sponsor or the Certificate Insurer or by
the Owners of at least 25% of the aggregate Percentage Interest
represented by any Class of Class A Certificates, or, if there are no
Class A Certificates then Outstanding, by such Percentage Interest
represented by any Class of Class B Certificates, a written notice
specifying such failure or breach and requiring it to be remedied
(unless the Trustee is aware of such breach as evidenced by notice
from the Trustee pursuant to Section 9.2(b) in which case the 30 day
cure period shall begin at the time such notice was given); or
(3) a decree or order of a court or agency or supervisory authority having
jurisdiction for the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of debt, marshalling of
assets and liabilities or similar proceedings, or for the winding-up
or liquidation of its affairs, shall have been entered against the
Trustee, and such decree or order shall have remained in force
undischarged or unstayed for a period of 60 days; or
(4) a conservator or receiver or liquidator or sequestrator or custodian
of the property of the Trustee is appointed in any insolvency,
readjustment of debt, marshalling of assets and liabilities or similar
proceedings of or relating to the Trustee or relating to all or
substantially all of its property; or
(5) the Trustee shall become insolvent (however insolvency is evidenced),
generally fail to pay its debts as they come
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due, file or consent to the filing of a petition to take advantage of
any applicable insolvency or reorganization statute, make an
assignment for the benefit of its creditors, voluntarily suspend
payment of its obligations, or take corporate action for the purpose
of any of the foregoing.
(b) The Seller and the Trustee shall give notice to each other, to the
Certificate Insurer, the Sponsor and to each Owner if it becomes aware that an
event described in Subsection (a) has occurred and is continuing.
(c) If any event described in Subsection (a) occurs and is continuing, then
and in every such case (x) the Sponsor, the Seller or the Certificate Insurer or
(y) with the consent of the Certificate Insurer, the Owners of a majority of the
Percentage Interest represented by any Class of Class A Certificates, or, if
there are no Class A Certificates then Outstanding, by such Percentage Interest
represented by any Class of Class B Certificates then Outstanding, may, whether
or not the Trustee resigns pursuant to Section 9.9 hereof, immediately,
concurrently with the giving of notice to the Trustee, appoint a successor
trustee pursuant to the terms of Section 9.9 hereof.
Section 9.3. Certain Rights of the Trustee. Except as otherwise provided in
Section 9.1 hereof:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, note or other paper or document believed by it to be genuine and to
have been signed or presented by the proper party or parties;
(b) any request or direction of the Sponsor, the Seller or the Owners
of any Class of Certificates mentioned herein shall be sufficiently
evidenced in writing;
(c) whenever in the administration of this Agreement the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may, in the absence of bad
faith on its part, rely upon an Officer's Certificate;
(d) the Trustee may consult with counsel, and the written advice of
such counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good
faith and in reasonable reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Agreement at
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the request or direction of any of the Owners pursuant to this Agreement,
unless such Owners shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, note or other paper or document, but the Trustee in its discretion
may make such further inquiry or investigation into such facts or matters
as it may see fit;
(g) 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 and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder; and
(h) the Trustee shall not be liable for any action it takes or omits
to take in good faith which it reasonably believes to be authorized by the
Authorized Officer of any Person or within its rights or powers under this
Agreement other than as to validity and sufficiency of its authentication
of the Certificates.
Section 9.4. Not Responsible for Recitals or Issuance of Certificates. The
recitals contained herein and in the Certificates, except any such recitals
relating to the Trustee, shall be taken as the statements of the Sponsor, the
Seller and the Master Servicer and the Trustee assumes no responsibility for
their correctness. The Trustee makes no representation as to the validity or
sufficiency of this Agreement, any offering materials relating to the
Certificates, or of the Certificates other than as to the validity and
sufficiency of its authentication of the Certificates.
Section 9.5. May Hold Certificates. The Trustee or any other agent of the
Trust, in its individual or any other capacity, may become an Owner or pledgee
of Certificates and may otherwise deal with the Trust with the same rights it
would have if it were not Trustee or such other agent.
Section 9.6. Money Held in Trust. Money held by the Trustee in trust
hereunder need not be segregated from other trust funds except to the extent
required herein or required by law. The Trustee shall be under no liability for
interest on any money received by it hereunder except as otherwise agreed with
the Sponsor or the Seller and except to the extent of income or other gain on
investments which are deposits in or certificates of deposit of the Trustee in
its commercial capacity and income or
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other gain actually received by the Trustee on Eligible Investments.
Section 9.7. Compensation and Reimbursement. The Trustee shall receive
compensation for fees and reimbursement for expenses pursuant to Section 2.5
hereof and Section 7.3(b)(i) hereof. The Trustee shall have no lien on the Trust
Estate for the payment of such fees and expenses.
Section 9.8. Corporate Trustee Required; Eligibility. There shall at all
times be a Trustee hereunder which shall be a corporation or association
acceptable to the Certificate Insurer and organized and doing business under the
laws of the United States of America or of any State authorized under such laws
to exercise corporate trust powers, having a combined capital and surplus of at
least $100,000,000, subject to supervision or examination by the United States
of America, having a rating or ratings acceptable to the Sponsor and the Seller
and having a long-term deposit rating of at least BBB from S&P and Baa2 from
Moody's (or such lower rating as may be acceptable to S&P, Moody's and the
Certificate Insurer). If such Trustee 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 or association shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section, it shall, upon the request of
the Sponsor, the Seller or the Certificate Insurer resign immediately in the
manner and with the effect hereinafter specified in this Article IX.
Section 9.9. Resignation and Removal; Appointment of Successor. (a) No
resignation or removal of the Trustee and no appointment of a successor trustee
pursuant to this Article IX shall become effective until the acceptance of
appointment by the successor trustee under Section 9.10 hereof.
(b) The Trustee, or any trustee or trustees hereafter appointed, may resign
at any time by giving written notice of resignation to the Certificate Insurer,
the Seller, the Master Servicer and to the Sponsor and by mailing notice of
resignation by first-class mail, postage prepaid, to the Owners at their
addresses appearing on the Register. Upon receiving notice of resignation, the
Seller shall promptly appoint a successor trustee or trustees satisfying the
eligibility requirements of Section 9.8 by written instrument, in duplicate,
executed on behalf of the Trust by an Authorized Officer of the Seller, one copy
of which instrument shall be delivered to the Trustee so resigning and one copy
to the successor trustee or trustees. If no successor trustee shall have been
appointed and have accepted appointment within 30 days after the giving of such
notice of resignation, the resigning trustee may petition any court of competent
jurisdiction for the appointment of
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a successor trustee, or any Owner may, on behalf of himself and all others
similarly situated, petition any such court for the appointment of a successor
trustee. Such court may thereupon, after such notice, if any, as it may deem
proper and prescribed, appoint a successor trustee.
(c) If at any time the Trustee shall cease to be eligible under Section 9.8
hereof and shall fail to resign after written request therefor by the Sponsor,
the Seller or the Certificate Insurer, the Sponsor, the Seller or the
Certificate Insurer may remove the Trustee and appoint a successor trustee by
written instrument, in duplicate, executed on behalf of the Trust by an
Authorized Officer of the Sponsor, the Seller or the Certificate Insurer, one
copy of which instrument shall be delivered to the Trustee so removed and one
copy to the successor trustee.
(d) The Owners of a majority of the Percentage Interests represented by any
Class of Class A Certificates, or, if there are no Class A Certificates then
Outstanding, by such Percentage Interest represented by any Class of Class B
Certificates then Outstanding, may at any time remove the Trustee and appoint a
successor trustee by delivering to the Trustee to be removed, to the successor
trustee so appointed, to the Sponsor, to the Seller and to the Certificate
Insurer, copies of the record of the act taken by the Owners, as provided for in
Section 12.3 hereof.
(e) If the Trustee fails to perform its duties in accordance with the terms
of this Agreement or becomes ineligible to serve as Trustee, the Sponsor, the
Seller or the Certificate Insurer may remove the Trustee and appoint a successor
trustee by written instrument, in quadruplicate, signed by the Sponsor, the
Seller or the Certificate Insurer duly authorized, one complete set of which
instruments shall be delivered to the Sponsor, one complete set to the Seller,
one complete set to the Trustee so removed and one complete set to the successor
trustee so appointed.
(f) If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of the Trustee for any cause, the
Sponsor or the Seller shall promptly appoint a successor trustee satisfying the
eligibility requirements of Section 9.8.
(g) The Seller shall give notice of any removal of the Trustee by mailing
notice of such event by first-class mail, postage prepaid, to the Owners as
their names and addresses appear in the Register. Each notice shall include the
name of the successor trustee and the address of its corporate trust office.
Section 9.10. Acceptance of Appointment by Successor Trustee. Every
successor trustee appointed hereunder shall execute, acknowledge and deliver to
the Sponsor and the Seller on behalf of the Trust and to its predecessor Trustee
an instrument
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accepting such appointment hereunder and stating its eligibility to serve as
Trustee hereunder, and thereupon the resignation or removal of the predecessor
Trustee shall become effective and such successor trustee, without any further
act, deed or conveyance, shall become vested with all the rights, powers,
trusts, duties and obligations of its predecessor hereunder; but, on request of
the Sponsor, the Seller or the successor trustee, such predecessor Trustee
shall, upon payment of its charges then unpaid, execute and deliver an
instrument transferring to such successor trustee all of the rights, powers and
trusts of the Trustee so ceasing to act, and shall duly assign, transfer and
deliver to such successor trustee all property and money held by such trustee so
ceasing to act hereunder. Upon request of any such successor trustee, the
Sponsor on behalf of the Trust shall execute any and all instruments for more
fully and certainly vesting in and confirming to such successor trustee all such
rights, powers and trusts.
Upon acceptance of appointment by a successor Trustee as provided in this
Section, the Seller shall mail notice thereof by first-class mail, postage
prepaid, to the Owners at their last addresses appearing in the Register. The
Seller shall send a copy of such notice to the Rating Agencies. If the Seller
fails to mail such notice within ten days after acceptance of appointment by the
successor trustee, the successor trustee shall cause such notice to be mailed at
the expense of the Seller.
No successor trustee shall accept its appointment unless at the time of
such acceptance such successor shall be qualified and eligible under this
Article IX.
Section 9.11. Merger, Conversion, Consolidation or Succession to Business
of the Trustee. Any corporation or association into which the Trustee may be
merged or converted or with which it may be consolidated, or any corporation or
association resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any corporation or association succeeding to all or
substantially all of the corporate trust business of the Trustee, shall be the
successor of the Trustee hereunder, without the execution or filing of any paper
or any further act on the part of any of the parties hereto; provided, however,
that such corporation or association shall be otherwise qualified and eligible
under this Article IX. In case any Certificates have been executed, but not
delivered, by the Trustee then in office, any successor by merger, conversion or
consolidation to such Trustee may adopt such execution and deliver the
Certificates so executed with the same effect as if such successor Trustee had
itself executed such Certificates.
Section 9.12. Reporting; Withholding. (a) The Trustee shall timely provide
to the Owners the Internal Revenue Service's Form 1099 and any other statement
required by applicable Treasury regulations as determined by the Seller, and
shall withhold, as required by applicable law, federal, state or local taxes, if
any,
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applicable to distributions to the Owners, including but not limited to backup
withholding under Section 3406 of the Code and the withholding tax on
distributions to foreign investors under Sections 1441 and 1442 of the Code.
(b) The Trustee shall timely file all reports required to be filed by the
Trust with any federal, state or local governmental authority having
jurisdiction over the Trust, including other reports that must be filed with the
Owners, such as the Internal Revenue Service's Form 1066 and Schedule Q and the
form required under Section 6050K of the Code, if applicable. Furthermore, the
Trustee shall report to Owners, if required, with respect to the allocation of
expenses pursuant to Section 212 of the Code in accordance with the specific
instructions to the Trustee by the Seller with respect to such allocation of
expenses. The Trustee shall collect any forms or reports from the Owners
determined by the Seller to be required under applicable federal, state and
local tax laws.
(c) The Trustee shall provide to the Internal Revenue Service and to
persons described in section 860(E)(e)(3) and (6) of the Code the information
described in Treasury Regulation section 1.860D-1(b)(5)(ii), or any successor
regulation thereto. Such information will be provided in the manner described in
Treasury Regulation section 1.860E-2(a)(5), or any successor regulation thereto.
Section 9.13. Liability of the Trustee. Except during the continuance of an
Event of Default, the Trustee shall be liable in accordance herewith only to the
extent of the obligations specifically imposed upon and undertaken by the
Trustee herein. Neither the Trustee nor any of the directors, officers,
employees or agents of the Trustee shall be under any liability on any
Certificate or otherwise to any Account, the Sponsor, the Seller, any Servicer
or any Owner for any action taken or for refraining from the taking of any
action in good faith pursuant to this Agreement, or for errors in judgment;
provided, however, that this provision shall not protect the Trustee or any such
Person against any liability which would otherwise be imposed by reason of
negligent action, negligent failure to act or bad faith in the performance of
duties or by reason of reckless disregard of obligations and duties hereunder.
Subject to the foregoing sentence, the Trustee shall not be liable for losses on
investments of amounts in any Account (except for any losses on obligations on
which the bank serving as Trustee is the obligor). In addition, the Seller
covenants and agrees to indemnify the Trustee, and when the Trustee is acting as
Master Servicer, the Trustee in its capacity as Master Servicer, from, and hold
it harmless against, any and all losses, liabilities, damages, claims or
expenses (including reasonable and documented legal fees and expenses) other
than those resulting from the negligence or bad faith of the Trustee. The
Trustee and any director, officer, employee or agent of the Trustee may rely and
shall be protected in acting or
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refraining from acting in good faith on any certificate, notice or other
document of any kind prima facie properly executed and submitted by the
Authorized Officer of any Person respecting any matters arising hereunder.
Section 9.14. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust Estate or any Property may at the time be located, the Master
Servicer and the Trustee acting jointly and with the consent of the Certificate
Insurer shall have the power and shall execute and deliver all instruments to
appoint one or more Persons approved by the Trustee to act as co-Trustee or
co-Trustees, jointly with the Trustee, of all or any part of the Trust Estate or
separate Trustee or separate Trustees of any part of the Trust Estate, and to
vest in such Person or Persons, in such capacity and for the benefit of the
Owners, such title to the Trust Estate, or any part thereof, and, subject to the
other provisions of this Section 9.14, such powers, duties, obligations, rights
and trusts as the Master Servicer and the Trustee may consider necessary or
desirable. If the Master Servicer shall not have joined in such appointment
within 15 days after the receipt by it of a request so to do, or in the case any
event indicated in Section 9.2 of this Agreement shall have occurred and be
continuing, the Trustee alone (with the consent of the Certificate Insurer)
shall have the power to make such appointment. No co-Trustee or separate Trustee
hereunder shall be required to meet the terms of eligibility as a successor
Trustee under Section 9.8 and no notice to Owners of the appointment of any
co-Trustee or separate Trustee shall be required under Section 9.9.
Every separate Trustee and co-Trustee shall, to the extent permitted, be
appointed and act subject to the following provisions and conditions:
(i) All rights, powers, duties and obligations conferred or imposed
upon the Trustee shall be conferred or imposed upon and exercised or
performed by the Trustee and such separate Trustee or co-Trustee jointly
(it being understood that such separate Trustee or co-Trustee is not
authorized to act separately without the Trustee joining in such act),
except to the extent that under any law of any jurisdiction in which any
particular act or acts are to be performed (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 singly by such separate Trustee or co-Trustee, but
solely at the direction of the Trustee;
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(ii) No co-Trustee hereunder shall be held personally liable by reason
of any act or omission of any other co-Trustee hereunder; and
(iii) The Master Servicer and the Trustee acting jointly with the
consent of the Certificate Insurer may at any time accept the resignation
of or remove any separate Trustee or co-Trustee.
Any notice, request or other writing given to the Trustee shall be deemed
to have been given to each of the then separate Trustees and co-Trustees, as
effectively as if given to each of them. Every instrument appointing any
separate Trustee or co-Trustee shall refer to this Agreement and the conditions
of this Section 9.14. Each separate Trustee and co-Trustee, upon its acceptance
of the trusts conferred, shall be vested with the estates or property specified
in its instrument of appointment, either jointly with the Trustee or separately,
as may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee and a copy thereof given to the
Master Servicer.
Any separate Trustee or co-Trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate Trustee or co-Trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor Trustee.
ARTICLE X
SERVICING AND ADMINISTRATION
OF MORTGAGE LOANS
Section 10.1. General Servicing Procedures. (a) Acting directly or through
one or more Sub-Servicers as provided in Section 10.3, the Master Servicer shall
service and administer the Mortgage Loans in accordance with this Agreement and
shall have full power and authority, acting alone, to do or cause to be done any
and all things in connection with such servicing and administration which it may
deem necessary or desirable and consistent with the terms of this Agreement.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Master Servicer shall not have any duties, responsibilities, or fiduciary
relationship with the parties hereto except those expressly set forth herein,
and no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read
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into this Agreement or shall otherwise exist against the Master Servicer.
(b) The Master Servicer may, and is hereby authorized to, perform any of
its servicing responsibilities with respect to all or certain of the Mortgage
Loans through a Sub-Servicer as it may from time to time designate, but no such
designation of a Sub-Servicer shall serve to release the Master Servicer from
any of its obligations under this Agreement. Such Sub-Servicer shall have all
the rights and powers of the Master Servicer with respect to such Mortgage Loans
under this Agreement.
(c) Without limiting the generality of the foregoing, but subject to the
provisions of this Article X, the Master Servicer in its own name or in the name
of a Sub-Servicer hereby is authorized and empowered, which authorization may
further be evidenced, at the reasonable request of the Master Servicer, by a
power of attorney executed and delivered by the Trustee, on behalf of itself,
the Owners and the Trustee or any of them, (i) to execute and deliver any and
all instruments of satisfaction or cancellation or of partial or full release or
discharge and all other comparable instruments with respect to the Mortgage
Loans and with respect to the Properties, (ii) to institute foreclosure
proceedings or obtain a deed in lieu of foreclosure so as to effect ownership of
any Property in the name of the Trust, and (iii) to hold title in the name of
the Trust to any Property upon such foreclosure or deed in lieu of foreclosure
on behalf of the Trustee; provided, however, that to the extent any instrument
described in clause (i) preceding would be delivered by the Master Servicer
outside of its ordinary procedures for mortgage loans held for its own account
the Master Servicer shall, prior to executing and delivering such instrument,
obtain the prior written consent of the Certificate Insurer, and provided
further, however, that Section 10.14(a) shall constitute a power of attorney
from the Trustee to the Master Servicer to execute an instrument of satisfaction
(or assignment of mortgage without recourse) with respect to any Mortgage Loan
paid in full (or with respect to which payment in full has been escrowed).
Subject to Sections 10.13 and 10.14, the Trustee shall execute any powers of
attorney and other documents as the Master Servicer or such Sub-Servicer shall
reasonably request and that are provided to the Trustee to enable the Master
Servicer and such Sub-Servicer to carry out their respective servicing and
administrative duties hereunder. The costs to the Master Servicer of delivering
any satisfactions described in clause (i) above shall be paid by the Master
Servicer to the extent not recoverable from the related Mortgagor under
applicable state law.
(d) The Master Servicer, with the approval of the Seller or the Sponsor,
shall have the right to approve requests of Mortgagors for consent to (i)
partial releases of Mortgages, (ii) alterations and (iii) removal, demolition or
division of Properties subject to Mortgages. No such request shall be approved
by the
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Master Servicer unless: (1) (x) the provisions of the related Note and Mortgage
have been complied with; (y) the Loan-to-Value Ratio (which may, for this
purpose, be determined at the time of any such action in a manner reasonably
acceptable to the Certificate Insurer) after any release does not exceed the
Loan-to-Value Ratio set forth for such Mortgage Loan in the Mortgage Loan
Schedule; and (z) the lien priority, monthly payment, Coupon Rate or maturity
date of the related Mortgage is not affected (except in accordance with Section
10.2) or (2) the Certificate Insurer shall have approved the granting of such
request and shall not unreasonably withhold such approval.
(e) The Master Servicer shall give prompt notice to the Sponsor, the
Seller, the Trustee and to the Certificate Insurer of any action, of which the
Master Servicer has actual knowledge, to (i) assert a claim against the Trust or
(ii) assert jurisdiction over the Trust.
(f) Servicing Advances incurred by the Master Servicer or any Sub-Servicer
in connection with the servicing of the Mortgage Loans (including any penalties
in connection with the payment of any taxes and assessments or other charges) on
any Property shall be recoverable by the Master Servicer or such Sub-Servicer to
the extent described in this Agreement.
(g) Each of the Master Servicer, each Sub-Servicer, the Sponsor, the
Seller, the Trustee and the Certificate Insurer shall be entitled to rely, and
shall be fully protected in relying, upon any promissory note, writing,
resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, telecopy, telex or teletype message, statement, order or other
document reasonably believed by it to be genuine and correct and to have been
signed, sent or made by the proper person or persons and upon advice and
statements of legal counsel (including, without limitation, counsel to the
Mortgagor(s)), independent accountants and other experts selected by the Master
Servicer, each Sub-Servicer, the Sponsor, the Seller, the Trustee or the
Certificate Insurer. The Master Servicer shall be fully justified in failing or
refusing to take any action under this Agreement for which it has sought and
received instructions from the Owners and has been consented to by the
Certificate Insurer. The Master Servicer shall in all cases be fully protected
in acting, or in refraining from acting, under this Agreement and the Mortgage
Loans in accordance with an express written request of the Owners to which the
Certificate Insurer has consented, and such request and any action taken or
failure to act pursuant thereto shall be binding upon the Master Servicer, the
Sponsor, the Seller, the Trustee, the Certificate Insurer and all Owners. In the
event of any conflicting instructions or requests, the instructions or requests
delivered by the Certificate Insurer shall prevail, unless such instructions or
requests violate the express terms of this Agreement or violate applicable law.
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(h) The Master Servicer shall have no liability to the Sponsor, the Seller,
the Trustee, the Certificate Insurer, the Owners or any other Person 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
the foregoing shall not apply to any breach of representations or warranties
made by the Master Servicer herein, or to any specific liability imposed upon
the Master Servicer pursuant to this Agreement or any liability that would
otherwise be imposed upon the Master Servicer by reason of its willful
misconduct, bad faith or negligence in the performance of its duties hereunder
or by reason of its reckless disregard of its obligations or duties hereunder.
Section 10.2. Collection of Certain Mortgage Loan Payments. The Master
Servicer shall generally service the Mortgage Loans in a prudent manner
consistent with the Master Servicer's Servicing and Collection Guide (the
"Servicing Standards"), and agrees to make reasonable efforts to collect all
payments called for under the terms and provisions of the Mortgage Loans, and
shall, to the extent such procedures shall be consistent with this Agreement,
follow collection procedures for all Mortgage Loans at least as rigorous as
those the Master Servicer would take in servicing similar mortgage loans and in
collecting payments thereunder for its own account. Consistent with the
foregoing, the Master Servicer may (i) in its discretion waive or permit to be
waived any late payment charge or assumption fee or any other fee or charge
which the Master Servicer would be entitled to retain pursuant to Section 10.15
as servicing compensation, (ii) extend the due date for payments due on a Note
for a period (with respect to each payment as to which the due date is extended)
not greater than 125 days after the initially scheduled due date for such
payment and (iii) amend any Note to extend the maturity thereof, provided that
no maturity shall be extended beyond the maturity date of the Mortgage Loan with
the latest maturity date and that no more than 1.0% of the Original Pool
Principal Balance of the Mortgage Loans shall have a maturity date which has
been extended beyond the maturity date thereof at the Cut-off Date; provided
further, with respect to clauses (i), (ii) and (iii), that such action does not
violate applicable REMIC provisions. In the event the Master Servicer shall
consent to the deferment of the due dates for payments due on a Note, the Master
Servicer shall nonetheless make payment of any required Delinquency Advance with
respect to the payments so extended to the same extent as if such installment
were due, owing and Delinquent and had not been deferred, and shall be entitled
to reimbursement therefor in accordance with Sections 10.8(d)(i)(D) and 10.9(a)
hereof.
The Master Servicer may not waive prepayment charges or penalty interest in
connection with Prepayments. Any such amounts so received shall be paid over to
the Seller as received.
Section 10.3. Sub-Servicing Agreements Between Master Servicer and
Sub-Servicers. The Master Servicer may enter into
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Sub-Servicing Agreements for any servicing and administration of Mortgage Loans
with any institution which is in compliance with the laws of each state
necessary to enable it to perform its obligations under such Sub-Servicing
Agreement and which has been designated an approved seller-servicer by FHLMC or
FNMA for first and second mortgage loans and (except for LSI Financial Group)
has equity of at least $15,000,000, as determined in accordance with generally
accepted accounting principles. The Master Servicer shall give notice to the
Sponsor, the Seller, the Trustee, Moody's, S&P and the Certificate Insurer of
the removal or appointment of any Sub-Servicer. Any such Sub-Servicing Agreement
shall be consistent with and not violate the provisions of this Agreement. For
purposes of this Agreement, the Master Servicer shall be deemed to have received
payments on or with respect to Mortgage Loans when any Sub-Servicer has received
such payments. For purposes of this Agreement, the Master Servicer shall be
deemed to have made a payment required to be made by it hereunder when any
Sub-Servicer has made such payment in the manner required of the Master Servicer
hereunder. For purposes of this Agreement, the Master Servicer shall be deemed
to have delivered any document required to be delivered by it hereunder when any
Sub-Servicer has delivered such document in the manner required of the Master
Servicer hereunder. As of the Startup Day, the only Sub-Servicer is LSI
Financial Group.
Section 10.4. Successor Sub-Servicers. Each Sub-Servicing Agreement shall
expressly provide that the Master Servicer or the Trustee shall be entitled to
terminate any Sub-Servicing Agreement in accordance with the terms and
conditions of such Sub-Servicing Agreement and to enter into a Sub-Servicing
Agreement with a successor Sub-Servicer which qualifies under Section 10.3. The
Trustee shall have no duty or obligation hereunder to monitor or supervise the
performance of any Sub-Servicer.
Section 10.5. Liability of Master Servicer. The Master Servicer shall not
be relieved of its obligations under this Agreement notwithstanding any
Sub-Servicing Agreement or any of the provisions of this Agreement relating to
agreements or arrangements between the Master Servicer and a Sub-Servicer or
otherwise, and the Master Servicer shall be obligated to the same extent and
under the same terms and conditions as if it alone were servicing and
administering the Mortgage Loans. The Master Servicer shall be entitled to enter
into any agreement with a Sub-Servicer for indemnification of the Master
Servicer by such Sub-Servicer and nothing contained in such Sub-Servicing
Agreement shall be deemed to limit or modify this Agreement.
Section 10.6. No Contractual Relationship Between Sub-Servicer and Trustee
or the Owners. Any Sub-Servicing Agreement and any other transactions or
services relating to the Mortgage Loans involving a Sub-Servicer shall be deemed
to be between the Sub-Servicer, the Master Servicer and any other parties
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thereto alone and the Sponsor, the Trustee and the Owners shall not be deemed
parties thereto and shall have no claims, rights, obligations, duties or
liabilities with respect to any Sub-Servicer except as set forth in Sections
10.4 and 10.7, unless expressly made a party thereto.
Section 10.7. Assumption or Termination of Sub-Servicing Agreement by
Trustee. In connection with the assumption of the responsibilities, duties and
liabilities and of the authority, power and rights of the Master Servicer
hereunder by the Trustee pursuant to Section 11.1, it is understood and agreed
that the Master Servicer's rights and obligations under any Sub-Servicing
Agreement then in force between the Master Servicer and a Sub-Servicer may be
assumed or terminated by the Trustee at its option.
The Master Servicer shall, upon request of the Trustee, but at the expense
of the Master Servicer, deliver to the assuming party documents and records
relating to each Sub-Servicing Agreement and an accounting of amounts collected
and held by it and otherwise use its best reasonable efforts to effect the
orderly and efficient transfer of the Sub-Servicing Agreements to the assuming
party.
Section 10.8. Principal and Interest Account.
(a) The Master Servicer shall establish and maintain at one or more
Designated Depository Institutions the Principal and Interest Account as a
segregated account.
Subject to Subsections (c) and (d) below, the Master Servicer and any
Sub-Servicer shall deposit all collections (other than amounts escrowed for
taxes and insurance) related to the Mortgage Loans to the Principal and Interest
Account on a daily basis (but no later than the first Business Day after
receipt).
On or before the Startup Day, the Master Servicer shall deposit to the
Principal and Interest Account (i) all scheduled payments due and collected
(other than amounts escrowed for taxes and insurance) on the Mortgage Loans
after the Cut-Off Date and prior to the Startup Day and (ii) all unscheduled
collections (other than amounts escrowed for taxes and insurance) on the
Mortgage Loans received on or after the Cut-Off Date and prior to the Startup
Day.
(b) All funds in the Principal and Interest Account shall be invested in
Eligible Investments maturing not later than the Business Day immediately
preceding the related Remittance Date. The Principal and Interest Account shall
be held in trust in the name of the Trustee for the benefit of the Owners. Any
investment earnings on funds held in the Principal and Interest Account shall be
for the account of the Master Servicer and may only be withdrawn from the
Principal and Interest Account by the Master Servicer
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immediately following the remittance of the Monthly Remittances by the Master
Servicer. Any investment losses shall be paid by the Master Servicer to the
Principal and Interest Account from the Master Servicer's own funds. Any
references herein to amounts on deposit in the Principal and Interest Account
shall refer to amounts net of such investment earnings. The Trustee shall have
no responsibility or liability for actions taken by the Master Servicer,
including withdrawals, with respect to the Principal and Interest Accounts.
(c) The Master Servicer shall deposit to the Principal and Interest Account
all principal and interest payments from the related Mortgagors received by the
Master Servicer (including any Prepayments), Net Proceeds, other recoveries or
amounts related to the Mortgage Loans received by the Master Servicer,
Compensating Interest, Delinquency Advances together with any amounts which are
reimbursable to the Master Servicer from the Principal and Interest Account, the
amount of any Loan Purchase Price received or paid by the Master Servicer, the
amount of any Substitution Amount received by the Master Servicer, REO income
pursuant to Section 10.13(c) hereof, and amounts required to be deposited
therein pursuant to Section 10.11 hereof in connection with blanket insurance
policies and any proceeds received by the Master Servicer in connection with the
termination of the Trust, but net of (i) the Master Servicing Fee with respect
to each Mortgage Loan and other servicing compensation to the Master Servicer as
permitted by Section 10.15 hereof, (ii) Net Proceeds to the extent such Net
Proceeds exceed the sum of (I) the Principal Balance of the related Mortgage
Loan, plus (II) accrued and unpaid interest on such Mortgage Loan at the Coupon
Rate applicable to the related Remittance Period (net of the Master Servicing
Fee) and (iii) prepayment charges and similar amounts to be paid over to the
Seller pursuant to Section 10.2 hereof. Amounts described in clause (ii) of the
preceding sentence shall be retained by the Master Servicer as additional
servicing compensation or paid over to the related Mortgagor if required by law.
(d) (i) The Master Servicer may make withdrawals from the Principal and
Interest Account only for the following purposes:
(A) to effect the timely remittance to the Trustee of the related Monthly
Remittance due on each Remittance Date;
(B) to withdraw investment earnings on amounts on deposit in the Principal
and Interest Account;
(C) to withdraw amounts that have been deposited to the Principal and
Interest Account in error;
(D) to reimburse itself for amounts which represent Reimbursable Advances
made by the Master Servicer
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from its own funds and subsequently collected from the related
Mortgagor; and
(E) to clear and terminate the Principal and Interest Account in
connection with the termination of the Trust.
(ii) On the tenth day of each month (or the immediately following Business
Day if the tenth day does not fall on a Business Day), the Master Servicer shall
send to the Trustee a report, in such electronic form as may be agreed upon by
the Master Servicer, the Seller and the Trustee, detailing the payments on the
Mortgage Loans for each of the Mortgage Loan Groups during the prior Remittance
Period. Such report shall be in the form and have the specifications as may be
agreed to between the Master Servicer, the Seller, and the Trustee from time to
time and, in any event, shall have such information as shall be necessary to
enable the Trustee to perform its obligations hereunder.
In addition, on or prior to each Remittance Date, the Master Servicer will
furnish to the Trustee, the Sponsor, the Seller and to the Certificate Insurer
the following information for each of the two Mortgage Loan Groups as of the
close of business on the first business day of the current calendar month:
(A) the total number of Mortgage Loans and the aggregate Principal
Balances thereof, together with the number and aggregate principal
balances of Mortgage Loans (a) 30-59 days Delinquent, (b) 60-89 days
Delinquent and (c) 90 or more days Delinquent;
(B) the number and aggregate principal balances of all Mortgage Loans in
foreclosure proceedings (and whether any such Mortgage Loans are also
included in any of the statistics described in the foregoing clause
(A));
(C) the number and aggregate principal balances of all Mortgage Loans
relating to Mortgagors in bankruptcy proceedings (and whether any such
Mortgage Loans are also included in any of the statistics described in
the foregoing clauses (A) and (B));
(D) the number and aggregate principal balances of all Mortgage Loans
relating to REO Properties (and whether any such Mortgage Loans are
also included in any of the statistics described in the foregoing
clauses (A), (B) and (C));
(E) the number and aggregate principal balances of all Mortgage Loans as
to which foreclosure proceedings were commenced during the prior
Remittance Period;
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(F) a schedule regarding cumulative foreclosures since the Cut-Off Date;
(G) a schedule regarding the Group I Cumulative Net Realized Losses, the
Group II Cumulative Net Realized Losses and the Cumulative Net
Realized Losses;
(H) the book value of any REO Property and any income received from REO
Properties during the prior Remittance Period; and
(I) such other information as the Trustee, the Sponsor or the Seller may
reasonably request and as is produced by the Master Servicer in the
ordinary course of its business.
(iii) On each Remittance Date the Master Servicer shall remit the Group I
Monthly Remittance and the Group II Monthly Remittance to the Trustee by wire
transfer, or otherwise make funds available in immediately available funds.
(e) In connection with any exercise by the Seller of its option and related
termination under Article VIII hereof, upon written request of the Seller, the
Master Servicer shall remit to the Trustee all amounts (net of investment
earnings and providing for investment losses pursuant to Section 10.8(b), net of
the Master Servicing Fee and net of amounts reimbursable for Delinquency
Advances and Servicing Advances) then on deposit in the Principal and Interest
Account for deposit to the Certificate Account, which deposit shall be deemed to
have occurred immediately preceding such purchase.
Section 10.9. Delinquency Advances and Servicing Advances. (a) If the
amount on deposit in the Principal and Interest Account with respect to any
Mortgage Loan Group as of any Remittance Date is less than the related Monthly
Remittance for such Remittance Date, the Master Servicer shall deposit to the
Principal and Interest Account with respect to such Mortgage Loan Group a
sufficient amount of its own funds to make such amount equal to the related
Monthly Remittance for such Remittance Date. Such amounts of the Master
Servicer's own funds so deposited are "Delinquency Advances". Any Delinquency
Advances funded by the Master Servicer from its own funds are reimbursable from
subsequent collections on or with respect to the related Mortgage Loan,
including Liquidation Proceeds, Insurance Proceeds, Released Mortgaged Property
Proceeds, and payments from the related Mortgagor. Notwithstanding anything to
the contrary contained in this Agreement, no Delinquency Advance or Servicing
Advance shall be required to be made by the Master Servicer if such Delinquency
Advance or Servicing Advance would, if made, constitute a Nonrecoverable
Advance.
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The Master Servicer shall be permitted to fund its payment of Delinquency
Advances on any Remittance Date from collections on any Mortgage Loan deposited
to the Principal and Interest Account subsequent to the related Remittance
Period, and shall deposit to the Principal and Interest Account with respect to
Delinquency Advances funded from amounts on deposit in the Principal and
Interest Account (i) collections from the Mortgagor whose delinquency gave rise
to the shortfall which resulted in such Delinquency Advance and (ii) Net
Liquidation Proceeds recovered on account of the related Mortgage Loan to the
extent of the amount of aggregate Delinquency Advances related thereto. In any
event, to the extent the Master Servicer uses such funds, the Master Servicer
must reimburse the Principal and Interest Account by the next Remittance Date to
the extent necessary to provide for the related Monthly Remittance.
(b) The Master Servicer will pay all reasonable and customary
"out-of-pocket" costs and expenses (including reasonable legal fees) incurred in
the performance of its servicing obligations including, but not limited to, the
cost of (i) Preservation Expenses, (ii) any enforcement or judicial proceedings,
including foreclosures, (iii) the management and liquidation of REO Property
(including, without limitation, realtors' commissions) and (iv) advances made
for taxes, insurance and other charges against the Property. Each such
expenditure will constitute a "Servicing Advance". The Master Servicer may
recover Servicing Advances from the Mortgagors to the extent permitted by the
Mortgage Loans or, if not theretofore recovered from the Mortgagor on whose
behalf such Servicing Advance was made, from Liquidation Proceeds, Insurance
Proceeds and/or Released Mortgage Property Proceeds realized with respect to the
related Mortgage Loan. In no case may the Master Servicer recover Servicing
Advances from the principal and interest payments on any Mortgage Loan or from
any amounts relating to any other Mortgage Loan.
Section 10.10. Compensating Interest. A full month's interest at the
related Coupon Rate less the Master Servicing Fee is due to the Trustee on the
outstanding Principal Balance of each Mortgage Loan as of the beginning of each
Remittance Period. If a Prepayment of a Mortgage Loan occurs during any calendar
month, any difference between the interest collected from the Mortgagor during
such calendar month and the full month's interest at the related Coupon Rate
less the Master Servicing Fee with respect to such Mortgage Loan ("Compensating
Interest") that is due shall be deposited prior to the Remittance Date by the
Master Servicer to the Principal and Interest Account and shall be included in
the related Monthly Remittance to be made available to the Trustee on the next
succeeding Remittance Date. The Master Servicer shall not be entitled to
reimbursement for Compensating Interest payments.
Section 10.11. Maintenance of Insurance. (a) The Master Servicer shall
cause to be maintained with respect to each Mortgage Loan a hazard insurance
policy with a carrier licensed in
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the state in which the Property is located that provides for fire and extended
coverage, and which provides for a recovery by the Trust of insurance proceeds
relating to such Mortgage Loan in an amount not less than the least of (i) the
outstanding principal balance of the Mortgage Loan (together in the case of a
Second Mortgage Loan, with the outstanding principal balance of the Senior
Lien), (ii) the minimum amount required to compensate for loss or damage on a
replacement cost basis and (iii) the full insurable value of the premises. The
Master Servicer shall indemnify the Trust out of the Master Servicer's own funds
for any loss to the Trust resulting from the Master Servicer's failure to
maintain the insurance required by this paragraph.
(b) If the Mortgage Loan at the time of origination relates to a Property
in an area identified in the Federal Register by the Federal Emergency
Management Agency as having special flood hazards, the Master Servicer will
cause to be maintained with respect thereto a flood insurance policy in a form
meeting the requirements of the current guidelines of the Federal Insurance
Administration with a generally acceptable carrier, and which provides for a
recovery by the Master Servicer on behalf of the Trust of insurance proceeds
relating to such Mortgage Loan of not less than the least of (i) the outstanding
principal balance of the Mortgage Loan, (ii) the minimum amount required to
compensate for damage or loss on a replacement cost basis and (iii) the maximum
amount of insurance that is available under the Flood Disaster Protection Act of
1973, as amended. The Master Servicer shall indemnify the Trust and the
Certificate Insurer out of the Master Servicer's own funds for any loss to the
Trust and the Certificate Insurer resulting from the Master Servicer's failure
to maintain the insurance required by this Section.
(c) In the event that the Master Servicer shall obtain and maintain a
blanket policy insuring against fire and hazards of extended coverage on all of
the Mortgage Loans, then, to the extent such policy names the Master Servicer as
loss payee and provides coverage in an amount equal to the aggregate unpaid
principal balance on the Mortgage Loans with co-insurance, and otherwise
complies with the requirements of this Section 10.11, the Master Servicer shall
be deemed conclusively to have satisfied its obligations with respect to fire
and hazard insurance coverage under this Section 10.11, it being understood and
agreed that such blanket policy may contain a deductible clause, in which case
the Master Servicer shall, in the event that there shall not have been
maintained on the related Property a policy complying with subsection (a) of
this Section 10.11, and there shall have been a loss which would have been
covered by such policy, deposit in the Principal and Interest Account from the
Master Servicer's own funds the difference, if any, between the amount that
would have been payable under a policy complying with subsection (a) of this
Section 10.11 and the amount paid under such blanket policy. Upon the request of
the Trustee, the Master Servicer shall cause to be delivered to the Trustee, a
certified true copy of such policy.
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(d) The Seller shall indemnify the Master Servicer for any loss to the
Master Servicer if any Mortgage Loan does not, at the time the Master Servicer
assumed the servicing of such Mortgage Loan, have in place the insurance
described in Sections 3.2(b)(xvi) and (xvii) hereof and described herein and, if
applicable, Section 3.2(b)(xviii) hereof. The Master Servicer shall only be
required to maintain insurance on any Property if such insurance was in place at
the time the Master Servicer assumed the servicing of the related Mortgage Loan.
Section 10.12. Due-on-Sale Clauses; Assumption and Substitution Agreements.
(a) When a Property has been or is about to be conveyed by the Mortgagor, the
Master Servicer shall, to the extent it has knowledge of such conveyance or
prospective conveyance, exercise its rights to accelerate the maturity of the
related Mortgage Loan under any "due on sale" clause contained in the related
Mortgage or Note; provided, however, that the Master Servicer shall not exercise
any such right if the "due on sale" clause, in the reasonable belief of the
Master Servicer, is not enforceable under applicable law; and provided, further,
that the Master Servicer may refrain from exercising any such right if the
Certificate Insurer gives its prior consent to such non-enforcement.
(b) The Mortgage Loan, if assumed, shall conform in all respects to the
requirements, representations and warranties of this Agreement. The Master
Servicer shall notify the Trustee in writing that any applicable assumption or
substitution agreement has been completed and shall forward to the Trustee the
original recorded copy of such assumption or substitution agreement, which copy
shall be added by the Trustee in writing to the related File and which shall,
for all purposes, be considered a part of such File to the same extent as all
other documents and instruments constituting a part thereof. The Master Servicer
shall be responsible for recording any such assumption or substitution
agreements. In connection with any such assumption or substitution agreement,
the required monthly payment on the related Mortgage Loan shall not be changed
but shall remain as in effect immediately prior to the assumption or
substitution, the stated maturity or outstanding principal amount of such
Mortgage Loan shall not be changed, the Coupon Rate shall not be changed nor
shall any required monthly payments of principal or interest be deferred or
forgiven. Any fee collected by the Master Servicer or the Sub-Servicer for
consenting to any such conveyance or entering into an assumption or substitution
agreement shall be retained by or paid to the Master Servicer as additional
servicing compensation.
(c) Notwithstanding the foregoing clauses (a) and (b) or any other
provision of this Agreement, the Master Servicer shall not be deemed to be in
default, breach or any other violation of its obligations hereunder by reason of
any assumption of a Mortgage Loan by operation of law or any assumption which
the Master
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Servicer may be restricted by law from preventing, for any reason whatsoever.
Section 10.13. Realization Upon Defaulted Mortgage Loans. (a) The Master
Servicer shall foreclose upon or otherwise comparably effect the ownership in
the name of the Trust of Properties relating to defaulted Mortgage Loans as to
which no satisfactory arrangements can be made for collection of Delinquent
payments and which the Master Servicer has not purchased pursuant to Section
10.13(f), unless the Master Servicer reasonably believes that Net Liquidation
Proceeds with respect to such Mortgage Loan would not be increased as a result
of such foreclosure or other action, in which case such Mortgage Loan will be
charged-off and will become a Liquidated Loan. The Master Servicer shall have no
obligation to purchase any Property at any foreclosure sale. The Master Servicer
will give notice of any such charge-off to the Certificate Insurer by delivery
of a Liquidation Report in the form attached as Exhibit G hereto. In connection
with such foreclosure or other conversion, the Master Servicer shall exercise
foreclosure procedures with the same degree of care and skill in their exercise
or use, as it would exercise or use under the circumstances in the conduct of
its own affairs. Any amounts, including Liquidation Expenses, advanced by the
Master Servicer in connection with such foreclosure or other action shall
constitute "Servicing Advances" within the meaning of Section 10.9(b) hereof.
(b) The Master Servicer shall sell any REO Property within 23 months of its
acquisition by the Trust, unless the Master Servicer obtains for the Trustee an
opinion of counsel experienced in federal income tax matters, addressed to the
Trustee, the Certificate Insurer and the Master Servicer, to the effect that the
holding by the Trust of such REO Property for a greater specified period will
not result in the imposition of taxes on "Prohibited Transactions" of the Trust
as defined in Section 860F of the Code or cause the REMICs to fail to qualify
under the REMIC Provisions at any time that any Certificates are outstanding.
(c) Notwithstanding the generality of the foregoing provisions, the Master
Servicer shall manage, conserve, protect and operate each REO Property for the
Owners solely for the purpose of its prompt disposition and sale in a manner
which does not cause such REO Property to fail to qualify as "foreclosure
property" within the meaning of Section 860G(a)(8) of the Code or result in the
receipt by the Trust of any "income from non-permitted assets" within the
meaning of Section 860F(a)(2)(B) of the Code or any "net income from foreclosure
property" which is subject to taxation under the REMIC Provisions. Pursuant to
its efforts to sell such REO Property, the Master Servicer shall either itself
or through an agent selected by the Master Servicer protect and conserve such
REO Property in the same manner and to such extent as is customary in the
locality where such REO Property is located and may, incident to its
conservation and protection of the interests of the Owners and the Certificate
Insurer, rent the same, or any part thereof, as
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the Master Servicer deems to be in the best interest of the Owners and the
Certificate Insurer for the period prior to the sale of such REO Property. The
net income from the sale of an REO Property shall be deposited in the Principal
and Interest Account.
(d) If the Master Servicer has reason to believe that a Property which the
Master Servicer is contemplating acquiring in foreclosure or by deed in lieu of
foreclosure contains environmental or hazardous waste risks known to the Master
Servicer, the Master Servicer shall notify the Certificate Insurer, the Seller,
the Sponsor and the Trustee prior to acquiring the Property. The Master Servicer
shall not institute foreclosure actions with respect to such a property if it
reasonably believes that such action would not be consistent with the Servicing
Standards, and the Master Servicer is not permitted to take any action with
respect to such a Property without the prior written approval of the Certificate
Insurer, the Trustee, the Sponsor and the Seller, and in no event shall the
Master Servicer be required to manage, operate or take any other action with
respect thereto which the Master Servicer in good faith believes will result in
"clean-up" or other liability under applicable law, unless the Master Servicer
receives an indemnity acceptable to it in its sole discretion.
(e) The Master Servicer shall determine, with respect to each defaulted
Mortgage Loan, when it has recovered, whether through trustee's sale,
foreclosure sale or otherwise, all amounts, if any, it expects to recover from
or on account of such defaulted Mortgage Loan, whereupon such Mortgage Loan
shall become a "Liquidated Loan". The Master Servicer shall deliver to the
Trustee, the Sponsor, the Seller and the Certificate Insurer on each Remittance
Date a Liquidation Report in the form annexed as Exhibit G hereto with respect
to each Mortgage Loan as to which the Master Servicer made a determination that
such Mortgage Loan has become a Liquidated Loan during the related Remittance
Period.
(f) The Master Servicer has the right and the option, but not the
obligation, to purchase for its own account any Mortgage Loan which becomes
Delinquent, in whole or in part, as to four consecutive monthly installments or
any Mortgage Loan as to which enforcement proceedings have been brought by the
Master Servicer pursuant to this Section 10.13 or which is in default or as to
which a default is imminent. Any such Mortgage Loan so purchased shall be
purchased on a Remittance Date at a purchase price equal to the Loan Purchase
Price thereof, which purchase price shall be deposited in the Principal and
Interest Account.
(g) The Master Servicer shall consult with the Sponsor or the Seller with
respect to its obligations under this Section 10.13.
Section 10.14. Trustee to Cooperate; Release of Files. (a) Upon the payment
in full of any Mortgage Loan (including the
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repurchase of any Mortgage Loan or any liquidation of such Mortgage Loan through
foreclosure or otherwise), or the receipt by the Master Servicer of a
notification that payment in full will be escrowed in a manner customary for
such purposes, the Master Servicer shall deliver to the Trustee a Master
Servicer's Trust Receipt. Upon receipt of such Master Servicer's Trust Receipt,
the Trustee shall promptly release the related File, in trust to (i) the Master
Servicer, (ii) an escrow agent or (iii) any employee, agent or attorney of the
Trustee, in each case pending its release by the Master Servicer, such escrow
agent or such employee, agent or attorney of the Trustee, as the case may be.
Upon any such payment in full, or the receipt of such notification that such
funds have been placed in escrow, the Master Servicer is authorized to give, as
attorney-in-fact for the Trustee and the mortgagee under the Mortgage which
secured the Note, an instrument of satisfaction (or assignment of Mortgage
without recourse) regarding the Property relating to such Mortgage, which
instrument of satisfaction or assignment, as the case may be, shall be delivered
to the Person or Persons entitled thereto against receipt therefor of payment in
full, it being understood and agreed that no expense incurred in connection with
such instrument of satisfaction or assignment, as the case may be, shall be
chargeable to the Principal and Interest Account. In lieu of executing any such
satisfaction or assignment, as the case may be, the Master Servicer may prepare
and submit to the Trustee, a satisfaction (or assignment without recourse, if
requested by the Person or Persons entitled thereto) in form for execution by
the Trustee with all requisite information completed by the Master Servicer; in
such event, the Trustee shall execute and acknowledge such satisfaction or
assignment, as the case may be, and deliver the same with the related File, as
aforesaid.
(b) From time to time and as appropriate in the servicing of any Mortgage
Loan, including, without limitation, foreclosure or other comparable conversion
of a Mortgage Loan or collection under any applicable Insurance Policy, the
Trustee shall (except in the case of the payment or liquidation pursuant to
which the related File is released to an escrow agent or an employee, agent or
attorney of the Trustee), promptly upon request of the Master Servicer and
delivery to the Trustee of a Master Servicer's Trust Receipt, release the
related File to the Master Servicer and shall execute such documents as shall be
reasonably necessary to the prosecution of any such proceedings, including,
without limitation, an assignment without recourse of the related Mortgage to
the Master Servicer. The Trustee shall complete in the name of the Trustee any
endorsement in blank on any Note prior to releasing such Note to the Master
Servicer. Such receipt shall obligate the Master Servicer to return the File to
the Trustee when the need therefor by the Master Servicer no longer exists
unless the Mortgage Loan shall be liquidated, in which case, upon receipt of the
liquidation information, in physical or electronic form, the Master Servicer's
Trust Receipt shall be released by the Trustee to the Master Servicer.
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Notwithstanding the foregoing, at no time shall the Trustee release to the
Master Servicer pursuant to this Section 10.14 a quantity of Files in excess of
10% of the Pool Principal Balance, excluding Files relating to Mortgage Loans
which have been paid in full or have become Liquidated Loans (unless otherwise
approved by the Certificate Insurer).
(c) In all cases where the Master Servicer needs the Trustee to sign any
document or to release a File within a particular period of time, the Master
Servicer shall notify an Authorized Officer of the Trustee by telephone or
telecopy of such need and the Trustee shall thereupon use its best efforts to
comply with the Master Servicer's needs, but in any event will comply within two
Business Days of such request.
Section 10.15. Master Servicing Compensation. As compensation for its
activities hereunder, the Master Servicer shall be entitled to retain the amount
of the Master Servicing Fee with respect to each Mortgage Loan. Additional
servicing compensation in the form of release and satisfaction fees (to the
extent allowed by law), bad check charges, assumption fees, late payment
charges, and any other servicing-related fees, Net Proceeds not required to be
deposited in the Principal and Interest Account pursuant to Section 10.8(c)(ii)
and similar items may, to the extent collected from Mortgagors, be retained by
the Master Servicer.
Section 10.16. Annual Statement as to Compliance. The Master Servicer, at
its own expense, will deliver to the Trustee, the Sponsor, the Seller and the
Certificate Insurer, on or before the last day of April of each year, commencing
in 1997, an Officer's Certificate stating, as to each signer thereof, that (i) a
review of the activities of the Master Servicer during such preceding calendar
year and of performance under this Agreement has been made under such officer's
supervision, and (ii) to the best of such officer's knowledge, based on such
review, the Master Servicer has fulfilled all its obligations under this
Agreement for such year, or, if there has been a default in the fulfillment of
one or more such obligations, specifying each such default known to such officer
and the nature and status thereof including the steps being taken by the Master
Servicer to remedy such default. Any Sub-Servicer which is not a Master Servicer
Affiliate also shall deliver an annual statement as to compliance in the form
described above or the Master Servicer shall cover their performance in their
statement. These statements shall be available to Owners upon written request.
Section 10.17. Annual Independent Certified Public Accountants' Reports. On
or before the last day of April of each year, commencing in 1997, the Master
Servicer, at its own expense, shall cause to be delivered to the Trustee,
Certificate Insurer, the Seller, the Sponsor, Moody's and S&P a letter or
letters of a firm of independent, nationally recognized certified public
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accountants reasonably acceptable to the Certificate Insurer stating that such
firm has, with respect to the Master Servicer's overall servicing operations (i)
performed applicable tests in accordance with the compliance testing procedures
as set forth in Appendix 3 of the "Audit Guide for Audits of HUD Approved
Non-Supervised Mortgages" or (ii) examined such operations in accordance with
the requirements of the Uniform Single Audit Program for Mortgage Bankers, and
stating such firm's conclusions relating thereto. These reports will be made
available to Owners upon written request.
Section 10.18. Access to Certain Documentation and Information Regarding
the Mortgage Loans; Confidentiality. The Master Servicer shall provide to the
Trustee, the Sponsor, the Certificate Insurer, and the supervisory agents and
examiners (as required in the latter case by applicable state and federal
regulations) of each of the foregoing access to the documentation regarding the
Mortgage Loans, such access being afforded without charge but only upon
reasonable request and during normal business hours at the offices of the Master
Servicer designated by it.
Upon any change in the format of the computer tape maintained by the Master
Servicer in respect of the Mortgage Loans, the Master Servicer shall deliver a
copy of such computer tape to the Trustee and the Seller and in addition shall
provide a copy of such computer tape to the Trustee and the Sponsor at such
other times as the Trustee and the Sponsor may request.
The Master Servicer, the Trustee, and the Certificate Insurer shall keep
confidential (including from affiliates thereof) information concerning the
Mortgage Loans and the underwriting criteria for the Mortgage Loans, except as
required by law.
Each of the Trustee, the Sponsor, the Certificate Insurer and the Seller
acknowledges the proprietary nature of the software, software procedures,
software development tools, know-how, methodologies, processes and technologies
of the Master Servicer and any Sub-Servicer and agrees (i) that it shall use the
same means as it uses to protect its own confidential information, but in no
event less than reasonable means, to avoid disclosure by it or its agents or
employees to any third party of any confidential or proprietary information of
the Master Servicer or any Sub-Servicer, and (ii) that all such software,
software procedures, software development tools, know-how, methodologies,
process and technologies that are based upon trade secrets or proprietary
information of the Master Servicer or any Sub-Servicer shall be and remain the
property of the Master Servicer or any Sub-Servicer and that each of the
Trustee, the Sponsor, the Certificate Insurer and the Seller will have no
interest therein or claim thereto. Each Sub-Servicer shall be a third-party
beneficiary of this paragraph.
Section 10.19. Assignment of Agreement. The Master Servicer may not assign
its obligations under this Agreement, in
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whole or in part, unless it shall have first obtained (i) the written consent of
the Seller, the Sponsor, the Trustee and Certificate Insurer and (ii) the
Trustee and Certificate Insurer shall have received a confirmation letter from
one or more rating agencies confirming the rating of the Class A Certificates as
AAA or its equivalent; provided, however, that any assignee must meet the
eligibility requirements set forth in Section 11.1(g) hereof for a successor
servicer.
Section 10.20. Inspections by Certificate Insurer and Account Parties;
Errors and Omissions Insurance. (a) At any reasonable time and from time to time
upon reasonable notice, the Seller, the Sponsor, the Certificate Insurer, the
Trustee, or any agents or representatives thereof may inspect the Master
Servicer's servicing operations and discuss the servicing operations of the
Master Servicer. The out-of-pocket costs and expenses incurred by the Master
Servicer or its agents or representatives in connection with any such
examinations or discussions shall be paid by the requesting party prior to the
occurrence and continuance of an Event of Default, and by the Master Servicer
after the occurrence and during the continuance of an Event of Default.
(b) The Master Servicer agrees to maintain or cause a Sub-Servicer to
maintain errors and omissions coverage and a fidelity bond, each at least to the
extent required by Section 305 of Part I of FNMA Guide or any successor
provision thereof or such other insurance arrangements reasonably satisfactory
to the Certificate Insurer.
Section 10.21. Financial Statements. The Master Servicer understands that,
in connection with the transfer of the Certificates, Owners may request that the
Master Servicer make available upon written request to prospective Owners any
publicly available annual audited financial statements of the Master Servicer
for one or more of the most recently completed four fiscal years for which such
statements are available, which request shall not be unreasonably denied. Such
financial statements shall also be supplied to the Certificate Insurer.
The Master Servicer also agrees to make available on a reasonable basis to
the Sponsor, the Seller, the Trustee, the Certificate Insurer, any Owner or any
prospective Owner a knowledgeable financial or accounting officer for the
purpose of answering reasonable questions respecting recent developments
affecting the Master Servicer or the financial statements of the Master Servicer
and to permit the Sponsor, the Seller, the Trustee, the Certificate Insurer, any
Owner or any prospective Owner to inspect the Master Servicer's servicing
facilities during normal business hours for the purpose of satisfying the
Seller, the Sponsor, the Trustee, the Certificate Insurer, any Owner or such
prospective Owner that the Master Servicer has the ability to service the
Mortgage Loans in accordance with this Agreement.
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Each requesting party shall use the same means as it uses to protect its
own confidential information, but in no event less than reasonable means, to
avoid disclosure by it or its agents or employees to any third party of any
confidential or proprietary information of the Master Servicer.
Section 10.22. REMIC. The Master Servicer covenants and agrees for the
benefit of the Owners (i) to take no action which would result in the
termination of REMIC status for either REMIC, (ii) not to engage in any
"prohibited transaction", as such term is defined in Section 860F(a)(2) of the
Code and (iii) not to engage in any other action which may result in the
imposition of any other taxes under the Code.
Section 10.23. The Designated Depository Institution. The Master Servicer
shall give the Sponsor, the Trustee, the Seller and the Certificate Insurer (a)
at least thirty days' prior written notice of any anticipated change of the
Designated Depository Institution at which the Principal and Interest Account is
maintained and (b) written notice of any change in the ratings of such
Designated Depository Institution of which the Master Servicer is aware, within
two Business Days after discovery.
Section 10.24. Appointment of Custodian. If the Master Servicer determines
that the Trustee is unable to deliver Files to the Master Servicer as required
pursuant to Section 10.14 hereof, the Master Servicer shall so notify the
Sponsor, the Certificate Insurer, S&P, Moody's, the Seller and the Trustee, and
make request that a custodian acceptable to the Master Servicer, the Sponsor,
the Seller and the Certificate Insurer be appointed to retain custody of the
Files on behalf of the Trustee. The Trustee, the Seller and the Sponsor agree to
co-operate reasonably with the Master Servicer in connection with the
appointment of such custodian. The Trustee shall pay from the Trustee's Fee all
reasonable fees and expenses of such custodian, in an amount not to exceed 1
basis point.
ARTICLE XI
EVENTS OF DEFAULT; REMOVAL OF MASTER SERVICER; MERGER
Section 11.1. Removal of Master Servicer; Resignation of Master Servicer.
(a) The Certificate Insurer (or, with the consent of the Certificate Insurer,
the Seller or the Owners of Class A Certificates evidencing at least a majority
in Percentage Interest of all Class A Certificates) may remove the Master
Servicer upon the occurrence of any of the following events (each, an "Event of
Default"):
(i) The Master Servicer shall (I) apply for or consent to the
appointment of a receiver, trustee, liquidator or custodian or similar
entity with respect to itself or its
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property, (II) admit in writing its inability to pay its debts generally as
they become due, (III) make a general assignment for the benefit of
creditors, (IV) be adjudicated a bankrupt or insolvent, (V) commence a
voluntary case under the federal bankruptcy laws of the United States of
America or file a voluntary petition or answer seeking reorganization, an
arrangement with creditors or an order for relief or seeking to take
advantage of any insolvency law or file an answer admitting the material
allegations of a petition filed against it in any bankruptcy,
reorganization or insolvency proceeding or (VI) cause corporate action to
be taken by it for the purpose of effecting any of the foregoing; or
(ii) If without the application, approval or consent of the Master
Servicer, a proceeding shall be instituted in any court of competent
jurisdiction, under any law relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking in respect of the Master
Servicer an order for relief or an adjudication in bankruptcy,
reorganization, dissolution, winding up, liquidation, a composition or
arrangement with creditors, a readjustment of debts, the appointment of a
trustee, receiver, conservator, liquidator or custodian or similar entity
with respect to the Master Servicer or of all or any substantial part of
its assets, or other like relief in respect thereof under any bankruptcy or
insolvency law, and, if such proceeding is being contested by the Master
Servicer in good faith, the same shall (A) result in the entry of an order
for relief or any such adjudication or appointment or (B) continue
undismissed or pending and unstayed for any period of sixty (60)
consecutive days; or
(iii) The Master Servicer shall fail to perform any one or more of its
obligations hereunder (other than its obligations referenced in clauses
(vi) and (vii) below) and shall continue in default thereof for a period of
thirty (30) days after the earlier to occur of (x) the date on which an
Authorized Officer of the Master Servicer knows or reasonably should know
of such failure or (y) receipt by the Master Servicer of a written notice
from the Trustee, any Owner, the Sponsor, the Seller or the Certificate
Insurer of said failure; or
(iv) The Master Servicer shall fail to cure any breach of any of its
representations and warranties set forth in Section 3.1(c) which materially
and adversely affects the interests of the Owners or Certificate Insurer
for a period of thirty (30) days after the earlier of (x) the date on which
an Authorized Officer of the Master Servicer knows or reasonably should
know of such breach or (y) receipt by the Master Servicer of a written
notice from the Trustee, any Owner, the Sponsor, the Seller or the
Certificate Insurer of such breach; or
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(v) If the Certificate Insurer pays out any money under the
Certificate Insurance Policies, or if the Certificate Insurer otherwise
funds any shortfall with its own money, because the amounts available to
the Trustee (other than from the Certificate Insurer) are insufficient to
make required distributions on the Class A Certificates; or
(vi) The failure by the Master Servicer to make any required Servicing
Advance for a period of 30 days following the earlier of (x) the date on
which an Authorized Officer of the Master Servicer knows or reasonably
should know of such failure or (y) receipt by the Master Servicer of a
written notice from the Trustee, any Owner, the Sponsor, the Seller, or the
Certificate Insurer of such failure; or
(vii) The failure by the Master Servicer to make any required
Delinquency Advance, to pay any Compensating Interest or to pay over any
Monthly Remittance or other amounts required to be remitted by the Master
Servicer pursuant to this Agreement; or
(viii) If on any Payment Date the Pool Rolling Three Month Delinquency
Rate (including all foreclosures and REO Properties) exceeds 3.75% during
the period June 1, 1996 through May 31, 1997, 4.50% during the period June
1, 1997 through May 31, 1998, 5.25% during the period June 1, 1998 through
May 31, 1999, 6.25% during the period June 1, 1999 through May 31, 2000,
7.25% during the period June 1, 2000 through May 31 2001, or 10.00% after
June 1, 2001; or
(ix) If on any Payment Date occurring in May of any year, commencing
in May 1997, the aggregate Pool Cumulative Net Realized Losses over the
prior twelve month period exceed .75% of the average Pool Principal Balance
as of the close of business on the last day of each of the twelve preceding
Remittance Periods; or
(x) If on any Payment Date the aggregate Pool Cumulative Net Realized
Losses for all prior Remittance Periods since the Startup Day exceed 2.75%
of the Original Pool Principal Balance;
provided, however, that (x) prior to any removal of the Master Servicer pursuant
to clauses (ii) through (iv) and (vi) of this Section 11.1(a), any applicable
grace period granted by any such clause shall have expired prior to the time
such occurrence shall have been remedied and (y) in the event of the refusal or
inability of the Master Servicer to comply with its obligations described in
clause (vii) above, such removal shall be effective (without the requirement of
any action on the part of the Sponsor, the Seller, the Certificate Insurer or of
the Trustee) at 4 p.m. New York City time on the second Business Day following
the day on which the Trustee notifies an Authorized Officer of the Master
Servicer that
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a required amount described in clause (vii) above has not been received by the
Trustee, unless the required amount described in clause (vii) above is paid by
the Master Servicer prior to such time. Upon the Trustee's obtaining actual
knowledge that a required amount described in clause (vii) above has not been
made by the Master Servicer, the Trustee shall so notify an Authorized Officer
of the Master Servicer, and the Certificate Insurer, as soon as is reasonably
practical.
(b) Upon the occurrence of an Event of Default as described in clauses
(viii), (ix) or (x) of Section 11.1(a), the Certificate Insurer may upon
consultation with the Seller, remove the Master Servicer; provided, however,
that if such occurrence of an Event of Default is the result of circumstances
beyond the Master Servicer's control, the Master Servicer shall not be removed,
and provided further, that in the event of any disagreement between the Seller
and the Certificate Insurer, the decision of the Certificate Insurer shall
control.
(c) 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, the other activities
of the Master Servicer so causing such a conflict being of a type and nature
carried on by the Master Servicer at the date of this Agreement. Any such
determination permitting the resignation of the Master Servicer shall be
evidenced by an opinion of counsel to such effect which shall be delivered to
the Trustee, the Sponsor, the Seller and the Certificate Insurer.
(d) No removal or resignation of the Master Servicer shall become effective
until the Trustee or a successor Master Servicer shall have assumed the Master
Servicer's responsibilities and obligations in accordance with this Section.
(e) Upon removal or resignation of the Master Servicer, the Master Servicer
also shall promptly deliver or cause to be delivered to a successor Master
Servicer or the Trustee all the books and records (including, without
limitation, records kept in electronic form) that the Master Servicer has
maintained for the Mortgage Loans, including all tax bills, assessment notices,
insurance premium notices and all other documents as well as all original
documents then in the Master Servicer's possession.
(f) Any collections received by the Master Servicer after removal or
resignation shall be endorsed by it to the Trustee and remitted directly and
immediately to the Trustee or the successor Master Servicer.
(g) Upon removal or resignation of the Master Servicer, the Trustee (x) may
solicit bids for a successor Master Servicer as described below, and (y) pending
the appointment of a successor
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Master Servicer as a result of soliciting such bids, shall serve as Master
Servicer; provided, however that the Trustee shall not be liable for any acts,
omissions or obligations of the Master Servicer prior to such succession or for
any breach by the Master Servicer of any of its representations and warranties
contained in this Agreement or in any related document or agreement. The Trustee
shall, if it is unable to obtain a qualifying bid and is prevented by law from
acting as Master Servicer, appoint, or petition a court of competent
jurisdiction to appoint, any housing and home finance institution, bank or
mortgage servicing institution which has been designated as an approved
seller-servicer by FNMA or FHLMC for first and second mortgage loans and having
equity of not less than $15,000,000, as determined in accordance with generally
accepted accounting principles, and acceptable to the Certificate Insurer 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.
The compensation of any successor Master Servicer (including, without
limitation, the Trustee) so appointed shall be the aggregate Master Servicing
Fees, together with the other servicing compensation in the form of assumption
fees, late payment charges or otherwise as provided in Sections 10.8 and 10.15.
(h) In the event the Trustee solicits bids as provided above, the Trustee
shall solicit, by public announcement, bids from housing and home finance
institutions, banks and mortgage servicing institutions meeting the
qualifications set forth above. Such public announcement shall specify that the
successor Master Servicer shall be entitled to the full amount of the aggregate
Master Servicing Fees as servicing compensation (including the servicing
compensation received in the form of assumption fees, late payment charges or
otherwise) as provided in Sections 10.8 and 10.15. Within thirty days after any
such public announcement, the Trustee shall, with the consent of the Certificate
Insurer, negotiate and effect the sale, transfer and assignment of the servicing
rights and responsibilities hereunder to the qualified party submitting the
highest satisfactory bid. The Trustee shall deduct from any sum received by the
Trustee from the successor to the Master Servicer in respect of such sale,
transfer and assignment all costs and expenses of any public announcement and of
any sale, transfer and assignment of the servicing rights and responsibilities
hereunder. After such deductions, the remainder of such sum shall be paid by the
Trustee to the Master Servicer at the time of such sale, transfer and assignment
to the successor Master Servicer.
(i) The Trustee and such successor Master Servicer 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 Trustee and any
successor Master Servicer in effecting the termination of the Master Servicer's
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servicing responsibilities and rights hereunder and shall promptly provide the
Trustee or such successor Master Servicer, as applicable, 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 Trustee or such
successor Master Servicer, as applicable, all amounts which then have been or
should have been deposited in the Principal and Interest Account by the Master
Servicer or which are thereafter received with respect to the Mortgage Loans.
Neither the Trustee nor any other successor Master Servicer shall be held liable
by reason of any failure to make, or any delay in making, any distribution
hereunder or any portion thereof caused by (i) the failure of the Master
Servicer to deliver, or any delay in delivering, cash, documents or records to
it, or (ii) restrictions imposed by any regulatory authority having jurisdiction
over the Master Servicer.
(j) The Trustee or any other successor Master Servicer, upon assuming the
duties of Master Servicer hereunder, shall immediately make all Delinquency
Advances and pay all Compensating Interest which the Master Servicer has
theretofore failed to remit with respect to the Mortgage Loans; provided,
however, that if the Trustee is acting as successor Master Servicer or another
successor Master Servicer has become the Master Servicer, the Trustee or such
other successor Master Servicer, as the case may be, shall only be required to
make Delinquency Advances (including the Delinquency Advances described in this
clause (j)) if, in the Trustee's or such other successor Master Servicer's, as
the case may be, reasonable good faith judgment, such Delinquency Advances will
ultimately be recoverable from the related Mortgage Loans.
(k) The Master Servicer that is being removed or is resigning shall give
notice to the Mortgagors and to the Rating Agencies of the transfer of the
servicing to the successor Master Servicer.
(l) Any successor Master Servicer shall assume all rights and obligations
of the predecessor Master Servicer under this Agreement, except those arising
before succession (other than the obligation to make Delinquency Advances) and
under Section 3.
(m) If the Master Servicer is removed pursuant to Section 11.1(a) or the
first paragraph of Section 11.1(b) hereof the Master Servicer shall remain
entitled to reimbursement for Reimbursable Advances to the extent that the
related amounts are thereafter recovered with respect to the related Mortgage
Loans.
Section 11.2. Merger, Conversion, Consolidation or Succession to Business
of Master Servicer. Subject to the immediately succeeding sentence, any
corporation into which the Master Servicer 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 Master Servicer shall be a party, or
any corporation succeeding to all or substantially all
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of the business of the Master Servicer, shall be the successor of the Master
Servicer hereunder, without the execution or filing of any paper or any further
act on the part of any of the parties hereto provided (x) that such corporation
meets the qualifications set forth in Section 11.1(g) and (y) that any successor
Master Servicer must meet the qualifications set forth in Section 11.1(g). Any
Affiliate into which the Master Servicer may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation of the Master Servicer and an Affiliate, or any
Affiliate succeeding to all or substantially all of the business of the Master
Servicer, shall be the successor of the Master Servicer hereunder, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto.
ARTICLE XII
MISCELLANEOUS
Section 12.1. Compliance Certificates and Opinions. Upon any application or
request by the Sponsor, the Seller or the Owners to the Trustee to take any
action under any provision of this Agreement, the Sponsor, the Seller or the
Owners, as the case may be, shall furnish to the Trustee a certificate stating
that all conditions precedent, if any, provided for in this Agreement relating
to the proposed action have been complied with, except that in the case of any
such application or request as to which the furnishing of any documents is
specifically required by any provision of this Agreement relating to such
particular application or request, no additional certificate need be furnished.
Except as otherwise specifically provided herein, each certificate or
opinion with respect to compliance with a condition or covenant provided for in
this Agreement shall include:
(a) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based; and
(c) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
Section 12.2. Form of Documents Delivered to the Trustee. In any case where
several matters are required to be certified by, or covered by an opinion of,
any specified Person, it
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is not necessary that all such matters be certified by, or covered by the
opinion of, only one such Person, or that they be so certified or covered by
only one document, but one such Person may certify or give an opinion with
respect to some matters and one or more other such Persons as to other matters,
and any such Person may certify or give an opinion as to such matters in one or
several documents.
Any certificate of an Authorized Officer of the Trustee may be based,
insofar as it relates to legal matters, upon an opinion of counsel, unless such
Authorized Officer knows, or in the exercise of reasonable care should know,
that the opinion is erroneous. Any such certificate of an Authorized Officer of
the Trustee or any opinion of counsel may be based, insofar as it relates to
factual matters upon a certificate or opinion of, or representations by, one or
more Authorized Officers of the Sponsor, the Seller or of the Master Servicer,
stating that the information with respect to such factual matters is in the
possession of the Sponsor, the Seller or the Master Servicer, unless such
Authorized Officer or counsel knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
such matters are erroneous. Any opinion of counsel may also be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an Authorized Officer of the Trustee, stating that the
information with respect to such matters is in the possession of the Trustee,
unless such counsel knows, or in the exercise of reasonable care should know,
that the certificate or opinion or representations with respect to such matters
are erroneous. Any opinion of counsel may be based on the written opinion of
other counsel, in which event such opinion of counsel shall be accompanied by a
copy of such other counsel's opinion and shall include a statement to the effect
that such counsel believes that such counsel and the Trustee may reasonably rely
upon the opinion of such other counsel.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Agreement, they may, but need not, be consolidated and
form one instrument.
Section 12.3. Acts of Owners. (a) Any request, demand, authorization,
direction, notice, consent, waiver or other action provided by this Agreement to
be given or taken by the Owners may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Owners in person or by
agent duly appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
are delivered to the Trustee, and, where it is hereby expressly required,
delivered to and with the consent of the Sponsor, the Seller and the Certificate
Insurer. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "act" of the Owners
signing such instrument or instruments. Proof of
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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, if made in the manner provided in this Section.
(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
the certificate of any 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. Whenever such execution is
by an officer of a corporation or a member of a partnership on behalf of such
corporation or partnership, such certificate or affidavit shall also constitute
sufficient proof of his authority.
(c) The ownership of Certificates shall be proved by the Register.
(d) Any request, demand, authorization, direction, notice, consent, waiver
or other action by the Owner of any Certificate shall bind the Owner 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 or the Trust in reliance thereon, whether or not notation
of such action is made upon such Certificates.
Section 12.4. Notices, etc. to Trustee. Any request, demand, authorization,
direction, notice, consent, waiver or act of the Owners or other documents
provided or permitted by this Agreement to be made upon, given or furnished to,
or filed with the Trustee by any Owner or by the Sponsor shall be sufficient for
every purpose hereunder if made, given, furnished or filed in writing to or with
and received by the Trustee at its corporate trust office as set forth in
Section 2.2 hereof.
Section 12.5. Notices and Reports to Owners; Waiver of Notices. Where this
Agreement provides for notice to Owners of any event or the mailing of any
report to Owners, such notice or report shall be sufficiently given (unless
otherwise herein expressly provided) if mailed, first-class postage prepaid, to
each Owner affected by such event or to whom such report is required to be
mailed, at the address of such Owner as it appears on the Register, not later
than the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice or the mailing of such report. In any case where a notice
or report to Owners is mailed in the manner provided above, neither the failure
to mail such notice or report nor any defect in any notice or report so mailed
to any particular Owner shall affect the sufficiency of such notice or report
with respect to other Owners, and any notice or report which is mailed in the
manner herein provided shall be conclusively presumed to have been duly given or
provided.
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Where this Agreement provides for notice in any manner, such notice may be
waived in writing by any Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Owners shall be filed with the Trustee, but such filing
shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
In case, by reason of the suspension of regular mail service as a result of
a strike, work stoppage or similar activity, it shall be impractical to mail
notice of any event to Owners when such notice is required to be given pursuant
to any provision of this Agreement, then any manner of giving such notice as
shall be satisfactory to the Trustee shall be deemed to be a sufficient giving
of such notice.
Where this Agreement provides for notice to any rating agency that rated
any Certificates, failure to give such notice shall not affect any other rights
or obligations created hereunder.
Section 12.6. Rules by Trustee and Sponsor. The Trustee may make reasonable
rules for any meeting of Owners. The Sponsor may make reasonable rules and set
reasonable requirements for its functions.
Section 12.7. Successors and Assigns. All covenants and agreements in this
Agreement by any party hereto shall bind its successors and assigns, whether so
expressed or not.
Section 12.8. Severability. In case any provision in this Agreement or in
the Certificates shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
Section 12.9. Benefits of Agreement. Nothing in this Agreement or in the
Certificates, expressed or implied, shall give to any Person, other than the
Owners, the Certificate Insurer and the parties hereto and their successors
hereunder, any benefit or any legal or equitable right, remedy or claim under
this Agreement.
Section 12.10. Legal Holidays. In any case where the date of any Remittance
Date, any Payment Date, any other date on which any distribution to any Owner is
proposed to be paid, or any date on which a notice is required to be sent to any
Person pursuant to the terms of this Agreement shall not be a Business Day, then
(notwithstanding any other provision of the Certificates or this Agreement)
payment or mailing need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made or mailed on
the nominal date of any such Remittance Date, such Payment Date, or such other
date for the payment of any distribution to any Owner or the mailing of such
notice, as the case may be, and no interest shall accrue for the
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period from and after any such nominal date, provided such payment is made in
full on such next succeeding Business Day.
Section 12.11. Governing Law. This Agreement and each Certificate shall be
construed in accordance with and governed by the laws of the State of New York
applicable to agreements made and to be performed therein.
Section 12.12. Counterparts. This instrument may be executed in any number
of counterparts, each of which so executed shall be deemed to be an original,
but all such counterparts shall together constitute but one and the same
instrument.
Section 12.13. Usury. The amount of interest payable or paid on any
Certificate under the terms of this Agreement shall be limited to an amount
which shall not exceed the maximum nonusurious rate of interest allowed by the
applicable laws of the State of New York or any applicable law of the United
States permitting a higher maximum nonusurious rate that preempts such
applicable New York laws, which could lawfully be contracted for, charged or
received (the "Highest Lawful Rate"). In the event any payment of interest on
any Certificate exceeds the Highest Lawful Rate, the Trust stipulates that such
excess amount will be deemed to have been paid to the Owner of such Certificate
as a result of an error and the Owner receiving such excess payment shall
promptly, upon discovery of such error or upon notice thereof from the Trustee
on behalf of the Trust, refund the amount of such excess or, at the option of
such Owner, apply the excess to the payment of principal of such Certificate, if
any, remaining unpaid. In addition, all sums paid or agreed to be paid to the
Trustee for the benefit of Owners of Certificates for the use, forbearance or
detention of money shall, to the extent permitted by applicable law, be
amortized, prorated, allocated and spread throughout the full term of such
Certificates.
Section 12.14. Amendment. The Trustee, the Seller, the Master Servicer and
the Sponsor, may at any time and from time to time, with the prior written
consent of the Certificate Insurer but without the consent of the Owners, amend
this Agreement, and the Trustee shall consent to such amendment, for the purpose
of (i) curing any ambiguity, or correcting or supplementing any provision hereof
which may be inconsistent with any other provision hereof, or to add provisions
hereto which are not inconsistent with the provisions hereof, (ii) upon receipt
of an opinion of counsel experienced in federal income tax matters to the effect
that no entity-level tax will be imposed on the Trust or upon the transferor of
a Residual Certificate as a result of the ownership of any Residual Certificate
by a Disqualified Organization, removing the restriction on transfer set forth
in Section 5.8(b) hereof or (iii) complying with the requirements of the Code
and the regulations proposed or promulgated thereunder; provided, however, that
any such action shall not, as evidenced by an opinion of counsel delivered to
the Trustee, materially and adversely affect the interests of any Owner or
materially and adversely affect
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(without its written consent) the rights and interests of the Certificate
Insurer.
This Agreement may also be amended by the Trustee, the Seller, the Master
Servicer and the Sponsor at any time and from time to time, with the prior
written approval of the Certificate Insurer and of not less than 662/3% of the
Percentage Interest represented by each affected Class of Certificates then
Outstanding, for the purpose of adding any provisions or changing in any manner
or eliminating any of the provisions of this Agreement or of modifying in any
manner the rights of the Owners hereunder; provided, however, that no such
amendment shall (a) change in any manner the amount of, or change the timing of,
payments which are required to be distributed to any Owner without the consent
of the Owner of such Certificate or (b) reduce the aforesaid percentages of
Percentage Interests which are required to consent to any such amendments,
without the consent of the Owners of all Certificates of the Class or Classes
affected then Outstanding.
The Trustee shall be entitled to receive upon request, and shall be fully
protected in relying in good faith upon, an opinion of counsel reasonably
acceptable to the Trustee stating that the execution of such amendment is
authorized or permitted by this Agreement.
Promptly after the execution of any such amendment, the Trustee shall
furnish written notification of the substance of such amendment to each Owner
and to the Rating Agencies.
The Certificate Insurer and the Owners, if they so request, shall be
provided with copies of any amendments to this Agreement, together with copies
of any opinions or other documents or instruments executed in connection
therewith.
The Trustee shall not be required to enter into any amendment which affects
its rights or obligations hereunder.
The definitions of "Group I Specified Subordinated Amount" or "Group II
Specified Subordinated Amount" may be amended by the Sponsor, the Seller, the
Master Servicer and the Trustee, with the consent of the Certificate Insurer, in
any respect without the consent of, or notice to, the Owners of any
Certificates; provided, (x) that the Certificate Insurer is not then in default,
(y) that the effect of such change would not be to alter materially (in the
judgment of the Seller) the weighted average life of the related Class A
Certificates and (z) the then-current ratings on the related Class A
Certificates are not thereby reduced.
Section 12.15. The Certificate Insurer. Subject to the provisions below,
the Certificate Insurer is a third party beneficiary of each provision of this
Agreement that creates a right of or benefit to the Certificate Insurer. Any
right conferred
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to the Certificate Insurer shall not arise until the issuance by the Certificate
Insurer of its certificate insurance policy and shall be suspended during any
period in which the Certificate Insurer is in default in its payment obligations
under such certificate insurance policy (except that subrogation rights which
have previously arisen shall not be so suspended). During the period of any such
suspension, such rights shall vest in the Owners of the Class A Certificates,
and may be exercised by the Owners of a majority in Percentage Interest of each
Class of Class A Certificates then Outstanding or, if there are no Class A
Certificates then Outstanding, by such Percentage Interest represented by the
Class B Certificates then Outstanding.
Section 12.16. REMIC Status; Taxes. (a) The Tax Matters Person shall
prepare and file or cause to be filed with the Internal Revenue Service Federal
tax or information returns with respect to each REMIC and the Certificates
containing such information and at the times and in such manner as may be
required by the Code or applicable Treasury regulations, and shall furnish to
Owners such statements or information at the times and in such manner as may be
required thereby. For this purpose, the Tax Matters Person may, but need not,
rely on any proposed regulations of the United States Department of the
Treasury. The Tax Matters Person shall indicate the election to treat each REMIC
as a REMIC (which election shall apply to the taxable period ending December 31,
1996 and each calendar year thereafter) in such manner as the Code or applicable
Treasury regulations may prescribe. The Trustee, as Tax Matters Person appointed
pursuant to Section 12.18 hereof shall sign all tax information returns filed
pursuant to this Section 12.16. The Tax Matters Person shall provide information
necessary for the computation of tax imposed on the transfer of a Residual
Certificate to a Disqualified Organization, or an agent of a Disqualified
Organization, or a pass-through entity in which a Disqualified Organization is
the record holder of an interest. The Trustee shall not be required to file a
separate tax return for the Supplemental Interest Trust.
(b) The Tax Matters Person shall timely file all reports required to be
filed by the Trust with any federal, state or local governmental authority
having jurisdiction over the Trust, including other reports that must be filed
with the Owners, such as the Internal Revenue Service's Form 1066 and Schedule Q
and the form required under Section 6050K of the Code, if applicable to REMICs.
Furthermore, the Tax Matters Person shall report to Owners, if required, with
respect to the allocation of expenses pursuant to Section 212 of the Code in
accordance with the specific instructions to the Tax Matters Person by the
Sponsor or the Seller with respect to such allocation of expenses. The Tax
Matters Person shall collect any forms or reports from the Owners determined by
the Sponsor to be required under applicable federal, state and local tax laws.
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(c) The Tax Matters Person shall provide to the Internal Revenue Service
and to persons described in Section 860E(e)(3) and (6) of the Code the
information described in Treasury Regulation Section 1.860D-1(b)(5)(ii), or any
successor regulation thereto. Such information will be provided in the manner
described in Treasury Regulation Section 1.860E-2(a)(5), or any successor
regulation thereto.
(d) The Sponsor covenants and agrees that it will cause the Seller to
within ten Business Days after the Startup Day provide to the Trustee any
information necessary to enable the Trustee to meet its obligations under
subsections (b) and (c) above.
(e) The Trustee, the Sponsor, the Master Servicer and the Seller each
covenants and agrees for the benefit of the Owners (i) to take no action which
would result in the termination of "REMIC" status for either REMIC, (ii) not to
engage in any "prohibited transaction", as such term is defined in Section
860F(a)(2) of the Code and (iii) not to engage in any other action which may
result in the imposition on the Trust of any other taxes under the Code,
including, without limitation, for purposes of this paragraph any alteration,
modification, amendment, extension, waiver or forbearance with respect to any
Mortgage Loan.
(f) The Trust shall, for federal income tax purposes, maintain books on a
calendar year basis and report income on an accrual basis.
(g) No Eligible Investment shall be sold prior to its stated maturity
(unless sold pursuant to a plan of liquidation in accordance with Article VIII
hereof).
(h) Neither the Sponsor nor the Seller nor the Trustee shall enter into any
arrangement by which the Trustee will receive a fee or other compensation for
services rendered pursuant to this Agreement, which fee or other compensation is
paid from the Trust Estate, other than as expressly contemplated by this
Agreement.
(i) Notwithstanding the foregoing clauses (g) and (h), the Trustee, the
Sponsor, or the Seller may engage in any of the transactions prohibited by such
clauses, provided that the Trustee shall have received an opinion of counsel
experienced in federal income tax matters to the effect that such transaction
does not result in a tax imposed on the Trustee or cause a termination of REMIC
status for either REMIC; provided, however, that such transaction is otherwise
permitted under this Agreement.
Section 12.17. Additional Limitation on Action and Imposition of Tax. (a)
Any provision of this Agreement to the contrary notwithstanding, the Trustee
shall not, without having obtained an opinion of counsel experienced in federal
income tax matters to the effect that such transaction does not result in a
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tax imposed on the Trust or cause a termination of REMIC status for either
REMIC, (i) sell any assets in the Trust Estate, (ii) accept any contribution of
assets after the Startup Day or (iii) agree to any modification of this
Agreement.
(b) In the event that any tax is imposed on "prohibited transactions" as
defined in Section 860F(a)(2) of the Code, on the "net income from foreclosure
property" as defined in Section 860G(c) of the Code, on any contribution to
either REMIC after the Startup Day pursuant to Section 860G(d) of the Code, or
any other tax is imposed, such tax shall be paid by (i) the Trustee, if such tax
arises out of or results from the Trustee's negligence or willful misconduct,
(ii) the Master Servicer, if such tax arises out of or results from a breach by
the Master Servicer of any of its obligations under this Agreement, or otherwise
(iii) the Owners of the Residual Certificates in proportion to their Percentage
Interests. To the extent such tax is chargeable against the Owners of the
Residual Certificates, notwithstanding anything to the contrary contained
herein, the Trustee is hereby authorized to retain from amounts otherwise
distributable to the Owners of the Residual Certificates on any Payment Date
sufficient funds for the payment of such tax.
Section 12.18. Appointment of Tax Matters Person. A Tax Matters Person will
be appointed by the Owners of the Residual Certificates for all purposes of the
Code and such Tax Matters Person will perform, or cause to be performed, such
duties and take, or cause to be taken, such actions, as are required to be
performed or taken by the Tax Matters Person under the Code. The Trustee hereby
agrees to act as the Tax Matters Person (and the Trustee is hereby appointed by
the Owners of the Residual Certificates as the Tax Matters Person) for each
REMIC held by the Trust.
Section 12.19. Notices. All notices hereunder shall be given as follows,
until any superseding instructions are given to all other Persons listed below:
The Trustee: Norwest Bank Minnesota, National
Association
Sixth Street & Marquette Avenue
Minneapolis, Minnesota 55479-0069
Attention: Corporate Trust Department
Access Financial Mortgage
Loan Trust 1996-2
Tel: (612) 667-8085
Fax: (612) 667-9825
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The Sponsor: Cargill Financial Services
Corporation
6000 Clearwater Drive
Minnetonka, Minnesota 55343-9497
Attention: Corporate Capital Group
Tel: (612) 984-3058
Fax: (612) 984-3910
The Certificate
Insurer : Financial Guaranty Insurance Company
115 Broadway
New York, New York 10006
Attention: General Counsel
Tel: (212) 312-3000
Fax: (212) 312-3093
Moody's: Moody's Investors Service
99 Church Street
New York, New York 10007
Attention: The Home Equity
Monitoring Department
S & P: Standard & Poor's
26 Broadway
15th Floor
New York, New York 10004
Attention: Residential Mortgage
Surveillance Dept.
Underwriters: c/o Prudential Securities
Incorporated
One New York Plaza, 15th Floor
New York, New York 10292-2015
Tel: 212-778-1000
Fax: 212-778-7401
The Seller: Access Financial Lending Corp.
and Master 12800 Whitewater Drive
Servicer Suite 200
Minnetonka, Minnesota 55343
Attention: Operations
Tel: (612) 984-0968
Fax: (612) 984-0877
Section 12.20. Grant of Security Interest. It is the express intent of the
parties hereto that the conveyance of the Mortgage Loans and all other assets
constituting the Trust Estate by the Seller to the Trust be, and be construed
as, a sale of the Mortgage Loans and such other assets constituting the Trust
Estate by the Seller and not a pledge by the Seller to secure a debt or other
obligation of the Seller. However, in the event that, notwithstanding the
aforementioned intent of the parties, the Mortgage Loans and
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other assets constituting the Trust Estate are held to be property of the
Seller, then (a) it is the express intent of the parties that such conveyance be
deemed as a pledge of the Mortgage Loans and all other assets constituting the
Trust Estate to the Trust to secure a debt or other obligation of the Seller and
this Agreement shall be deemed to be a security agreement within the meaning of
the Uniform Commercial Code and the conveyance provided for in Section 3.3
hereof shall be deemed a grant by the Seller to the Trust of a security interest
in all of the Seller's right, title and interest in and to the Mortgage Loans
and all other assets constituting the Trust Estate.
Accordingly, the Seller hereby grants to the Trustee a security interest in
the Mortgage Loans and all other assets constituting the Trust Estate for the
purpose of securing to the Trust the performance by the Sponsor of the
obligations under this Agreement. Notwithstanding the foregoing, the parties
hereto intend the conveyance pursuant to Section 3.3 to be a true, absolute and
unconditional sale of the Mortgage Loans and all other assets constituting the
Trust Estate by the Seller to the Trust, the Seller shall take such actions, and
the Trustee shall take such actions as directed by the Sponsor, as may be
necessary to ensure that if this Agreement were deemed to create a security
interest, such security interest would be deemed to be a perfected security
interest of first priority under applicable law and will be maintained as such
for the term of this Agreement. Without limiting the generality of the
foregoing, the Trustee shall file, or shall cause to be filed, all filings
necessary to maintain the effectiveness of any original filings necessary under
the Uniform Commercial Code to perfect the Trustee's security interest in or
lien on the Mortgage Loans for the benefit of the Owners, including, without
limitation, (x) continuation statements and (y) such other statements as may be
occasioned by (i) any change of name of the Seller or Trustee, (ii) any change
of location of the place of business or the chief executive office of the Seller
or (iii) any transfer of any interest of the Seller in any Mortgage Loan;
provided, however, that with respect to clauses (i) through (iii) above, the
Seller shall notify the Trustee of any changes related thereto. The Trustee
shall be reimbursed by the Seller for all such filing costs.
Section 12.21. Indemnification.
(a) The Master Servicer agrees to indemnify and hold the Trustee, the
Sponsor, the Certificate Insurer, each Certificateholder harmless against any
and all claims, losses, penalties, fines, forfeitures, reasonable legal fees and
related costs, judgments, and any other reasonable costs, fees and expenses that
were caused by (i) the failure of the Master Servicer to perform its duties and
service the Mortgage Loans
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in compliance with the terms of this Agreement and the Servicing Standards and
(ii) a breach of any of the Master Servicer's representations, covenants and
warranties contained in this Agreement. This indemnity shall survive the
termination of this Agreement and the payment of the Mortgage Loans, provided,
that the Master Servicer shall have no liability to indemnify any such
indemnified party under this Agreement to the extent that any such losses,
penalties, fines, forfeitures, costs, fees, judgments, liabilities, damages,
claims or expenses were caused by the negligence, willful misconduct or bad
faith of such indemnified party. If the Master Servicer shall have made any
indemnity payment pursuant to this Section 12.21(a) and the recipient thereafter
collects from another Person any amount relating to the matters covered by the
foregoing indemnity, the recipient shall promptly repay such amount to the
Master Servicer.
Promptly after receipt by any of the above-mentioned indemnified parties of
notice of any claim or commencement of any action discussed above, such
indemnified party shall, if a claim in respect thereof is to be made against the
Master Servicer, promptly notify the Master Servicer in writing of the claim or
the commencement of that action; provided, however, that the failure to notify
the Master Servicer shall not relieve it from any liability which it may have
under this Section 12.21(a) except to the extent it has been materially
prejudiced by such failure; and provided, further, that the failure to notify
the Master Servicer shall not relieve it from any liability which it may have to
the above-mentioned indemnified parties otherwise than under this Section
12.21(a).
(b) The Seller agrees to indemnify and hold the Master Servicer, the
Sponsor, the Certificate Insurer, the Trustee, each Certificateholder harmless
against any and all claims, losses, penalties, fines, forfeitures, reasonable
legal fees and related costs, judgments and other reasonable costs, fees and
expenses that were caused by (i) the failure of the Seller to perform its duties
in accordance with the terms of this Agreement or (ii) a breach of any of the
Seller's representations, covenants, and warranties contained in this Agreement.
This indemnity shall survive the termination of this Agreement and the payment
of the Mortgage Loans; provided, that the Seller shall have no liability to
indemnify any such indemnified party under this Agreement to the extent that any
such losses, penalties, fines, forfeitures, costs, fees and judgments,
liabilities, damages, claims or expenses were caused by the negligence, willful
misconduct or bad faith of such indemnified party. If the Seller shall have made
any indemnity payment pursuant to this Section 12.21 and the recipient
thereafter collects from another Person any amount relating to the matters
covered by
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the foregoing indemnity, the recipient shall promptly repay such amount to the
Seller.
Promptly after receipt by any of the above-mentioned indemnified parties of
notice of any claim or commencement of any action discussed above, such
indemnified party shall, if a claim in respect thereof is to be made against the
Seller, promptly notify the Seller in writing of the claim or the commencement
of that action; provided, however, that the failure to notify the Seller shall
not relieve it from any liability which it may have under this Section 12.21(b)
except to the extent it has been materially prejudiced by such failure; and
provided, further, that the failure to notify the Seller shall not relieve it
from any liability which it may have to the above-mentioned indemnified parties
otherwise than under this Section 12.21(b).
(c) The Seller hereby covenants and agrees to indemnify, exonerate and hold
the Master Servicer, the Sponsor, the Trustee, the Trust Estate, the Owners,
their respective directors, officers, agents and employees (collectively, the
"Indemnified Persons") harmless from and against any and all damages, losses,
liabilities, obligations, penalties, fines, claims, litigation, demands,
defenses, judgments, suits, proceedings, costs, disbursements or expenses
(including, without limitation, reasonable attorneys' and experts' fees and
disbursements as they become due and without waiting for the ultimate outcome of
the matter) of any kind or of any nature whatsoever which may at any time be
imposed upon, incurred by or asserted or awarded against any Indemnified Person
arising from or out of any Hazardous Substances (as defined below) on, in, under
or affecting all or any portion of any of the Properties. The matters covered by
the foregoing indemnity shall include, without limitation, all of the following:
(i) the costs of removal of any and all Hazardous Substances from all or any
portion of the Properties or any adjacent property, (ii) the costs required to
take necessary precautions to protect against the release of Hazardous
Substances on, in, under or affecting any of the Properties into the air,
ground, water, other public domain or any adjacent property to the extent
required by applicable Environmental Laws or any governmental authority,
including, without limitation, the costs and expenses of environmental testing
and assessments, and (iii) the costs incurred to comply, in connection with all
or any portion of the Properties, with all applicable Environmental Laws,
including without limitation fines, penalties, and administrative and overhead
costs charged by any governmental entity.
The obligations of the Seller under this Section to compensate the
Indemnified Persons and to reimburse them for expenses (including, without
limitation, litigation expenses), disbursements and advances shall survive the
termination of
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this Agreement and the resignation or removal of the Trustee, and continue
thereafter for so long as any liability or expenses indemnified against may be
imposed under applicable Environmental Law (as defined below) against any
Indemnified Person.
(d) In no event shall any Person be indemnified for any losses, expenses,
damages, claims or liabilities incurred by such Person by reason of such
Person's (or such Person's agents) willful malfeasance, bad faith or negligence.
"Hazardous Substance" shall include, without limitation: (i) those
substances included within the definitions of one or more of the terms
"hazardous substances," "hazardous materials" and "toxic substances" in CERCLA,
RCRA, and the Hazardous Materials Transportation Act, as amended, 49 U.S.C.
ss.ss. 1801 et seq., and in the regulations promulgated pursuant to said laws
under applicable law; (ii) those substances listed in the United States
Department of Transportation Table (49 CFR 172 1 01 and amendments thereto) or
by the Environmental Protection Agency (or any successor agency) as hazardous
substances (40 CFR Part 302 and amendments thereto); (iii) such other
substances, materials and wastes as are or become regulated under applicable
local, state or Federal laws or regulations, or which are classified as
hazardous or toxic under Federal, state, or local laws or regulations; and (iv)
any material, waste or substance which is (a) petroleum; (b) friable asbestos;
(c) polychlorinated biphenyls; (d) designated as a "Hazardous Substance"
pursuant to Section 311 of the Clean Water Act, as amended, 13 U.S.C. ss.ss.
1321 et seq. (33 U.S.C. ss.ss. 1321) or designated as "toxic pollutants" subject
to Chapter 26 of the Clean Water Act pursuant to Section 307 of the Clean Water
Act (33 U.S.C. ss.ss. 1317); (e) flammable explosive; or (f) radioactive
materials.
"Environmental Law" shall mean any Federal, state or local statute, law,
regulation, order, consent decree, judgment, permit, license, code, covenant,
deed restriction, common law, ordain or other requirement relating to public
health, safety or the environment, including, without limitation, those relating
to releases, discharges or emissions to air, water, land or ground water, to the
withdrawal or use of groundwater, to the use and handling of polychlorinated
biphenyls or asbestos, to the disposal, treatment, storage or management of
hazardous or solid waste, or Hazardous Substances or crude oil, or any fraction
thereof, or to exposure to toxic hazardous materials, to the handling,
transportation, discharge or release of gaseous or liquid Hazardous Substances
and any regulation, order, notice or demand issued pursuant to such law, statute
or ordinance, in each case applicable to the property of Borrower or the
operation, construction or modification of any thereof,
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including without limitation the following: CERCLA, the Solid Waste Disposal
Act, as amended by the Resource Conservation and Recovery Act of 1976 and the
Hazardous and Sold Waste Amendments of 1984, the Hazardous Materials
Transportation Act, as amended, the Federal Water Pollution Control Act, as
amended by the Clean Water Act of 1976, the Safe Drinking Water Control Act, the
Clean Air Act of 1966, as amended, the Toxic Substances Control Act of 1976, the
Occupational Safety and Health Act of 1977, as amended, the Emergency Planning
and Community Right-to-Know Act of 1986, the National Environmental Policy Act
of 1975 and the Oil Pollution Act of 1990 and any similar or implementing state
law, and any state statute and any further amendments to these laws, providing
for financial responsibility for cleanup or other actions with respect to the
release or threatened release of Hazardous Substances or crude oil, or any
fraction thereof and all rules, regulations, guidance documents and publication
promulgated thereunder.
[Except for these words (and the accompanying punctuation) the rest of this
page has been intentionally left blank.]
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IN WITNESS WHEREOF, the Sponsor, the Seller, the Master Servicer and the
Trustee have caused this Agreement to be duly executed by their respective
officers thereunto duly authorized, all as of the day and year first above
written.
CARGILL FINANCIAL SERVICES
CORPORATION, as Sponsor
By: /s/ Kenneth M. Duncan
_________________________________
Name: Kenneth M. Duncan
Title: Senior Vice President
ACCESS FINANCIAL LENDING CORP.,
as Seller
By: /s/ Leslie Zejdlik Foster
_________________________________
Name: Leslie Zejdlik Foster
Title: President
ACCESS FINANCIAL LENDING CORP.,
as Master Servicer
By: /s/ Leslie Zejdlik Foster
_________________________________
Name: Leslie Zejdlik Foster
Title: President
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as Trustee
By: /s/ Kristin M. Solie Johnson
_________________________________
Name: Kristin M. Solie Johnson
Title: Corporate Trust Officer
[Pooling and Servicing Agreement]
<PAGE>
<PAGE>
STATE OF MINNESOTA )
: ss.:
COUNTY OF HENNEPIN )
On the 22nd day of May 1996, before me personally came Kristin M. Solie
Johnson, to me known, who, being by me duly sworn did depose and say that her
office is located at Sixth Street and Marquette Avenue, Minneapolis, MN
55479-0069; that she is a Corporate Trust Officer of Norwest Bank Minnesota,
National Association, the national banking association described in and that
executed the above instrument as Trustee; and that she signed her name thereto
by order of the Board of Directors of said national banking association.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
[NOTARIAL SEAL]
/s/ Jeanne E. Dunn
________________________
Notary Public
[Pooling and Servicing Agreement]
<PAGE>
<PAGE>
STATE OF MINNESOTA )
: ss.:
COUNTY OF HENNEPIN )
On the 22nd day of May, 1996, before me personally came Kenneth M. Duncan,
to me known, who, being by me duly sworn did depose and say that his office is
located at 6000 Clearwater Drive, Minnetonka, Minnesota 55343, that he is the
Senior Vice President of Cargill Financial Services Corporation, a Delaware
corporation which is described in and which executed the above instrument; and
that he signed his name thereto by order of the Board of Directors of said
corporation.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
[NOTARIAL SEAL]
/s/ Mary E. Bydlon
________________________
Notary Public
[Pooling and Servicing Agreement]
<PAGE>
<PAGE>
STATE OF MINNESOTA )
: ss.:
COUNTY OF HENNEPIN )
On the 22nd day of May, 1996, before me personally came Leslie Zejdlik
Foster, to me known, who, being by me duly sworn did depose and say that her
office is located at 6000 Clearwater Drive, Minnetonka, Minnesota 55343, that
she is the President of Access Financial Lending Corp., a Delaware corporation
which is described in and which executed the above instrument; and that she
signed her name thereto by order of the Board of Directors of said corporation.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
[NOTARIAL SEAL]
/s/ Mary E. Bydlon
________________________
Notary Public
[Pooling and Servicing Agreement]
<PAGE>
<PAGE>
EXHIBIT A-1
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-2
MORTGAGE LOAN PASS-THROUGH CERTIFICATE
CLASS A-1 GROUP I
(Variable Pass-Through Rate)
Representing Certain Interests Relating to a Pool of
Mortgage Loans formed by
CARGILL FINANCIAL SERVICES CORPORATION
with
ACCESS FINANCIAL LENDING CORP.
as Master Servicer
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to Issuer or its agent
for registration of transfer, exchange, or payment, and any certificate issued
is registered in the name of Cede & Co. or in such other name as is requested by
an authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
(This Certificate does not represent an interest in, or an obligation of,
nor are the underlying Mortgage Loans insured or guaranteed by Cargill Financial
Services Corporation, Access Financial Lending Corp., Norwest Bank Minnesota,
National Association, any Sub-Servicer or any of their respective subsidiaries
and affiliates. This Certificate represents a fractional ownership interest in
the Trust Estate described herein, moneys in the Principal and Interest Account
or otherwise held by the Master Servicer or any Sub-Servicer in trust for the
Owners (except as otherwise provided in the Pooling and Servicing Agreement) and
certain other rights relating thereto and is payable only from amounts received
by the Trustee (i) relating to the Mortgage Loans held by the Trust and (ii)
pursuant to the Certificate Insurance Policy.)
No.: A-1-1 May 22, 1996
Date
$58,456,000 March 18, 2011 003916 AG8
- ------------------ ---------------- ----------
Original Principal Final Scheduled CUSIP
Amount Payment Date
Cede & Co.
- --------------------------------------------------------------------------------
Registered Owner
<PAGE>
<PAGE>
The registered Owner named above is the registered Owner of a fractional
undivided interest in (i) a pool of mortgage loans, consisting of first and
second liens (the "Mortgage Loans") formed by Cargill Financial Services
Corporation (the "Sponsor"), a Delaware corporation, and held in trust by
Norwest Bank Minnesota, National Association, a national banking association, as
trustee (the "Trustee"), on behalf of Access Financial Mortgage Loan Trust
1996-2 (the "Trust") pursuant to that certain Pooling and Servicing Agreement
dated as of May 1, 1996 (the "Pooling and Servicing Agreement") by and among the
Sponsor, Access Financial Lending Corp., as seller (the "Seller") and as master
servicer (the "Master Servicer"), and the Trustee, (ii) such amounts, including
Eligible Investments, as from time to time may be held by the Trustee in the
Accounts held by the Trustee pursuant to the Pooling and Servicing Agreement or
by the Master Servicer or any Sub-Servicer in the Principal and Interest Account
created pursuant to the Pooling and Servicing Agreement, or otherwise held by
the Master Servicer or any Sub-Servicer in trust for the Owners (except as
otherwise provided in the Pooling and Servicing Agreement), (iii) any Property,
the ownership of which has been effected in the name of the Master Servicer or
any Sub-Servicer on behalf of the Trust as a result of foreclosure or acceptance
by the Master Servicer or a Sub-Servicer of a deed in lieu of foreclosure and
that has not been withdrawn from the Trust, (iv) the rights, if any, of the
Trust in any Insurance Policy relating to the Mortgage Loans, (v) Net Proceeds
(but only to the extent such Net Proceeds do not exceed the sum of the Principal
Balance of the related Mortgage Loan plus accrued and unpaid interest on such
Mortgage Loan), and (vi) the Certificate Insurance Policy. Such Mortgage Loans
and other amounts and property enumerated above are hereinafter referred to as
the "Trust Estate."
The Original Principal Amount set forth above is equal to the product of
(i) the Percentage Interest represented by this Certificate and (ii) the
aggregate original principal amount of the Class A-1 Group I Certificates on May
22, 1996 (the "Startup Day"), which aggregate amount on May 22, 1996 was
$58,456,000. The Owner hereof is entitled to principal payments on each Payment
Date, as hereinafter described, which will fully amortize such Original
Principal Amount over the period from the date of initial delivery hereof to the
final Payment Date of the Class A-1 Group I Certificates. The Class A
Certificates have been tranched into five "sequential pay" Classes, such that
the Class A-5 Group I Certificates are entitled to receive no principal
distributions until the Class A-4 Principal Balance has been reduced to zero,
the Class A-4 Group I Certificates are entitled to receive no principal
distributions until the Class A-3 Principal Balance has been reduced to zero,
the Class A-3 Group I Certificates are entitled to receive no principal
A-1-2
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<PAGE>
distributions until the Class A-2 Principal Balance has been reduced to zero and
the Class A-2 Group I Certificates are entitled to receive no principal
distributions until the Class A-1 Principal Balance has been reduced to zero.
Upon receiving the final distribution hereon, the Owner hereof is required
to send this Certificate to the Trustee. The Pooling and Servicing Agreement
provides that, in any event, upon the making of the final distribution due on
this Certificate, this Certificate shall be deemed cancelled for all purposes
under the Pooling and Servicing Agreement.
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN A CLASS OF "REGULAR INTERESTS" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT" ("REMIC") AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTION 860G AND
860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), ASSUMING
COMPLIANCE WITH THE REMIC PROVISIONS OF THE CODE.
THIS CERTIFICATE IS A PASS-THROUGH CERTIFICATE ONLY AND, NOTWITHSTANDING
REFERENCES HEREIN TO PRINCIPAL AND INTEREST, NO DEBT OF ANY PERSON IS
REPRESENTED HEREBY.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION OR ANY OTHER GOVERNMENTAL AGENCY.
This Certificate is one of a Class of duly-authorized Certificates
designated as Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class A-1 Group I (the "Class A-1 Group I
Certificates") and issued under and subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Owner of this Certificate by virtue of acceptance hereof
assents and by which such Owner is bound. Also issued under the Pooling and
Servicing Agreement are Certificates designated as Access Financial Mortgage
Loan Trust 1996-2, 6.925% Mortgage Loan Pass-Through Certificates, Class A-2
Group I (the "Class A-2 Group I Certificates"), Access Financial Mortgage Loan
Trust 1996-2, 7.300% Mortgage Loan Pass-Through Certificates, Class A-3 Group I
(the "Class A-3 Group I Certificates"), Access Financial Mortgage Loan Trust
1996-2, 7.625% Mortgage Loan Pass-Through Certificates, Class A-4 Group I (the
"Class A-4 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-2,
7.925% Mortgage Loan Pass-Through Certificates, Class A-5 Group I (the "Class
A-5 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-2 Mortgage
Loan Pass-Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class B Group I
A-1-3
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<PAGE>
Certificates (the "Class B Group I Certificates"), Access Financial Mortgage
Loan Trust 1996-2, Mortgage Loan Pass-Through Certificates, Class B Group II
(the "Class B Group II Certificates"), Access Financial Mortgage Loan Trust
1996-2, Mortgage Loan Pass-Through Certificates, Class BI-S (the "Class BI-S
Certificates") and Class BII-S (the "Class BII-S Certificates"), and Access
Financial Mortgage Loan Trust 1996-2, Mortgage Loan Pass-Through Certificates,
Class RL and Class RU (the "Residual Certificates"). The Class A-1 Group I
Certificates, the Class A-2 Group I Certificates, the Class A-3 Group I
Certificates, the Class A-4 Group I Certificates, the Class A-5 Group I
Certificates, the Class A-6 Group II Certificates (collectively, the "Class A
Certificates"), the Class B Group I Certificates, the Class B Group II
Certificates, the Class BI-S Certificates, the Class BII-S Certificates and the
Residual Certificates are collectively referred to herein as the "Certificates."
As more fully described in the Pooling and Servicing Agreement, each Class
of Certificates has a specified priority to the collections on the related Pool
of Mortgage Loans which comprise the related Available Funds. In addition,
Financial Guaranty Insurance Company, as Certificate Insurer, is required
pursuant to the Certificate Insurance Policy to make available to the Trustee on
each Payment Date 100% of the amount required to be distributed to the Owners of
each Class of Class A Certificates on each Payment Date.
Terms capitalized herein and not otherwise defined herein shall have the
respective meanings set forth in the Pooling and Servicing Agreement.
On the 18th day of each month, or, if such day is not a Business Day, then
the next succeeding Business Day (each such day being a "Payment Date")
commencing June 18, 1996, the Owners of the Class A-2 Group I Certificates, the
Class A-3 Group I Certificates, the Class A-4 Group I Certificates and the Class
A-5 Group I Certificates, as of the close of business on the first Business Day
of the current calendar month in which such Payment Date occurs (for the Class
A-2 through A-5 Group I Certificates, the "Record Date") will be entitled to
receive the Class A-2 Distribution Amount, the Class A-3 Distribution Amount,
Class A-4 Distribution Amount and Class A-5 Distribution Amount, respectively,
relating to such Payment Date. On each Payment Date commencing June 18, 1996,
the Owners of the Class A-1 Group I Certificates and the Class A-6 Group II
Certificates as of the close of business on the Business Day immediately
preceding such Payment Date occurs (for the Class A-1 Group I Certificates and
the Class A-6 Group II Certificates, the "Record Date") will be entitled to
receive the Class A-1 Distribution Amount or the Class A-6 Distribution Amount,
respectively, relating to such Payment Date. Distributions
A-1-4
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will be made in immediately available funds to Owners of Certificates, by wire
transfer or otherwise, to the account of an Owner at a domestic bank or other
entity having appropriate facilities therefor, if such Owner has so notified the
Trustee, or by check mailed to the address of the person entitled thereto as it
appears on the Register.
Each Owner of record of a Class A-1 Group I Certificate, Class A-2 Group I
Certificate, Class A-3 Group I Certificate, Class A-4 Group I Certificate, Class
A-5 Group I Certificate, and Class A-6 Group II Certificate will be entitled to
receive such Owner's Percentage Interest in the amounts due on such Payment Date
to the Owners of the Class A-1 Group I Certificate, Class A-2 Group I
Certificate, Class A-3 Group I Certificate, the Class A-4 Group I Certificate,
the Class A-5 Group I Certificate, and a Class A-6 Group II Certificate,
respectively.
The Percentage Interest of each Class A-1 Group I Certificate as of any
date of determination will be equal to the percentage obtained by dividing the
Original Principal Amount set forth on such Class A-1 Group I Certificate by
$58,456,000.
The Class A-1 Distribution Amount for any Payment Date will be an amount
equal to the Class A-1 Interest Distribution Amount for such Payment Date, the
Class A-1 Principal Distribution for such Payment Date, the Class A-1 Interest
Carry-Forward Amount for such Payment Date and the Class A-1 Principal
Carry-Forward Amount for such Payment Date, as such terms are defined in the
Pooling and Servicing Agreement.
Pursuant to the Certificate Insurance Policy, Financial Guaranty Insurance
Company (the "Certificate Insurer") is required, to the extent of any
insufficiency in the related Available Funds, to make Insured Payments available
to the Trustee necessary to deposit the full amount of the related Insured
Distribution Amount to the Distribution Account (other than amounts to be paid
to the Certificate Insurer) on each Payment Date. Pursuant to the Pooling and
Servicing Agreement, from amounts on deposit in the related Distribution
Account, the Class A-1 Distribution Amount will be distributed to the Owners of
the Class A-1 Group I Certificates. The Certificate Insurer will be subrogated
to the rights of the Owners of the Class A-1 Group I Certificates with respect
to the related Insured Payments.
The Owner of this Certificate is required to notify the Trustee promptly in
writing upon the receipt of a court order pursuant to which any amount received
by the Owners of the Class A-1 Group I Certificates is recoverable and sought to
be recovered as a voidable preference by a trustee in
A-1-5
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<PAGE>
bankruptcy pursuant to the United States Bankruptcy Code and is required to
enclose a copy of such order with such notice to the Trustee.
The Trustee is required to duly and punctually pay distributions with
respect to this Certificate in accordance with the terms hereof and the Pooling
and Servicing Agreement. Amounts properly withheld under the Code or applicable
state or local law by any Person from a distribution to any Owner shall be
considered as having been paid by the Trustee to such Owner for all purposes of
the Pooling and Servicing Agreement.
Access Financial Lending Corp., as Master Servicer, pursuant to the Pooling
and Servicing Agreement will service the Mortgage Loans. The Pooling and
Servicing Agreement permits the Master Servicer to enter into Sub-Servicing
Agreements with certain institutions eligible for appointment as Sub-Servicers
for the servicing and administration of the Mortgage Loans. No appointment of
any Sub-Servicer shall release the Master Servicer from any of its obligations
under the Pooling and Servicing Agreement.
This Certificate does not represent a deposit or other obligation of, or an
interest in, nor are the underlying Mortgage Loans insured or guaranteed by,
Cargill Financial Services Corporation, Access Financial Lending Corp., Norwest
Bank Minnesota, National Association, any Sub-Servicer, or any of their
respective subsidiaries and affiliates and are not insured or guaranteed by the
Federal Deposit Insurance Corporation, the Government National Mortgage
Association, or any other governmental agency.
No Owner shall have any right to institute any proceeding, judicial or
otherwise, with respect to the Pooling and Servicing Agreement, or for the
appointment of a receiver or trustee, or for any other remedy under the Pooling
and Servicing Agreement except in compliance with the terms thereof.
Notwithstanding any other provisions in the Pooling and Servicing
Agreement, the Owner of any Certificate shall have the right which is absolute
and unconditional to receive distributions to the extent provided in the Pooling
and Servicing Agreement with respect to such Certificate or to institute suit
for the enforcement of any such distribution, and such right shall not be
impaired without the consent of such Owner.
The Pooling and Servicing Agreement provides that the obligations created
thereby will terminate upon the earlier of (i) the payment to the Owners of all
Certificates of all amounts held by the Trustee and required to be paid to such
Owners pursuant to the Pooling and Servicing Agreement
A-1-6
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<PAGE>
upon the later to occur of (a) the final payment or other liquidation (or any
advance made with respect thereto) of the last Mortgage Loan in the Trust Estate
or (b) the disposition of all property acquired in respect of any Mortgage Loan
remaining in the Trust Estate or (ii) at any time when a Qualified Liquidation
of the Upper-Tier REMIC and the Lower-Tier REMIC is effected as described in the
Pooling and Servicing Agreement.
The Pooling and Servicing Agreement provides that the Seller may, at its
option, purchase from the Trust all (but not fewer than all) remaining Mortgage
Loans and other property then constituting the Trust Estate, and thereby effect
early retirement of the Certificates, on any Remittance Date when the aggregate
outstanding Principal Balance of the Mortgage Loans is ten percent or less of
the Original Pool Principal Balance. If the Seller declines to exercise such
option within ninety days following such date, the Trustee shall solicit bids
for the purchase of all Mortgage Loans remaining in the Trust. If satisfactory
bids are received as described in the Pooling and Servicing Agreement, the
Trustee shall effect early retirement of the Certificates. If satisfactory bids
are not received, the Trustee shall decline to sell the Mortgage Loans and shall
not be under any obligation to solicit any further bids or otherwise negotiate
any further sale of the Mortgage Loans. Such sale and consequent termination of
the Trust must constitute a "qualified liquidation" of each REMIC established by
the Trust under Section 860F of the Internal Revenue Code of 1986, as amended,
including, without limitation, the requirement that the qualified liquidation
takes place over a period not to exceed ninety days.
The Trustee is required to give written notice of termination of the
Pooling and Servicing Agreement to each Owner in the manner set forth therein.
The Owners of a majority of the Percentage Interests represented by any
Class of Class A Certificates, or if there are no Class A Certificates then
Outstanding, by such Percentage Interest represented by the Class B Certificates
then Outstanding, upon compliance with the requirements set forth in the Pooling
and Servicing Agreement, have the right to exercise any trust or power set forth
in the Pooling and Servicing Agreement with respect to the Certificates or the
Trust Estate.
As provided in the Pooling and Servicing Agreement, the transfer of this
Certificate is registrable in the Register upon surrender of this Certificate
for registration of transfer at the office designated as the location of the
Register, and thereupon one or more new Certificates of like
A-1-7
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<PAGE>
Class, tenor and a like Percentage Interest will be issued to the designated
transferee or transferees.
The Trustee is required to furnish certain information on each Payment Date
to the Owner of this Certificate, as more fully described in the Pooling and
Servicing Agreement.
The Class A-1 Group I Certificates are issuable only as registered
Certificates in denominations of $1,000 original principal amount and integral
multiples of $1,000 in excess thereof (except for one odd Certificate). As
provided in the Pooling and Servicing Agreement and subject to certain
limitations therein set forth, Class A-1 Group I Certificates are exchangeable
for new Class A-1 Group I Certificates of authorized denominations evidencing
the same aggregate principal amount.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and neither
the Trustee nor any such agent shall be affected by notice to the contrary,
except as may otherwise be specifically provided in the Pooling and Servicing
Agreement with respect to the Certificate Insurer.
A-1-8
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<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed on behalf of the Trust.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, as Trustee
By:_____________________________
Title:__________________________
Trustee Authentication
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as
Trustee
By: _________________________
Title: ______________________
Dated: May 22, 1996
A-1-9
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<PAGE>
EXHIBIT A-2
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-2
6.925% MORTGAGE LOAN PASS-THROUGH CERTIFICATE
CLASS A-2 GROUP I
(6.925% Pass-Through Rate)
Representing Certain Interests Relating to a Pool of
Mortgage Loans formed by
CARGILL FINANCIAL SERVICES CORPORATION
with
ACCESS FINANCIAL LENDING CORP.
as Master Servicer
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to Issuer or its agent
for registration of transfer, exchange, or payment, and any certificate issued
is registered in the name of Cede & Co. or in such other name as is requested by
an authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
(This Certificate does not represent an interest in, or an obligation of,
nor are the underlying Mortgage Loans insured or guaranteed by Cargill Financial
Services Corporation, Access Financial Lending Corp., Norwest Bank Minnesota,
National Association, any Sub-Servicer or any of their respective subsidiaries
and affiliates. This Certificate represents a fractional ownership interest in
the Trust Estate described herein, moneys in the Principal and Interest Account
or otherwise held by the Master Servicer or any Sub-Servicer in trust for the
Owners (except as otherwise provided in the Pooling and Servicing Agreement) and
certain other rights relating thereto and is payable only from amounts received
by the Trustee (i) relating to the Mortgage Loans held by the Trust and (ii)
pursuant to the Certificate Insurance Policy.)
No.: A-2-1 May 22, 1996
Date
$38,714,000 March 18, 2011 003916 AH6
- ------------------ ---------------- ----------
Original Principal Final Scheduled CUSIP
Amount Payment Date
Cede & Co.
- --------------------------------------------------------------------------------
Registered Owner
<PAGE>
<PAGE>
The registered Owner named above is the registered Owner of a fractional
undivided interest in (i) a pool of mortgage loans, consisting of first and
second liens (the "Mortgage Loans") formed by Cargill Financial Services
Corporation (the "Sponsor"), a Delaware corporation, and held in trust by
Norwest Bank Minnesota, National Association, a national banking association, as
trustee (the "Trustee"), on behalf of Access Financial Mortgage Loan Trust
1996-2 (the "Trust") pursuant to that certain Pooling and Servicing Agreement
dated as of May 1, 1996 (the "Pooling and Servicing Agreement") by and among the
Sponsor, Access Financial Lending Corp., as seller (the "Seller") and as master
servicer (the "Master Servicer"), and the Trustee, (ii) such amounts, including
Eligible Investments, as from time to time may be held by the Trustee in the
Accounts held by the Trustee pursuant to the Pooling and Servicing Agreement or
by the Master Servicer or any Sub-Servicer in the Principal and Interest Account
created pursuant to the Pooling and Servicing Agreement, or otherwise held by
the Master Servicer or any Sub-Servicer in trust for the Owners (except as
otherwise provided in the Pooling and Servicing Agreement), (iii) any Property,
the ownership of which has been effected in the name of the Master Servicer or
any Sub-Servicer on behalf of the Trust as a result of foreclosure or acceptance
by the Master Servicer or a Sub-Servicer of a deed in lieu of foreclosure and
that has not been withdrawn from the Trust, (iv) the rights, if any, of the
Trust in any Insurance Policies relating to the Mortgage Loans, (v) Net Proceeds
(but only to the extent such Net Proceeds do not exceed the sum of the Principal
Balance of the related Mortgage Loan plus accrued and unpaid interest on such
Mortgage Loan), and (vi) the Certificate Insurance Policy. Such Mortgage Loans
and other amounts and property enumerated above are hereinafter referred to as
the "Trust Estate."
The Original Principal Amount set forth above is equal to the product of
(i) the Percentage Interest represented by this Certificate and (ii) the
aggregate original principal amount of the Class A-2 Group I Certificates on May
22, 1996 (the "Startup Day"), which aggregate amount on May 22, 1996 was
$38,714,000. The Owner hereof is entitled to principal payments on each Payment
Date, as hereinafter described, which will fully amortize such Original
Principal Amount over the period from the date of initial delivery hereof to the
final Payment Date of the Class A-2 Group I Certificates. The Class A
Certificates have been tranched into five "sequential pay" Classes, such that
the Class A-5 Group I Certificates are entitled to receive no principal
distributions until the Class A-4 Principal Balance has been reduced to zero,
the Class A-4 Group I Certificates are entitled to receive no principal
distributions until the Class A-3 Principal Balance has been reduced to zero,
the Class A-3 Group I Certificates are entitled to receive no principal
A-2-2
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<PAGE>
distributions until the Class A-2 Principal Balance has been reduced to zero and
the Class A-2 Group I Certificates are entitled to receive no principal
distributions until the Class A-1 Principal Balance has been reduced to zero.
Upon receiving the final distribution hereon, the Owner hereof is required
to send this Certificate to the Trustee. The Pooling and Servicing Agreement
provides that, in any event, upon the making of the final distribution due on
this Certificate, this Certificate shall be deemed cancelled for all purposes
under the Pooling and Servicing Agreement.
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN A CLASS OF "REGULAR INTERESTS" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT" ("REMIC") AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTION 860G AND
860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), ASSUMING
COMPLIANCE WITH THE REMIC PROVISIONS OF THE CODE.
THIS CERTIFICATE IS A PASS-THROUGH CERTIFICATE ONLY AND, NOTWITHSTANDING
REFERENCES HEREIN TO PRINCIPAL AND INTEREST, NO DEBT OF ANY PERSON IS
REPRESENTED HEREBY.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION OR ANY OTHER GOVERNMENTAL AGENCY.
This Certificate is one of a Class of duly-authorized Certificates
designated as Access Financial Mortgage Loan Trust 1996-2, 6.925% Mortgage Loan
Pass-Through Certificates, Class A-2 Group I (the "Class A-2 Group I
Certificates"), and issued under and subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Owner of this Certificate by virtue of acceptance hereof
assents and by which such Owner is bound. Also issued under the Pooling and
Servicing Agreement are Certificates designated as Access Financial Mortgage
Loan Trust 1996-2, Mortgage Loan Pass-Through Certificates, Class A-1 Group I
(the "Class A-1 Group I Certificates"), Access Financial Mortgage Loan Trust
1996-2, 7.300% Mortgage Loan Pass-Through Certificates, Class A-3 Group I (the
"Class A-3 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-2,
7.625% Mortgage Loan Pass-Through Certificates, Class A-4 Group I (the "Class
A-4 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-2, 7.925%
Mortgage Loan Pass-Through Certificates, Class A-5 Group I (the "Class A-5 Group
I Certificates"), Access Financial Mortgage Loan Trust 1996-2 Mortgage Loan
Pass-Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class B Group I
A-2-3
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<PAGE>
Certificates (the "Class B Group I Certificates"), Access Financial Mortgage
Loan Trust 1996-2, Mortgage Loan Pass-Through Certificates, Class B Group II
(the "Class B Group II Certificates"), Access Financial Mortgage Loan Trust
1996-2, Mortgage Loan Pass-Through Certificates, Class BI-S (the "Class BI-S
Certificates") and Class BII-S (the "Class BII-S Certificates"), and Access
Financial Mortgage Loan Trust 1996-2, Mortgage Loan Pass-Through Certificates,
Class RL and Class RU (the "Residual Certificates"). The Class A-1 Group I
Certificates, the Class A-2 Group I Certificates, the Class A-3 Group I
Certificates, the Class A-4 Group I Certificates, the Class A-5 Group I
Certificates, the Class A-6 Group II Certificates (collectively, the "Class A
Certificates"), the Class B Group I Certificates, the Class B Group II
Certificates, the Class BI-S Certificates, the Clas BII-S Certificates and the
Residual Certificates are collectively referred to herein as the "Certificates."
As more fully described in the Pooling and Servicing Agreement, each Class
of Certificates has a specified priority to the collections on the related Pool
of Mortgage Loans which comprise the related Available Funds. In addition,
Financial Guaranty Insurance Company, as Certificate Insurer, is required
pursuant to the Certificate Insurance Policy to make available to the Trustee on
each Payment Date 100% of the amount required to be distributed to the Owners of
each Class of Class A Certificates on each Payment Date.
Terms capitalized herein and not otherwise defined herein shall have the
respective meanings set forth in the Pooling and Servicing Agreement.
On the 18th day of each month, or, if such day is not a Business Day, then
the next succeeding Business Day (each such day being a "Payment Date")
commencing June 18, 1996, the Owners of the Class A-2 Group I Certificates, the
Class A-3 Group I Certificates, the Class A-4 Group I Certificates and the Class
A-5 Group I Certificates, as of the close of business on the first Business Day
of the current calendar month in which such Payment Date occurs (for the Class
A-2 through A-5 Group I Certificates, the "Record Date") will be entitled to
receive the Class A-2 Distribution Amount, the Class A-3 Distribution Amount,
Class A-4 Distribution Amount and Class A-5 Distribution Amount, respectively,
relating to such Payment Date. On each Payment Date commencing June 18, 1996,
the Owners of the Class A-1 Group I Certificates and the Class A-6 Group II
Certificates as of the close of business on the Business Day immediately
preceding such Payment Date occurs (for the Class A-1 Group I Certificates and
the Class A-6 Group II Certificates, the "Record Date") will be entitled to
receive the Class A-1 Distribution Amount or the Class A-6 Distribution Amount,
respectively, relating to such Payment Date. Distributions
A-2-4
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<PAGE>
will be made in immediately available funds to Owners of Certificates, by wire
transfer or otherwise, to the account of an Owner at a domestic bank or other
entity having appropriate facilities therefor, if such Owner has so notified the
Trustee, or by check mailed to the address of the person entitled thereto as it
appears on the Register.
Each Owner of record of a Class A-1 Group I Certificate, Class A-2 Group I
Certificate, Class A-3 Group I Certificate, Class A-4 Group I Certificate, Class
A-5 Group I Certificate, and Class A-6 Group II Certificate will be entitled to
receive such Owner's Percentage Interest in the amounts due on such Payment Date
to the Owners of the Class A-1 Group I Certificate, Class A-2 Group I
Certificate, Class A-3 Group I Certificate, the Class A-4 Group I Certificate,
the Class A-5 Group I Certificate, and a Class A-6 Group II Certificate,
respectively.
The Percentage Interest of each Class A-2 Group I Certificate as of any
date of determination will be equal to the percentage obtained by dividing the
Original Principal Amount set forth on such Class A-2 Group I Certificate by
$38,714,000.
The Class A-2 Distribution Amount for any Payment Date will be an amount
equal to the Class A-2 Interest Distribution Amount for such Payment Date, the
Class A-2 Principal Distribution for such Payment Date, the Class A-2 Interest
Carry-Forward Amount for such Payment Date and the Class A-2 Principal
Carry-Forward Amount for such Payment Date, as such terms are defined in the
Pooling and Servicing Agreement.
Pursuant to the Certificate Insurance Policy, Financial Guaranty Insurance
Company (the "Certificate Insurer") is required, to the extent of any
insufficiency in the related Available Funds, to make Insured Payments available
to the Trustee necessary to deposit the full amount of the related Insured
Distribution Amount to the Distribution Account (other than amounts to be paid
to the Certificate Insurer) on each Payment Date. Pursuant to the Pooling and
Servicing Agreement, from amounts on deposit in the related Distribution
Account, the Class A-2 Distribution Amount will be distributed to the Owners of
the Class A-2 Group I Certificates. The Certificate Insurer will be subrogated
to the rights of the Owners of the Class A-2 Group I Certificates with respect
to the related Insured Payments.
The Owner of this Certificate is required to notify the Trustee promptly in
writing upon the receipt of a court order pursuant to which any amount received
by the Owners of the Class A-2 Group I Certificates is recoverable and sought to
be recovered as a voidable preference by a trustee in
A-2-5
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<PAGE>
bankruptcy pursuant to the United States Bankruptcy Code and is required to
enclose a copy of such order with such notice to the Trustee.
The Trustee is required to duly and punctually pay distributions with
respect to this Certificate in accordance with the terms hereof and the Pooling
and Servicing Agreement. Amounts properly withheld under the Code or applicable
state or local law by any Person from a distribution to any Owner shall be
considered as having been paid by the Trustee to such Owner for all purposes of
the Pooling and Servicing Agreement.
Access Financial Lending Corp., as Master Servicer, pursuant to the Pooling
and Servicing Agreement will service the Mortgage Loans. The Pooling and
Servicing Agreement permits the Master Servicer to enter into Sub-Servicing
Agreements with certain institutions eligible for appointment as Sub-Servicers
for the servicing and administration of the Mortgage Loans. No appointment of
any Sub-Servicer shall release the Master Servicer from any of its obligations
under the Pooling and Servicing Agreement.
This Certificate does not represent a deposit or other obligation of, or an
interest in, nor are the underlying Mortgage Loans insured or guaranteed by,
Cargill Financial Services Corporation, Access Financial Lending Corp., Norwest
Bank Minnesota, National Association, any Sub-Servicer, or any of their
respective subsidiaries and affiliates and are not insured or guaranteed by the
Federal Deposit Insurance Corporation, the Government National Mortgage
Association, or any other governmental agency.
No Owner shall have any right to institute any proceeding, judicial or
otherwise, with respect to the Pooling and Servicing Agreement, or for the
appointment of a receiver or trustee, or for any other remedy under the Pooling
and Servicing Agreement except in compliance with the terms thereof.
Notwithstanding any other provisions in the Pooling and Servicing
Agreement, the Owner of any Certificate shall have the right which is absolute
and unconditional to receive distributions to the extent provided in the Pooling
and Servicing Agreement with respect to such Certificate or to institute suit
for the enforcement of any such distribution, and such right shall not be
impaired without the consent of such Owner.
The Pooling and Servicing Agreement provides that the obligations created
thereby will terminate upon the earlier of (i) the payment to the Owners of all
Certificates of all amounts held by the Trustee and required to be paid to such
Owners pursuant to the Pooling and Servicing Agreement
A-2-6
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<PAGE>
upon the later to occur of (a) the final payment or other liquidation (or any
advance made with respect thereto) of the last Mortgage Loan in the Trust Estate
or (b) the disposition of all property acquired in respect of any Mortgage Loan
remaining in the Trust Estate or (ii) at any time when a Qualified Liquidation
of the Upper-Tier REMIC and the Lower-Tier REMIC is effected as described in the
Pooling and Servicing Agreement.
The Pooling and Servicing Agreement provides that the Seller may, at its
option, purchase from the Trust all (but not fewer than all) remaining Mortgage
Loans and other property then constituting the Trust Estate, and thereby effect
early retirement of the Certificates, on any Remittance Date when the aggregate
outstanding Principal Balance of the Mortgage Loans is ten percent or less of
the Original Pool Principal Balance. If the Seller declines to exercise such
option within ninety days following such date, the Trustee shall solicit bids
for the purchase of all Mortgage Loans remaining in the Trust. If satisfactory
bids are received as described in the Pooling and Servicing Agreement, the
Trustee shall effect early retirement of the Certificates. If satisfactory bids
are not received, the Trustee shall decline to sell the Mortgage Loans and shall
not be under any obligation to solicit any further bids or otherwise negotiate
any further sale of the Mortgage Loans. Such sale and consequent termination of
the Trust must constitute a "qualified liquidation" of each REMIC established by
the Trust under Section 860F of the Internal Revenue Code of 1986, as amended,
including, without limitation, the requirement that the qualified liquidation
takes place over a period not to exceed ninety days.
The Trustee is required to give written notice of termination of the
Pooling and Servicing Agreement to each Owner in the manner set forth therein.
The Owners of a majority of the Percentage Interests represented by any
Class of Class A Certificates, or if there are no Class A Certificates then
Outstanding, by such Percentage Interest represented by the Class B Certificates
then Outstanding, upon compliance with the requirements set forth in the Pooling
and Servicing Agreement, have the right to exercise any trust or power set forth
in the Pooling and Servicing Agreement with respect to the Certificates or the
Trust Estate.
As provided in the Pooling and Servicing Agreement, the transfer of this
Certificate is registrable in the Register upon surrender of this Certificate
for registration of transfer at the office designated as the location of the
Register, and thereupon one or more new Certificates of like
A-2-7
<PAGE>
<PAGE>
Class, tenor and a like Percentage Interest will be issued to the designated
transferee or transferees.
The Trustee is required to furnish certain information on each Payment Date
to the Owner of this Certificate, as more fully described in the Pooling and
Servicing Agreement.
The Class A-2 Group I Certificates are issuable only as registered
Certificates in denominations of $1,000 original principal amount and integral
multiples of $1,000 in excess thereof (except for one odd Certificate). As
provided in the Pooling and Servicing Agreement and subject to certain
limitations therein set forth, Class A-2 Group I Certificates are exchangeable
for new Class A-2 Group I Certificates of authorized denominations evidencing
the same aggregate principal amount.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and neither
the Trustee nor any such agent shall be affected by notice to the contrary,
except as may otherwise be specifically provided in the Pooling and Servicing
Agreement with respect to the Certificate Insurer.
A-2-8
<PAGE>
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed on behalf of the Trust.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, as Trustee
By:_____________________________
Title:__________________________
Trustee Authentication
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as
Trustee
By: _________________________
Title: ______________________
Dated: May 22, 1996
A-2-9
<PAGE>
<PAGE>
EXHIBIT A-3
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-2
7.300% MORTGAGE LOAN PASS-THROUGH CERTIFICATE
CLASS A-3 GROUP I
(7.300% Pass-Through Rate)
Representing Certain Interests Relating to a Pool of
Mortgage Loans formed by
CARGILL FINANCIAL SERVICES CORPORATION
with
ACCESS FINANCIAL LENDING CORP.
as Master Servicer
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to Issuer or its agent
for registration of transfer, exchange, or payment, and any certificate issued
is registered in the name of Cede & Co. or in such other name as is requested by
an authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
(This Certificate does not represent an interest in, or an obligation of,
nor are the underlying Mortgage Loans insured or guaranteed by Cargill Financial
Services Corporation, Access Financial Lending Corp., Norwest Bank Minnesota,
National Association, any Sub-Servicer or any of their respective subsidiaries
and affiliates. This Certificate represents a fractional ownership interest in
the Trust Estate described herein, moneys in the Principal and Interest Account
or otherwise held by the Master Servicer or any Sub-Servicer in trust for the
Owners (except as otherwise provided in the Pooling and Servicing Agreement) and
certain other rights relating thereto and is payable only from amounts received
by the Trustee (i) relating to the Mortgage Loans held by the Trust and (ii)
pursuant to the Certificate Insurance Policy.)
No.: A-3-1 May 22, 1996
Date
$16,525,000 June 18, 2014 003916 AJ2
- ------------------ ---------------- ----------
Original Principal Final Scheduled CUSIP
Amount Payment Date
Cede & Co.
- --------------------------------------------------------------------------------
Registered Owner
<PAGE>
<PAGE>
The registered Owner named above is the registered Owner of a fractional
undivided interest in (i) a pool of mortgage loans, consisting of first and
second liens (the "Mortgage Loans") formed by Cargill Financial Services
Corporation (the "Sponsor"), a Delaware corporation, and held in trust by
Norwest Bank Minnesota, National Association, a national banking association, as
trustee (the "Trustee"), on behalf of Access Financial Mortgage Loan Trust
1996-2 (the "Trust") pursuant to that certain Pooling and Servicing Agreement
dated as of May 1, 1996 (the "Pooling and Servicing Agreement") by and among the
Sponsor, Access Financial Lending Corp., as seller (the "Seller") and as master
servicer (the "Master Servicer"), and the Trustee, (ii) such amounts, including
Eligible Investments, as from time to time may be held by the Trustee in the
Accounts held by the Trustee pursuant to the Pooling and Servicing Agreement or
by the Master Servicer or any Sub-Servicer in the Principal and Interest Account
created pursuant to the Pooling and Servicing Agreement, or otherwise held by
the Master Servicer or any Sub-Servicer in trust for the Owners (except as
otherwise provided in the Pooling and Servicing Agreement), (iii) any Property,
the ownership of which has been effected in the name of the Master Servicer or a
Sub-Servicer on behalf of the Trust as a result of foreclosure or acceptance by
the Master Servicer or a Sub-Servicer of a deed in lieu of foreclosure and that
has not been withdrawn from the Trust, (iv) the rights, if any, of the Trust in
any Insurance Policies relating to the Mortgage Loans, (v) Net Proceeds (but
only to the extent such Net Proceeds do not exceed the sum of the Principal
Balance of the related Mortgage Loan plus accrued and unpaid interest on such
Mortgage Loan), and (vi) the Certificate Insurance Policy. Such Mortgage Loans
and other amounts and property enumerated above are hereinafter referred to as
the "Trust Estate."
The Original Principal Amount set forth above is equal to the product of
(i) the Percentage Interest represented by this Certificate and (ii) the
aggregate original principal amount of the Class A-3 Group I Certificates on May
22, 1996 (the "Startup Day"), which aggregate amount on May 22, 1996 was
$16,525,000. The Owner hereof is entitled to principal payments on each Payment
Date, as hereinafter described, which will fully amortize such Original
Principal Amount over the period from the date of initial delivery hereof to the
final Payment Date of the Class A-3 Group I Certificates. The Class A
Certificates have been tranched into five "sequential pay" Classes, such that
the Class A-5 Group I Certificates are entitled to receive no principal
distributions until the Class A-4 Principal Balance has been reduced to zero,
the Class A-4 Group I Certificates are entitled to receive no principal
distributions until the Class A-3 Principal Balance has been reduced to zero,
the Class A-3 Group I Certificates are entitled to receive no principal
A-3-2
<PAGE>
<PAGE>
distributions until the Class A-2 Principal Balance has been reduced to zero and
the Class A-2 Group I Certificates are entitled to receive no principal
distributions until the Class A-1 Principal Balance has been reduced to zero.
Upon receiving the final distribution hereon, the Owner hereof is required
to send this Certificate to the Trustee. The Pooling and Servicing Agreement
provides that, in any event, upon the making of the final distribution due on
this Certificate, this Certificate shall be deemed cancelled for all purposes
under the Pooling and Servicing Agreement.
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN A CLASS OF "REGULAR INTERESTS" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT" ("REMIC") AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTION 860G AND
860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), ASSUMING
COMPLIANCE WITH THE REMIC PROVISIONS OF THE CODE.
THIS CERTIFICATE IS A PASS-THROUGH CERTIFICATE ONLY AND, NOTWITHSTANDING
REFERENCES HEREIN TO PRINCIPAL AND INTEREST, NO DEBT OF ANY PERSON IS
REPRESENTED HEREBY.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION OR ANY OTHER GOVERNMENTAL AGENCY.
This Certificate is one of a Class of duly-authorized Certificates
designated as Access Financial Mortgage Loan Trust 1996-2, 7.300% Mortgage Loan
Pass-Through Certificates, Class A-3 Group I (the "Class A-3 Group I
Certificates"), and issued under and subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Owner of this Certificate by virtue of acceptance hereof
assents and by which such Owner is bound. Also issued under the Pooling and
Servicing Agreement are Certificates designated as Access Financial Mortgage
Loan Trust 1996-2, Mortgage Loan Pass-Through Certificates, Class A-1 Group I
(the "Class A-1 Group I Certificates"), Access Financial Mortgage Loan Trust
1996-2, 6.925% Mortgage Loan Pass-Through Certificates, Class A-2 Group I (the
"Class A-2 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-2,
7.625% Mortgage Loan Pass-Through Certificates, Class A-4 Group I (the "Class
A-4 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-2, 7.925%
Mortgage Loan Pass-Through Certificates, Class A-5 Group I (the "Class A-5 Group
I Certificates"), Access Financial Mortgage Loan Trust 1996-2 Mortgage Loan
Pass-Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class B Group I
A-3-3
<PAGE>
<PAGE>
Certificates (the "Class B Group I Certificates"), Access Financial Mortgage
Loan Trust 1996-2, Mortgage Loan Pass-Through Certificates, Class B Group II
(the "Class B Group II Certificates"), Access Financial Mortgage Loan Trust
1996-2, Mortgage Loan Pass-Through Certificates, Class BI-S (the "Class BI-S
Certificates") and Class BII-S (the "Class BII-S Certificates"), and Access
Financial Mortgage Loan Trust 1996-2, Mortgage Loan Pass-Through Certificates,
Class RL and Class RU (the "Residual Certificates"). The Class A-1 Group I
Certificates, the Class A-2 Group I Certificates, the Class A-3 Group I
Certificates, the Class A-4 Group I Certificates, the Class A-5 Group I
Certificates, the Class A-6 Group II Certificates (collectively, the "Class A
Certificates"), the Class B Group I Certificates, the Class B Group II
Certificates, the Class BI-S Certificates, the Class BII-S Certificates and the
Residual Certificates are collectively referred to herein as the "Certificates."
As more fully described in the Pooling and Servicing Agreement, each Class
of Certificates has a specified priority to the collections on the related Pool
of Mortgage Loans which comprise the related Available Funds. In addition,
Financial Guaranty Insurance Company, as Certificate Insurer, is required
pursuant to the Certificate Insurance Policy to make available to the Trustee on
each Payment Date 100% of the amount required to be distributed to the Owners of
each Class of Class A Certificates on each Payment Date.
Terms capitalized herein and not otherwise defined herein shall have the
respective meanings set forth in the Pooling and Servicing Agreement.
On the 18th day of each month, or, if such day is not a Business Day, then
the next succeeding Business Day (each such day being a "Payment Date")
commencing June 18, 1996, the Owners of the Class A-2 Group I Certificates, the
Class A-3 Group I Certificates, the Class A-4 Group I Certificates and the Class
A-5 Group I Certificates, as of the close of business on the first Business Day
of the current calendar month in which such Payment Date occurs (for the Class
A-2 through A-5 Group I Certificates, the "Record Date") will be entitled to
receive the Class A-2 Distribution Amount, the Class A-3 Distribution Amount,
Class A-4 Distribution Amount and Class A-5 Distribution Amount, respectively,
relating to such Payment Date. On each Payment Date commencing June 18, 1996,
the Owners of the Class A-1 Group I Certificates and the Class A-6 Group II
Certificates as of the close of business on the Business Day immediately
preceding such Payment Date occurs (for the Class A-1 Group I Certificates and
the Class A-6 Group II Certificates, the "Record Date") will be entitled to
receive the Class A-1 Distribution Amount or the Class A-6 Distribution Amount,
respectively, relating to such Payment Date. Distributions
A-3-4
<PAGE>
<PAGE>
will be made in immediately available funds to Owners of Certificates, by wire
transfer or otherwise, to the account of an Owner at a domestic bank or other
entity having appropriate facilities therefor, if such Owner has so notified the
Trustee, or by check mailed to the address of the person entitled thereto as it
appears on the Register.
Each Owner of record of a Class A-1 Group I Certificate, Class A-2 Group I
Certificate, Class A-3 Group I Certificate, Class A-4 Group I Certificate, Class
A-5 Group I Certificate, and Class A-6 Group II Certificate will be entitled to
receive such Owner's Percentage Interest in the amounts due on such Payment Date
to the Owners of the Class A-1 Group I Certificate, Class A-2 Group I
Certificate, Class A-3 Group I Certificate, the Class A-4 Group I Certificate,
the Class A-5 Group I Certificate, and a Class A-6 Group II Certificate,
respectively.
The Percentage Interest of each Class A-3 Group I Certificate as of any
date of determination will be equal to the percentage obtained by dividing the
Original Principal Amount set forth on such Class A-3 Group I Certificate by
$16,525,000.
The Class A-3 Distribution Amount for any Payment Date will be an amount
equal to the Class A-1 Interest Distribution Amount for such Payment Date, the
Class A-3 Principal Distribution for such Payment Date, the Class A-3 Interest
Carry-Forward Amount for such Payment Date and the Class A-3 Principal
Carry-Forward Amount for such Payment Date, as such terms are defined in the
Pooling and Servicing Agreement.
Pursuant to the Certificate Insurance Policy, Financial Guaranty Insurance
Company (the "Certificate Insurer") is required, to the extent of any
insufficiency in the related Available Funds, to make Insured Payments available
to the Trustee necessary to deposit the full amount of the related Insured
Distribution Amount to the Distribution Account (other than amounts to be paid
to the Certificate Insurer) on each Payment Date. Pursuant to the Pooling and
Servicing Agreement, from amounts on deposit in the related Distribution
Account, the Class A-3 Distribution Amount will be distributed to the Owners of
the Class A-3 Group I Certificates. The Certificate Insurer will be subrogated
to the rights of the Owners of the Class A-3 Group I Certificates with respect
to the related Insured Payments.
The Owner of this Certificate is required to notify the Trustee promptly in
writing upon the receipt of a court order pursuant to which any amount received
by the Owners of the Class A-3 Group I Certificates is recoverable and sought to
be recovered as a voidable preference by a trustee in
A-3-5
<PAGE>
<PAGE>
bankruptcy pursuant to the United States Bankruptcy Code and is required to
enclose a copy of such order with such notice to the Trustee.
The Trustee is required to duly and punctually pay distributions with
respect to this Certificate in accordance with the terms hereof and the Pooling
and Servicing Agreement. Amounts properly withheld under the Code or applicable
state or local law by any Person from a distribution to any Owner shall be
considered as having been paid by the Trustee to such Owner for all purposes of
the Pooling and Servicing Agreement.
Access Financial Lending Corp., as Master Servicer, pursuant to the Pooling
and Servicing Agreement will service the Mortgage Loans. The Pooling and
Servicing Agreement permits the Master Servicer to enter into Sub-Servicing
Agreements with certain institutions eligible for appointment as Sub-Servicers
for the servicing and administration of the Mortgage Loans. No appointment of
any Sub-Servicer shall release the Master Servicer from any of its obligations
under the Pooling and Servicing Agreement.
This Certificate does not represent a deposit or other obligation of, or an
interest in, nor are the underlying Mortgage Loans insured or guaranteed by,
Cargill Financial Services Corporation, Access Financial Lending Corp., Norwest
Bank Minnesota, National Association, any Sub-Servicer, or any of their
respective subsidiaries and affiliates and are not insured or guaranteed by the
Federal Deposit Insurance Corporation, the Government National Mortgage
Association, or any other governmental agency.
No Owner shall have any right to institute any proceeding, judicial or
otherwise, with respect to the Pooling and Servicing Agreement, or for the
appointment of a receiver or trustee, or for any other remedy under the Pooling
and Servicing Agreement except in compliance with the terms thereof.
Notwithstanding any other provisions in the Pooling and Servicing
Agreement, the Owner of any Certificate shall have the right which is absolute
and unconditional to receive distributions to the extent provided in the Pooling
and Servicing Agreement with respect to such Certificate or to institute suit
for the enforcement of any such distribution, and such right shall not be
impaired without the consent of such Owner.
The Pooling and Servicing Agreement provides that the obligations created
thereby will terminate upon the earlier of (i) the payment to the Owners of all
Certificates of all amounts held by the Trustee and required to be paid to such
Owners pursuant to the Pooling and Servicing Agreement
A-3-6
<PAGE>
<PAGE>
upon the later to occur of (a) the final payment or other liquidation (or any
advance made with respect thereto) of the last Mortgage Loan in the Trust Estate
or (b) the disposition of all property acquired in respect of any Mortgage Loan
remaining in the Trust Estate or (ii) at any time when a Qualified Liquidation
of the Upper-Tier REMIC and the Lower-Tier REMIC is effected as described in the
Pooling and Servicing Agreement.
The Pooling and Servicing Agreement provides that the Seller may, at its
option, purchase from the Trust all (but not fewer than all) remaining Mortgage
Loans and other property then constituting the Trust Estate, and thereby effect
early retirement of the Certificates, on any Remittance Date when the aggregate
outstanding Principal Balance of the Mortgage Loans is ten percent or less of
the Original Pool Principal Balance. If the Seller declines to exercise such
option within ninety days following such date, the Trustee shall solicit bids
for the purchase of all Mortgage Loans remaining in the Trust. If satisfactory
bids are received as described in the Pooling and Servicing Agreement, the
Trustee shall effect early retirement of the Certificates. If satisfactory bids
are not received, the Trustee shall decline to sell the Mortgage Loans and shall
not be under any obligation to solicit any further bids or otherwise negotiate
any further sale of the Mortgage Loans. Such sale and consequent termination of
the Trust must constitute a "qualified liquidation" of each REMIC established by
the Trust under Section 860F of the Internal Revenue Code of 1986, as amended,
including, without limitation, the requirement that the qualified liquidation
takes place over a period not to exceed ninety days.
The Trustee is required to give written notice of termination of the
Pooling and Servicing Agreement to each Owner in the manner set forth therein.
The Owners of a majority of the Percentage Interests represented by any
Class of Class A Certificates, or if there are no Class A Certificates then
Outstanding, by such Percentage Interest represented by the Class B Certificates
then Outstanding, upon compliance with the requirements set forth in the Pooling
and Servicing Agreement, have the right to exercise any trust or power set forth
in the Pooling and Servicing Agreement with respect to the Certificates or the
Trust Estate.
As provided in the Pooling and Servicing Agreement, the transfer of this
Certificate is registrable in the Register upon surrender of this Certificate
for registration of transfer at the office designated as the location of the
Register, and thereupon one or more new Certificates of like
A-3-7
<PAGE>
<PAGE>
Class, tenor and a like Percentage Interest will be issued to the designated
transferee or transferees.
The Trustee is required to furnish certain information on each Payment Date
to the Owner of this Certificate, as more fully described in the Pooling and
Servicing Agreement.
The Class A-3 Group I Certificates are issuable only as registered
Certificates in denominations of $1,000 original principal amount and integral
multiples of $1,000 in excess thereof (except for one odd Certificate). As
provided in the Pooling and Servicing Agreement and subject to certain
limitations therein set forth, Class A-3 Group I Certificates are exchangeable
for new Class A-3 Group I Certificates of authorized denominations evidencing
the same aggregate principal amount.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and neither
the Trustee nor any such agent shall be affected by notice to the contrary,
except as may otherwise be specifically provided in the Pooling and Servicing
Agreement with respect to the Certificate Insurer.
A-3-8
<PAGE>
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed on behalf of the Trust.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, as Trustee
By:_____________________________
Title:__________________________
Trustee Authentication
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as
Trustee
By: _________________________
Title: ______________________
Dated: May 22, 1996
A-3-9
<PAGE>
<PAGE>
EXHIBIT A-4
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-2
7.625% MORTGAGE LOAN PASS-THROUGH CERTIFICATE
CLASS A-4 GROUP I
(7.625% Pass-Through Rate)
Representing Certain Interests Relating to a Pool of
Mortgage Loans formed by
CARGILL FINANCIAL SERVICES CORPORATION
with
ACCESS FINANCIAL LENDING CORP.
as Master Servicer
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to Issuer or its agent
for registration of transfer, exchange, or payment, and any certificate issued
is registered in the name of Cede & Co. or in such other name as is requested by
an authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
(This Certificate does not represent an interest in, or an obligation of,
nor are the underlying Mortgage Loans insured or guaranteed by Cargill Financial
Services Corporation, Access Financial Lending Corp., Norwest Bank Minnesota,
National Association, any Sub-Servicer or any of their respective subsidiaries
and affiliates. This Certificate represents a fractional ownership interest in
the Trust Estate described herein, moneys in the Principal and Interest Account
or otherwise held by the Master Servicer or any Sub-Servicer in trust for the
Owners (except as otherwise provided in the Pooling and Servicing Agreement) and
certain other rights relating thereto and is payable only from amounts received
by the Trustee (i) relating to the Mortgage Loans held by the Trust and (ii)
pursuant to the Certificate Insurance Policy.)
No.: A-4-1 May 22, 1996
Date
$14,713,000 September 18, 2021 003916 AK9
- ------------------ ------------------ ----------
Original Principal Final Scheduled CUSIP
Amount Payment Date
Cede & Co.
- --------------------------------------------------------------------------------
Registered Owner
<PAGE>
<PAGE>
The registered Owner named above is the registered Owner of a fractional
undivided interest in (i) a pool of mortgage loans, consisting of first and
second liens (the "Mortgage Loans") formed by Cargill Financial Services
Corporation (the "Sponsor"), a Delaware corporation, and held in trust by
Norwest Bank Minnesota, National Association, a national banking association, as
trustee (the "Trustee"), on behalf of Access Financial Mortgage Loan Trust
1996-2 (the "Trust") pursuant to that certain Pooling and Servicing Agreement
dated as of May 1, 1996 (the "Pooling and Servicing Agreement") by and among the
Sponsor, Access Financial Lending Corp., as seller (the "Seller") and as master
servicer (the "Master Servicer"), and the Trustee, (ii) such amounts, including
Eligible Investments, as from time to time may be held by the Trustee in the
Accounts held by the Trustee pursuant to the Pooling and Servicing Agreement by
the Master Servicer or any Sub-Servicer in the Principal and Interest Account
created pursuant to the Pooling and Servicing Agreement, or otherwise held by
the Master Servicer or any Sub-Servicer in trust for the Owners (except as
otherwise provided in the Pooling and Servicing Agreement), (iii) any Property,
the ownership of which has been effected in the name of the Master Servicer or
any Sub-Servicer on behalf of the Trust as a result of foreclosure or acceptance
by the Master Servicer or any Sub-Servicer of a deed in lieu of foreclosure and
that has not been withdrawn from the Trust, (iv) the rights, if any, of the
Trust in any Insurance Policies relating to the Mortgage Loans, (v) Net Proceeds
(but only to the extent such Net Proceeds do not exceed the sum of the Principal
Balance of the related Mortgage Loan plus accrued and unpaid interest on such
Mortgage Loan), and (vi) the Certificate Insurance Policy. Such Mortgage Loans
and other amounts and property enumerated above are hereinafter referred to as
the "Trust Estate."
The Original Principal Amount set forth above is equal to the product of
(i) the Percentage Interest represented by this Certificate and (ii) the
aggregate original principal amount of the Class A-4 Group I Certificates on May
22, 1996 (the "Startup Day"), which aggregate amount on May 22, 1996 was
$14,713,000. The Owner hereof is entitled to principal payments on each Payment
Date, as hereinafter described, which will fully amortize such Original
Principal Amount over the period from the date of initial delivery hereof to the
final Payment Date of the Class A-4 Group I Certificates. The Class A
Certificates have been tranched into five "sequential pay" Classes, such that
the Class A-5 Group I Certificates are entitled to receive no principal
distributions until the Class A-4 Principal Balance has been reduced to zero,
the Class A-4 Group I Certificates are entitled to receive no principal
distributions until the Class A-3 Principal Balance has been reduced to zero,
the Class A-3 Group I Certificates are entitled to receive no principal
A-4-2
<PAGE>
<PAGE>
distributions until the Class A-2 Principal Balance has been reduced to zero and
the Class A-2 Group I Certificates are entitled to receive no principal
distributions until the Class A-1 Principal Balance has been reduced to zero.
Upon receiving the final distribution hereon, the Owner hereof is required
to send this Certificate to the Trustee. The Pooling and Servicing Agreement
provides that, in any event, upon the making of the final distribution due on
this Certificate, this Certificate shall be deemed cancelled for all purposes
under the Pooling and Servicing Agreement.
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN A CLASS OF "REGULAR INTERESTS" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT" ("REMIC") AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTION 860G AND
860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), ASSUMING
COMPLIANCE WITH THE REMIC PROVISIONS OF THE CODE.
THIS CERTIFICATE IS A PASS-THROUGH CERTIFICATE ONLY AND, NOTWITHSTANDING
REFERENCES HEREIN TO PRINCIPAL AND INTEREST, NO DEBT OF ANY PERSON IS
REPRESENTED HEREBY.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION OR ANY OTHER GOVERNMENTAL AGENCY.
This Certificate is one of a Class of duly-authorized Certificates
designated as Access Financial Mortgage Loan Trust 1996-2, 7.625% Mortgage Loan
Pass-Through Certificates, Class A-4 Group I (the "Class A-4 Group I
Certificates"), and issued under and subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Owner of this Certificate by virtue of acceptance hereof
assents and by which such Owner is bound. Also issued under the Pooling and
Servicing Agreement are Certificates designated as Access Financial Mortgage
Loan Trust 1996-2, Mortgage Loan Pass-Through Certificates, Class A-1 Group I
(the "Class A-1 Group I Certificates"), Access Financial Mortgage Loan Trust
1996-2, 6.925% Mortgage Loan Pass-Through Certificates, Class A-2 Group I (the
"Class A-2 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-2,
7.300% Mortgage Loan Pass-Through Certificates, Class A-3 Group I (the "Class
A-3 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-2, 7.925%
Mortgage Loan Pass-Through Certificates, Class A-5 Group I (the "Class A-5 Group
I Certificates"), Access Financial Mortgage Loan Trust 1996-2 Mortgage Loan
Pass-Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates"), Access Financial Mortgage Loan Trust 1996- 2, Mortgage Loan
Pass-Through Certificates, Class B Group I
A-4-3
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Certificates (the "Class B Group I Certificates"), Access Financial Mortgage
Loan Trust 1996-2, Mortgage Loan Pass-Through Certificates, Class B Group II
(the "Class B Group II Certificates"), Access Financial Mortgage Loan Trust
1996-2, Mortgage Loan Pass-Through Certificates, Class BI-S (the "Class BI-S
Certificates") and Class BII-S (the "Class BII-S Certificates"), and Access
Financial Mortgage Loan Trust 1996-2, Mortgage Loan Pass-Through Certificates,
Class RL and Class RU (the "Residual Certificates"). The Class A-1 Group I
Certificates, the Class A-2 Group I Certificates, the Class A-3 Group I
Certificates, the Class A-4 Group I Certificates, the Class A-5 Group I
Certificates, the Class A-6 Group II Certificates (collectively, the "Class A
Certificates"), the Class B Group I Certificates, the Class B Group II
Certificates, the Class BI-S Certificates, the Class BII-S Certificates and the
Residual Certificates are collectively referred to herein as the "Certificates."
As more fully described in the Pooling and Servicing Agreement, each Class
of Certificates has a specified priority to the collections on the related Pool
of Mortgage Loans which comprise the related Available Funds. In addition,
Financial Guaranty Insurance Company, as Certificate Insurer, is required
pursuant to the Certificate Insurance Policy to make available to the Trustee on
each Payment Date 100% of the amount required to be distributed to the Owners of
each Class of Class A Certificates on each Payment Date.
Terms capitalized herein and not otherwise defined herein shall have the
respective meanings set forth in the Pooling and Servicing Agreement.
On the 18th day of each month, or, if such day is not a Business Day, then
the next succeeding Business Day (each such day being a "Payment Date")
commencing June 18, 1996, the Owners of the Class A-2 Group I Certificates, the
Class A-3 Group I Certificates, the Class A-4 Group I Certificates and the Class
A-5 Group I Certificates, as of the close of business on the first Business Day
of the current calendar month in which such Payment Date occurs (for the Class
A-2 through A-5 Group I Certificates, the "Record Date") will be entitled to
receive the Class A-2 Distribution Amount, the Class A-3 Distribution Amount,
Class A-4 Distribution Amount and Class A-5 Distribution Amount, respectively,
relating to such Payment Date. On each Payment Date commencing June 18, 1996,
the Owners of the Class A-1 Group I Certificates and the Class A-6 Group II
Certificates as of the close of business on the Business Day immediately
preceding such Payment Date occurs (for the Class A-1 Group I Certificates and
the Class A-6 Group II Certificates, the "Record Date") will be entitled to
receive the Class A-1 Distribution Amount or the Class A-6 Distribution Amount,
respectively, relating to such Payment Date. Distributions
A-4-4
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will be made in immediately available funds to Owners of Certificates, by wire
transfer or otherwise, to the account of an Owner at a domestic bank or other
entity having appropriate facilities therefor, if such Owner has so notified the
Trustee, or by check mailed to the address of the person entitled thereto as it
appears on the Register.
Each Owner of record of a Class A-1 Group I Certificate, Class A-2 Group I
Certificate, Class A-3 Group I Certificate, Class A-4 Group I Certificate, Class
A-5 Group I Certificate, and Class A-6 Group II Certificate will be entitled to
receive such Owner's Percentage Interest in the amounts due on such Payment Date
to the Owners of the Class A- 1 Group I Certificate, Class A-2 Group I
Certificate, Class A- 3 Group I Certificate, the Class A-4 Group I Certificate,
the Class A-5 Group I Certificate, and a Class A-6 Group II Certificate,
respectively.
The Percentage Interest of each Class A-4 Group I Certificate as of any
date of determination will be equal to the percentage obtained by dividing the
Original Principal Amount set forth on such Class A-4 Group I Certificate by
$14,713,000.
The Class A-4 Distribution Amount for any Payment Date will be an amount
equal to the Class A-4 Interest Distribution Amount for such Payment Date, the
Class A-4 Principal Distribution for such Payment Date, the Class A-4 Interest
Carry-Forward Amount for such Payment Date and the Class A-4 Principal
Carry-Forward Amount for such Payment Date, as such terms are defined in the
Pooling and Servicing Agreement.
Pursuant to the Certificate Insurance Policy, Financial Guaranty Insurance
Company (the "Certificate Insurer") is required, to the extent of any
insufficiency in the related Available Funds, to make Insured Payments available
to the Trustee necessary to deposit the full amount of the related Insured
Distribution Amount to the Distribution Account (other than amounts to be paid
to the Certificate Insurer) on each Payment Date. Pursuant to the Pooling and
Servicing Agreement, from amounts on deposit in the related Distribution
Account, the Class A-4 Distribution Amount will be distributed to the Owners of
the Class A-4 Group I Certificates. The Certificate Insurer will be subrogated
to the rights of the Owners of the Class A-4 Group I Certificates with respect
to the related Insured Payments.
The Owner of this Certificate is required to notify the Trustee promptly in
writing upon the receipt of a court order pursuant to which any amount received
by the Owners of the Class A-4 Group I Certificates is recoverable and sought to
be recovered as a voidable preference by a trustee in
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bankruptcy pursuant to the United States Bankruptcy Code and is required to
enclose a copy of such order with such notice to the Trustee.
The Trustee is required to duly and punctually pay distributions with
respect to this Certificate in accordance with the terms hereof and the Pooling
and Servicing Agreement. Amounts properly withheld under the Code or applicable
state or local law by any Person from a distribution to any Owner shall be
considered as having been paid by the Trustee to such Owner for all purposes of
the Pooling and Servicing Agreement.
Access Financial Lending Corp., as Master Servicer, pursuant to the Pooling
and Servicing Agreement will service the Mortgage Loans. The Pooling and
Servicing Agreement permits the Master Servicer to enter into Sub-Servicing
Agreements with certain institutions eligible for appointment as Sub-Servicers
for the servicing and administration of the Mortgage Loans. No appointment of
any Sub-Servicer shall release the Master Servicer from any of its obligations
under the Pooling and Servicing Agreement.
This Certificate does not represent a deposit or other obligation of, or an
interest in, nor are the underlying Mortgage Loans insured or guaranteed by,
Cargill Financial Services Corporation, Access Financial Lending Corp., Norwest
Bank Minnesota, National Association, any Sub-Servicer, or any of their
respective subsidiaries and affiliates and are not insured or guaranteed by the
Federal Deposit Insurance Corporation, the Government National Mortgage
Association, or any other governmental agency.
No Owner shall have any right to institute any proceeding, judicial or
otherwise, with respect to the Pooling and Servicing Agreement, or for the
appointment of a receiver or trustee, or for any other remedy under the Pooling
and Servicing Agreement except in compliance with the terms thereof.
Notwithstanding any other provisions in the Pooling and Servicing
Agreement, the Owner of any Certificate shall have the right which is absolute
and unconditional to receive distributions to the extent provided in the Pooling
and Servicing Agreement with respect to such Certificate or to institute suit
for the enforcement of any such distribution, and such right shall not be
impaired without the consent of such Owner.
The Pooling and Servicing Agreement provides that the obligations created
thereby will terminate upon the earlier of (i) the payment to the Owners of all
Certificates of all amounts held by the Trustee and required to be paid to such
Owners pursuant to the Pooling and Servicing Agreement
A-4-6
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upon the later to occur of (a) the final payment or other liquidation (or any
advance made with respect thereto) of the last Mortgage Loan in the Trust Estate
or (b) the disposition of all property acquired in respect of any Mortgage Loan
remaining in the Trust Estate or (ii) at any time when a Qualified Liquidation
of the Upper-Tier REMIC and the Lower-Tier REMIC is effected as described in the
Pooling and Servicing Agreement.
The Pooling and Servicing Agreement provides that the Seller may, at its
option, purchase from the Trust all (but not fewer than all) remaining Mortgage
Loans and other property then constituting the Trust Estate, and thereby effect
early retirement of the Certificates, on any Remittance Date when the aggregate
outstanding Principal Balance of the Mortgage Loans is ten percent or less of
the Original Pool Principal Balance. If the Seller declines to exercise such
option within ninety days following such date, the Trustee shall solicit bids
for the purchase of all Mortgage Loans remaining in the Trust. If satisfactory
bids are received as described in the Pooling and Servicing Agreement, the
Trustee shall effect early retirement of the Certificates. If satisfactory bids
are not received, the Trustee shall decline to sell the Mortgage Loans and shall
not be under any obligation to solicit any further bids or otherwise negotiate
any further sale of the Mortgage Loans. Such sale and consequent termination of
the Trust must constitute a "qualified liquidation" of each REMIC established by
the Trust under Section 860F of the Internal Revenue Code of 1986, as amended,
including, without limitation, the requirement that the qualified liquidation
takes place over a period not to exceed ninety days.
The Trustee is required to give written notice of termination of the
Pooling and Servicing Agreement to each Owner in the manner set forth therein.
The Owners of a majority of the Percentage Interests represented by any
Class of Class A Certificates, or if there are no Class A Certificates then
Outstanding, by such Percentage Interest represented by the Class B Certificates
then Outstanding, upon compliance with the requirements set forth in the Pooling
and Servicing Agreement, have the right to exercise any trust or power set forth
in the Pooling and Servicing Agreement with respect to the Certificates or the
Trust Estate.
As provided in the Pooling and Servicing Agreement, the transfer of this
Certificate is registrable in the Register upon surrender of this Certificate
for registration of transfer at the office designated as the location of the
Register, and thereupon one or more new Certificates of like
A-4-7
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<PAGE>
Class, tenor and a like Percentage Interest will be issued to the designated
transferee or transferees.
The Trustee is required to furnish certain information on each Payment Date
to the Owner of this Certificate, as more fully described in the Pooling and
Servicing Agreement.
The Class A-4 Group I Certificates are issuable only as registered
Certificates in denominations of $1,000 original principal amount and integral
multiples of $1,000 in excess thereof (except for one odd Certificate). As
provided in the Pooling and Servicing Agreement and subject to certain
limitations therein set forth, Class A-4 Group I Certificates are exchangeable
for new Class A-4 Group I Certificates of authorized denominations evidencing
the same aggregate principal amount.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and neither
the Trustee nor any such agent shall be affected by notice to the contrary,
except as may otherwise be specifically provided in the Pooling and Servicing
Agreement with respect to the Certificate Insurer.
A-4-8
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<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed on behalf of the Trust.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, as Trustee
By:_____________________________
Title:__________________________
Trustee Authentication
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as
Trustee
By: _________________________
Title: ______________________
Dated: May 22, 1996
A-4-9
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EXHIBIT A-5
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-2
7.925% MORTGAGE LOAN PASS-THROUGH CERTIFICATE
CLASS A-5 GROUP I
(7.925% Pass-Through Rate)
Representing Certain Interests Relating to a Pool of
Mortgage Loans formed by
CARGILL FINANCIAL SERVICES CORPORATION
with
ACCESS FINANCIAL LENDING CORP.
as Master Servicer
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to Issuer or its agent
for registration of transfer, exchange, or payment, and any certificate issued
is registered in the name of Cede & Co. or in such other name as is requested by
an authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
(This Certificate does not represent an interest in, or an obligation of,
nor are the underlying Mortgage Loans insured or guaranteed by Cargill Financial
Services Corporation, Access Financial Lending Corp., Norwest Bank Minnesota,
National Association, any Sub-Servicer or any of their respective subsidiaries
and affiliates. This Certificate represents a fractional ownership interest in
the Trust Estate described herein, moneys in the Principal and Interest Account
or otherwise held by the Master Servicer or any Sub-Servicer in trust for the
Owners (except as otherwise provided in the Pooling and Servicing Agreement) and
certain other rights relating thereto and is payable only from amounts received
by the Trustee (i) relating to the Mortgage Loans held by the Trust and (ii)
pursuant to the Certificate Insurance Policy.)
No.: A-5-1 May 22, 1996
Date
$13,796,000 June 18, 2027 003916 AL7
- ------------------ ---------------- ----------
Original Principal Final Scheduled CUSIP
Amount Payment Date
Cede & Co.
- --------------------------------------------------------------------------------
Registered Owner
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<PAGE>
The registered Owner named above is the registered Owner of a fractional
undivided interest in (i) a pool of mortgage loans, consisting of first and
second liens (the "Mortgage Loans") formed by Cargill Financial Services
Corporation (the "Sponsor"), a Delaware corporation, and held in trust by
Norwest Bank Minnesota, National Association, a national banking association, as
trustee (the "Trustee"), on behalf of Access Financial Mortgage Loan Trust
1996-2 (the "Trust") pursuant to that certain Pooling and Servicing Agreement
dated as of May 1, 1996 (the "Pooling and Servicing Agreement") by and among the
Sponsor, Access Financial Lending Corp., as seller (the "Seller") and as master
servicer (the "Master Servicer"), and the Trustee, (ii) such amounts, including
Eligible Investments, as from time to time may be held by the Trustee in the
Accounts held by the Trustee pursuant to the Pooling and Servicing Agreement by
the Master Servicer or any Sub-Servicer in the Principal and Interest Account
created pursuant to the Pooling and Servicing Agreement, or otherwise held by
the Master Servicer or any Sub-Servicer in trust for the Owners (except as
otherwise provided in the Pooling and Servicing Agreement), (iii) any Property,
the ownership of which has been effected in the name of the Master Servicer or
any Sub-Servicer on behalf of the Trust as a result of foreclosure or acceptance
by the Master Servicer or any Sub-Servicer of a deed in lieu of foreclosure and
that has not been withdrawn from the Trust, (iv) the rights, if any, of the
Trust in any Insurance Policies relating to the Mortgage Loans, (v) Net Proceeds
(but only to the extent such Net Proceeds do not exceed the sum of the Principal
Balance of the related Mortgage Loan plus accrued and unpaid interest on such
Mortgage Loan), and (vi) the Certificate Insurance Policy. Such Mortgage Loans
and other amounts and property enumerated above are hereinafter referred to as
the "Trust Estate."
The Original Principal Amount set forth above is equal to the product of
(i) the Percentage Interest represented by this Certificate and (ii) the
aggregate original principal amount of the Class A-5 Group I Certificates on May
22, 1996 (the "Startup Day"), which aggregate amount on May 22, 1996 was
$13,796,000. The Owner hereof is entitled to principal payments on each Payment
Date, as hereinafter described, which will fully amortize such Original
Principal Amount over the period from the date of initial delivery hereof to the
final Payment Date of the Class A-5 Group I Certificates. The Class A
Certificates have been tranched into five "sequential pay" Classes, such that
the Class A-5 Group I Certificates are entitled to receive no principal
distributions until the Class A-4 Principal Balance has been reduced to zero,
the Class A-4 Group I Certificates are entitled to receive no principal
distributions until the Class A-3 Principal Balance has been reduced to zero,
the Class A-3 Group I Certificates are entitled to receive no principal
A-5-2
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<PAGE>
distributions until the Class A-2 Principal Balance has been reduced to zero and
the Class A-2 Group I Certificates are entitled to receive no principal
distributions until the Class A-1 Principal Balance has been reduced to zero.
Upon receiving the final distribution hereon, the Owner hereof is required
to send this Certificate to the Trustee. The Pooling and Servicing Agreement
provides that, in any event, upon the making of the final distribution due on
this Certificate, this Certificate shall be deemed cancelled for all purposes
under the Pooling and Servicing Agreement.
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN A CLASS OF "REGULAR INTERESTS" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT" ("REMIC") AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTION 860G AND
860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), ASSUMING
COMPLIANCE WITH THE REMIC PROVISIONS OF THE CODE.
THIS CERTIFICATE IS A PASS-THROUGH CERTIFICATE ONLY AND, NOTWITHSTANDING
REFERENCES HEREIN TO PRINCIPAL AND INTEREST, NO DEBT OF ANY PERSON IS
REPRESENTED HEREBY.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION OR ANY OTHER GOVERNMENTAL AGENCY.
This Certificate is one of a Class of duly-authorized Certificates
designated as Access Financial Mortgage Loan Trust 1996-2, 7.625% Mortgage Loan
Pass-Through Certificates, Class A-5 Group I (the "Class A-5 Group I
Certificates"), and issued under and subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Owner of this Certificate by virtue of acceptance hereof
assents and by which such Owner is bound. Also issued under the Pooling and
Servicing Agreement are Certificates designated as Access Financial Mortgage
Loan Trust 1996-2, Mortgage Loan Pass-Through Certificates, Class A-1 Group I
(the "Class A-1 Group I Certificates"), Access Financial Mortgage Loan Trust
1996-2, 6.925% Mortgage Loan Pass-Through Certificates, Class A-2 Group I (the
"Class A-2 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-2,
7.300% Mortgage Loan Pass-Through Certificates, Class A-3 Group I (the "Class
A-3 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-2, 7.625%
Mortgage Loan Pass-Through Certificates, Class A-4 Group I (the "Class A-4 Group
I Certificates"), Access Financial Mortgage Loan Trust 1996-2 Mortgage Loan
Pass-Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class B Group I
A-5-3
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Certificates (the "Class B Group I Certificates"), Access Financial Mortgage
Loan Trust 1996-2, Mortgage Loan Pass-Through Certificates, Class B Group II
(the "Class B Group II Certificates"), Access Financial Mortgage Loan Trust
1996-2, Mortgage Loan Pass-Through Certificates, Class BI-S (the "Class BI-S
Certificates") and Class BII-S (the "Class BII-S Certificates"), and Access
Financial Mortgage Loan Trust 1996-1, Mortgage Loan Pass-Through Certificates,
Class RL and Class RU (the "Residual Certificates"). The Class A-1 Group I
Certificates, the Class A-2 Group I Certificates, the Class A-3 Group I
Certificates, the Class A-4 Group I Certificates, the Class A-5 Group I
Certificates, the Class A-6 Group II Certificates (collectively, the "Class A
Certificates"), the Class B Group I Certificates, the Class B Group II
Certificates, the Class BI-S Certificates, the Class BII-S Certificates and the
Residual Certificates are collectively referred to herein as the "Certificates."
As more fully described in the Pooling and Servicing Agreement, each Class
of Certificates has a specified priority to the collections on the related Pool
of Mortgage Loans which comprise the related Available Funds. In addition,
Financial Guaranty Insurance Company, as Certificate Insurer, is required
pursuant to the Certificate Insurance Policy to make available to the Trustee on
each Payment Date 100% of the amount required to be distributed to the Owners of
each Class of Class A Certificates on each Payment Date.
Terms capitalized herein and not otherwise defined herein shall have the
respective meanings set forth in the Pooling and Servicing Agreement.
On the 18th day of each month, or, if such day is not a Business Day, then
the next succeeding Business Day (each such day being a "Payment Date")
commencing June 18, 1996, the Owners of the Class A-2 Group I Certificates, the
Class A-3 Group I Certificates, the Class A-4 Group I Certificates and the Class
A-5 Group I Certificates, as of the close of business on the first Business Day
of the current calendar month in which such Payment Date occurs (for the Class
A-2 through A-5 Group I Certificates, the "Record Date") will be entitled to
receive the Class A-2 Distribution Amount, the Class A-3 Distribution Amount,
Class A-4 Distribution Amount and Class A-5 Distribution Amount, respectively,
relating to such Payment Date. On each Payment Date commencing June 18, 1996,
the Owners of the Class A-1 Group I Certificates and the Class A-6 Group II
Certificates as of the close of business on the Business Day immediately
preceding such Payment Date occurs (for the Class A-1 Group I Certificates and
the Class A-6 Group II Certificates, the "Record Date") will be entitled to
receive the Class A-1 Distribution Amount or the Class A-6 Distribution Amount,
respectively, relating to such Payment Date. Distributions
A-5-4
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<PAGE>
will be made in immediately available funds to Owners of Certificates, by wire
transfer or otherwise, to the account of an Owner at a domestic bank or other
entity having appropriate facilities therefor, if such Owner has so notified the
Trustee, or by check mailed to the address of the person entitled thereto as it
appears on the Register.
Each Owner of record of a Class A-1 Group I Certificate, Class A-2 Group I
Certificate, Class A-3 Group I Certificate, Class A-4 Group I Certificate, Class
A-5 Group I Certificate, and Class A-6 Group II Certificate will be entitled to
receive such Owner's Percentage Interest in the amounts due on such Payment Date
to the Owners of the Class A-1 Group I Certificate, Class A-2 Group I
Certificate, Class A-3 Group I Certificate, the Class A-4 Group I Certificate,
the Class A-5 Group I Certificate, and a Class A-6 Group II Certificate,
respectively.
The Percentage Interest of each Class A-5 Group I Certificate as of any
date of determination will be equal to the percentage obtained by dividing the
Original Principal Amount set forth on such Class A-5 Group I Certificate by
$13,588,000.
The Class A-1 Distribution Amount for any Payment Date will be an amount
equal to the Class A-5 Interest Distribution Amount for such Payment Date, the
Class A-5 Principal Distribution for such Payment Date, the Class A-5 Interest
Carry-Forward Amount for such Payment Date and the Class A-5 Principal
Carry-Forward Amount for such Payment Date, as such terms are defined in the
Pooling and Servicing Agreement.
Pursuant to the Certificate Insurance Policy, Financial Guaranty Insurance
Company (the "Certificate Insurer") is required, to the extent of any
insufficiency in the related Available Funds, to make Insured Payments available
to the Trustee necessary to deposit the full amount of the related Insured
Distribution Amount to the Distribution Account (other than amounts to be paid
to the Certificate Insurer) on each Payment Date. Pursuant to the Pooling and
Servicing Agreement, from amounts on deposit in the related Distribution
Account, the Class A-5 Distribution Amount will be distributed to the Owners of
the Class A-5 Group I Certificates. The Certificate Insurer will be subrogated
to the rights of the Owners of the Class A-5 Group I Certificates with respect
to the related Insured Payments.
The Owner of this Certificate is required to notify the Trustee promptly in
writing upon the receipt of a court order pursuant to which any amount received
by the Owners of the Class A-5 Group I Certificates is recoverable and sought to
be recovered as a voidable preference by a trustee in
A-5-5
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bankruptcy pursuant to the United States Bankruptcy Code and is required to
enclose a copy of such order with such notice to the Trustee.
The Trustee is required to duly and punctually pay distributions with
respect to this Certificate in accordance with the terms hereof and the Pooling
and Servicing Agreement. Amounts properly withheld under the Code or applicable
state or local law by any Person from a distribution to any Owner shall be
considered as having been paid by the Trustee to such Owner for all purposes of
the Pooling and Servicing Agreement.
Access Financial Lending Corp., as Master Servicer, pursuant to the Pooling
and Servicing Agreement will service the Mortgage Loans. The Pooling and
Servicing Agreement permits the Master Servicer to enter into Sub-Servicing
Agreements with certain institutions eligible for appointment as Sub-Servicers
for the servicing and administration of the Mortgage Loans. No appointment of
any Sub-Servicer shall release the Master Servicer from any of its obligations
under the Pooling and Servicing Agreement.
This Certificate does not represent a deposit or other obligation of, or an
interest in, nor are the underlying Mortgage Loans insured or guaranteed by,
Cargill Financial Services Corporation, Access Financial Lending Corp., Norwest
Bank Minnesota, National Association, any Sub-Servicer, or any of their
respective subsidiaries and affiliates and are not insured or guaranteed by the
Federal Deposit Insurance Corporation, the Government National Mortgage
Association, or any other governmental agency.
No Owner shall have any right to institute any proceeding, judicial or
otherwise, with respect to the Pooling and Servicing Agreement, or for the
appointment of a receiver or trustee, or for any other remedy under the Pooling
and Servicing Agreement except in compliance with the terms thereof.
Notwithstanding any other provisions in the Pooling and Servicing
Agreement, the Owner of any Certificate shall have the right which is absolute
and unconditional to receive distributions to the extent provided in the Pooling
and Servicing Agreement with respect to such Certificate or to institute suit
for the enforcement of any such distribution, and such right shall not be
impaired without the consent of such Owner.
The Pooling and Servicing Agreement provides that the obligations created
thereby will terminate upon the earlier of (i) the payment to the Owners of all
Certificates of all amounts held by the Trustee and required to be paid to such
Owners pursuant to the Pooling and Servicing Agreement
A-5-6
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upon the later to occur of (a) the final payment or other liquidation (or any
advance made with respect thereto) of the last Mortgage Loan in the Trust Estate
or (b) the disposition of all property acquired in respect of any Mortgage Loan
remaining in the Trust Estate or (ii) at any time when a Qualified Liquidation
of the Upper-Tier REMIC and the Lower-Tier REMIC is effected as described in the
Pooling and Servicing Agreement.
The Pooling and Servicing Agreement provides that the Seller may, at its
option, purchase from the Trust all (but not fewer than all) remaining Mortgage
Loans and other property then constituting the Trust Estate, and thereby effect
early retirement of the Certificates, on any Remittance Date when the aggregate
outstanding Principal Balance of the Mortgage Loans is ten percent or less of
the Original Pool Principal Balance. If the Seller declines to exercise such
option within ninety days following such date, the Trustee shall solicit bids
for the purchase of all Mortgage Loans remaining in the Trust. If satisfactory
bids are received as described in the Pooling and Servicing Agreement, the
Trustee shall effect early retirement of the Certificates. If satisfactory bids
are not received, the Trustee shall decline to sell the Mortgage Loans and shall
not be under any obligation to solicit any further bids or otherwise negotiate
any further sale of the Mortgage Loans. Such sale and consequent termination of
the Trust must constitute a "qualified liquidation" of each REMIC established by
the Trust under Section 860F of the Internal Revenue Code of 1986, as amended,
including, without limitation, the requirement that the qualified liquidation
takes place over a period not to exceed ninety days.
The Trustee is required to give written notice of termination of the
Pooling and Servicing Agreement to each Owner in the manner set forth therein.
The Owners of a majority of the Percentage Interests represented by any
Class of Class A Certificates, or if there are no Class A Certificates then
Outstanding, by such Percentage Interest represented by the Class B Certificates
then Outstanding, upon compliance with the requirements set forth in the Pooling
and Servicing Agreement, have the right to exercise any trust or power set forth
in the Pooling and Servicing Agreement with respect to the Certificates or the
Trust Estate.
As provided in the Pooling and Servicing Agreement, the transfer of this
Certificate is registrable in the Register upon surrender of this Certificate
for registration of transfer at the office designated as the location of the
Register, and thereupon one or more new Certificates of like
A-5-7
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<PAGE>
Class, tenor and a like Percentage Interest will be issued to the designated
transferee or transferees.
The Trustee is required to furnish certain information on each Payment Date
to the Owner of this Certificate, as more fully described in the Pooling and
Servicing Agreement.
The Class A-5 Group I Certificates are issuable only as registered
Certificates in denominations of $1,000 original principal amount and integral
multiples of $1,000 in excess thereof (except for one odd Certificate). As
provided in the Pooling and Servicing Agreement and subject to certain
limitations therein set forth, Class A-5 Group I Certificates are exchangeable
for new Class A-5 Group I Certificates of authorized denominations evidencing
the same aggregate principal amount.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and neither
the Trustee nor any such agent shall be affected by notice to the contrary,
except as may otherwise be specifically provided in the Pooling and Servicing
Agreement with respect to the Certificate Insurer.
A-5-8
<PAGE>
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed on behalf of the Trust.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, as Trustee
By:_____________________________
Title:__________________________
Trustee Authentication
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as
Trustee
By: _________________________
Title: ______________________
Dated: May 22, 1996
A-5-9
<PAGE>
<PAGE>
EXHIBIT A-6
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-2
MORTGAGE LOAN PASS-THROUGH CERTIFICATE
CLASS A-6 GROUP II
(Variable Pass-Through Rate)
Representing Certain Interests Relating to a Pool of
Mortgage Loans formed by
CARGILL FINANCIAL SERVICES CORPORATION
with
ACCESS FINANCIAL LENDING CORP.
as Master Servicer
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to Issuer or its agent
for registration of transfer, exchange, or payment, and any certificate issued
is registered in the name of Cede & Co. or in such other name as is requested by
an authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
(This Certificate does not represent an interest in, or an obligation of,
nor are the underlying Mortgage Loans insured or guaranteed by Cargill Financial
Services Corporation, Access Financial Lending Corp., Norwest Bank Minnesota,
National Association, any Sub-Servicer or any of their respective subsidiaries
and affiliates. This Certificate represents a fractional ownership interest in
the Trust Estate described herein, moneys in the Principal and Interest Account
or otherwise held by the Master Servicer or any Sub-Servicer in trust for the
Owners (except as otherwise provided in the Pooling and Servicing Agreement) and
certain other rights relating thereto and is payable only from amounts received
by the Trustee (i) relating to the Mortgage Loans held by the Trust and (ii)
pursuant to the Certificate Insurance Policy.)
No.: A-6-1 May 22, 1996
Date
$68,344,000 June 18, 2027 003916 AM5
- ------------------ ---------------- ----------
Original Principal Final Scheduled CUSIP
Amount Payment Date
Cede & Co.
- --------------------------------------------------------------------------------
Registered Owner
<PAGE>
<PAGE>
The registered Owner named above is the registered Owner of a fractional
undivided interest in (i) a pool of mortgage loans, consisting of first and
second liens (the "Mortgage Loans") formed by Cargill Financial Services
Corporation (the "Sponsor"), a Delaware corporation, and held in trust by
Norwest Bank Minnesota, National Association, a national banking association, as
trustee (the "Trustee"), on behalf of Access Financial Mortgage Loan Trust
1996-2 (the "Trust") pursuant to that certain Pooling and Servicing Agreement
dated as of May 1, 1996 (the "Pooling and Servicing Agreement") by and among the
Sponsor, Access Financial Lending Corp., as seller (the "Seller") and as master
servicer (the "Master Servicer"), and the Trustee, (ii) such amounts, including
Eligible Investments, as from time to time may be held by the Trustee in the
Accounts held by the Trustee pursuant to the Pooling and Servicing Agreement by
the Master Servicer or any Sub-Servicer in the Principal and Interest Account
created pursuant to the Pooling and Servicing Agreement, or otherwise held by
the Master Servicer or any Sub-Servicer in trust for the Owners (except as
otherwise provided in the Pooling and Servicing Agreement), (iii) any Property,
the ownership of which has been effected in the name of the Master Servicer or
any Sub-Servicer on behalf of the Trust as a result of foreclosure or acceptance
by the Master Servicer or any Sub-Servicer of a deed in lieu of foreclosure and
that has not been withdrawn from the Trust, (iv) the rights, if any, of the
Trust in any Insurance Policies relating to the Mortgage Loans, (v) Net Proceeds
(but only to the extent such Net Proceeds do not exceed the sum of the Principal
Balance of the related Mortgage Loan plus accrued and unpaid interest on such
Mortgage Loan), and (vi) the Certificate Insurance Policy. Such Mortgage Loans
and other amounts and property enumerated above are hereinafter referred to as
the "Trust Estate."
The Original Principal Amount set forth above is equal to the product of
(i) the Percentage Interest represented by this Certificate and (ii) the
aggregate original principal amount of the Class A-6 Group II Certificates on
May 22, 1996 (the "Startup Day"), which aggregate amount on May 22, 1996 was
$68,344,000. The Owner hereof is entitled to principal payments on each Payment
Date, as hereinafter described, which will fully amortize such Original
Principal Amount over the period from the date of initial delivery hereof to the
final Payment Date of the Class A-6 Group II Certificates.
Upon receiving the final distribution hereon, the Owner hereof is required
to send this Certificate to the Trustee. The Pooling and Servicing Agreement
provides that, in any event, upon the making of the final distribution due on
this Certificate, this Certificate shall be deemed cancelled for all purposes
under the Pooling and Servicing Agreement.
A-6-2
<PAGE>
<PAGE>
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN A CLASS OF "REGULAR INTERESTS" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT" ("REMIC") AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTION 860G AND
860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), ASSUMING
COMPLIANCE WITH THE REMIC PROVISIONS OF THE CODE.
THIS CERTIFICATE IS A PASS-THROUGH CERTIFICATE ONLY AND, NOTWITHSTANDING
REFERENCES HEREIN TO PRINCIPAL AND INTEREST, NO DEBT OF ANY PERSON IS
REPRESENTED HEREBY.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION OR ANY OTHER GOVERNMENTAL AGENCY.
This Certificate is one of a Class of duly-authorized Certificates
designated as Access Financial Mortgage Loan Trust 1996-2 Mortgage Loan
Pass-Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates") and issued under and subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Owner of this Certificate by virtue of acceptance hereof
assents and by which such Owner is bound. Also issued under the Pooling and
Servicing Agreement are Certificates designated as Access Financial Mortgage
Loan Trust 1996-2, Mortgage Loan Pass-Through Certificates, Class A-1 Group I
(the "Class A-1 Group I Certificates"), Access Financial Mortgage Loan Trust
1996-2, 6.925% Mortgage Loan Pass-Through Certificates, Class A-2 Group I (the
"Class A-2 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-2,
7.300% Mortgage Loan Pass-Through Certificates, Class A-3 Group I (the "Class
A-3 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-2, 7.625%
Mortgage Loan Pass-Through Certificates, Class A-4 Group I (the "Class A-4 Group
I Certificates"), Access Financial Mortgage Loan Trust 1996-2, 7.925% Mortgage
Loan Pass-Through Certificates, Class A-5 Group I (the "Class A-5 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class B Group I Certificates (the "Class B Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class B Group II (the "Class B Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class BI-S (the "Class BI-S Certificates") and Class
BII-S (the "Class BII-S Certificates"), and Access Financial Mortgage Loan Trust
1996-2, Mortgage Loan Pass-Through Certificates, Class RL and Class RU (the
"Residual Certificates"). The Class A-1 Group I Certificates, the Class A-2
Group I Certificates, the Class A-3 Group I Certificates, the Class A-4 Group I
Certificates, the Class A-5 Group I Certificates, the Class A-6 Group II
A-6-3
<PAGE>
<PAGE>
Certificates (collectively, the "Class A Certificates"), the Class B Group I
Certificates, the Class B Group II Certificates, the Class BI-S Certificates,
the Class BII-S Certificates and the Residual Certificates are collectively
referred to herein as the "Certificates."
As more fully described in the Pooling and Servicing Agreement, each Class
of Certificates has a specified priority to the collections on the related Pool
of Mortgage Loans which comprise the related Available Funds. In addition,
Financial Guaranty Insurance Company, as Certificate Insurer, is required
pursuant to the Certificate Insurance Policy to make available to the Trustee on
each Payment Date 100% of the amount required to be distributed to the Owners of
each Class of Class A Certificates on each Payment Date.
Terms capitalized herein and not otherwise defined herein shall have the
respective meanings set forth in the Pooling and Servicing Agreement.
On the 18th day of each month, or, if such day is not a Business Day, then
the next succeeding Business Day (each such day being a "Payment Date")
commencing June 18, 1996, the Owners of the Class A-2 Group I Certificates, the
Class A-3 Group I Certificates, the Class A-4 Group I Certificates and the Class
A-5 Group I Certificates, as of the close of business on the first Business Day
of the current calendar month in which such Payment Date occurs (for the Class
A-2 through A-5 Group I Certificates, the "Record Date") will be entitled to
receive the Class A-2 Distribution Amount, the Class A-3 Distribution Amount,
Class A-4 Distribution Amount and Class A-5 Distribution Amount, respectively,
relating to such Payment Date. On each Payment Date commencing June 18, 1996,
the Owners of the Class A-1 Group I Certificates and the Class A-6 Group II
Certificates as of the close of business on the Business Day immediately
preceding such Payment Date occurs (for the Class A-1 Group I Certificates and
the Class A-6 Group II Certificates, the "Record Date") will be entitled to
receive the Class A-1 Distribution Amount or the Class A-6 Distribution Amount,
respectively, relating to such Payment Date. Distributions will be made in
immediately available funds to Owners of Certificates, by wire transfer or
otherwise, to the account of an Owner at a domestic bank or other entity having
appropriate facilities therefor, if such Owner has so notified the Trustee, or
by check mailed to the address of the person entitled thereto as it appears on
the Register.
Each Owner of record of a Class A-1 Group I Certificate, Class A-2 Group I
Certificate, Class A-3 Group I Certificate, Class A-4 Group I Certificate, Class
A-5 Group I Certificate, and Class A-6 Group II Certificate will be entitled to
receive such Owner's Percentage Interest in the
A-6-4
<PAGE>
<PAGE>
amounts due on such Payment Date to the Owners of the Class A-1 Group I
Certificate, Class A-2 Group I Certificate, Class A-3 Group I Certificate, the
Class A-4 Group I Certificate, the Class A-5 Group I Certificate, and a Class
A-6 Group II Certificate, respectively.
The Percentage Interest of each Class A-6 Group II Certificate as of any
date of determination will be equal to the percentage obtained by dividing the
Original Principal Amount set forth on such Class A-6 Group II Certificate by
$68,344,000.
The Class A-6 Distribution Amount for any Payment Date will be an amount
equal to the Class A-6 Interest Distribution Amount for such Payment Date, the
Class A-6 Principal Distribution for such Payment Date, the Class A-6 Interest
Carry-Forward Amount for such Payment Date and the Class A-6 Principal
Carry-Forward Amount for such Payment Date, as such terms are defined in the
Pooling and Servicing Agreement.
Pursuant to the Certificate Insurance Policy, Financial Guaranty Insurance
Company (the "Certificate Insurer") is required, to the extent of any
insufficiency in the related Available Funds, to make Insured Payments available
to the Trustee necessary to deposit the full amount of the related Insured
Distribution Amount to the Distribution Account (other than amounts to be paid
to the Certificate Insurer) on each Payment Date. Pursuant to the Pooling and
Servicing Agreement, from amounts on deposit in the related Distribution
Account, the Class A-6 Distribution Amount will be distributed to the Owners of
the Class A-6 Group II Certificates. The Certificate Insurer will be subrogated
to the rights of the Owners of the Class A-6 Group II Certificates with respect
to the related Insured Payments.
The Owner of this Certificate is required to notify the Trustee promptly in
writing upon the receipt of a court order pursuant to which any amount received
by the Owners of the Class A-6 Group II Certificates is recoverable and sought
to be recovered as a voidable preference by a trustee in bankruptcy pursuant to
the United States Bankruptcy Code and is required to enclose a copy of such
order with such notice to the Trustee.
The Trustee is required to duly and punctually pay distributions with
respect to this Certificate in accordance with the terms hereof and the Pooling
and Servicing Agreement. Amounts properly withheld under the Code or applicable
state or local law by any Person from a distribution to any Owner shall be
considered as having been paid by the Trustee to such Owner for all purposes of
the Pooling and Servicing Agreement.
A-6-5
<PAGE>
<PAGE>
Access Financial Lending Corp., as Master Servicer, pursuant to the Pooling
and Servicing Agreement will service the Mortgage Loans. The Pooling and
Servicing Agreement permits the Master Servicer to enter into Sub-Servicing
Agreements with certain institutions eligible for appointment as Sub-Servicers
for the servicing and administration of the Mortgage Loans. No appointment of
any Sub-Servicer shall release the Master Servicer from any of its obligations
under the Pooling and Servicing Agreement.
This Certificate does not represent a deposit or other obligation of, or an
interest in, nor are the underlying Mortgage Loans insured or guaranteed by,
Cargill Financial Services Corporation, Access Financial Lending Corp., Norwest
Bank Minnesota, National Association, any Sub-Servicer, or any of their
respective subsidiaries and affiliates and are not insured or guaranteed by the
Federal Deposit Insurance Corporation, the Government National Mortgage
Association, or any other governmental agency.
No Owner shall have any right to institute any proceeding, judicial or
otherwise, with respect to the Pooling and Servicing Agreement, or for the
appointment of a receiver or trustee, or for any other remedy under the Pooling
and Servicing Agreement except in compliance with the terms thereof.
Notwithstanding any other provisions in the Pooling and Servicing
Agreement, the Owner of any Certificate shall have the right which is absolute
and unconditional to receive distributions to the extent provided in the Pooling
and Servicing Agreement with respect to such Certificate or to institute suit
for the enforcement of any such distribution, and such right shall not be
impaired without the consent of such Owner.
The Pooling and Servicing Agreement provides that the obligations created
thereby will terminate upon the earlier of (i) the payment to the Owners of all
Certificates of all amounts held by the Trustee and required to be paid to such
Owners pursuant to the Pooling and Servicing Agreement upon the later to occur
of (a) the final payment or other liquidation (or any advance made with respect
thereto) of the last Mortgage Loan in the Trust Estate or (b) the disposition of
all property acquired in respect of any Mortgage Loan remaining in the Trust
Estate or (ii) at any time when a Qualified Liquidation of the Upper-Tier REMIC
and the Lower-Tier REMIC is effected as described in the Pooling and Servicing
Agreement.
A-6-6
<PAGE>
<PAGE>
The Pooling and Servicing Agreement provides that the Seller may, at its
option, purchase from the Trust all (but not fewer than all) remaining Mortgage
Loans and other property then constituting the Trust Estate, and thereby effect
early retirement of the Certificates, on any Remittance Date when the aggregate
outstanding Principal Balance of the Mortgage Loans is ten percent or less of
the Original Pool Principal Balance. If the Seller declines to exercise such
option within ninety days following such date, the Trustee shall solicit bids
for the purchase of all Mortgage Loans remaining in the Trust. If satisfactory
bids are received as described in the Pooling and Servicing Agreement, the
Trustee shall effect early retirement of the Certificates. If satisfactory bids
are not received, the Trustee shall decline to sell the Mortgage Loans and shall
not be under any obligation to solicit any further bids or otherwise negotiate
any further sale of the Mortgage Loans. Such sale and consequent termination of
the Trust must constitute a "qualified liquidation" of each REMIC established by
the Trust under Section 860F of the Internal Revenue Code of 1986, as amended,
including, without limitation, the requirement that the qualified liquidation
takes place over a period not to exceed ninety days.
The Trustee is required to give written notice of termination of the
Pooling and Servicing Agreement to each Owner in the manner set forth therein.
The Owners of a majority of the Percentage Interests represented by any
Class of Class A Certificates, or if there are no Class A Certificates then
Outstanding, by such Percentage Interest represented by the Class B Certificates
then Outstanding, upon compliance with the requirements set forth in the Pooling
and Servicing Agreement, have the right to exercise any trust or power set forth
in the Pooling and Servicing Agreement with respect to the Certificates or the
Trust Estate.
As provided in the Pooling and Servicing Agreement, the transfer of this
Certificate is registrable in the Register upon surrender of this Certificate
for registration of transfer at the office designated as the location of the
Register, and thereupon one or more new Certificates of like Class, tenor and a
like Percentage Interest will be issued to the designated transferee or
transferees.
The Trustee is required to furnish certain information on each Payment Date
to the Owner of this Certificate, as more fully described in the Pooling and
Servicing Agreement.
The Class A-6 Group II Certificates are issuable only as registered
Certificates in denominations of $1,000
A-6-7
<PAGE>
<PAGE>
original principal amount and integral multiples of $1,000 in excess thereof
(except for one odd Certificate). As provided in the Pooling and Servicing
Agreement and subject to certain limitations therein set forth, Class A-6 Group
II Certificates are exchangeable for new Class A-6 Group II Certificates of
authorized denominations evidencing the same aggregate principal amount.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and neither
the Trustee nor any such agent shall be affected by notice to the contrary,
except as may otherwise be specifically provided in the Pooling and Servicing
Agreement with respect to the Certificate Insurer.
A-6-8
<PAGE>
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed on behalf of the Trust.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, as Trustee
By:_____________________________
Title:__________________________
Trustee Authentication
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as
Trustee
By: _________________________
Title: ______________________
Dated: May 22, 1996
A-6-9
<PAGE>
<PAGE>
EXHIBIT B-1
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE ACT MAY BE MADE ONLY IN A TRANSACTION EXEMPT FROM
THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE PROVISIONS
OF SECTION 5.8 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-2
MORTGAGE LOAN PASS-THROUGH CERTIFICATE
CLASS B GROUP I
Representing Certain Interests Relating to a Pool of
Mortgage Loans formed by
CARGILL FINANCIAL SERVICES CORPORATION
with
ACCESS FINANCIAL LENDING CORP.
as Master Servicer
(This Certificate does not represent an interest in, or an obligation of,
nor are the underlying Mortgage Loans insured or guaranteed by Cargill Financial
Services Corporation, Access Financial Lending Corp., Norwest Bank Minnesota,
National Association, any Sub-Servicer or any of their respective subsidiaries
and affiliates. This Certificate represents a fractional ownership interest in
the Trust Estate described herein, moneys in the Principal and Interest Account
or otherwise held by the Master Servicer or any Sub-Servicer in trust for the
Owners (except as otherwise provided in the Pooling and Servicing Agreement) and
certain other rights relating thereto and is payable only from amounts received
by the Trustee relating to the Mortgage Loans held by the Trust.)
No.: B-1 May 22, 1996
Date
$961.34 June 18, 2027
- ------- -------------
Original Principal Final Scheduled
Amount Payment Date
ACCESS FINANCIAL RECEIVABLES CORP.
- --------------------------------------------------------------------------------
Registered Owner
<PAGE>
<PAGE>
The registered Owner named above is the registered Owner of a fractional
undivided interest in (i) a pool of mortgage loans, consisting of first and
second liens (the "Mortgage Loans") formed by Cargill Financial Services
Corporation (the "Sponsor"), a Delaware corporation, and held in trust by
Norwest Bank Minnesota, National Association, a national banking association, as
trustee (the "Trustee"), on behalf of Access Financial Mortgage Loan Trust
1996-2 (the "Trust") pursuant to that certain Pooling and Servicing Agreement
dated as of May 1, 1996 (the "Pooling and Servicing Agreement") by and among the
Sponsor, Access Financial Lending Corp., as seller (the "Seller") and as master
servicer (the "Master Servicer"), and the Trustee, (ii) such amounts, including
Eligible Investments, as from time to time may be held by the Trustee in the
Accounts held by the Trustee pursuant to the Pooling and Servicing Agreement by
the Master Servicer or any Sub-Servicer in the Principal and Interest Account
created pursuant to the Pooling and Servicing Agreement, or otherwise held by
the Master Servicer or any Sub-Servicer in trust for the Owners (except as
otherwise provided in the Pooling and Servicing Agreement), (iii) any Property,
the ownership of which has been effected in the name of the Master Servicer or
any Sub-Servicer on behalf of the Trust as a result of foreclosure or acceptance
by the Master Servicer or any Sub-Servicer of a deed in lieu of foreclosure and
that has not been withdrawn from the Trust, (iv) the rights, if any, of the
Trust in any Insurance Policies relating to the Mortgage Loans, (v) Net Proceeds
(but only to the extent such Net Proceeds do not exceed the sum of the Principal
Balance of the related Mortgage Loan plus accrued and unpaid interest on such
Mortgage Loan), and (vi) the Certificate Insurance Policy. Such Mortgage Loans
and other amounts and property enumerated above are hereinafter referred to as
the "Trust Estate."
Upon receiving the final distribution hereon, the Owner hereof is required
to send this Certificate to the Trustee. The Pooling and Servicing Agreement
provides that, in any event, upon the making of the final distribution due on
this Certificate, this Certificate shall be deemed cancelled for all purposes
under the Pooling and Servicing Agreement.
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN A CLASS OF "REGULAR INTERESTS" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT" ("REMIC") AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTION 860G AND
860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), ASSUMING
COMPLIANCE WITH THE REMIC PROVISIONS OF THE CODE.
THIS CERTIFICATE IS A PASS-THROUGH CERTIFICATE ONLY AND, NOTWITHSTANDING
REFERENCES HEREIN TO PRINCIPAL AND INTEREST, NO DEBT OF ANY PERSON IS
REPRESENTED HEREBY.
B-1-2
<PAGE>
<PAGE>
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION OR ANY OTHER GOVERNMENTAL AGENCY.
This Certificate is one of a Class of duly-authorized Certificates
designated as Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class B Group I Certificates (the "Class B Group I
Certificates") and issued under and subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Owner of this Certificate by virtue of acceptance hereof
assents and by which such Owner is bound. Also issued under the Pooling and
Servicing Agreement are Certificates designated as Access Financial Mortgage
Loan Trust 1996-2, Mortgage Loan Pass-Through Certificates, Class A-1 Group I
(the "Class A-1 Group I Certificates"), Access Financial Mortgage Loan Trust
1996-2, 6.925% Mortgage Loan Pass-Through Certificates, Class A-2 Group I (the
"Class A-2 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-2,
7.300% Mortgage Loan Pass-Through Certificates, Class A-3 Group I (the "Class
A-3 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-2, 7.625%
Mortgage Loan Pass-Through Certificates, Class A-4 Group I (the "Class A-4 Group
I Certificates"), Access Financial Mortgage Loan Trust 1996-2, 7.925% Mortgage
Loan Pass-Through Certificates, Class A-5 Group I (the "Class A-5 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-2 Mortgage Loan
Pass-Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class B Group II (the "Class B Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class BI-S (the "Class BI-S Certificates") and Class
BII-S (the "Class BII-S Certificates"), and Access Financial Mortgage Loan Trust
1996-2, Mortgage Loan Pass-Through Certificates, Class RL and Class RU (the
"Residual Certificates"). The Class A-1 Group I Certificates, the Class A-2
Group I Certificates, the Class A-3 Group I Certificates, the Class A-4 Group I
Certificates, the Class A-5 Group I Certificates, the Class A-6 Group II
Certificates (collectively, the "Class A Certificates"), the Class B Group I
Certificates, the Class B Group II Certificates, the Class BI-S Certificates,
the Class BII-S Certificates and the Residual Certificates are collectively
referred to herein as the "Certificates."
As more fully described in the Pooling and Servicing Agreement, each Class
of Certificates has a specified priority to the collections on the related Pool
of Mortgage Loans which comprise the related Available Funds.
B-1-3
<PAGE>
<PAGE>
Terms capitalized herein and not otherwise defined herein shall have the
respective meanings set forth in the Pooling and Servicing Agreement.
On the 18th day of each month, or, if such day is not a Business Day, then
the next succeeding Business Day (each such day being a "Payment Date")
commencing June 18, 1996, the Owners of the Class B Group I Certificates as of
the close of business on the first Business Day of the calendar month in which
such Payment Date occurs (the "Record Date") will be entitled to receive the
Class B Group I Distribution Amount. Distributions will be made in immediately
available funds to Owners of Certificates, by wire transfer or otherwise, to the
account of an Owner at a domestic bank or other entity having appropriate
facilities therefor, if such Owner has so notified the Trustee, or by check
mailed to the address of the person entitled thereto as it appears on the
Register.
Each Owner of record of a Class B Group I Certificate will be entitled to
receive such Owner's Percentage Interest in the Class B Group I Distribution
Amount due on such Payment Date to the Owners of the Class B Group I
Certificates. The Class B Group I Distribution Amount as of any date of
determination will be determined as set forth in the Pooling and Servicing
Agreement.
The Trustee is required to duly and punctually pay distributions with
respect to this Certificate in accordance with the terms hereof and the Pooling
and Servicing Agreement. Amounts properly withheld under the Code or applicable
state or local law by any Person from a distribution to any Owner shall be
considered as having been paid by the Trustee to such Owner for all purposes of
the Pooling and Servicing Agreement.
Access Financial Lending Corp., as Master Servicer, pursuant to the Pooling
and Servicing Agreement will service the Mortgage Loans. The Pooling and
Servicing Agreement permits the Master Servicer to enter into Sub-Servicing
Agreements with certain institutions eligible for appointment as Sub-Servicers
for the servicing and administration of the Mortgage Loans. No appointment of
any Sub-Servicer shall release the Master Servicer from any of its obligations
under the Pooling and Servicing Agreement.
This Certificate does not represent a deposit or other obligation of, or an
interest in, nor are the underlying Mortgage Loans insured or guaranteed by,
Cargill Financial Services Corporation, Access Financial Lending Corp., Norwest
Bank Minnesota, National Association, any Sub-Servicer, or any of their
respective subsidiaries and affiliates and are not insured or guaranteed by the
Federal Deposit Insurance
B-1-4
<PAGE>
<PAGE>
Corporation, the Government National Mortgage Association, or any other
governmental agency.
No Owner shall have any right to institute any proceeding, judicial or
otherwise, with respect to the Pooling and Servicing Agreement, or for the
appointment of a receiver or trustee, or for any other remedy under the Pooling
and Servicing Agreement except in compliance with the terms thereof.
Notwithstanding any other provisions in the Pooling and Servicing
Agreement, the Owner of any Certificate shall have the right which is absolute
and unconditional to receive distributions to the extent provided in the Pooling
and Servicing Agreement with respect to such Certificate or to institute suit
for the enforcement of any such distribution, and such right shall not be
impaired without the consent of such Owner.
The Pooling and Servicing Agreement provides that the obligations created
thereby will terminate upon the earlier of (i) the payment to the Owners of all
Certificates of all amounts held by the Trustee and required to be paid to such
Owners pursuant to the Pooling and Servicing Agreement upon the later to occur
of (a) the final payment or other liquidation (or any advance made with respect
thereto) of the last Mortgage Loan in the Trust Estate or (b) the disposition of
all property acquired in respect of any Mortgage Loan remaining in the Trust
Estate or (ii) at any time when a Qualified Liquidation of the Upper-Tier REMIC
and the Lower-Tier REMIC is effected as described in the Pooling and Servicing
Agreement.
The Pooling and Servicing Agreement provides that the Seller may, at its
option, purchase from the Trust all (but not fewer than all) remaining Mortgage
Loans and other property then constituting the Trust Estate, and thereby effect
early retirement of the Certificates, on any Remittance Date when the aggregate
outstanding Principal Balance of the Mortgage Loans is ten percent or less of
the Original Pool Principal Balance. If the Seller declines to exercise such
option within ninety days following such date, the Trustee shall solicit bids
for the purchase of all Mortgage Loans remaining in the Trust. If satisfactory
bids are received as described in the Pooling and Servicing Agreement, the
Trustee shall effect early retirement of the Certificates. If satisfactory bids
are not received, the Trustee shall decline to sell the Mortgage Loans and shall
not be under any obligation to solicit any further bids or otherwise negotiate
any further sale of the Mortgage Loans. Such sale and consequent termination of
the Trust must constitute a "qualified liquidation" of each REMIC established by
the Trust under Section 860F of the Internal Revenue Code of 1986, as
B-1-5
<PAGE>
<PAGE>
amended, including, without limitation, the requirement that the qualified
liquidation takes place over a period not to exceed ninety days.
The Trustee is required to give written notice of termination of the
Pooling and Servicing Agreement to each Owner in the manner set forth therein.
As provided in the Pooling and Servicing Agreement, the transfer of this
Certificate is registrable in the Register upon surrender of this Certificate
for registration of transfer at the office designated as the location of the
Register, and thereupon one or more new Certificates of like Class, tenor and a
like Percentage Interest will be issued to the designated transferee or
transferees.
The Trustee is required to furnish certain information on each Payment Date
to the Owner of this Certificate, as more fully described in the Pooling and
Servicing Agreement.
The Class B Group I Certificates are issuable only as registered
Certificates in minimum denominations of $100,000 original principal amount and
integral multiples of $1,000 in excess thereof (except for one odd Class B Group
I Certificate). As provided in the Pooling and Servicing Agreement and subject
to certain limitations therein set forth, Class B Group I Certificates are
exchangeable for new Class B Group I Certificates evidencing the same Percentage
Interest as the Class B Group I Certificates exchanged.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and neither
the Trustee nor any such agent shall be affected by notice to the contrary,
except as may otherwise be specifically provided in the Pooling and Servicing
Agreement with respect to the Certificate Insurer.
B-1-6
<PAGE>
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed on behalf of the Trust.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, as Trustee
By:_____________________________
Title:__________________________
Trustee Authentication
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as
Trustee
By: _________________________
Title: ______________________
Dated: May 22, 1996
B-1-7
<PAGE>
<PAGE>
EXHIBIT B-2
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE ACT MAY BE MADE ONLY IN A TRANSACTION EXEMPT FROM
THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE PROVISIONS
OF SECTION 5.8 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-2
MORTGAGE LOAN PASS-THROUGH CERTIFICATE
CLASS B GROUP II
Representing Certain Interests Relating to a Pool of
Mortgage Loans formed by
CARGILL FINANCIAL SERVICES CORPORATION
with
ACCESS FINANCIAL LENDING CORP.
as Master Servicer
(This Certificate does not represent an interest in, or an obligation of,
nor are the underlying Mortgage Loans insured or guaranteed by Cargill Financial
Services Corporation, Access Financial Lending Corp., Norwest Bank Minnesota,
National Association, any Sub-Servicer or any of their respective subsidiaries
and affiliates. This Certificate represents a fractional ownership interest in
the Trust Estate described herein, moneys in the Principal and Interest Account
or otherwise held by the Master Servicer or any Sub-Servicer in trust for the
Owners (except as otherwise provided in the Pooling and Servicing Agreement) and
certain other rights relating thereto and is payable only from amounts received
by the Trustee relating to the Mortgage Loans held by the Trust.)
No.: B-1 May 22, 1996
Date
$659.70 June 18, 2027
- ------- -------------
Original Principal Final Scheduled
Amount Payment Date
ACCESS FINANCIAL RECEIVABLES CORP.
- --------------------------------------------------------------------------------
Registered Owner
<PAGE>
<PAGE>
The registered Owner named above is the registered Owner of a fractional
undivided interest in (i) a pool of mortgage loans, consisting of first and
second liens (the "Mortgage Loans") formed by Cargill Financial Services
Corporation (the "Sponsor"), a Delaware corporation, and held in trust by
Norwest Bank Minnesota, National Association, a national banking association, as
trustee (the "Trustee"), on behalf of Access Financial Mortgage Loan Trust
1996-2 (the "Trust") pursuant to that certain Pooling and Servicing Agreement
dated as of May 1, 1996 (the "Pooling and Servicing Agreement") by and among the
Sponsor, Access Financial Lending Corp., as seller (the "Seller") and as master
servicer (the "Master Servicer"), and the Trustee, (ii) such amounts, including
Eligible Investments, as from time to time may be held by the Trustee in the
Accounts held by the Trustee pursuant to the Pooling and Servicing Agreement by
the Master Servicer or any Sub-Servicer in the Principal and Interest Account
created pursuant to the Pooling and Servicing Agreement, or otherwise held by
the Master Servicer or any Sub-Servicer in trust for the Owners (except as
otherwise provided in the Pooling and Servicing Agreement), (iii) any Property,
the ownership of which has been effected in the name of the Master Servicer or
any Sub-Servicer on behalf of the Trust as a result of foreclosure or acceptance
by the Master Servicer or any Sub-Servicer of a deed in lieu of foreclosure and
that has not been withdrawn from the Trust, (iv) the rights, if any, of the
Trust in any Insurance Policies relating to the Mortgage Loans, (v) Net Proceeds
(but only to the extent such Net Proceeds do not exceed the sum of the Principal
Balance of the related Mortgage Loan plus accrued and unpaid interest on such
Mortgage Loan), and (vi) the Certificate Insurance Policy. Such Mortgage Loans
and other amounts and property enumerated above are hereinafter referred to as
the "Trust Estate."
Upon receiving the final distribution hereon, the Owner hereof is required
to send this Certificate to the Trustee. The Pooling and Servicing Agreement
provides that, in any event, upon the making of the final distribution due on
this Certificate, this Certificate shall be deemed cancelled for all purposes
under the Pooling and Servicing Agreement.
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN A CLASS OF "REGULAR INTERESTS" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT" ("REMIC") AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTION 860G AND
860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), ASSUMING
COMPLIANCE WITH THE REMIC PROVISIONS OF THE CODE.
THIS CERTIFICATE IS A PASS-THROUGH CERTIFICATE ONLY AND, NOTWITHSTANDING
REFERENCES HEREIN TO PRINCIPAL AND INTEREST, NO DEBT OF ANY PERSON IS
REPRESENTED HEREBY.
B-2-2
<PAGE>
<PAGE>
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION OR ANY OTHER GOVERNMENTAL AGENCY.
This Certificate is one of a Class of duly-authorized Certificates
designated as Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class B Group II (the "Class B Group II
Certificates") and issued under and subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Owner of this Certificate by virtue of acceptance hereof
assents and by which such Owner is bound. Also issued under the Pooling and
Servicing Agreement are Certificates designated as Access Financial Mortgage
Loan Trust 1996-2, Mortgage Loan Pass-Through Certificates, Class A-1 Group I
(the "Class A-1 Group I Certificates"), Access Financial Mortgage Loan Trust
1996-2, 6.925% Mortgage Loan Pass-Through Certificates, Class A-2 Group I (the
"Class A-2 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-2,
7.300% Mortgage Loan Pass-Through Certificates, Class A-3 Group I (the "Class
A-3 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-2, 7.625%
Mortgage Loan Pass-Through Certificates, Class A-4 Group I (the "Class A-4 Group
I Certificates"), Access Financial Mortgage Loan Trust 1996-2, 7.925% Mortgage
Loan Pass-Through Certificates, Class A-5 Group I (the "Class A-5 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-2 Mortgage Loan
Pass-Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class B Group I Certificates (the "Class B Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class BI-S (the "Class BI-S Certificates") and Class
BII-S (the "Class BII-S Certificates") and Access Financial Mortgage Loan Trust
1996-2, Mortgage Loan Pass-Through Certificates, Class RL and Class RU (the
"Residual Certificates"). The Class A-1 Group I Certificates, the Class A-2
Group I Certificates, the Class A-3 Group I Certificates, the Class A-4 Group I
Certificates, the Class A-5 Group I Certificates, the Class A-6 Group II
Certificates (collectively, the "Class A Certificates"), the Class B Group I
Certificates, the Class B Group II Certificates, the Class BI-S Certificates,
the Class BII-S Certificates and the Residual Certificates are collectively
referred to herein as the "Certificates."
As more fully described in the Pooling and Servicing Agreement, each Class
of Certificates has a specified priority to the collections on the related Pool
of Mortgage Loans which comprise the related Available Funds.
B-2-3
<PAGE>
<PAGE>
Terms capitalized herein and not otherwise defined herein shall have the
respective meanings set forth in the Pooling and Servicing Agreement.
On the 18th day of each month, or, if such day is not a Business Day, then
the next succeeding Business Day (each such day being a "Payment Date")
commencing June 18, 1996, the Owners of the Class B Group II Certificates as of
the close of business on the first Business Day of the calendar month in which
such Payment Date occurs (the "Record Date") will be entitled to receive the
Class B Group II Distribution Amount. Distributions will be made in immediately
available funds to Owners of Certificates, by wire transfer or otherwise, to the
account of an Owner at a domestic bank or other entity having appropriate
facilities therefor, if such Owner has so notified the Trustee, or by check
mailed to the address of the person entitled thereto as it appears on the
Register.
Each Owner of record of a Class B Group II Certificate will be entitled to
receive such Owner's Percentage Interest in the Class B Group II Distribution
Amount due on such Payment Date to the Owners of the Class B Group II
Certificates. The Class B Group II Distribution Amount as of any date of
determination will be determined as set forth in the Pooling and Servicing
Agreement.
The Trustee is required to duly and punctually pay distributions with
respect to this Certificate in accordance with the terms hereof and the Pooling
and Servicing Agreement. Amounts properly withheld under the Code or applicable
state or local law by any Person from a distribution to any Owner shall be
considered as having been paid by the Trustee to such Owner for all purposes of
the Pooling and Servicing Agreement.
Access Financial Lending Corp., as Master Servicer, pursuant to the Pooling
and Servicing Agreement will service the Mortgage Loans. The Pooling and
Servicing Agreement permits the Master Servicer to enter into Sub-Servicing
Agreements with certain institutions eligible for appointment as Sub-Servicers
for the servicing and administration of the Mortgage Loans. No appointment of
any Sub-Servicer shall release the Master Servicer from any of its obligations
under the Pooling and Servicing Agreement.
This Certificate does not represent a deposit or other obligation of, or an
interest in, nor are the underlying Mortgage Loans insured or guaranteed by,
Cargill Financial Services Corporation, Access Financial Lending Corp., Norwest
Bank Minnesota, National Association, any Sub-Servicer, or any of their
respective subsidiaries and affiliates and are not insured or guaranteed by the
Federal Deposit Insurance
B-2-4
<PAGE>
<PAGE>
Corporation, the Government National Mortgage Association, or any other
governmental agency.
No Owner shall have any right to institute any proceeding, judicial or
otherwise, with respect to the Pooling and Servicing Agreement, or for the
appointment of a receiver or trustee, or for any other remedy under the Pooling
and Servicing Agreement except in compliance with the terms thereof.
Notwithstanding any other provisions in the Pooling and Servicing
Agreement, the Owner of any Certificate shall have the right which is absolute
and unconditional to receive distributions to the extent provided in the Pooling
and Servicing Agreement with respect to such Certificate or to institute suit
for the enforcement of any such distribution, and such right shall not be
impaired without the consent of such Owner.
The Pooling and Servicing Agreement provides that the obligations created
thereby will terminate upon the earlier of (i) the payment to the Owners of all
Certificates of all amounts held by the Trustee and required to be paid to such
Owners pursuant to the Pooling and Servicing Agreement upon the later to occur
of (a) the final payment or other liquidation (or any advance made with respect
thereto) of the last Mortgage Loan in the Trust Estate or (b) the disposition of
all property acquired in respect of any Mortgage Loan remaining in the Trust
Estate or (ii) at any time when a Qualified Liquidation of the Upper-Tier REMIC
and the Lower-Tier REMIC is effected as described in the Pooling and Servicing
Agreement.
The Pooling and Servicing Agreement provides that the Seller may, at its
option, purchase from the Trust all (but not fewer than all) remaining Mortgage
Loans and other property then constituting the Trust Estate, and thereby effect
early retirement of the Certificates, on any Remittance Date when the aggregate
outstanding Principal Balance of the Mortgage Loans is ten percent or less of
the Original Pool Principal Balance. If the Seller declines to exercise such
option within ninety days following such date, the Trustee shall solicit bids
for the purchase of all Mortgage Loans remaining in the Trust. If satisfactory
bids are received as described in the Pooling and Servicing Agreement, the
Trustee shall effect early retirement of the Certificates. If satisfactory bids
are not received, the Trustee shall decline to sell the Mortgage Loans and shall
not be under any obligation to solicit any further bids or otherwise negotiate
any further sale of the Mortgage Loans. Such sale and consequent termination of
the Trust must constitute a "qualified liquidation" of each REMIC established by
the Trust under Section 860F of the Internal Revenue Code of 1986, as
B-2-5
<PAGE>
<PAGE>
amended, including, without limitation, the requirement that the qualified
liquidation takes place over a period not to exceed ninety days.
The Trustee is required to give written notice of termination of the
Pooling and Servicing Agreement to each Owner in the manner set forth therein.
As provided in the Pooling and Servicing Agreement, the transfer of this
Certificate is registrable in the Register upon surrender of this Certificate
for registration of transfer at the office designated as the location of the
Register, and thereupon one or more new Certificates of like Class, tenor and a
like Percentage Interest will be issued to the designated transferee or
transferees.
The Trustee is required to furnish certain information on each Payment Date
to the Owner of this Certificate, as more fully described in the Pooling and
Servicing Agreement.
The Class B Group II Certificates are issuable only as registered
Certificates in minimum denominations of $100,000 original principal amount and
integral multiples of $1,000 in excess thereof (except for one odd Class B Group
II Certificate). As provided in the Pooling and Servicing Agreement and subject
to certain limitations therein set forth, Class B Group II Certificates are
exchangeable for new Class B Group II Certificates evidencing the same
Percentage Interest as the Class B Group II Certificates exchanged.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and neither
the Trustee nor any such agent shall be affected by notice to the contrary,
except as may otherwise be specifically provided in the Pooling and Servicing
Agreement with respect to the Certificate Insurer.
B-2-6
<PAGE>
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed on behalf of the Trust.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, as Trustee
By:_____________________________
Title:__________________________
Trustee Authentication
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as
Trustee
By: _________________________
Title: ______________________
Dated: May 22, 1996
B-2-7
<PAGE>
<PAGE>
EXHIBIT B-3
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN (X) A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT" ("REMIC") AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTION 860G AND
860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), ASSUMING
COMPLIANCE WITH THE REMIC PROVISIONS OF THE CODE AND (Y) CERTAIN OTHER PROPERTY
HELD IN THE GROUP I SUPPLEMENTAL INTEREST PAYMENT ACCOUNT.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL SAVINGS AND
LOAN INSURANCE CORPORATION, THE GOVERNMENT NATIONAL MORTGAGE ASSOCIATION OR ANY
OTHER GOVERNMENTAL AGENCY.
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE ACT MAY BE MADE ONLY IN A TRANSACTION EXEMPT FROM
THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE PROVISIONS
OF SECTION 5.8 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
TRANSFER OF THIS CLASS BI-S CERTIFICATE IS RESTRICTED AS SET FORTH IN THE
POOLING AND SERVICING AGREEMENT.
SUPPLEMENTAL INTEREST PAYMENT ACCOUNT
RELATING TO
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-2
CLASS BI-S
(This Certificate does not represent an interest in, or an obligation of,
nor are the underlying Mortgage Loans insured or guaranteed by, Cargill
Financial Services Corporation, Access Financial Lending Corp., Norwest Bank
Minnesota, National Association, any Sub-Servicer or any Originator or any of
their subsidiaries and affiliates. This Certificate represents a fractional
ownership interest in certain excess moneys of the Supplemental Interest Payment
Account described herein.
No: BI-S-1 Date: May 22, 1996
Percentage Interest: 100% June 18, 2027
Final Scheduled Payment Date
ACCESS FINANCIAL RECEIVABLES CORP.
Registered Owner
<PAGE>
<PAGE>
The registered Owner named above is the registered Owner of a fractional
interest in certain excess moneys of the Group I Supplemental Interest Payment
Account pursuant to that certain Pooling and Servicing Agreement dated as of May
1, 1996 (the "Pooling and Servicing Agreement") by and among the Sponsor, the
Trustee and Access Financial Lending Corp., as Master Servicer (the "Master
Servicer") and as Seller.
This Certificate is one of a Class of duly authorized Certificates
designated as Access Financial Mortgage Loan Trust 1996-2, Class BI-S
Certificates (the "Class BI-S Certificates") and issued under and subject to the
terms, provisions and conditions of the Pooling and Servicing Agreement, to
which Pooling and Servicing Agreement the Owner of this Certificate by virtue of
acceptance hereof assents and by which such Owner is bound.
Terms capitalized herein and not otherwise defined herein shall have the
respective meanings set forth in the Pooling and Servicing Agreement.
On the 18th day of each month or, if such day is not a Business Day, then
the next succeeding Business Day (each such day being a "Payment Date"),
commencing June 18, 1996, to the persons in whose names the Class BI-S
Certificates are registered at the close of business on the last business day of
the calendar month immediately preceding the calendar month in which such
Payment Date occurs (the "Record Date"), the Trustee will distribute to each
Owner of the Class BI-S Certificates such Owner's Percentage Interest multiplied
by any amounts then available to be distributed to the Owners of the Class BI-S
Certificates. Distributions will be made in immediately available funds, by wire
transfer or otherwise, to the account of such Owner at a domestic bank or other
entity having appropriate facilities therefor, if such Owner has so notified the
Trustee at least five business days prior to the related record date, or by
check mailed to the address of the person entitled thereto as it appears on the
Register.
Upon receiving the final distribution hereon, the Owner hereof is required
to send this Certificate to the Trustee. The Pooling and Servicing Agreement
provides that, in any event, upon the making of the final distribution due on
this Certificate, this Certificate shall be deemed cancelled for all purposes
under the Pooling and Servicing Agreement.
The Trustee is required to duly and punctually pay distributions with
respect to this Certificate in accordance with the terms hereof and the Pooling
and Servicing Agreement. Amounts properly withheld under the Code or applicable
state or local law by any person from a distribution to any Owner shall be
considered as having been paid by the Trustee to such Owner for all purposes of
the Pooling and Servicing Agreement.
B-3-2
<PAGE>
<PAGE>
Access Financial Lending Corp., as Maser Servicer, pursuant to the Pooling
and Servicing Agreement will service the Mortgage Loans. The Pooling and
Servicing Agreement permits the Master Servicer to enter into Sub-Servicing
Agreements with certain institutions eligible for appointments as Sub-Servicers
for the servicing and administration of the Mortgage Loans. No appointment of
any Sub-Servicer shall release the Master Servicer from any of its obligations
under the Pooling and Servicing Agreement.
This Certificate does not represent a deposit or other obligation of, or an
interest in, nor are the underlying Mortgage Loans insured or guaranteed by,
Cargill Financial Services Corporation, Access Financial Lending Corp., Norwest
Bank Minnesota, National Association, any Sub-Servicer or any of their
subsidiaries and affiliates and are not insured or guaranteed by the Federal
Deposit Insurance Corporation, the Government National Mortgage Association, or
any other governmental agency. This Certificate is limited in right of payment
to certain collections and recoveries relating to the Mortgage Loans, all as
more specifically set forth hereinabove and in the Pooling and Servicing
Agreement.
No Owner shall have the right to institute any proceeding, judicial or
otherwise, with respect to the Pooling and Servicing Agreement, or for the
appointment of a receiver or trustee, or for any other remedy under the Pooling
and Servicing Agreement except in compliance with the terms thereof.
Notwithstanding any other provisions in the Pooling and Servicing
Agreement, the Owner of any Certificate shall have the right which is absolute
and unconditional to receive distributions to the extent provided in the Pooling
and Servicing Agreement with respect to such Certificate or to institute suit
for the enforcement of any such distribution, and such right shall not be
impaired without the consent of such Owner.
The Pooling and Servicing Agreement provides that the obligations created
thereby will terminate upon the earlier of (i) the payment to the Owners of all
Certificates from amounts other than those available under the Certificate
Insurance Policy of all amounts held by the Trustee and required to be paid to
such Owners pursuant to the Pooling and Servicing Agreement upon the later to
occur of (a) the final payment or other liquidation (or any advance made with
respect thereto) of the last Mortgage Loan in the Trust Estate or (b) the
disposition of all property acquired in respect of any Mortgage Loan remaining
in the Trust Estate or (ii) at any time when a Qualified Liquidation of the
Upper-Tier REMIC and the Lower-Tier REMIC is effected as described in the
Pooling and Servicing Agreement.
B-3-3
<PAGE>
<PAGE>
The Pooling and Servicing Agreement provides that the Seller may, at its
option, purchase from the Trust all (but no fewer than all) remaining Mortgage
Loans and other property then constituting the Trust Estate, and thereby effect
early retirement of the Certificates, on any Remittance Date when the aggregate
outstanding Principal Balance of the Mortgage Loans is ten percent or less of
the Original Pool Principal Balance. If the Seller declines to exercise such
option within ninety days following such date, the Trustee shall solicit bids
for the purchase of all Mortgage Loans remaining in the Trust. If satisfactory
bids are received as described in the Pooling and Servicing Agreement, the
Trustee shall effect early retirement of the Certificates. If satisfactory bids
are not received, the Trustee shall decline to sell the Mortgage Loans and shall
not be under any obligation to solicit any further bids or otherwise negotiate
any further sale of the Mortgage Loans. Such sale and consequent termination of
the Trust must constitute a "qualified liquidation" of each REMIC established by
the Trust under Section 860F of the Internal Revenue Code of 1986, as amended,
including, without limitation, the requirement that the qualified liquidation
takes place over a period not to exceed ninety days.
The Trustee shall give written notice of termination of the Pooling and
Servicing Agreement to each Owner in the manner set forth therein.
As provided in the Pooling and Servicing Agreement and subject to certain
limitations therein set forth and referred to on the face hereof, the transfer
of this Certificate is registrable in the Register upon surrender of this
Certificate for registration of transfer at the office designated as the
location of the Register duly endorsed by, or accompanied by a written
instrument of transfer in the form required by the Pooling and Servicing
Agreement duly executed by, the Owner hereof or his attorney duly authorized in
writing, and thereupon one or more new Certificates of like Class, tenor and a
like Percentage Interest in the Trust Estate will be issued to the designated
transferee or transferees.
The Trustee is required to furnish certain information on each Payment Date
to the Owner of this Certificate, as more fully described in the Pooling and
Servicing Agreement.
The Class BI-S Certificates are issuable only as registered Certificates.
As provided in the Pooling and Servicing Agreement and subject to certain
limitations therein set forth, Class BI-S Certificates are exchangeable for new
Class BI-S Certificates evidencing the same Percentage Interest as the Class
BI-S Certificates exchanged.
B-3-4
<PAGE>
<PAGE>
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and neither
the Trustee or any such agent shall be affected by notice to the contrary.
B-3-5
<PAGE>
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed on behalf of the Trust.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Trustee
By:______________________
Name:
Title:
Trustee's Authentication
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
as Trustee
By:___________________________________
Name:
Title:
B-3-6
<PAGE>
<PAGE>
EXHIBIT B-4
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN (X) A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT" ("REMIC") AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTION 860G AND
860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), ASSUMING
COMPLIANCE WITH THE REMIC PROVISIONS OF THE CODE AND (Y) CERTAIN OTHER PROPERTY
HELD IN THE GROUP II SUPPLEMENTAL INTEREST PAYMENT ACCOUNT.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL SAVINGS AND
LOAN INSURANCE CORPORATION, THE GOVERNMENT NATIONAL MORTGAGE ASSOCIATION OR ANY
OTHER GOVERNMENTAL AGENCY.
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE ACT MAY BE MADE ONLY IN A TRANSACTION EXEMPT FROM
THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE PROVISIONS
OF SECTION 5.8 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
TRANSFER OF THIS CLASS BI-S CERTIFICATE IS RESTRICTED AS SET FORTH IN THE
POOLING AND SERVICING AGREEMENT.
SUPPLEMENTAL INTEREST PAYMENT ACCOUNT
RELATING TO
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-2
CLASS BII-S
(This Certificate does not represent an interest in, or an obligation of,
nor are the underlying mortgage loans insured or guaranteed by, Cargill
Financial Services Corporation, Access Financial Lending Corp., Norwest Bank
Minnesota, National Association, any Sub-Servicer, any Originator or any of
their subsidiaries and affiliates. This Certificate represents a fractional
ownership interest in certain excess moneys of the Supplemental Interest Payment
Account described herein.
No: BII-S-1 Date: May 22, 1996
Percentage Interest: 100% June 18, 2027
Final Scheduled Payment Date
<PAGE>
<PAGE>
ACCESS FINANCIAL RECEIVABLES CORP.
Registered Owner
The registered Owner named above is the registered Owner of a fractional
interest in certain excess moneys of the Group II Supplemental Interest Payment
Account pursuant to that certain Pooling and Servicing Agreement dated as of May
1, 1996 (the "Pooling and Servicing Agreement") by and among the Sponsor, the
Trustee and Access Financial Lending Corp., as Master Servicer (the "Master
Servicer") and the Seller.
This Certificate is one of a Class of duly authorized Certificates
designated as Access Financial Mortgage Loan Trust 1996-2, Class BII-S
Certificates (the Class BII-S Certificates") and issued under and subject to the
terms, provisions, and conditions of the Pooling and Servicing Agreement, to
which Pooling ad Servicing Agreement the Owner of this Certificate by virtue of
acceptance hereof assents and by which such Owner is bound.
Terms capitalized herein and to otherwise defined herein shall have the
respective meanings set forth in the Pooling and Servicing Agreement.
On the 18th day of each month or, if such day is not a Business Day, then
the next succeeding Business Day (each such day being a "Payment Date"),
commencing June 18, 1996, to the persons in whose names the Class BII-S
Certificates are registered at the close of business on the last business day of
the calendar month immediately preceding the calendar month in which such
Payment Date occurs (the "Record Date"), the Trustee will distribute to each
Owner of the Class BII-S Certificates such Owner's Percentage Interest
multiplied by any amounts then available to be distributed to the Owners of the
Class BII-S Certificates. Distributions will be made in immediately available
funds, by wire transfer or otherwise, to the account of such Owner at a domestic
bank or other entity having appropriate facilities therefor, if such Owner has
so notified the Trustee at least five business days prior to the related record
date, or by check mailed to the address of the person entitled thereto as it
appears on the Register.
Upon receiving the final distribution hereon, the Owner hereof is required
to send this Certificate to the Trustee. The Pooling and Servicing Agreement
provides that, in any event, upon the making of the final distribution due on
this Certificate, this Certificate shall be deemed cancelled for all purposes
under the Pooling and Servicing Agreement.
The Trustee is required to duly and punctually pay distributions with
respect to this Certificate in accordance with the terms hereof and the Pooling
and Servicing Agreement. Amounts properly withheld under the Code or applicable
state
B-4-2
<PAGE>
<PAGE>
or local law by any person from a distribution to any Owner shall be considered
as having been paid by the Trustee to such Owner for all purposes of the Pooling
and Servicing Agreement.
Access Financial Lending Corp., as Master Servicer, pursuant to the Pooling
and Servicing Agreement will service the Mortgage Loans. The Pooling and
Servicing Agreement permits the Master Servicer to enter into Sub-Servicing
Agreements with certain institutions eligible for appointments as Sub-Servicers
for the servicing and administration of the Mortgage Loans. No appointment of
any Sub-Servicer shall release the Master Servicer from any of its obligations
under the Pooling and Servicing Agreement.
This Certificate does not represent a deposit or other obligation of, or an
interest in, nor are the underlying Mortgage Loans insured or guaranteed by,
Cargill Financial Services Corporation, Access Financial Lending Corp., Norwest
Bank Minnesota, National Association, any Sub-Servicer or any of their
subsidiaries and affiliates and are not insured or guaranteed by the Federal
Deposit Insurance Corporation, the Government National Mortgage Association, or
any other governmental agency. This Certificate is limited in right of payment
to certain collections and recoveries relating to the Mortgage Loans, all as
more specifically set forth hereinabove and in the Pooling and Servicing
Agreement.
No Owner shall have the right to institute any proceeding, judicial or
otherwise, with respect to the Pooling and Servicing Agreement, or for the
appointment of a receiver or trustee, or for any other remedy under the Pooling
and Servicing Agreement except in compliance with the terms thereof.
Notwithstanding any other provisions in the Pooling and Servicing
Agreement, the Owner of any Certificate shall have the right which is absolute
and unconditional to receive distributions to the extent provided in the Pooling
and Servicing Agreement with respect to such Certificate or to institute suit
for the enforcement of any such distribution, and such right shall not be
impaired without the consent of such Owner.
The Pooling and Servicing Agreement provides that the obligations created
thereby will terminate upon the earlier of (i) the payment to the Owners of all
Certificates from amounts other than those available under the Certificate
Insurance Policy of all amounts held by the Trustee and required to be paid to
such Owners pursuant to the Pooling and Servicing Agreement upon the later to
occur of (a) the final payment or other liquidation (or any advance made with
respect thereto) of the last Mortgage Loan in the Trust Estate or (b) the
disposition of all property acquired in respect of any
B-4-3
<PAGE>
<PAGE>
Mortgage Loan remaining in the Trust Estate or (ii) at any time when a Qualified
Liquidation of the Upper-Tier REMIC and the Lower-Tier REMIC is effected as
described in the Pooling and Servicing Agreement.
The Pooling and Servicing Agreement provides that the Seller may, at its
option, purchase from the Trust all (but no fewer than all) remaining Mortgage
Loans and other property then constituting the Trust Estate, and thereby effect
early retirement of the Certificates, on any Remittance Date when the aggregate
outstanding Principal Balance of the Mortgage Loans is ten percent or less of
the Original Pool Principal Balance. If the Seller declines to exercise such
option within ninety days following such date, the Trustee shall solicit bids
for the purchase of all Mortgage Loans remaining in the Trust. If satisfactory
bids are received as described in the Pooling and Servicing Agreement, the
Trustee shall effect early retirement of the Certificates. If satisfactory bids
are not received, the Trustee shall decline to sell the Mortgage Loans and shall
not be under any obligation to solicit any further bids or otherwise negotiate
any further sale of the Mortgage Loans. Such sale and consequent termination of
the Trust must constitute a "qualified liquidation" of each REMIC established by
the Trust under Section 860F of the Internal Revenue Code of 1986, as amended,
including, without limitation, the requirement that the qualified liquidation
takes place over a period not to exceed ninety days.
The Trustee shall give written notice of termination of the Pooling and
Servicing Agreement to each Owner in the manner set forth therein.
As provided in the Pooling and Servicing Agreement and subject to certain
limitations therein set forth and referred to on the face hereof, the transfer
of this Certificate is registrable in the Register upon surrender of this
Certificate for registration of transfer at the office designated as the
location of the Register duly endorsed by, or accompanied by a written
instrument of transfer in the form required by he Pooling and Servicing
Agreement duly executed by, the Owner hereof or his attorney duly authorized in
writing, and thereupon one or more new Certificates of like Class, tenor and a
like Percentage Interest in the Trust Estate will be issued to the designated
transferee or transferees.
The Trustee is required to furnish certain information on each Payment Date
to the Owner of this Certificate, as more fully described in the Pooling and
Servicing Agreement.
B-4-4
<PAGE>
<PAGE>
The Class BII-S Certificates are issuable only as registered Certificates.
As provided in the Pooling and Servicing Agreement and subject to certain
limitations therein set forth, Class BII-S Certificates are exchangeable for new
Class BII-S Certificates evidencing the same Percentage Interest as the Class
BII-S Certificates exchanged.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and neither
the Trustee or any such agent shall be affected by notice to the contrary.
B-4-5
<PAGE>
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed on behalf of the Trust.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Trustee
By:______________________
Name:
Title:
Trustee's Authentication
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
as Trustee
By:___________________________________
Name:
Title:
B-4-6
<PAGE>
<PAGE>
EXHIBIT C-1
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE ACT MAY BE MADE ONLY IN A TRANSACTION EXEMPT FROM
THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE PROVISIONS
OF SECTION 5.8 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION OR ANY OTHER GOVERNMENTAL AGENCY.
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN THE ONLY "RESIDUAL INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT" ("REMIC") AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTION 860G and
860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), ASSUMING
COMPLIANCE WITH THE REMIC PROVISIONS OF THE CODE.
TRANSFER OF THIS CLASS RL CERTIFICATE IS RESTRICTED AS SET FORTH IN THE
POOLING AND SERVICING AGREEMENT. NO TRANSFER OF THIS CLASS RL CERTIFICATE MAY BE
MADE TO A "DISQUALIFIED ORGANIZATION" AS DEFINED IN SECTION 860E(e)(5) OF THE
CODE. SUCH TERM INCLUDES 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 CERTAIN TAXABLE
INSTRUMENTALITIES), ANY COOPERATIVE ORGANIZATION FURNISHING ELECTRIC ENERGY OR
PROVIDING TELEPHONE SERVICE TO PERSONS IN RURAL AREAS, OR ANY ORGANIZATION
(OTHER THAN A FARMERS' COOPERATIVE) THAT IS EXEMPT FROM FEDERAL INCOME TAX
UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX ON UNRELATED BUSINESS INCOME. NO
TRANSFER OF THIS CLASS RL CERTIFICATE WILL BE REGISTERED BY THE TRUSTEE UNLESS
THE PROPOSED TRANSFEREE HAS DELIVERED AN AFFIDAVIT AFFIRMING, AMONG OTHER
THINGS, THAT THE PROPOSED TRANSFEREE IS NOT A DISQUALIFIED ORGANIZATION AND IS
NOT ACQUIRING THE CLASS RL CERTIFICATE FOR THE ACCOUNT OF A DISQUALIFIED
ORGANIZATION. A COPY OF THE FORM OF AFFIDAVIT REQUIRED OF EACH PROPOSED
TRANSFEREE IS ON FILE AND AVAILABLE FROM THE TRUSTEE.
A TRANSFER IN VIOLATION OF THE APPLICABLE RESTRICTIONS MAY GIVE RISE TO A
SUBSTANTIAL TAX UPON THE TRANSFEROR OR, IN CERTAIN CASES, UPON AN AGENT ACTING
FOR THE TRANSFEREE. A PASS-THRU ENTITY THAT HOLDS THIS CLASS RL CERTIFICATE AND
THAT HAS A DISQUALIFIED ORGANIZATION AS A RECORD OWNER IN ANY TAXABLE YEAR
GENERALLY WILL BE SUBJECT TO A TAX FOR EACH SUCH YEAR EQUAL TO THE PRODUCT OF
(A) THE AMOUNT OF EXCESS INCLU-
<PAGE>
<PAGE>
SIONS WITH RESPECT TO THE PORTION OF THIS CERTIFICATE OWNED THROUGH SUCH
PASS-THRU ENTITY BY SUCH DISQUALIFIED ORGANIZATION, AND (B) THE HIGHEST MARGINAL
FEDERAL TAX RATE ON CORPORATIONS. FOR PURPOSES OF THE PRECEDING SENTENCE, THE
TERM "PASS-THRU" ENTITY INCLUDES REGULATED INVESTMENT COMPANIES, REAL ESTATE
INVESTMENT TRUSTS, COMMON TRUST FUNDS, PARTNERSHIPS, TRUSTS, ESTATES,
COOPERATIVES TO WHICH PART I OF SUBCHAPTER IT OF THE CODE APPLIES AND, EXCEPT AS
PROVIDED IN REGULATIONS, NOMINEES.
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-2
MORTGAGE LOAN PASS-THROUGH CERTIFICATE
CLASS RL
Representing Certain Interests Relating to a Pool of
Mortgage Loans Formed by
CARGILL FINANCIAL SERVICES CORPORATION
with
ACCESS FINANCIAL LENDING CORP.
as Master Servicer
(This Certificate does not represent an interest in, or an obligation of,
nor are the underlying Mortgage Loans insured or guaranteed by Cargill Financial
Services Corporation, Access Financial Lending Corp., Norwest Bank Minnesota,
National Association, any Sub-Servicer or any of their respective subsidiaries
and affiliates. This Certificate represents a fractional residual ownership
interest in the Lower-Tier REMIC described in the Pooling and Servicing
Agreement.)
No: RL-1 Date: May 22, 1996
Percentage Interest: 100% June 18, 2027
-------------
Final Scheduled
Payment Date
ACCESS FINANCIAL RECEIVABLES CORP.
- --------------------------------------------------------------------------------
Registered Owner
C-1-2
<PAGE>
<PAGE>
THIS CERTIFICATE IS A PASS-THROUGH CERTIFICATE ONLY AND, NOTWITHSTANDING
REFERENCES HEREIN TO PRINCIPAL AND INTEREST, NO DEBT OF ANY PERSON IS
REPRESENTED HEREBY.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION OR ANY OTHER GOVERNMENTAL AGENCY.
This Certificate is one of a Class of duly-authorized Certificates
designated as Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class RL (the "Class RL Certificates") and issued
under and subject to the terms, provisions and conditions of the Pooling and
Servicing Agreement, to which Pooling and Servicing Agreement the Owner of this
Certificate by virtue of acceptance hereof assents and by which such Owner is
bound. Also issued under the Pooling and Servicing Agreement are Certificates
designated as Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class A-1 Group I (the "Class A-1 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-2, 6.925% Mortgage
Loan Pass-Through Certificates, Class A-2 Group I (the "Class A-2 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-2, 7.300% Mortgage
Loan Pass-Through Certificates, Class A-3 Group I (the "Class A-3 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-2, 7.625% Mortgage
Loan Pass-Through Certificates, Class A-4 Group I (the "Class A-4 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-2, 7.925% Mortgage
Loan Pass-Through Certificates, Class A-5 Group I (the "Class A-5 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-2 Mortgage Loan
Pass-Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class B Group I Certificates (the "Class B Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class B Group II (the "Class B Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class BI-S (the "Class BI-S Certificates") and Class
BII-S (the "Class BII-S Certificates") and Access Financial Mortgage Loan Trust
1996-2 Mortgage Loan Pass-Through Certificates, Class RU (together with the
Class RL Certificates, the "Residual Certificates"). The Class A-1 Group I
Certificates, the Class A-2 Group I Certificates, the Class A-3 Group I
Certificates, the Class A-4 Group I Certificates, the Class A-5 Group I
Certificates, the Class A-6 Group II Certificates (collectively, the "Class A
Certificates"), the Class B Group I Certificates, the Class B Group II
Certificates, the Class BI-S Certificates, the Class BII-S Certificates and the
Residual Certificates are collectively referred to herein as the "Certificates."
C-1-3
<PAGE>
<PAGE>
Terms capitalized herein and not otherwise defined herein shall have the
respective meanings set forth in the Pooling and Servicing Agreement.
On the 18th day of each month, or, if such day is not a Business Day, then
the next succeeding Business Day (each such day being a "Payment Date"),
commencing June 18, 1996, to the Owners of the Class RL Certificates as of the
close of business on the first Business Day of the calendar month in which such
Payment Date occurs (the "Record Date"), the Trustee will distribute to each
Owner of the Class RL Certificates such Owner's Percentage Interest multiplied
by the amounts then available to be distributed to the Owners of the Class RL
Certificates. No significant distributions are anticipated to be made.
Upon receiving the final distribution hereon, the Owner hereof is required
to send this Certificate to the Trustee. The Pooling and Servicing Agreement
provides that, in any event, upon the making of the final distribution due on
this Certificate, this Certificate shall be deemed cancelled for all purposes
under the Pooling and Servicing Agreement.
The Trustee is required to duly and punctually pay distributions with
respect to this Certificate in accordance with the terms hereof and the Pooling
and Servicing Agreement. Amounts properly withheld under the Code or applicable
state or local law by any Person from a distribution to any Owner shall be
considered as having been paid by the Trustee to such Owner for all purposes of
the Pooling and Servicing Agreement.
Access Financial Lending Corp., as Master Servicer, pursuant to the Pooling
and Servicing Agreement will service the Mortgage Loans. The Pooling and
Servicing Agreement permits the Master Servicer to enter into Sub-Servicing
Agreements with certain institutions eligible for appointment as Sub-Servicers
for the servicing and administration of the Mortgage Loans. No appointment of
any Sub-Servicer shall release the Master Servicer from any of its obligations
under the Pooling and Servicing Agreement.
This Certificate does not represent a deposit or other obligation of, or an
interest in, nor are the underlying Mortgage Loans insured or guaranteed by,
Cargill Financial Services Corporation, Access Financial Lending Corp., Norwest
Bank Minnesota, National Association, any Sub-Servicer, or any of their
respective subsidiaries and affiliates and are not insured or guaranteed by the
Federal Deposit Insurance Corporation, the Government National Mortgage
Association, or any other governmental agency.
No Owner shall have any right to institute any proceeding, judicial or
otherwise, with respect to the Pooling
C-1-4
<PAGE>
<PAGE>
and Servicing Agreement, or for the appointment of a receiver or trustee, or for
any other remedy under the Pooling and Servicing Agreement except in compliance
with the terms thereof.
Notwithstanding any other provisions in the Pooling and Servicing
Agreement, the Owner of any Certificate shall have the right which is absolute
and unconditional to receive distributions to the extent provided in the Pooling
and Servicing Agreement with respect to such Certificate or to institute suit
for the enforcement of any such distribution, and such right shall not be
impaired without the consent of such Owner.
The Pooling and Servicing Agreement provides that the obligations created
thereby will terminate upon the earlier of (i) the payment to the Owners of all
Certificates of all amounts held by the Trustee and required to be paid to such
Owners pursuant to the Pooling and Servicing Agreement upon the later to occur
of (a) the final payment or other liquidation (or any advance made with respect
thereto) of the last Mortgage Loan in the Trust Estate or (b) the disposition of
all property acquired in respect of any Mortgage Loan remaining in the Trust
Estate or (ii) at any time when a Qualified Liquidation of the Upper-Tier REMIC
and the Lower-Tier REMIC is effected as described in the Pooling and Servicing
Agreement.
The Pooling and Servicing Agreement provides that the Seller may, at its
option, purchase from the Trust all (but not fewer than all) remaining Mortgage
Loans and other property then constituting the Trust Estate, and thereby effect
early retirement of the Certificates, on any Remittance Date when the aggregate
outstanding Principal Balance of the Mortgage Loans is ten percent or less of
the Original Pool Principal Balance. If the Seller declines to exercise such
option within ninety days following such date, the Trustee shall solicit bids
for the purchase of all Mortgage Loans remaining in the Trust. If satisfactory
bids are received as described in the Pooling and Servicing Agreement, the
Trustee shall effect early retirement of the Certificates. If satisfactory bids
are not received, the Trustee shall decline to sell the Mortgage Loans and shall
not be under any obligation to solicit any further bids or otherwise negotiate
any further sale of the Mortgage Loans. Such sale and consequent termination of
the Trust must constitute a "qualified liquidation" of each REMIC established by
the Trust under Section 860F of the Internal Revenue Code of 1986, as amended,
including, without limitation, the requirement that the qualified liquidation
takes place over a period not to exceed ninety days.
C-1-5
<PAGE>
<PAGE>
The Trustee shall give written notice of termination of the Pooling and
Servicing Agreement to each Owner in the manner set forth therein.
As provided in the Pooling and Servicing Agreement and subject to certain
limitations therein set forth and referred to on the face hereof, the transfer
of this Certificate is registrable in the Register upon surrender of this
Certificate for registration of transfer at the office designated as the
location of the Register duly endorsed by, or accompanied by a written
instrument of transfer in the form set forth in the Pooling and Servicing
Agreement duly executed by, the Owner hereof or his attorney duly authorized in
writing, and thereupon one or more new Certificates of like Class, tenor and a
like Percentage Interest will be issued to the designated transferee or
transferees.
The Trustee is required to furnish certain information on each Payment Date
to the Owner of this Certificate, as more fully described in the Pooling and
Servicing Agreement.
The Class RL Certificates are issuable only as registered Certificates. As
provided in the Pooling and Servicing Agreement and subject to certain
limitations therein set forth, Class RL Certificates are exchangeable for new
Class RL Certificates evidencing the same Percentage Interest as the Class RL
Certificates exchanged.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and neither
the Trustee or any such agent shall be affected by notice to the contrary.
C-1-6
<PAGE>
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed on behalf of the Trust.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, as Trustee
By:___________________________
Title:_____________________
Trustee's Authentication
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION,
as Trustee
By:__________________________
Title:_______________________
Dated: May 22, 1996
C-1-7
<PAGE>
<PAGE>
EXHIBIT C-2
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE ACT MAY BE MADE ONLY IN A TRANSACTION EXEMPT FROM
THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE PROVISIONS
OF SECTION 5.8 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION OR ANY OTHER GOVERNMENTAL AGENCY.
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN THE ONLY "RESIDUAL INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT" ("REMIC") AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTION 860G and
860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), ASSUMING
COMPLIANCE WITH THE REMIC PROVISIONS OF THE CODE.
TRANSFER OF THIS CLASS RU CERTIFICATE IS RESTRICTED AS SET FORTH IN THE
POOLING AND SERVICING AGREEMENT. NO TRANSFER OF THIS CLASS RU CERTIFICATE MAY BE
MADE TO A "DISQUALIFIED ORGANIZATION" AS DEFINED IN SECTION 860E(e)(5) OF THE
CODE. SUCH TERM INCLUDES 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 CERTAIN TAXABLE
INSTRUMENTALITIES), ANY COOPERATIVE ORGANIZATION FURNISHING ELECTRIC ENERGY OR
PROVIDING TELEPHONE SERVICE TO PERSONS IN RURAL AREAS, OR ANY ORGANIZATION
(OTHER THAN A FARMERS' COOPERATIVE) THAT IS EXEMPT FROM FEDERAL INCOME TAX
UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX ON UNRELATED BUSINESS INCOME. NO
TRANSFER OF THIS CLASS RU CERTIFICATE WILL BE REGISTERED BY THE TRUSTEE UNLESS
THE PROPOSED TRANSFEREE HAS DELIVERED AN AFFIDAVIT AFFIRMING, AMONG OTHER
THINGS, THAT THE PROPOSED TRANSFEREE IS NOT A DISQUALIFIED ORGANIZATION AND IS
NOT ACQUIRING THE CLASS RU CERTIFICATE FOR THE ACCOUNT OF A DISQUALIFIED
ORGANIZATION. A COPY OF THE FORM OF AFFIDAVIT REQUIRED OF EACH PROPOSED
TRANSFEREE IS ON FILE AND AVAILABLE FROM THE TRUSTEE.
A TRANSFER IN VIOLATION OF THE APPLICABLE RESTRICTIONS MAY GIVE RISE TO A
SUBSTANTIAL TAX UPON THE TRANSFEROR OR, IN CERTAIN CASES, UPON AN AGENT ACTING
FOR THE TRANSFEREE. A PASS-THRU ENTITY THAT HOLDS THIS CLASS RU CERTIFICATE AND
THAT HAS A DISQUALIFIED ORGANIZATION AS A RECORD OWNER IN ANY TAXABLE YEAR
GENERALLY WILL BE SUBJECT TO A TAX FOR EACH SUCH
<PAGE>
<PAGE>
YEAR EQUAL TO THE PRODUCT OF (A) THE AMOUNT OF EXCESS INCLUSIONS WITH RESPECT TO
THE PORTION OF THIS CERTIFICATE OWNED THROUGH SUCH PASS-THRU ENTITY BY SUCH
DISQUALIFIED ORGANIZATION, AND (B) THE HIGHEST MARGINAL FEDERAL TAX RATE ON
CORPORATIONS. FOR PURPOSES OF THE PRECEDING SENTENCE, THE TERM "PASS-THRU"
ENTITY INCLUDES REGULATED INVESTMENT COMPANIES, REAL ESTATE INVESTMENT TRUSTS,
COMMON TRUST FUNDS, PARTNERSHIPS, TRUSTS, ESTATES, COOPERATIVES TO WHICH PART I
OF SUBCHAPTER IT OF THE CODE APPLIES AND, EXCEPT AS PROVIDED IN REGULATIONS,
NOMINEES.
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-2
MORTGAGE LOAN PASS-THROUGH CERTIFICATE
CLASS RU
Representing Certain Interests Relating to a Pool of
Mortgage Loans Formed by
CARGILL FINANCIAL SERVICES CORPORATION
with
ACCESS FINANCIAL LENDING CORP.
as Master Servicer
(This Certificate does not represent an interest in, or an obligation of,
nor are the underlying Mortgage Loans insured or guaranteed by Cargill Financial
Services Corporation, Access Financial Lending Corp., Norwest Bank Minnesota,
National Association, any Sub-Servicer or any of their respective subsidiaries
and affiliates. This Certificate represents a fractional residual ownership
interest in the Upper-Tier REMIC described in the Pooling and Servicing
Agreement.)
No: RU-1 Date: May 22, 1996
Percentage Interest: 100% June 18, 2027
-------------
Final Scheduled
Payment Date
ACCESS FINANCIAL RECEIVABLES CORP.
- --------------------------------------------------------------------------------
Registered Owner
C-2-2
<PAGE>
<PAGE>
THIS CERTIFICATE IS A PASS-THROUGH CERTIFICATE ONLY AND, NOTWITHSTANDING
REFERENCES HEREIN TO PRINCIPAL AND INTEREST, NO DEBT OF ANY PERSON IS
REPRESENTED HEREBY.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION OR ANY OTHER GOVERNMENTAL AGENCY.
This Certificate is one of a Class of duly-authorized Certificates
designated as Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class RU (the "RU Certificates") and issued under and
subject to the terms, provisions and conditions of the Pooling and Servicing
Agreement, to which Pooling and Servicing Agreement the Owner of this
Certificate by virtue of acceptance hereof assents and by which such Owner is
bound. Also issued under the Pooling and Servicing Agreement are Certificates
designated as Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class A-1 Group I (the "Class A-1 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-2, 6.925% Mortgage
Loan Pass-Through Certificates, Class A-2 Group I (the "Class A-2 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-2, 7.300% Mortgage
Loan Pass-Through Certificates, Class A-3 Group I (the "Class A-3 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-2, 7.625% Mortgage
Loan Pass-Through Certificates, Class A-4 Group I (the "Class A-4 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-2, 7.925% Mortgage
Loan Pass-Through Certificates, Class A-5 Group I (the "Class A-5 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-2 Mortgage Loan
Pass-Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class B Group I Certificates (the "Class B Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class B Group II (the "Class B Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-2, Mortgage Loan
Pass-Through Certificates, Class BI-S (the "Class BI-S Certificates") and Class
BII-S (the "Class BII-S Certificates") and Access Financial Mortgage Loan Trust
1996-2 Mortgage Loan Pass-Through Certificates, Class RL (together with the
Class RU Certificates, the "Residual Certificates"). The Class A-1 Group I
Certificates, the Class A-2 Group I Certificates, the Class A-3 Group I
Certificates, the Class A-4 Group I Certificates, the Class A-5 Group I
Certificates, the Class A-6 Group II Certificates (collectively, the "Class A
Certificates"), the Class B Group I Certificates, the Class B Group II
Certificates, the Class BI-S Certificates, the Class BII-S Certificates and the
Residual Certificates are collectively referred to herein as the "Certificates."
C-2-3
<PAGE>
<PAGE>
Terms capitalized herein and not otherwise defined herein shall have the
respective meanings set forth in the Pooling and Servicing Agreement.
On the 18th day of each month, or, if such day is not a Business Day, then
the next succeeding Business Day (each such day being a "Payment Date"),
commencing June 18, 1996, to the Owners of the Class RU Certificates as of the
close of business on the first Business Day of the calendar month immediately
preceding the calendar month in which such Payment Date occurs (the "Record
Date"), the Trustee will distribute to each Owner of the Class RU Certificates
such Owner's Percentage Interest multiplied by the amounts then available to be
distributed to the Owners of the Class RU Certificates. No significant
distributions are anticipated to be made.
Upon receiving the final distribution hereon, the Owner hereof is required
to send this Certificate to the Trustee. The Pooling and Servicing Agreement
provides that, in any event, upon the making of the final distribution due on
this Certificate, this Certificate shall be deemed cancelled for all purposes
under the Pooling and Servicing Agreement.
The Trustee is required to duly and punctually pay distributions with
respect to this Certificate in accordance with the terms hereof and the Pooling
and Servicing Agreement. Amounts properly withheld under the Code or applicable
state or local law by any Person from a distribution to any Owner shall be
considered as having been paid by the Trustee to such Owner for all purposes of
the Pooling and Servicing Agreement.
Access Financial Lending Corp., as Master Servicer, pursuant to the Pooling
and Servicing Agreement will service the Mortgage Loans. The Pooling and
Servicing Agreement permits the Master Servicer to enter into Sub-Servicing
Agreements with certain institutions eligible for appointment as Sub-Servicers
for the servicing and administration of the Mortgage Loans. No appointment of
any Sub-Servicer shall release the Master Servicer from any of its obligations
under the Pooling and Servicing Agreement.
This Certificate does not represent a deposit or other obligation of, or an
interest in, nor are the underlying Mortgage Loans insured or guaranteed by,
Cargill Financial Services Corporation, Access Financial Lending Corp., Norwest
Bank Minnesota, National Association, any Sub-Servicer, or any of their
respective subsidiaries and affiliates and are not insured or guaranteed by the
Federal Deposit Insurance Corporation, the Government National Mortgage
Association, or any other governmental agency.
C-2-4
<PAGE>
<PAGE>
No Owner shall have any right to institute any proceeding, judicial or
otherwise, with respect to the Pooling and Servicing Agreement, or for the
appointment of a receiver or trustee, or for any other remedy under the Pooling
and Servicing Agreement except in compliance with the terms thereof.
Notwithstanding any other provisions in the Pooling and Servicing
Agreement, the Owner of any Certificate shall have the right which is absolute
and unconditional to receive distributions to the extent provided in the Pooling
and Servicing Agreement with respect to such Certificate or to institute suit
for the enforcement of any such distribution, and such right shall not be
impaired without the consent of such Owner.
The Pooling and Servicing Agreement provides that the obligations created
thereby will terminate upon the earlier of (i) the payment to the Owners of all
Certificates of all amounts held by the Trustee and required to be paid to such
Owners pursuant to the Pooling and Servicing Agreement upon the later to occur
of (a) the final payment or other liquidation (or any advance made with respect
thereto) of the last Mortgage Loan in the Trust Estate or (b) the disposition of
all property acquired in respect of any Mortgage Loan remaining in the Trust
Estate or (ii) at any time when a Qualified Liquidation of the Upper-Tier REMIC
and the Lower-Tier REMIC is effected as described in the Pooling and Servicing
Agreement.
The Pooling and Servicing Agreement provides that the Seller may, at its
option, purchase from the Trust all (but not fewer than all) remaining Mortgage
Loans and other property then constituting the Trust Estate, and thereby effect
early retirement of the Certificates, on any Remittance Date when the aggregate
outstanding Principal Balance of the Mortgage Loans is ten percent or less of
the Original Pool Principal Balance. If the Seller declines to exercise such
option within ninety days following such date, the Trustee shall solicit bids
for the purchase of all Mortgage Loans remaining in the Trust. If satisfactory
bids are received as described in the Pooling and Servicing Agreement, the
Trustee shall effect early retirement of the Certificates. If satisfactory bids
are not received, the Trustee shall decline to sell the Mortgage Loans and shall
not be under any obligation to solicit any further bids or otherwise negotiate
any further sale of the Mortgage Loans. Such sale and consequent termination of
the Trust must constitute a "qualified liquidation" of each REMIC established by
the Trust under Section 860F of the Internal Revenue Code of 1986, as amended,
including, without limitation, the requirement that the qualified liquidation
takes place over a period not to exceed ninety days.
C-2-5
<PAGE>
<PAGE>
The Trustee shall give written notice of termination of the Pooling and
Servicing Agreement to each Owner in the manner set forth therein.
As provided in the Pooling and Servicing Agreement and subject to certain
limitations therein set forth and referred to on the face hereof, the transfer
of this Certificate is registrable in the Register upon surrender of this
Certificate for registration of transfer at the office designated as the
location of the Register duly endorsed by, or accompanied by a written
instrument of transfer in the form set forth in the Pooling and Servicing
Agreement duly executed by, the Owner hereof or his attorney duly authorized in
writing, and thereupon one or more new Certificates of like Class, tenor and a
like Percentage Interest will be issued to the designated transferee or
transferees.
The Trustee is required to furnish certain information on each Payment Date
to the Owner of this Certificate, as more fully described in the Pooling and
Servicing Agreement.
The Class RU Certificates are issuable only as registered Certificates. As
provided in the Pooling and Servicing Agreement and subject to certain
limitations therein set forth, Class RU Certificates are exchangeable for new
Class RU Certificates evidencing the same Percentage Interest as the Class RU
Certificates exchanged.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Trustee and any agent of the Trustee may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and neither
the Trustee or any such agent shall be affected by notice to the contrary.
C-2-6
<PAGE>
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed on behalf of the Trust.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, as Trustee
By:___________________________
Title:_____________________
Trustee's Authentication
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION,
as Trustee
By:__________________________
Title:_______________________
Dated: May 22, 1996
C-2-7
<PAGE>
<PAGE>
EXHIBIT D
FORM OF TRANSFER CERTIFICATE
Norwest Bank Minnesota, National Association
Sixth Street & Marquette Avenue
Minneapolis, Minnesota 55343-9497
Attention: Corporate Trust Administration
Cargill Financial Services Corporation
6000 Clearwater Drive
Minnetonka, Minnesota 55343-9497
Attention: Corporate Capital Group
Access Financial Lending Corp.
12800 Whitewater Drive
Suite 200
Minnetonka, Minnesota 55343-4109
Attention: Operations
Ladies and Gentlemen:
The undersigned (the "Transferee") has agreed to purchase from
______________________ (the "Transferor") the following:
Class Number
----- ------
----- ------
----- ------
----- ------
----- ------
----- ------
A. Rule 144A "Qualified Institutional Buyers" should complete this section
I. The Transferee is (check one):
___ (i) An insurance company, as defined in Section 2(13) of the
Securities Act of 1933, as amended (the "Securities Act"), (ii)
an investment company registered under the Investment Company Act
of 1940, as amended (the "Investment Company Act"), (iii) a
business development company as defined in Section 2(a)(48) of
the Securities Act, (iv) a Small Business
<PAGE>
<PAGE>
Investment Company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958, as amended, (v) a plan established and
maintained by a state, its political subdivisions, or any agency
or instrumentality of a state or its political subdivisions, for
the benefit of its employees, (vi) an employee benefit plan
within the meaning of Title I of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), (vii) a business
development company as defined in Section 202(a)(22) of the
Investment Advisors Act of 1940, as amended, (viii) an
organization described in Section 501(c)(3) of the Internal
Revenue Code, corporation (other than a bank as defined in
Section 3(a)(2) of the Securities Act or a savings and loan
association or other institution referenced in Section 3(a)(2) of
the Securities Act or a foreign bank or savings and loan
association or equivalent institution), partnership, or
Massachusetts or similar business trust; or (ix) an investment
advisor registered under the Investment Advisors Act of 1940, as
amended, which, for each of (i) through (ix), owns and invests on
a discretionary basis at least $100 million in securities other
than securities of issuers affiliated with the Transferee,
securities issued or guaranteed by the United States or a person
controlled or supervised by and acting as an instrumentality of
the government of the United States pursuant to authority granted
by the Congress of the United States, bank deposit notes and
certificates of deposit, loan participations, repurchase
agreements, securities owned but subject to a repurchase
agreement, and currency, interest rate and commodity swaps
(collectively, "Excluded Securities");
___ a dealer registered pursuant to Section 15 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") that in the
aggregate owns and invests on a discretionary basis at least $10
D-2
<PAGE>
<PAGE>
million of securities other than Excluded Securities and
securities constituting the whole or part of an unsold allotment
to, or subscription by, Transferee as a participant in a public
offering;
___ an investment company registered under the Investment Company Act
that is part of a family of investment companies (as defined in
Rule 144A of the Securities and Exchange Commission) which own in
the aggregate at least $100 million in securities other than
Excluded Securities and securities of issuers that are part of
such family of investment companies;
___ an entity, all of the equity owners of which are entities
described in this Paragraph A(I);
___ a bank as defined in Section 3(a)(2) of the Securities Act, any
savings and loan association or other institution as referenced
in Section 3(a)(5)(A) of the Securities Act, or any foreign bank
or savings and loan association or equivalent institution that in
the aggregate owns and invests on a discretionary basis at least
$100 million in securities other than Excluded Securities and has
an audited net worth of at least $25 million as demonstrated in
its latest annual financial statements, as of a date not more
than 16 months preceding the date of transfer of the Certificates
to the Transferee in the case of a U.S. Bank or savings and loan
association, and not more than 18 months preceding such date in
the case of a foreign bank or savings association or equivalent
institution.
II. The Transferee is acquiring such Certificates solely for its own
account, for the account of one or more others, all of which are "Qualified
Institutional Buyers" within the meaning of Rule 144A, or in its capacity as a
dealer registered pursuant to Section 15 of the Exchange Act acting in a
riskless principal transaction on behalf of a "Qualified Institutional Buyer".
The Transferee is not acquiring such Certificates with a view to or for the
resale, distribution, subdivision or fractionalization thereof which would
require registration of the Certificates under the Securities Act.
D-3
<PAGE>
<PAGE>
B. "Accredited Investors" should complete this Section
I. The Transferee is (check one):
___ a bank within the meaning of Section 3(a)(2) of the Securities
Act;
___ a savings and loan association or other institution defined in
Section 3(a)(5) of the Securities Act;
___ a broker or dealer registered pursuant to the Exchange Act;
___ an insurance company within the meaning of Section 2(13) of the
Securities Act;
___ an investment company registered under the Investment Company
Act;
___ an employee benefit plan within the meaning of Title I of ERISA,
which has total assets in excess of $5,000,000;
___ another entity which is an "accredited investor" within the
meaning of paragraph (fill in) of subsection (a) of Rule 501 of
the Securities and Exchange Commission.
II. The Transferee is acquiring such Certificates solely for its own
account, for investment, and not with a view to or for the resale, distribution,
subdivision or fractionalization thereof which would require registration of the
Certificates under the Securities Act.
C. If the Transferee is unable to complete one of paragraph A(I) or
paragraph B(I) above and is not a designated PORTAL depository organization, the
Transferee must furnish an opinion in form and substance satisfactory to the
Trustee of counsel satisfactory to the Trustee to the effect that such purchase
will not violate any applicable federal or state securities laws.
D. The Transferee represents that either (a) it is not (i) an employee
benefit plan (as defined in section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA")) subject to the provisions of Title I
of ERISA, (ii) a plan described in section 4975(e)(l) of the Internal Revenue
Code of 1986, or (iii) an entity whose underlying assets are deemed to be assets
of a plan described in (i) or (ii) above by reason so such plan's investment in
D-4
<PAGE>
<PAGE>
the entity (any such entity described in clauses (i) through (iii), a "Benefit
Plan Entity")* or (b) it is an insurance company general account and, pursuant
to Section I of Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60"), the
acquisition and holding of the Class A Certificates and, pursuant to Section III
of PTCE 95-60, the servicing, management and operation of the Trust are with
respect to such Purchaser exempt form the "prohibited transaction" provisions of
ERISA and the Code or (c) if the Purchaser is a Benefit Plan Entity, the
following:
(i) the Purchaser is not a Benefit Plan Entity with respect to an employee
benefit plan sponsored by any member of the Restricted Group (as defined in the
Private Placement Memorandum);
(ii) either (A) the person who has discretionary authority or renders
investment advice to the Purchaser with respect to the investment of plan assets
in the Class A Certificates is not an Obligor (or an affiliate) with respect to
the Mortgage Loans (as defined in the Prospectus), or (B) the person who has
such discretionary authority or renders such investment advice is an Obligor (or
an affiliate) with respect to less than 5 percent of the Receivables; and,
immediately after the acquisition of the Class A Certificates, no more than 25
percent of the assets of the Purchaser are invested in certificates representing
an interest in a trust containing assets sold or serviced by the same entity;
and
(iii) the purchaser is an "accredited investor" as defined in Rule 501(a)
of Regulation D pursuant to the 1933 Act.
Very truly yours,
- --------
* Do not include option (b) or (c) for acquisitions or transfers of a class of
Certificates which has not been placed or underwritten by an entity which has an
Underwriter Exemption (as described in Prohibited Transaction Class Exception
95-60) and do not include option (c) for acquisitions or transfers of
Certificates that (i) evidence rights and interests that are subordinated to the
rights and interests evidenced by other Certificates of the Trust, or (ii) occur
at any time during which the Certificates being acquired or transferred are not
rated in one of the top three rating categories of any rating agency that
satisfies the requirements of Prohibited Transaction Exemption 89-90 and that
(a) is rating the Certificates as of the date hereof and (b) has been requested
by the issuer of the Certificates to rate the Certificates.
D-5
<PAGE>
<PAGE>
By: ________________________________
Title: _____________________________
Dated: _______________________
D-6
<PAGE>
<PAGE>
EXHIBIT E
FORM OF RESIDUAL CERTIFICATE
TAX MATTERS TRANSFER CERTIFICATE
AFFIDAVIT PURSUANT TO SECTION
860(e) OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED
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 Investor] (the "Investor"), a
[savings institution] [corporation] duly organized and existing under the laws
of [the State of __________] [the United States], on behalf of which he makes
this affidavit.
2. That (i) the Investor is not a "disqualified organization" and will not
be a "disqualified organization" as of [date of transfer] (For this purpose, 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 certain taxable
instrumentalities), any cooperative organization furnishing electric energy or
providing telephone service to persons in rural areas, or any organization
(other than a farmers' cooperative) that is exempt from federal income tax
unless such organization is subject to the tax on unrelated business income);
(ii) it is not acquiring the Class RU [RL] Certificate for the account of a
disqualified organization; (iii) it consents to any amendment of the Pooling and
Servicing Agreement dated as of May 1, 1996 among Cargill Financial Services
Corporation, as Sponsor, Access Financial Lending Corp., as Seller and Master
Servicer, and Norwest Bank Minnesota, National Association, as Trustee that
shall be deemed necessary by the Trustee (upon advice of counsel) to constitute
a reasonable arrangement to ensure that the Class RU [RL] Certificates will not
be owned directly or indirectly by a disqualified organization; and (iv) it will
not transfer such Class RU [RL] Certificate unless (a) it has received from the
transferee an affidavit in substantially the same form as this affidavit
containing these same four representations and (b) as of the time of the
<PAGE>
<PAGE>
transfer, it does not have actual knowledge that such affidavit is false.
IN WITNESS WHEREOF, the Investor has caused this instrument to be executed
on its behalf, pursuant to authority of its Board of Directors, by its [Title of
Officer] and its corporate seal to be hereunto attached, attested by its
[Assistant] Secretary, this ____ day of __________, ____.
[NAME OF INVESTOR]
By: ________________________
[Name of Officer]
[Title of Officer]
[Corporate Seal]
Attest:
_________________________
[Assistant] Secretary
Personally appeared before me the above-named [Name of Officer], known or
proved to be the same person who executed the foregoing instrument and to be the
[Title of Officer] of the Investor, and acknowledged to me that he executed the
same as his free act and deed and the free act and deed of the Investor.
Subscribed and sworn before me this ____ day of __________, ____.
_________________________
NOTARY PUBLIC
COUNTY OF _______________
STATE OF ________________
My commission expires the ____ day of ____________, ____.
E-2
<PAGE>
<PAGE>
EXHIBIT F
FORM OF MASTER SERVICER'S TRUST RECEIPT
To: Norwest Bank Minnesota, National Association
Sixth Avenue & Marquette Street
Minneapolis, Minnesota 55479-0069
Attn: Corporate Trust
Date:
In connection with the administration of the mortgage loans serviced by
Access Financial Lending Corp. (the "Master Servicer") pursuant to a Pooling and
Servicing Agreement dated as of May 1, 1996 (the " Pooling and Servicing
Agreement") by and among the Master Servicer, you, as Trustee, Cargill Financial
Services Corporation, as Sponsor, and Access Financial Lending Corp., in its
capacity as Seller, the Master Servicer hereby requests a release of the File
held by you as Trustee with respect to the following described Mortgage Loan for
the reason indicated below.
Mortgagor's Name:
Loan No.:
Reason for requesting file:
_____ 1. Mortgage Loan paid in full.
(The Master Servicer hereby certifies that all amounts
received in connection with the loan and required to be
remitted to the Trustee have been or will be remitted to the
Trustee pursuant to the Pooling and Servicing Agreement.)
_____ 2. Mortgage Loan repurchased pursuant to Section 3.2,
3.3 or 3.4(b) of the Pooling and Servicing
Agreement.
_____ 3. Mortgage Loan substituted.
(The Master Servicer hereby certifies that a Qualified
Replacement Mortgage has been or will be assigned and
delivered to you along with the related File pursuant to the
Pooling and Servicing Agreement.)
_____ 4. The Mortgage Loan is being foreclosed.
_____ 5. Other. (Describe)
<PAGE>
<PAGE>
The undersigned acknowledges that the above File will be held by the
undersigned in accordance with the provisions of the Pooling and Servicing
Agreement and will be returned to you, except (i) if the Mortgage Loan has been
paid in full, or repurchased or substituted by a Qualified Replacement Mortgage
(in which case the File will be retained by us permanently) or (ii) except if
the Mortgage Loan is being foreclosed (in which case the File will be returned
when no longer required by us for such purpose).
Capitalized terms used herein shall have the meanings ascribed to them in
the Pooling and Servicing Agreement.
ACCESS FINANCIAL LENDING CORP.
By______________________________
Name:_________________________
Title:________________________
The Trustee hereby acknowledges
the above request.
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
By:_________________________________________
Name:
Title:
<PAGE>
<PAGE>
EXHIBIT G
[RESERVED]
<PAGE>
<PAGE>
EXHIBIT H
FORM OF DELIVERY ORDER
May 22, 1996
Norwest Bank Minnesota, National
Association, as Trustee
Sixth Street & Marquette Avenue
Minneapolis, Minnesota 55479-0069
Attention: ______________
Dear Sirs:
Pursuant to Article IV of the Pooling and Servicing Agreement, dated as of
May 1, 1996 (the "Pooling and Servicing Agreement"), by and among Cargill
Financial Services Corporation, as sponsor (the "Sponsor"), Access Financial
Lending Corp., as seller (the "Seller") and master servicer, and Norwest Bank
Minnesota, National Association, as trustee (the "Trustee"), the Sponsor HEREBY
CERTIFIES that all conditions precedent to the issuance of Access Financial
Mortgage Loan Trust 1996-2 Mortgage Loan Pass-Through Certificates, Series
1996-2, Class A-1 Group I, Class A-2 Group I, Class A-3 Group I, Class A-4 Group
I, Class A-5 Group I, Class A-6 Group II, Class B Group I, Class B Group II,
Class RL and Class RU (the "Certificates"), HAVE BEEN SATISFIED and HEREBY
REQUESTS YOU TO AUTHENTICATE AND DELIVER said Certificates, and to RELEASE said
Certificates to the Sponsor thereof, or otherwise upon their order.
Very truly yours,
CARGILL FINANCIAL SERVICES
CORPORATION
By:________________________
Name:
Title:
<PAGE>
<PAGE>
EXHIBIT I
[RESERVED]
<PAGE>
<PAGE>
EXHIBIT J
FORM OF CERTIFICATE REGARDING PREPAID LOANS
I, _________________, _____________ of Access Financial Lending Corp., a
Delaware corporation, (the "Seller"), hereby certify that between the "Cut-Off
Date" (as defined in the Pooling and Servicing Agreement, dated as of May 1,
1996, among Access Financial Lending Corp., as seller (the "Seller") and master
servicer, Cargill Financial Services Corporation, as sponsor (the "Sponsor"),
and Norwest Bank Minnesota, National Association, as trustee (the "Trustee") and
the "Startup Day" the attached schedule of "Mortgage Loans" (each as defined in
the Pooling and Servicing Agreement) has been prepaid in full.
Dated: May 22, 1996
By:___________________________
Name:
Title:
<PAGE>
<PAGE>
EXHIBIT K
TRUSTEE'S ACKNOWLEDGEMENT OF RECEIPT
Norwest Bank Minnesota, National Association, a national banking
association, in its capacity as trustee (the "Trustee") under that certain
Pooling and Servicing Agreement, dated as of May 1, 1996 (the "Pooling and
Servicing Agreement"), by and among Cargill Financial Services Corporation, as
sponsor (the "Sponsor"), Access Financial Lending Corp., as seller (the
"Seller") and master servicer, and the Trustee, hereby acknowledges receipt of
the items delivered to it by the Seller with respect to the Mortgage Loans
relating to Access Financial Mortgage Loan Trust 1996-2 of the Pooling and
Servicing Agreement.
The Mortgage Loan Schedule relating to Access Financial Mortgage Loan Trust
1996-2 is attached to this Receipt.
The Trustee hereby additionally acknowledges that it shall review such
items as required by Section 3.4 of the Pooling and Servicing Agreement and
shall otherwise comply with Section 3.4 of the Pooling and Servicing Agreement
as required thereby.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Trustee
By:________________________
Name:
Title:
Dated: May 22, 1996
<PAGE>
<PAGE>
EXHIBIT L
FORM OF INTERIM TRUSTEE CERTIFICATION
[DATE]
Cargill Financial Services
Corporation
6000 Clearwater Drive
Minnetonka, Minnesota 55343-9497
Attention: Corporate Capital Group
Access Financial Lending Corp.
12800 Whitewater Drive
Suite 200
Minnetonka, Minnesota 55343-4109
Attention: Operations
Prudential Securities Incorporated
One New York Plaza, 15th Floor
New York, New York 10292-2015
Attention: Asset-Backed Finance Group
J.P. Morgan Securities Inc.
60 Wall Street, 18th Floor
New York, New York 10260-0060
Financial Guaranty Insurance Company
115 Broadway
New York, New York 10006
RE: Pooling and Servicing Agreement, dated as of May 1, 1996,
among Cargill Financial Services Corporation, as sponsor,
Access Financial Lending Corp., as seller and master servicer,
and Norwest Bank Minnesota, National Association, as trustee
Ladies and Gentlemen:
In accordance with Section 3.4 of the above-captioned Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), the undersigned, as trustee
(the "Trustee"), hereby certifies that, as to each Mortgage Loan listed in the
Mortgage Loan Schedule relating to Access Financial Mortgage Loan Trust 1996-2
(except with respect to the Mortgage Loans, if any, listed in the attached
schedule), that:
<PAGE>
<PAGE>
(i) all documents required to be delivered to it are in the Trustee's
possession;
(ii) the Mortgage Note bears an original of an endorsement to the Trustee
purportedly from the original payee (or a set of original endorsements
evidencing a complete chain of title from the original payee to the
Trustee);
(iii) such documents have been reviewed by it and relate to such Mortgage
Loan; and
(iv) based upon such review, the information set forth in items (i)-(vi) of
Section 3.4(a) of the Pooling and Servicing Agreement as they relate
to the Mortgage Loan Schedule accurately reflects the information in
the Mortgage Files.
The Trustee, based on its examination of the Mortgage Loan Files, also
hereby confirms that, as to each Mortgage Loan listed in the Mortgage Loan
Schedule (except as listed in the attached schedule), that:
(i) each Mortgage Note and Mortgage bears an original signature or
signatures purporting to be that of the person named as the maker and
mortgagor/trustor;
(ii) the principal amount of the indebtedness secured by the Mortgage is
identical to the original principal amount of the Mortgage Note;
(iii) the assignment of Mortgage to the Trustee is in the form required by
this Agreement and bears a signature that purports to be the signature
of an authorized officer of the Servicer;
(iv) if intervening assignments are included in the Mortgage Loan File,
each such intervening assignment bears a signature that purports to be
the signature of the mortgagee/beneficiary and/or the assignee;
(v) if either a title insurance policy or a preliminary title report or a
commitment to issue a title policy is delivered, the address of the
real property set forth in such policy, report or commitment is
identical the real property address contained in the Mortgage;
L-2
<PAGE>
<PAGE>
(vi) if either a title insurance policy or a preliminary title report or a
commitment to issue a title policy is delivered, such policy or
written commitment is for an amount equal to the original principal
amount of the Note; and
(vii) it has received an original recorded Mortgage and assignment, in each
case, with evidence of recordation thereon or a copy thereof certified
to be true and correct by the public recording office in possession of
such Mortgage and assignment.
The Trustee has made no independent examination of any documents contained
in each Mortgage File beyond the review specifically required in the Pooling and
Servicing Agreement. The Trustee makes no representation as to: (i) the
validity, legality, sufficiency, enforceability or genuineness of any of the
documents contained in each such Mortgage File or any of the Mortgage Loans
identified on said Mortgage Loan Schedule, or (ii) the collectibility,
insurability, effectiveness or suitability of any such Mortgage Loan.
Capitalized words and phrases used but not defined herein shall have the
respective meanings ascribed to them in the Pooling and Servicing Agreement.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
By:
Name:
Title:
L-3
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EXHIBIT M
FORM OF FINAL TRUSTEE CERTIFICATION
[DATE]
Cargill Financial Services
Corporation
6000 Clearwater Drive
Minnetonka, Minnesota 55343-9497
Attention: Corporate Capital Group
Access Financial Lending Corp.
12800 Whitewater Drive
Suite 200
Minnetonka, Minnesota 55343-4109
Attention: Operations
Prudential Securities Incorporated
One New York Plaza, 15th Floor
New York, New York 10292-2015
Attention: Asset-Backed Finance Group
J.P. Morgan Securities Inc.
60 Wall Street, 18th Floor
New York, New York 10260-0060
Financial Guaranty Insurance Company
115 Broadway
New York, New York 10006
Re: Pooling and Servicing Agreement, dated as of May 1, 1996,
among Cargill Financial Services Corporation, as sponsor,
Access Financial Lending Corp., as seller and master servicer,
and Norwest Bank Minnesota, National Association, as trustee
Ladies and Gentlemen:
In accordance with Section 3.4 of the above-captioned Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), the undersigned, as trustee
(the "Trustee"), hereby certifies that, as to each Mortgage Loan listed in the
Mortgage Loan Schedule relating to Access Financial Mortgage Loan Trust 1996-2
(except with respect to the Mortgage Loans, if any, listed in the attached
schedule), that:
(i) all documents required to be delivered to it are in the Trustee's
possession;
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(ii) the Mortgage Note bears an original of an endorsement to the Trustee
purportedly from the original payee (or a set of original endorsements
evidencing a complete chain of title from the original payee to the
Trustee);
(iii) such documents have been reviewed by it and relate to such Mortgage
Loan; and
(iv) based upon such review, the information set forth in items (i)-(vi) of
Section 3.4(a) of the Pooling and Servicing Agreement as they relate
to the Mortgage Loan Schedule accurately reflects the information in
the Mortgage Files.
The Trustee, based on its examination of the Mortgage Loan Files, also
hereby confirms that, as to each Mortgage Loan listed in the Mortgage Loan
Schedule (except as listed in the attached schedule), that:
(i) each Mortgage Note and Mortgage bears an original signature or
signatures purporting to be that of the person named as the maker and
mortgagor/trustor;
(ii) the principal amount of the indebtedness secured by the Mortgage is
identical to the original principal amount of the Mortgage Note;
(iii) the assignment of Mortgage to the Trustee is in the form required by
this Agreement and bears a signature that purports to be the signature
of an authorized officer of the Servicer;
(iv) if intervening assignments are included in the Mortgage Loan File,
each such intervening assignment bears a signature that purports to be
the signature of the mortgagee/beneficiary and/or the assignee;
(v) if either a title insurance policy or a preliminary title report or a
commitment to issue a title policy is delivered, the address of the
real property set forth in such policy, report or commitment is
identical the real property address contained in the Mortgage;
(vi) if either a title insurance policy or a preliminary title report or a
commitment to issue a title policy is delivered, such policy
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or written commitment is for an amount equal to the original principal
amount of the Note; and
(vii) it has received an original recorded Mortgage and assignment, in each
case, with evidence of recordation thereon or a copy thereof certified
to be true and correct by the public recording office in possession of
such Mortgage and assignment.
The Trustee has made no independent examination of any documents contained
in each Mortgage File beyond the review specifically required in the Pooling and
Servicing Agreement. The Trustee makes no representation as to: (i) the
validity, legality, sufficiency, enforceability or genuineness of any of the
documents contained in each such Mortgage File or any of the Mortgage Loans
identified on said Mortgage Loan Schedule, or (ii) the collectibility,
insurability, effectiveness or suitability of any such Mortgage Loan.
Capitalized words and phrases used but not defined herein shall have the
respective meanings ascribed to them in the Pooling and Servicing Agreement.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
By:
Name:
Title:
M-3
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EXHIBIT N
AUCTION PROCEDURES
I. Pre-Auction Process
a. If by the ninetieth day following the Seller's optional
termination date pursuant to Section 9.02 of the Pooling and
Servicing Agreement, the Seller has not exercised such option,
then a plan of complete liquidation with respect to the Mortgage
Loans will be adopted by the Trustee in order to satisfy REMIC
requirements, and the Trustee will notify Prudential Securities
Incorporated (or, if Prudential Securities Incorporated is unable
or unwilling to so act, another investment banking or whole-loan
trading firm selected by the Seller (Prudential Securities
Incorporated or such other investment bank or trading firm, the
"Advisor")), as Advisor of the assets of the proposed auction.
b. Upon receiving notice of the proposed auction, the Advisor will
initiate its general auction procedures consisting of the
following: (i) with the assistance of the Seller, prepare a
general solicitation package along with a confidentiality
agreement; (ii) prepare a list of qualified bidders, in a
commercially reasonable manner; (iii) initiate contact with all
qualified bidders; (iv) send a confidentiality agreement to all
qualified bidders; (v) upon receipt of a signed confidentiality
agreement, send solicitation packages to all interested bidders
on behalf of the Trustee; and (vi) notify the Seller of all
potential bidders and anticipated timetable.
c. The general solicitation package will include: (i) the prospectus
from the public offering of the Class A Certificates
("Prospectus"); (ii) a copy of all monthly servicing reports or a
copy of all annual servicing reports and, upon a written request,
the prior years' monthly servicing reports; (iii) a form of a
purchase and sale agreement and servicing agreement for such
sale; (iv) a description of the minimum purchase price required
to cause the Trustee to sell the Mortgage Loans as set forth in
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Section 8.3 of the Pooling and Servicing Agreement; (v) a formal
bidsheet; (vi) a detailed timetable; and (vii) a preliminary data
tape of the Mortgage Loans as of the most recent Payment Date
reflecting the same data attributes used to create the original
Cut-Off Date tables for the Prospectus.
d. The Advisor will send solicitation packages to all bidders no
later than the Payment Date preceding the date of the auction,
which date shall be fifteen (15) Business Days before a Payment
Date (the "Auction Date"). Bidders will be required to submit any
due diligence questions in writing to the Advisor, for
determination of their relevancy, no later than ten (10) Business
Days before the Auction Date. The Seller and the Advisor will be
required to satisfy all relevant questions at least five (5)
Business Days prior to the Auction Date and distribute the
questions and answers to all bidders.
II. Auction Process
a. The Advisor will be allowed to bid in the auction, but will not
be required to do so.
b. The Seller will also be allowed to bid in the auction if it deems
appropriate, but will not be required to do so.
c. On the Auction Date, all bids will be due by facsimile to such
office as shall be designated by the Trustee by 1:00 p.m. EST;
with the winning bidder to be notified by 2:00 p.m. EST. All
acceptable bids (as described in Section 8.3 of the Pooling and
Servicing Agreement) will be due on a conforming basis on the bid
sheet contained in the solicitation package.
d. If the Trustee receives fewer than two market value bids from
competitive participants in the home equity loan market, the
Trustee may, following consultation with the Advisor and the
Seller, decline to consummate the sale.
e. Upon notification to the winning bidder, a one percent (1%) good
faith deposit of the aggregate balance of the unpaid principal
balances of the Mortgage Loans as of the last
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day of the preceding Remittance Period will be required to be
wired to the Trustee upon acceptance of the bid. This deposit,
along with any interest income attributable to it, will be
credited to the purchase price, but will not be refundable. The
Trustee will establish a separate account for the acceptance of
the good faith deposit, until such time as the account is fully
funded and all monies are transferred into the Certificate
Account, such time not to exceed one (1) Business Day before the
final Payment Date.
f. The winning bidder will receive on the Auction Date a copy of the
draft purchase and sale agreement and servicing agreement.
g. The Advisor will provide to the Trustee a letter concluding
whether or not the winning bid is a fair market value bid. The
Advisor will also provide this letter if it is the winning
bidder. In the case where the Advisor (or the Seller) is the
winning bidder, it will provide in its letter for market
comparables and valuations.
h. The auction will stipulate that the Master Servicer or a
successor Master Servicer be retained to service the Mortgage
Loans sold pursuant to the terms of the purchase and sale
agreement and the servicing agreement.
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EXHIBIT O
FORM OF TRUSTEE REQUEST
FOR INTEREST ADVANCES
Access Financial Receivables Corp.
1110 Abernathy Road, Suite 1205
Atlanta, Georgia 30328
Re: Pooling and Servicing Agreement, dated as of May 1, 1996,
among Cargill Financial Services Corporation, as sponsor,
Access Financial Lending Corp., as seller and master servicer,
and Norwest Bank Minnesota, National Association, as trustee
Ladies and Gentlemen:
In accordance with Section 7.9 of the above-captioned Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), the undersigned, as trustee
(the "Trustee"), hereby requests payment of the following amount representing
the Class A-6 Formula Interest Shortfall:
$_________________
Capitalized words and phrases used but not defined herein shall have the
respective meanings ascribed to them in the Pooling and Servicing Agreement.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
By:_______________________
Name:
Title:
Dated:
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EXECUTION COPY
INDEMNIFICATION AGREEMENT
This Agreement, dated as of May 1, 1996, is by and among Financial Guaranty
Insurance Company (the "Insurer"), as the Insurer under the certificate guaranty
surety bond (the "Policy") to be issued in connection with the Certificates
described below, Cargill Financial Services Corporation (the "Sponsor"), Access
Financial Lending Corp. (the "Seller"), Prudential Securities Incorporated
("Prudential") and J.P. Morgan Securities Inc. ("J.P. Morgan", together with
Prudential, the "Underwriters").
1. Definitions. As used in this Agreement, the following terms shall have
the respective meanings stated below:
"Act" means the Securities Act of 1933, as amended, together with all
related rules and regulations.
"Agreement" means this Indemnification Agreement by and among the
Insurer, the Sponsor, the Seller and the Underwriters.
"Certificates" means the Access Financial Mortgage Loan Pass-Through
Certificates, Series 1996-2, Class A-1 Group I, Class A-2 Group I, Class
A-3 Group I, Class A-4 Group I, Class A-5 Group I and Class A-6 Group II,
Class B Group I, Class B Group II, Class RL and Class RU issued pursuant to
a Pooling and Servicing Agreement (the "Pooling and Servicing Agreement")
dated as of May 1, 1996 among the Sponsor, the Seller, Access Financial
Lending Corp., as Master Servicer, and Norwest Bank Minnesota, National
Association, as Trustee.
"Class A Certificates" means the Access Financial Mortgage Loan
Pass-Through Certificates, Series 1996-2, Class A-1 Group I, Class A-2
Group I, Class A-3 Group I, Class A-4 Group I, Class A-5 Group I, and Class
A-6 Group II, issued pursuant to the Pooling and Servicing Agreement.
"Indemnified Party" means any party entitled to any indemnification
pursuant to Section 6 below, as the context requires.
"Indemnifying Party" means any party required to provide
indemnification pursuant to Section 6 below, as the context requires.
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"Insurance Agreement" means the Insurance Agreement dated as of May 1,
1996 between the Insurer and the Seller.
"Insurer Party" means the Insurer and each of its parents,
subsidiaries and affiliates, if any, and any shareholder, director,
officer, employee, agent or any "controlling person" (as such term is used
in the Act) of any of the foregoing.
"J.P. Morgan Party" means J.P. Morgan and its parents, subsidiaries
and affiliates, if any, and any shareholder, director, officer, employee,
agent or "controlling person" (as such term is used in the Act) of any of
the foregoing.
"Losses" means (i) any actual out-of-pocket loss paid by the party
entitled to indemnification or contribution hereunder, and (ii) any actual
out-of-pocket costs and expenses paid by such party, including reasonable
fees and expenses of its counsel, to the extent not paid, satisfied or
reimbursed from funds provided by any other Person (provided that the
foregoing shall not create or imply any obligation to pursue recourse
against any such other Person).
"Person" means any individual, partnership, joint venture,
corporation, trust or unincorporated organization or any government or
agency or political subdivision thereof.
"Prospectus" means the form of final Prospectus, dated October 19,
1995 as supplemented by the Prospectus Supplement included in the
Registration Statement on each date that the Registration Statement and any
post-effective amendment or amendments thereto became effective.
"Prospectus Supplement" means the form of final Prospectus Supplement,
dated May 15, 1996 relating to the offer and sale of the Class A
Certificates.
"Prudential Party" means Prudential and its parents, subsidiaries and
affiliates, if any, and any shareholder, director, officer, employee, agent
or "controlling person" (as such term is used in the Act) of any of the
foregoing.
"Registration Statement" means the registration statement on Form S-3
of the Sponsor (Registration No. 33-96500) relating to the Certificates in
the form in which it has become effective.
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"Seller Offering Materials" means the Prospectus Supplement except for
(x) the information set forth under the caption "The Sponsor" therein and
(y) the Underwriter Information.
"Seller Party" means the Seller, each of its parents, subsidiaries and
affiliates, if any, and any shareholder, director, officer, employee, agent
or any "controlling person" (as such term is used in the Act) of any of the
foregoing.
"Sponsor Offering Materials" means, collectively, the Registration
Statement, the Base Prospectus and the information set forth under the
caption "The Sponsor" in the Prospectus Supplement.
"Sponsor Party" means the Sponsor, each of its parents, subsidiaries
and affiliates, if any, and any shareholder, director, officer, employee,
agent or any "controlling person" (as such term is used in the Act) of any
of the foregoing.
"Sponsorship Agreement" means the Securitization Sponsorship Agreement
dated as of May 1, 1996 between the Sponsor and the Seller.
"State Securities Law" means any state, local or foreign statute, and
any rule or regulation thereunder, regulating (i) transactions and dealings
in securities, (ii) any person or entity engaging in such transactions or
advising with respect to securities or (iii) investment companies.
"Underwriter Information" means the information set forth under the
caption "Underwriting" in the Prospectus Supplement and any information in
the Prospectus Supplement relating to any potential market-making,
over-allotment or price stabilization activities of the Underwriters.
"Underwriting Agreement" means the Underwriting Agreement by and among
the Sponsor, the Seller and the Underwriters, dated as of May 15, 1996.
2. Representations and Warranties of the Insurer. The Insurer represents
and warrants to the Underwriters, the Sponsor and the Seller as follows:
(a) Organization and Licensing. The Insurer is a duly incorporated and
existing New York stock insurance company licensed to do business in the
State of New York.
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(b) Corporate Power. The Insurer has the corporate power and authority
to issue the Policy and execute and deliver this Agreement and to perform
all of its obligations hereunder and thereunder.
(c) Authorization; Approvals. The issuance of the Policy and the
execution, delivery and performance of this Agreement have been duly
authorized by all necessary corporate proceedings. No further approvals or
filings of any kind, including, without limitation, any further approvals
of or further filing with any governmental agency or other governmental
authority, or any approval of the Insurer's board of directors or
stockholders, are necessary for the Policy and this Agreement to constitute
the legal, valid and binding obligations of the Insurer.
(d) No Conflicts. The execution and delivery of this Agreement and
consummation of the transactions contemplated hereunder will not result in
the breach of any terms or provisions of the certificate of incorporation
or by-laws of the Insurer, or result in the breach of a term or provision
of, or conflict with or constitute a default under or result in the
acceleration of any obligation under, any material agreement or other
material instrument to which the Insurer or its property is subject, or
result in the violation of any law, rule, regulation, order, judgment or
decree to which the Insurer or any of its property is subject or result in
the creation of any lien on any of the Insurer's assets or property (other
than pursuant to this Agreement).
(e) Enforceability. The Policy, when issued, and this Agreement, will
each constitute a legal, valid and binding obligation of the Insurer,
enforceable in accordance with its terms subject to applicable laws
affecting the enforceability of creditors' rights generally and general
principles of equity.
(f) Financial Information. The balance sheets of the Insurer as of
December 31, 1994 and December 31, 1995 and the related statements of
income, stockholders' equity and cash flows for the fiscal years then
ended, and the accompanying footnotes, together with an opinion thereon
dated January 19, 1996 of KPMG Peat Marwick, independent certified public
accountants, a copy of which is attached as Appendix A to the Prospectus
Supplement (the "Insurer Financial Statements"), fairly present in all
material respects the financial condition of the Insurer as of such dates
and for the periods covered by such statements in accordance with generally
accepted accounting principles consistently applied, and, since December
31, 1995, there has been no material change in such financial condition of
the Insurer which would
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materially and adversely affect its ability to perform its obligations
under the Policy.
(g) Insurer Information. The information in the Prospectus Supplement
as of the date hereof under the caption "The Certificate Insurance Policy
and the Certificate Insurer" (collectively, the "Insurer Information") is
true and correct in all material respects and does not contain any untrue
statement of a fact that is material to the Insurer's ability to perform
its obligations under the Policy.
(h) Limitations. Nothing in this Agreement shall be construed as a
representation or undertaking by the Insurer concerning maintenance of the
rating currently assigned to its claims-paying ability by Moody's Investors
Service, Inc. ("Moody's"), Standard & Poor's Corporation ("S&P"), Fitch
Investors Service, Inc. ("Fitch") or any other rating agency (collectively,
the "Rating Agencies"). The Rating Agencies, in assigning such rating, may
take into account facts and assumptions not described in the Prospectus or
the Prospectus Supplement, and the facts and assumptions which are
considered by the Rating Agencies are subject to change over time. The
Insurer has not attempted to disclose all facts and assumptions which the
Rating Agencies deem relevant in assigning a rating within a particular
rating category to the Insurer's claims-paying ability. Notwithstanding the
foregoing, the Insurer is not aware of any facts that, if disclosed to
Moody's, S&P or Fitch, would be reasonably expected to result in a
downgrade of the rating of the claims-paying ability of the Insurer by
either of such Rating Agencies.
(i) No Litigation. There are no actions, suits, proceedings or
investigations pending, or to the best of the Insurer's knowledge,
threatened against it at law or in equity or before or by any court,
governmental agency, board or commission or any arbitrator which, if
decided adversely, would materially and adversely affect its condition
(financial or otherwise) or operations of it or would materially and
adversely affect its ability to perform its obligations under this
Agreement or the Policy.
(j) 1933 Act Registration. The Policy is exempt from registration
under the Act.
3. Agreements, Representations and Warranties of the Underwriters. The
Underwriters, severally and not jointly, represent and warrant to and agree with
the Sponsor, the Seller and the Insurer that the statements contained in the
Prospectus Supplement under the caption "Underwriting"
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(referred to herein as the "Underwriter Information") are true and correct in
all material respects.
4. Agreements, Representations and Warranties of the Sponsor. The Sponsor
represents and warrants to and agrees with the Seller, the Insurer and the
Underwriters as follows:
(a) Sponsor Offering Materials. The information in the Sponsor
Offering Materials is true and correct in all material respects and does
not contain any untrue statement of a fact that is material or omit to
state a fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(b) Organization. The Sponsor is duly incorporated and existing under
the laws of the State of Delaware and is in good standing as a foreign
corporation in each jurisdiction in which the nature of its business, or
the properties owned or leased by it make such qualification necessary.
(c) Corporate Power. The Sponsor has the corporate power and authority
to execute and deliver this Agreement, the Underwriting Agreement, the
Pooling and Servicing Agreement and the Sponsorship Agreement (together,
the "Sponsor Agreements") and to perform all of its obligations hereunder
and thereunder.
(d) Authorization; Approvals. The execution, delivery and performance
of the Sponsor Agreements by the Sponsor have been duly authorized by all
necessary corporate proceedings. No further approvals or filings of any
kind, including, without limitation, any further approvals of or further
filing with any governmental agency or other governmental authority, or any
approval of the Sponsor's board of directors or stockholders, are necessary
for the Sponsor Agreements to constitute the legal, valid and binding
obligations of the Sponsor.
(e) No Conflicts. The execution and delivery of this Agreement and
consummation of the transactions contemplated hereunder will not result in
the breach of any terms or provisions of the certificate of incorporation
or by-laws of the Sponsor or result in the breach of a term or provision
of, or conflict with or constitute a default under or result in the
acceleration of any obligation under, any material agreement or other
material instrument to which the Sponsor or its property is subject, or
result in the violation of any law, rule, regulation, order, judgment or
decree to which the Sponsor or any of its property is subject or result in
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the creation of any lien on any of Sponsor's assets or property (other than
pursuant to this Agreement).
(f) Enforceability. Each of the Sponsor Agreements will constitute a
legal, valid and binding obligation of the Sponsor, enforceable in
accordance with its terms subject, as to the enforcement of remedies, to
bankruptcy, insolvency, reorganization, moratorium and other similar laws
affecting the enforceability of creditors' rights generally applicable in
the event of the bankruptcy, insolvency or reorganization of the Sponsor
and to general principles of equity.
(g) No Litigation. There are no actions, suits, proceedings or
investigations pending, or to the best of the Sponsor's knowledge,
threatened against it at law or in equity or before any court, governmental
agency, board or commission or any arbitrator which, if decided adversely,
would materially and adversely affect its condition (financial or
otherwise) or operations of it or would materially and adversely affect its
ability to perform its obligations under the Sponsor Agreements.
5. Agreements, Representations and Warranties of the Seller. The Seller
represents and warrants to and agrees with the Sponsor, the Insurer and the
Underwriters as follows:
(a) Seller Offering Materials. The information in the Seller Offering
Materials is true and correct in all material respects and does not contain
any untrue statement of a fact that is material or omit to state a fact
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading.
(b) Organization. The Seller is duly incorporated and existing under
the laws of the State of Delaware and is in good standing as a foreign
corporation in each jurisdiction in which the nature of its business, or
the properties owned or leased by it make such qualification necessary.
(c) Corporate Power. The Seller has the corporate power and authority
to execute and deliver this Agreement, the Underwriting Agreement, the
Insurance Agreement, the Pooling and Servicing Agreement and the
Sponsorship Agreement (together, the "Seller Agreements") and to perform
all of its obligations hereunder and thereunder.
(d) Authorization; Approvals. The execution, delivery and performance
of the Seller Agreements have been duly authorized by all necessary
corporate
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proceedings. No further approvals or filings of any kind, including,
without limitation, any further approvals of or further filing with any
governmental agency or other governmental authority (other than approvals
and filings relating to servicing), or any approval of the Seller's board
of directors or stockholders, are necessary for the Seller Agreements to
constitute the legal, valid and binding obligations of the Seller.
(e) No Conflicts. The execution and delivery of this Agreement and
consummation of the transactions contemplated hereunder will not result in
the breach of any terms or provisions of the certificate of incorporation
or by-laws of Seller or result in the breach of a term or provision of, or
conflict with or constitute a default under or result in the acceleration
of any obligation under, any material agreement or other material
instrument to which the Seller or its property is subject, or result in the
violation of any law, rule, regulation, order, judgment or decree to which
the Seller or any of its property is subject or result in the creation of
any lien on any of the Seller's assets or property (other than pursuant to
this Agreement).
(f) Enforceability. Each of the Seller Agreements will constitute a
legal, valid and binding obligation of the Seller, enforceable in
accordance with its terms subject, as to the enforcement of remedies, to
bankruptcy, insolvency, reorganization, moratorium and other similar laws
affecting the enforceability of creditors' rights generally applicable in
the event of the bankruptcy, insolvency or reorganization of the Seller and
to general principles of equity.
(g) No Litigation. There are no actions, suits, proceedings or
investigations pending, or to the best of the Seller's knowledge,
threatened against it at law or in equity or before any court, governmental
agency, board or commission or any arbitrator which, if decided adversely,
would materially and adversely affect its condition (financial or
otherwise) or operations of it or would materially and adversely affect its
ability to perform its obligations under the Seller Agreements.
6. Indemnification.
(a) The Insurer hereby agrees, upon the terms and subject to the
conditions of this Agreement, to indemnify, defend and hold harmless each
Sponsor Party, each Seller Party, each Prudential Party and each J.P.
Morgan Party against any and all Losses incurred by them with respect to
the offer and sale of the Certificates
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and resulting from the Insurer's breach of any of its representations and
warranties set forth in Section 2 of this Agreement.
(b) The Underwriters, severally and not jointly, hereby agree, upon
the terms and subject to the conditions of this Agreement, to indemnify,
defend and hold harmless each Insurer Party against any and all Losses
incurred by them which arise out of or are based upon (i) any untrue
statement or alleged untrue statement of a material fact in the Underwriter
Information or (ii) the omission or alleged omission to state in the
Underwriter Information a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
(c) The Sponsor hereby agrees, upon the terms and subject to the
conditions of this Agreement, to indemnify, defend and hold harmless each
Insurer Party against any and all losses incurred by them with respect to
the Sponsor's establishing the Trust and instructing the Trustee to deliver
the Certificates to the Underwriters, which result from the Sponsor's
breach of any of its representations and warranties set forth in Section 4
of this Agreement.
(d) The Seller hereby agrees, upon the terms and subject to the
conditions of this Agreement, to indemnify, defend and hold harmless each
Insurer Party against any and all losses incurred by them with respect to
the offer and sale of the Certificates and resulting from the Seller's
breach of any of its representations and warranties set forth in Section 5
of this Agreement.
(e) Upon the incurrence of any Losses entitled to indemnification
hereunder, the Indemnifying Party shall reimburse the Indemnified Party
promptly upon establishment by the Indemnified Party to the Indemnifying
Party of the Losses incurred.
7. Insurer Undertaking. The Insurer hereby agrees that, for so long as the
Underwriters are required under the Act to deliver a Prospectus in connection
with the sale of the Class A Certificates, the Insurer will furnish to either or
both of the Underwriters, the Sponsor or the Seller upon written request of such
party or parties and at the expense of such requesting party, copies of the
Insurer's most recent financial statements (annual or interim, as the case may
be) prepared in accordance with generally accepted accounting principles
(subject, as to interim statements, to normal year-end adjustments and to the
absence of footnotes) within a reasonable time after they are available.
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8. Notice to be Given to the Insurer. Except as provided in Section 13
below with respect to contribution, the indemnification provided herein by the
Insurer shall be the exclusive remedy of the Prudential Party, the J.P. Morgan
Party, the Sponsor Party or the Seller Party for the Losses resulting from the
Insurer's breach of a representation, warranty or agreement hereunder; provided,
however, that the Prudential Party, the J.P. Morgan Party, the Sponsor Party or
the Seller Party shall be entitled to pursue any other remedy at law or in
equity for any such breach so long as the damages sought to be recovered shall
not exceed the Losses incurred thereby resulting from such breach. In the event
that any action or regulatory proceeding shall be commenced or claim asserted
which may entitle the Prudential Party, the J.P. Morgan Party, the Sponsor Party
or the Seller Party to be indemnified under this Agreement, such party shall
give the Insurer notice in writing or by facsimile of such action or claim
reasonably promptly after receipt of written notice thereof. The Insurer shall
be entitled to participate in the defense of any such action or claim in
reasonable cooperation with, and with the reasonable cooperation of, the Sponsor
Party, the Seller Party, the Prudential Party, or the J.P. Morgan Party, as the
case may be. The Indemnified Party will have the right to employ its own counsel
in any such action in addition to counsel for the Insurer, but the fees and
expenses of such counsel will be at the expense of such Indemnified Party unless
(1) the employment of counsel by the Indemnified Party at its expense has been
authorized in writing by the Insurer, or (2) the Insurer has not in fact
employed counsel to assume the defense of such action within a reasonable time
after receiving notice of the commencement of the action, or (3) the named
parties to any such action include the Insurer on the one hand, and, on the
other hand, the Indemnified Party, and such Indemnified Party shall have been
advised by counsel that there may be one or more legal defenses available to it
which are different from or additional to those available to the Insurer (in
which case, if such Indemnified Party notifies the Insurer in writing that it
elects to employ separate counsel at the expense of the Insurer, the Insurer
shall not have the right to assume the defense of such action or proceeding on
such Indemnified Party's behalf), in each of which cases the reasonable fees and
expenses of counsel (including local counsel) will be at the expense of the
Insurer and all such fees and expenses will be reimbursed promptly as they are
incurred but, in connection with any one action or separate but substantially
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, the Insurer shall not be liable for the
fees and expenses of more than one counsel for all Sponsor Parties, more than
one counsel for all Seller Parties, and more than one counsel for all Prudential
Parties and J.P. Morgan Parties combined. The Prudential Parties, the J.P.
Morgan Parties, the Sponsor Parties and the Seller
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Parties shall cooperate with the Insurer Parties in resolving any event which
would give rise to an indemnity obligation pursuant to Section 6(a) hereof in
the most efficient manner. No settlement of any such claim or action shall be
entered into without the consent of the Sponsor Party, the Seller Party, the
Prudential Party or the J.P. Morgan Party, as the case may be, who is subject to
such claim or action, on the one hand and the Insurer Party who is subject to
such claim or action on the other hand, provided, however, that the consent of
such Sponsor Party, Seller Party, Prudential Party or such J.P. Morgan Party, as
applicable, shall not be required if such settlement fully discharges, with
prejudice against the plaintiff, the claim or action against such Sponsor Party,
Seller Party, Prudential Party or J.P. Morgan Party. Any failure by a Sponsor
Party, Seller Party, Prudential Party or J.P. Morgan Party, as the case may be,
to comply with the provisions of this Section shall relieve the Insurer of
liability only if such failure is materially prejudicial to any legal pleadings,
grounds, defenses or remedies in respect thereof or the Insurer's financial
liability hereunder and then only to the extent of such prejudice.
9. Notice to be Given to Prudential. Except as provided below in Section 13
with respect to contribution, the indemnification provided herein by Prudential
shall be the exclusive remedy of any Insurer Party for the Losses resulting from
Prudential's breach of a representation, warranty or agreement hereunder;
provided, however, that the Insurer Party shall be entitled to pursue any other
remedy at law or in equity for any such breach so long as the damages sought to
be recovered shall not exceed the Losses incurred thereby resulting from such
breach. In the event that any action or regulatory proceeding shall be commenced
or claim asserted which may entitle an Insurer Party to be indemnified under
this Agreement, such party shall give Prudential notice in writing or by
facsimile of such action or claim reasonably promptly after receipt of written
notice thereof. Prudential shall be entitled to participate in the defense of
any such action or claim in reasonable cooperation with, and with the reasonable
cooperation of, the Insurer Party. The Indemnified Party will have the right to
employ its own counsel in any such action in addition to counsel for Prudential,
but the fees and expenses of such counsel will be at the expense of such
Indemnified Party unless (1) the employment of counsel by the Indemnified Party
at its expense has been authorized in writing by Prudential, or (2) Prudential
has not in fact employed counsel to assume the defense of such action within a
reasonable time after receiving notice of the commencement of the action, or (3)
the named parties to any such action include Prudential on the one hand, and on
the other hand, the Indemnified Party, and such Indemnified Party shall have
been advised by counsel that there may be one or more legal defenses available
to it which are different from or
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additional to those available to Prudential (in which case, if such Indemnified
Party notifies Prudential in writing that it elects to employ separate counsel
at the expense of Prudential, Prudential shall not have the right to assume the
defense of such action or proceeding on such Indemnified Party's behalf), in
each of which cases the reasonable fees and expenses of counsel will be at the
expense of Prudential and all such fees and expenses will be reimbursed promptly
as they are incurred but, in connection with any one action or separate but
substantially similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances, Prudential shall not be liable
for the fees and expenses of more than one counsel for all Insurer Parties. The
Insurer Party shall cooperate with the Prudential Party in resolving any event
which would give rise to an indemnification obligation pursuant to Section 6(b)
hereof in the most efficient manner. No settlement of any such claim or action
shall be entered into without the consent of the Insurer Party who is subject to
such claim or action, on the one hand and Prudential Party who is subject to
such claim or action on the other hand; provided, however, that the consent of
such Insurer Party shall not be required if such settlement fully discharges,
with prejudice against the plaintiff, the claim or action against such Insurer
Party. Any failure by an Insurer Party to comply with the provisions of this
Section shall relieve Prudential of liability only if such failure is materially
prejudicial to any legal pleadings, grounds, defenses or remedies in respect
thereof or Prudential's liability hereunder and then only to the extent of such
prejudice.
10. Notice to be Given to J.P. Morgan. Except as provided below in
Section 13 with respect to contribution, the indemnification provided herein by
J.P. Morgan shall be the exclusive remedy of any Insurer Party for the Losses
resulting from J.P. Morgan's breach of a representation, warranty or agreement
hereunder; provided, however, that the Insurer Party shall be entitled to pursue
any other remedy at law or in equity for any such breach so long as the damages
sought to be recovered shall not exceed the Losses incurred thereby resulting
from such breach. In the event that any action or regulatory proceeding shall be
commenced or claim asserted which may entitle an Insurer Party to be indemnified
under this Agreement, such party shall give J.P. Morgan notice in writing or by
facsimile of such action or claim reasonably promptly after receipt of written
notice thereof. J.P. Morgan shall be entitled to participate in the defense of
any such action or claim in reasonable cooperation with, and with the reasonable
cooperation of, the Insurer Party. The Indemnified Party will have the right to
employ its own counsel in any such action in addition to counsel for J.P.
Morgan, but the fees and expenses of such counsel will be at the expense of such
Indemnified Party unless (1) the employment of counsel by
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the Indemnified Party at its expense has been authorized in writing by J.P.
Morgan, or (2) J.P. Morgan has not in fact employed counsel to assume the
defense of such action within a reasonable time after receiving notice of the
commencement of the action, or (3) the named parties to any such action include
J.P. Morgan on the one hand, and on the other hand, the Indemnified Party, and
such Indemnified Party shall have been advised by counsel that there may be one
or more legal defenses available to it which are different from or additional to
those available to J.P. Morgan (in which case, if such Indemnified Party
notifies J.P. Morgan in writing that it elects to employ separate counsel at the
expense of J.P. Morgan, J.P. Morgan shall not have the right to assume the
defense of such action or proceeding on such Indemnified Party's behalf), in
each of which cases the reasonable fees and expenses of counsel will be at the
expense of J.P. Morgan and all such fees and expenses will be reimbursed
promptly as they are incurred but, in connection with any one action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, J.P. Morgan shall not be
liable for the fees and expenses of more than one counsel for all Insurer
Parties. The Insurer Party shall cooperate with the J.P. Morgan Party in
resolving any event which would give rise to an indemnification obligation
pursuant to Section 6(b) hereof in the most efficient manner. No settlement of
any such claim or action shall be entered into without the consent of the
Insurer Party who is subject to such claim or action, on the one hand and J.P.
Morgan Party who is subject to such claim or action on the other hand; provided,
however, that the consent of such Insurer Party shall not be required if such
settlement fully discharges, with prejudice against the plaintiff, the claim or
action against such Insurer Party. Any failure by an Insurer Party to comply
with the provisions of this Section shall relieve J.P. Morgan of liability only
if such failure is materially prejudicial to any legal pleadings, grounds,
defenses or remedies in respect thereof or J.P. Morgan's liability hereunder and
then only to the extent of such prejudice.
11. Notice to be Given to the Sponsor. Except as provided below in Section
13 with respect to contribution, the indemnification provided herein by the
Sponsor shall be the exclusive remedy of any Insurer Party for the Losses
resulting from the Sponsor's breach of a representation, warranty or agreement
hereunder; provided, however, that the Insurer Party shall be entitled to pursue
any other remedy at law or in equity for any such breach so long as the damages
sought to be recovered shall not exceed the Losses incurred thereby resulting
from such breach. In the event that any action or regulatory proceeding shall be
commenced or claim asserted which may entitle an Insurer Party to be indemnified
under this Agreement, such party shall give the Sponsor notice in
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writing or by facsimile of such action or claim reasonably promptly after
receipt of written notice thereof. The Sponsor shall be entitled to participate
in the defense of any such action or claim in reasonable cooperation with, and
with the reasonable cooperation of, the Insurer Party. The Indemnified Party
will have the right to employ its own counsel in any such action in addition to
counsel for the Sponsor, but the fees and expenses of such counsel will be at
the expense of such Indemnified Party unless (1) the employment of counsel by
the Indemnified Party at its expense has been authorized in writing by the
Sponsor, or (2) the Sponsor has not in fact employed counsel to assume the
defense of such action within a reasonable time after receiving notice of the
commencement of the action, or (3) the named parties to any such action include
the Sponsor on the one hand, and on the other hand, the Indemnified Party, and
such Indemnified Party shall have been advised by counsel that there may be one
or more legal defenses available to it which are different from or additional to
those available to the Sponsor (in which case, if such Indemnified Party
notifies the Sponsor in writing that it elects to employ separate counsel at the
expense of the Sponsor, the Sponsor shall not have the right to assume the
defense of such action or proceeding on such Indemnified Party's behalf), in
each of which cases the reasonable fees and expenses of counsel will be at the
expense of the Sponsor and all such fees and expenses will be reimbursed
promptly as they are incurred but, in connection with any one action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, the Sponsor shall not be
liable for the fees and expenses of more than one counsel for all Insurer
Parties. The Insurer Party shall cooperate with the Sponsor Party in resolving
any event which would give rise to an indemnification obligation pursuant to
Section 6(c) hereof in the most efficient manner. No settlement of any such
claim or action shall be entered into without the consent of the Insurer Party,
who is subject to such claim or action, on the one hand and the Sponsor Party on
the other hand; provided, however, that the consent of such Insurer Party shall
not be required if such settlement fully discharges, with prejudice against the
plaintiff, the claim or action against such Insurer Party. Any failure by an
Insurer Party to comply with the provisions of this Section shall relieve the
Sponsor of liability only if such failure is materially prejudicial to any legal
pleadings, grounds, defenses, or remedies in respect thereof or the Sponsor's
liability hereunder and then only to the extent of such prejudice.
12. Notice to be Given to the Seller. Except as provided below in Section
13 with respect to contribution, the indemnification provided herein by the
Seller shall be the exclusive remedy of any Insurer Party for the Losses
resulting from the Seller's breach of a representation, warranty or
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agreement hereunder; provided, however, that the Insurer Party shall be entitled
to pursue any other remedy at law or in equity for any such breach so long as
the damages sought to be recovered shall not exceed the Losses incurred thereby
resulting from such breach. In the event that any action or regulatory
proceeding shall be commenced or claim asserted which may entitle an Insurer
Party to be indemnified under this Agreement, such party shall give the Seller
notice in writing or by facsimile of such action or claim reasonably promptly
after receipt of written notice thereof. The Seller shall be entitled to
participate in the defense of any such action or claim in reasonable cooperation
with, and with the reasonable cooperation of, the Insurer Party. The Indemnified
Party will have the right to employ its own counsel in any such action in
addition to counsel for the Seller, but the fees and expenses of such counsel
will be at the expense of such Indemnified Party unless (1) the employment of
counsel by the Indemnified Party at its expense has been authorized in writing
by the Seller, or (2) the Seller has not in fact employed counsel to assume the
defense of such action within a reasonable time after receiving notice of the
commencement of the action, or (3) the named parties to any such action include
the Seller on the one hand, and on the other hand, the Indemnified Party, and
such Indemnified Party shall have been advised by counsel that there may be one
or more legal defenses available to it which are different from or additional to
those available to the Seller (in which case, if such Indemnified Party notifies
the Seller in writing that it elects to employ separate counsel at the expense
of the Seller, the Seller shall not have the right to assume the defense of such
action or proceeding on such Indemnified Party's behalf), in each of which cases
the reasonable fees and expenses of counsel will be at the expense of the Seller
and all such fees and expenses will be reimbursed promptly as they are incurred
but, in connection with any one action or separate but substantially similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances, the Seller shall not be liable for the fees and
expenses of more than one counsel for all Insurer Parties. The Insurer Party
shall cooperate with the Seller Party in resolving any event which would give
rise to an indemnification obligation pursuant to Section 6(d) hereof in the
most efficient manner. No settlement of any such claim or action shall be
entered into without the consent of the Insurer Party, who is subject to such
claim or action, on the one hand and the Seller Party on the other hand;
provided, however, that the consent of such Insurer Party shall not be required
if such settlement fully discharges, with prejudice against the plaintiff, the
claim or action against such Insurer Party. Any failure by an Insurer Party to
comply with the provisions of this Section shall relieve the Seller of liability
only if such failure is materially prejudicial to any legal pleadings, grounds,
defenses, or remedies in respect
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thereof or the Seller's liability hereunder and then only to the extent of such
prejudice.
13. Contribution.
(a) To provide for just and equitable contribution if the
indemnification provided by the Insurer is determined to be unavailable for
any Prudential Party, J.P. Morgan Party, Sponsor Party or Seller Party
(other than pursuant to Section 6 or 8 of this Agreement), the Insurer
shall contribute to the aggregate costs of liabilities arising from any
breach of a representation or warranty set forth in this Agreement on the
basis of the relative fault of all Prudential Parties, all J.P. Morgan
Parties, all Sponsor Parties, all Seller Parties and all Insurer Parties.
(b) To provide for just and equitable contribution if the
indemnification provided by the Sponsor is determined to be unavailable for
any Insurer Party (other than pursuant to Section 6 or 11 of this
Agreement), the Sponsor shall contribute to the aggregate costs of
liabilities arising from any breach of a representation or warranty set
forth in this Agreement on the basis of the relative fault of all
Prudential Parties, all J.P. Morgan Parties, all Sponsor Parties, all
Seller Parties and all Insurer Parties.
(c) To provide for just and equitable contribution if the
indemnification provided by the Seller is determined to be unavailable for
any Insurer Party (other than pursuant to Section 6 or 12 of this
Agreement), the Seller shall contribute to the aggregate costs of
liabilities arising from any breach of a representation or warranty set
forth in this Agreement on the basis of the relative fault of all
Prudential Parties, all J.P. Morgan Parties, all Sponsor Parties, all
Seller Parties and all Insurer Parties.
(d) To provide for just and equitable contribution if the
indemnification provided by Prudential is determined to be unavailable for
any Insurer Party (other than pursuant to Section 6 or 9 of this
Agreement), Prudential shall contribute to the aggregate costs of
liabilities arising from (i) any untrue statement or alleged untrue
statement of a material fact in the Underwriter Information or (ii) the
omission or alleged omission to state in the Underwriter Information a
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading on the basis of the relative fault of all Prudential
Parties, all J.P. Morgan Parties, all Sponsor
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Parties, all Seller Parties and all Insurer Parties; provided however, that
the Prudential Party shall not be liable for any amount in excess of (i)
the excess of the sales prices of the Class A Certificates to the public
over the prices paid therefor by Prudential, over (ii) the aggregate amount
of any damages which the Prudential Party has been otherwise required to
pay in respect of the same or any substantially similar claim.
(e) To provide for just and equitable contribution if the
indemnification provided by J.P. Morgan is determined to be unavailable for
any Insurer Party (other than pursuant to Section 6 or 10 of this
Agreement), J.P. Morgan shall contribute to the aggregate costs of
liabilities arising from (i) any untrue statement or alleged untrue
statement of a material fact in the Underwriter Information or (ii) the
omission or alleged omission to state in the Underwriter Information a
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading on the basis of the relative fault of all Prudential
Parties, all J.P. Morgan Parties, all Sponsor Parties, all Seller Parties
and all Insurer Parties; provided however, that the J.P. Morgan Party shall
not be liable for any amount in excess of (i) the excess of the sales
prices of the Class A Certificates to the public over the prices paid
therefor by J.P. Morgan, over (ii) the aggregate amount of any damages
which the J.P. Morgan Party has been otherwise required to pay in respect
of the same or any substantially similar claim.
(f) The relative fault of each Indemnifying Party, on the one hand,
and of each Indemnified Party, on the other, shall be determined by
reference to, among other things, whether the breach of, or alleged breach
of, any of its representations and warranties set forth in Section 2, 3, 4
or 5 of this Agreement relates to information supplied by, or action within
the control of, the Indemnifying Party or the Indemnified Party and the
parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such breach.
(g) The parties agree that the Insurer shall be solely responsible for
the Insurer Information and for the Insurer Financial Statements, that the
Underwriters, severally and not jointly, shall be solely responsible for
the Underwriter Information, that the Sponsor shall be responsible for the
Sponsor Offering Materials and the Seller shall be responsible for the
Seller Offering Materials.
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(h) No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
(i) The indemnity and contribution agreements contained in this
Agreement shall remain operative and in full force and effect, regardless
of (i) any investigation made by or on behalf of any Prudential Party, any
J.P. Morgan Party, any Sponsor Party, any Seller Party or any Insurer
Party, (ii) the issuance of the Certificates or the Policy or (iii) any
termination of this Agreement.
(j) Upon the incurrence of any Losses entitled to contribution
hereunder, the contributor shall reimburse the party entitled to
contribution promptly upon establishment by the party entitled to
contribution to the contributor of the Losses incurred.
It is understood and agreed that the indemnities set forth in this
Agreement shall service the execution and delivery of this Agreement and the
issuance, sale and delivery of the Class A Certificates.
14. Notices. All notices and other communications provided for under this
Agreement shall be addressed to the address set forth below as to each party or
at such other address as shall be designated by a party in a written notice to
the other party.
If to the Insurer: Financial Guaranty Insurance Company
115 Broadway
New York, New York 10006
Attention: General Counsel
If to the Sponsor: Cargill Financial Services Corporation
6000 Clearwater Drive
Minnetonka, MN 55343
Attention: General Counsel
If to the Seller: Access Financial Lending Corp.
12800 Whitewater Drive, Suite 200
Minnetonka, MN 55343
Attention: General Counsel
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If to Prudential: Prudential Securities Incorporated
One New York Plaza, 15th Floor
New York, New York 10292-2015
Attention: Asset-Backed Finance Group
If to J.P. Morgan: J.P. Morgan Securities Inc.
60 Wall Street, 18th Floor
New York, New York 10260-0060
15. Governing Law, Etc. This Agreement shall be deemed to be a contract
under the laws of the State of New York and shall be governed by and construed
in accordance with the laws of the State of New York without regard to its
conflicts of laws provisions. This Agreement may not be assigned by any party
without the express written consent of each other party. Amendments of this
Agreement shall be in writing signed by each party. This Agreement shall not be
effective until executed by each of the Insurer, the Sponsor, the Seller and the
Underwriters.
16. Underwriting Agreement; Pooling and Servicing Agreement; Sponsorship
Agreement. This Agreement in no way limits or otherwise affects the
indemnification obligations of the Sponsor or the Seller under (a) the
Underwriting Agreement, (b) the Pooling and Servicing Agreement or (c) the
Sponsorship Agreement.
17. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall together constitute but one and the same
instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their respective officers thereunto duly
authorized, all as of the date first above written.
FINANCIAL GUARANTY INSURANCE
COMPANY
By: /s/ Warren K. Tong
______________________________
Name: Warren K. Tong
Title: Team Leader
CARGILL FINANCIAL SERVICES CORPORATION
By: /s/ Kenneth M. Duncan
______________________________
Name: Kenneth M. Duncan
Title: Senior Vice President
ACCESS FINANCIAL LENDING CORP.
By: /s/ Leslie Zejdlik Foster
______________________________
Name: Leslie Zejdlik Foster
Title: President
PRUDENTIAL SECURITIES INCORPORATED
By: /s/ Valerie H. Kay
______________________________
Name: Valerie H. Kay
Title: Vice President
J.P. MORGAN SECURITIES INC.
By: /s/ Peggy Wallace
______________________________
Name: Peggy Wallace
Title: Vice President
[Indemnification Agreement]
<PAGE>
