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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)
August 23, 1996
Cargill Financial Services Corporation
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(Exact name of registrant as specified in its charter)
Delaware 333-10743 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 ------------------
---------------------- (Zip Code)
(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 $1,034,000,000 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 Nos. 33-96500 and 333-10743) (as
amended, the "Registration Statement"). Pursuant to the Registration Statement,
Access Financial Mortgage Loan Trust 1996-3 (the "Trust") issued $206,597,000 in
aggregate principal amount of its Mortgage Loan Pass-Through Certificates,
Series 1996-3 (the "Certificates"), on August 27, 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 August 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 lesser of (i) the London interbank offered rate for one-month
United States dollar deposits ("LIBOR") plus 0.120% per annum or (ii) the
weighted average net coupon rate for the fixed rate mortgage loans
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as of the payment date. The Pass-Through Rate for the Class A-2 Group I
Certificates, the Class A-3 Group I Certificates and the Class A-4 Group I
Certificates will be 6.900%, 7.250% and 7.500% per annum, respectively. The
Pass-Through Rate for the Class A-5 Group I Certificates will be the lesser of
(i) 7.600%, provided however that if the Trustee has not solicited bids for the
purchase of the Mortgage Loans by the 90th day following the first payment date
on which the aggregate principal balance of the Mortgage Loans has declined to
10% or less of the original aggregate principal balance of the Mortgage Loans,
8.350% or (ii) the weighted average net coupon rate for the fixed rate mortgage
loans as of the payment date. The Pass-Through Rate for the Class A-6 Group II
Certificates will be equal to the lesser of (i) LIBOR plus 0.310% 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 $44,843,000, the Class A-2 Group I Certificates have an aggregate
principal amount of $28,572,000, the Class A-3 Group I Certificates have an
aggregate principal amount of $13,552,000, the Class A-4 Group I Certificates
have an aggregate principal amount of $10,000,000, the Class A-5 Group I
Certificates have an aggregate principal amount of $10,744,000, and the Class A-
6 Group II Certificates have an aggregate principal amount of $98,886,000.
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 August 23, 1996, filed pursuant to Rule 424(b)(2) of
the Act on August 28, 1996.
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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 August 22, 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 August 1,
1996 between Cargill Financial Services Corporation and Access Financial Lending
Corp.
4.2 Pooling and Servicing Agreement, dated as of August 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 August 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 1996-3
Registrant
By: /s/ Kenneth M. Duncan
_______________________________
Name: Kenneth M. Duncan
Title: Senior Vice President
Dated: September 5, 1996
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EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION PAGE NO.
----------- ----------- --------
<S> <C> <C>
1.1 Underwriting Agreement, dated August 22,
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 August 1, 1996 between Cargill
Financial Services Corporation and Access
Financial Lending Corp.
4.2 Pooling and Servicing Agreement, dated as
of August 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
August 1, 1996, among Cargill Financial
Services Corporation, Access Financial
Lending Corp., Financial Guaranty
Insurance Company, Prudential Securities
Incorporated and J.P. Morgan Securities
Inc.
</TABLE>
STATEMENT OF DIFFERENCES
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The section mark symbol shall be expressed as.... 'ss'
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ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-3
$44,843,000 Class A-1 Group I Certificates
$28,572,000 Class A-2 Group I Certificates, 6.900% Pass-Through Rate
$13,552,000 Class A-3 Group I Certificates, 7.250% Pass-Through Rate
$10,000,000 Class A-4 Group I Certificates, 7.500% Pass-Through Rate
$10,744,000 Class A-5 Group I Certificates, 7.600% Pass-Through Rate
$98,886,000 Class A-6 Group II Certificates
UNDERWRITING AGREEMENT
PRUDENTIAL SECURITIES INCORPORATED
J.P. MORGAN SECURITIES INC.
August 22, 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 1996-3, Class A-1 Group I Certificates in an aggregate principal amount
of $44,843,000, Class A-2 Group I Certificates in an aggregate principal amount
of $28,572,000, Class A-3 Group I Certificates in an aggregate principal amount
of $13,552,000, Class A-4 Group I Certificates in an aggregate principal amount
of $10,000,000, Class A-5 Group I Certificates in an aggregate principal amount
of $10,744,000, and Class A-6 Group II Certificates in an aggregate principal
amount of $98,886,000 (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 1996-3 (the "Trust") pursuant to a Pooling and Servicing Agreement,
to be dated as of August 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 Association, a
national banking
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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 August 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 August 1, 1996 (the "Indemnification
Agreement").
The Sponsor and the Seller will enter into a Securitization
Sponsorship Agreement dated as of August 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.
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 Master Servicer and the Trustee will enter into a Sub-Servicing
Agreement dated as of August 1, 1996 with LSI Financial Group ("LSI" or the
"Sub-Servicer") (the "LSI Sub- Servicing Agreement") pursuant to which LSI will
agree to service and administer the Mortgage Loans in accordance with the
provisions of the LSI Sub-Servicing Agreement.
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 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
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offering of the Offered Certificates for settlement on August 27, 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 and No.
333-10743) 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, 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
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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 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.
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(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 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.
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(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, regis- tration 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 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
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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 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
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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 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
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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, regis- tration 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 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.
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(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 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
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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 August 27, 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 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;
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(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.
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
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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 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
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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 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
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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.
(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
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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
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",
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"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
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
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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 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
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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:
(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
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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 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
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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.
(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.
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(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 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 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:
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(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.
I. 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 contained under the heading "The
Sub-Servicer" 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.
J. 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
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Certificates and such other related matters as the Underwriters may require.
K. 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 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
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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.
L. 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.
M. 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 June 30, 1996, which
would have a material adverse effect on the Certificate Insurer's ability to
meet its obligations under the Certificate Insurance Policy.
N. 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.
O. 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").
P. 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 O above.
Q. 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
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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.
R. 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.
S. 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 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
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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 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
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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 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
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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 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
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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 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
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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 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
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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 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
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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:
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
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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.
400 Highway 169 South, Suite 400
St. Louis Park, MN 55426-0365
Attention: Operations
Fax: (612) 542-6510
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.
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
34
<PAGE>
<PAGE>
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]
35
<PAGE>
<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
/s/ KENNETH M. DUNCAN
By: __________________________________
Name: Kenneth M. Duncan
Title: Senior Vice President
ACCESS FINANCIAL LENDING CORP.
/s/ LESLIE ZEJDLIK FOSTER
By: __________________________________
Name: Leslie Zejdlik Foster
Title: President
CONFIRMED AND ACCEPTED, as of
the date first above written:
PRUDENTIAL SECURITIES INCORPORATED
/s/ LEN BLUM
By: __________________________________
Name: Len Blum
Title: Managing Director
J.P. MORGAN SECURITIES INC.
/s/ JACQUELINE V. BRADY
By: __________________________________
Name: Jacqueline V. Brady
Title: Vice President
[Underwriting Agreement]
<PAGE>
<PAGE>
Schedule 1
Underwriting
<TABLE>
<CAPTION>
Class A-1
----------------------------------------
Purchase Price
Percentage Proceeds
(excluding Principal (excluding
Underwriter accrued interest) Amount accrued interest)
----------- ----------------- ---------- -----------------
<S> <C> <C> <C>
Prudential Securities 99.75% $22,421,500.00 $22,365,446.25
Incorporated
J.P. Morgan 99.75% 22,421,500.00 $22,365,446.25
Securities Inc. ------ -------------
TOTAL $44,843,000.00 $44,730,892.50
</TABLE>
<TABLE>
<CAPTION>
Class A-2
----------------------------------------
Purchase Price
Percentage Proceeds
(excluding Principal (excluding
Underwriter accrued interest) Amount accrued interest)
----------- ----------------- ---------- -----------------
<S> <C> <C> <C>
Prudential Securities 99.734375% $14,286,000.00 $14,248,052.8125
Incorporated
J.P. Morgan 99.734375% 14,286,000.00 $14,248,052.8125
Securities Inc. ---------- ------------- -----------------
TOTAL $28,572,000.00 $28,496,105.625
</TABLE>
<TABLE>
<CAPTION>
Class A-3
----------------------------------------
Purchase Price
Percentage Proceeds
(excluding Principal (excluding
Underwriter accrued interest) Amount accrued interest)
----------- ----------------- ---------- -----------------
<S> <C> <C> <C>
Prudential Securities 99.75% $6,776,000.00 $6,759,060.00
Incorporated
J.P. Morgan 99.75% 6,776,000.00 6,759,060.00
Securities Inc. ------ ------------ ------------
TOTAL $13,552,000.00 $13,518,120.00
</TABLE>
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
Class A-4
----------------------------------------
Purchase Price
Percentage Proceeds
(excluding Principal (excluding
Underwriter accrued interest) Amount accrued interest)
----------- ----------------- ---------- -----------------
<S> <C> <C> <C>
Prudential Securities 99.6875% $5,000,000.00 $4,984,375.00
Incorporated
J.P. Morgan 99.6875% 5,000,000.00 $4,984,375.00
Securities Inc. -------- ------------ -------------
TOTAL $10,000,000.00 $9,968,750.00
</TABLE>
<TABLE>
<CAPTION>
Class A-5
----------------------------------------
Purchase Price
Percentage Proceeds
(excluding Principal (excluding
Underwriter accrued interest) Amount accrued interest)
----------- ----------------- ---------- -----------------
<S> <C> <C> <C>
Prudential Securities 99.6875% $5,372,000.00 $5,355,212.50
Incorporated
J.P. Morgan 99.6875% 5,372,000.00 5,355,212.50
Securities Inc. -------- ------------ ------------
TOTAL $10,744,000.00 $10,710,425.00
</TABLE>
<TABLE>
<CAPTION>
Class A-6
----------------------------------------
Purchase Price
Percentage Proceeds
(excluding Principal (excluding
Underwriter accrued interest) Amount accrued interest)
----------- ----------------- ---------- -----------------
<S> <C> <C> <C>
Prudential Securities 99.75% $49,443,000.00 $49,319,392.50
Incorporated
J.P. Morgan 99.75% 49,443,000.00 49,319,392.50
Securities Inc. ------ ------------- -------------
TOTAL $98,886,000.00 $98,638,785.00
</TABLE>
<PAGE>
<PAGE>
SECURITIZATION SPONSORSHIP AGREEMENT
Between
ACCESS FINANCIAL LENDING CORP.
and
CARGILL FINANCIAL SERVICES CORPORATION
Dated as of August 1, 1996
<PAGE>
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
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
</TABLE>
Exhibit A - Mortgage Loan Schedule
i
<PAGE>
<PAGE>
This Securitization Sponsorship Agreement, dated as of August 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 August 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 August 27, 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
2
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<PAGE>
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.
3
<PAGE>
<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
4
<PAGE>
<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
<PAGE>
<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 August 22, 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.
400 Highway 169 South, Suite 400
St. Louis Park, Minnesota
55426-0365
Attention: Operations
Tel: (612) 542-6500
Fax: (612) 542-6510
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
<PAGE>
<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
<PAGE>
<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.
8
<PAGE>
<PAGE>
(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
<PAGE>
<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>
POOLING AND SERVICING AGREEMENT
Relating to
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-3
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 August 1, 1996
<PAGE>
<PAGE>
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 Sale ................................................... 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 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 .............................. 16
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 ........................................ 39
Representation Letter ........................................... 40
Reserve Interest Rate ........................................... 40
Residual Certificate ............................................ 40
S&P ............................................................. 40
Second Mortgage Loan ............................................ 40
Seller .......................................................... 40
Seller Optional Termination Date ................................ 40
Senior Lien ..................................................... 40
Servicing Advance ............................................... 40
Servicing Standards ............................................. 40
Sponsor ......................................................... 41
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Sponsorship Agreement ........................................... 41
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 ...................................................... 44
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 ............................................. 78
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 ................................... 82
6.10. Delay or Omission Not Waiver .................................... 82
6.11. Control by Owners ............................................... 82
ARTICLE VII ACCOUNTS, FLOW OF FUNDS, DISTRIBUTIONS
AND REPORTS.......................................... 83
7.1. Collection of Money .............................................. 83
7.2. Establishment of Accounts ........................................ 83
7.3. Flow of Funds .................................................... 83
7.4. Investment of Accounts ........................................... 90
7.5. Eligible Investments ............................................. 91
7.6. Reports by Trustee ............................................... 92
7.7. Drawings under the Certificate Insurance
Policy and Reports by Trustee .............................. 97
7.8. Allocation of Realized Losses .................................... 97
7.9. Supplemental Interest Payments ................................... 98
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 Sale...................................................... 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 ............................................ 108
9.6. Money Held in Trust .............................................. 108
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 .................................................... 110
9.11. Merger, Conversion, Consolidation or
Succession to Business of the Trustee ...................... 110
9.12. Reporting; Withholding .......................................... 111
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 .................................... 114
10.2. Collection of Certain Mortgage Loan
Payments ................................................... 116
10.3. Sub-Servicing Agreements Between Master
Servicer and Sub-Servicers ................................. 117
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 ..................... 118
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 ....................................... 123
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 ......................... 127
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 ....................................... 129
10.18. Access to Certain Documentation and
Information Regarding the Mortgage
Loans; Confidentiality ..................................... 129
10.19. Assignment of Agreement ........................................ 130
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..................................... 132
11.1. Removal of Master Servicer; Resignation
of Master Servicer ......................................... 132
11.2. Merger, Conversion, Consolidation or
Succession to Business of Master
Servicer ................................................... 137
ARTICLE XII MISCELLANEOUS........................................ 137
12.1. Compliance Certificates and Opinions ............................ 137
12.2. Form of Documents Delivered to the
Trustee .................................................... 138
12.3. Acts of Owners .................................................. 139
12.4. Notices, etc. to Trustee ........................................ 139
12.5. Notices and Reports to Owners; Waiver of
Notices .................................................... 140
12.6. Rules by Trustee and Sponsor .................................... 140
12.7. Successors and Assigns .......................................... 140
12.8. Severability .................................................... 140
12.9. Benefits of Agreement ........................................... 141
12.10. Legal Holidays ................................................. 141
12.11. Governing Law .................................................. 141
12.12. Counterparts ................................................... 141
12.13. Usury .......................................................... 141
12.14. Amendment ...................................................... 142
12.15. The Certificate Insurer ........................................ 143
12.16. REMIC Status; Taxes ............................................ 143
12.17. Additional Limitation on Action and
Imposition of Tax .......................................... 145
12.18. Appointment of Tax Matters Person .............................. 145
12.19. Reports to the Securities and Exchange
Commission ................................................. 146
12.20. Notices ........................................................ 146
12.21. Grant of Security Interest ..................................... 147
12.22. Indemnification ................................................ 148
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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 1996-3, dated as of August 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 trust created by 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 Sale": The Trustee's solicitation of bids for the
purchase of all Mortgage Loans in the Trust pursuant to 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,
2
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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 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
3
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Group I Certificates, Class A-6 Group II Certificates, Class B Group I
Certificates, Class B Group II Certificates, Class 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 96010468 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)
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the Class A-1 Principal Carry-Forward Amount for such Payment Date.
"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 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 0.120%
per annum or (ii) the Net Weighted Average Coupon Rate for the Group I Mortgage
Loans for such Payment Date.
"Class A-1 Principal Balance": The original Class A-1 Principal
Balance of $44,843,000 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 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.
"Class A-1 Principal Distribution Amount": With respect to any
Payment Date on or prior to the Class A-1
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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": 6.900% per annum.
"Class A-2 Principal Balance": The original Class A-2 Principal
Balance of $28,572,000 reduced by the sum of all amounts previously distributed
to the Owners of the Class A-2 Group I Certificates in respect of principal on
all previous Payment Dates, but shall not be reduced below zero.
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"Class A-2 Principal Carry-Forward Amount": As of any Payment
Date, 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.
"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 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
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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": 7.250% per annum.
"Class A-3 Principal Balance": The original Class A-3 Principal
Balance of $13,552,000 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 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.
"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.
"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)
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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": 7.500% per annum.
"Class A-4 Principal Balance": The original Class A-4 Principal
Balance of $10,000,000 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 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.
"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
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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": The lesser of (i) 7.600% per
annum, or if the Auction Sale has not occurred by the 90th day following the
Seller Optional Termination Date, 8.350% per annum for each Payment Date
occurring after such 90th day and (ii) the Net Weighted Average Coupon Rate for
the Group I Mortgage Loans for such Payment Date.
"Class A-5 Principal Balance": The original Class A-5 Principal
Balance of $10,744,000 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.
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"Class A-5 Principal Carry-Forward Amount": As of any Payment
Date, 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.
"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 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.
"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
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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 0.310% 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 $98,886,000 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.
"Class A-6 Principal Carry-Forward Amount": As of any Payment
Date, 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.
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"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.
"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
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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.
"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.
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"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 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
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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.
"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.
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"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 August 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 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
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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 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.
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"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.
"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
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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-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
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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, (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,
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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 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 amount
otherwise payable as the Group I Principal Distribution Amount on such Payment
Date (i.e., the sum of (i)
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the Base Group I Principal Distribution Amount, (ii) the Group I Subordination
Increase Amount, (iii) the Class A-1 Principal Carry-Forward Amount, (iv) the
Class A-2 Principal Carry-Forward Amount, (v) the Class A-3 Principal
Carry-Forward Amount, (vi) the Class A-4 Principal Carry-Forward Amount and
(vii) the Class A-5 Principal Carry-Forward Amount), 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 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 0.0275% 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
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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.
"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
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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 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.
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"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.
"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).
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"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 amount otherwise payable as the Group II Principal Distribution
Amount on such Payment Date (i.e., the sum of (i) the Base Group II Principal
Distribution Amount, (ii) the Group II Subordination Increase Amount and (iii)
the Class A-6 Principal Carry-Forward Amount), 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.
"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.
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"Group II Trustee's Fee": With respect to any Payment Date, the
product of (i) one-twelfth of 0.0275% 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 August
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 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%).
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(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 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
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(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 0.45% 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 0.50% and if the Trustee is acting as Master Servicer such rate
shall be equal to 0.50%.
"Monthly Remittance": The Group I Monthly Remittance, or the
Group II Monthly Remittance, as the case may be.
"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"
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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 Cut-Off 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.
"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.
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"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.
"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 August 1, 1996 between the Sponsor and the
Seller, the Underwriting Agreement dated August 22, 1996 between the Sponsor and
the Underwriters, and the Indemnification Agreement dated as of August 1, 1996
among the Sponsor, the Underwriters and the Certificate Insurer.
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"Original Group I Pool Principal Balance": The aggregate
Principal Balances of all Group I Mortgage Loans as of the Cut-Off Date, i.e.,
$107,711,655.82.
"Original Group II Pool Principal Balance": The aggregate
Principal Balances of all Group II Mortgage Loans as of the Cut-Off Date, i.e.,
$99,885,343.08.
"Original Pool Principal Balance": The aggregate Principal
Balances of all Mortgage Loans as of the Cut-Off Date, i.e., $207,596,998.90.
"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
(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.
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"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 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 Certificate-
holders 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);
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(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 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
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(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.
"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.
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"Prospectus Supplement": The Prospectus Supplement dated August
23, 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 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
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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 Class A-2, Class A-3, Class
A-4 and Class A-5 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 Class A-1 and Class A-6 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.
"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.
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"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 0.01%
of the Pool Principal Balance paid to the Trustee 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.
"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.
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"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.
"Seller Optional Termination Date": The first 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.
"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.
"Sponsorship Agreement": The Securitization Sponsorship Agreement
dated as of August 1, 1996 between the Seller and the Sponsor.
"Startup Day": August 27, 1996.
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"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 1996-3 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- 3, 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 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
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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 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.
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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 Class A-1 and Class A-6
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 1996-3". 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
55479-0070 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
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.
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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 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
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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 $44,843,000 (1) May 18, 2011
LT-2 A-2, B Group I $28,572,000 (1) May 18, 2011
LT-3 A-3, B Group I $13,552,000 (1) November 18, 2015
LT-4 A-4, B Group I $10,000,000 (1) June 18, 2022
LT-5 A-5, B Group I $10,744,000 (1) September 18, 2027
LT-6 A-6, B Group II $98,886,000 (2) January 18, 2027
RL (3) (3) September 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.
(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.
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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 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).
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(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 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
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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.
(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
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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 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,
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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
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
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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 any 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.
(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
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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.
(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.
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(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 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,
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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) 91.00% of the Original Group I Pool Principal Balance
and 93.95% 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 72.886% and no
Mortgage Loan in Group II had a Loan-to-Value Ratio in excess of 90.00%
and the weighted average Loan-to-Value Ratio for Group II was
approximately 75.982%.
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(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 7.00% 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 3.00%, an adjustment
cap of at least 1.00%, a lifetime cap of at least 13.881% and a Coupon
Rate as of the Cut-Off Date of at least 7.225%;
(viii) Notes representing not more than 54.73% 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 0.90% 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;
(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 3.30% of the Original Group I Pool Principal Balance of the
Mortgage Loans are 30-59 days delinquent and no more than 3.19% of the
Original Group II
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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 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
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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. 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
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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 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;
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(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;
(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
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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 3.68% of the Original Pool Principal
Balance of the Mortgage Loans in Group I is secured by condominiums,
townhouses or rowhouses and no more than 2.90% 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 Recovery Act of 1976, or other federal, state
or local environmental legislation;
(xl) No more than 0.589% 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 0.593% of the
Original Pool Principal Balance of the Mortgage Loans in Group II is
secured by Properties located
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within any single zip code area; no more than 15.24% of the Original
Pool Principal Balance of the Mortgage Loans in Group I is located
within any single state and no more than 15.15% of the Original Pool
Principal Balance of the Mortgage Loans in Group II is located within
any single state.
(xli) At least 93.72% of the Original Group I Pool Principal
Balance and at least 96.71% 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 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;
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(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 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
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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.
(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
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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 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.
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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 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
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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
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.
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(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, 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.
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(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 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
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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 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
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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 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
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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.
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,
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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 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.
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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 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
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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 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
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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.
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
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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 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.
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(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 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
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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 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;
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(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.
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:
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(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:
(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;
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(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 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
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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 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 B Group I Distribution Account and a Class B Group
II Distribution Account,
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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;
(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
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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;
(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
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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 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
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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 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
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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;
(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,
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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 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
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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 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
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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:
(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.
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(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.
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;
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(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
(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:
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(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 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-
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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 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;
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(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));
(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
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(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 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
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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.
(a) The parties hereto do hereby create and establish a trust,
the "Access Financial Supplemental Interest Trust 1996-3" (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
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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 Group II 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:
(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
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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
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
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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.
(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 Sale. 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
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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 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.
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On each Payment Date following the Trustee's failure to obtain a
satisfactory bid as described in this Section 8.3, the Class A-5 Pass-Through
Rate shall be 8.350%.
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;
(iii) to enforce due-on-sale clauses and to enter into
assumption and substitution agreements as permitted by
Article X hereof;
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(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 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
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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.
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
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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 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
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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 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,
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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 other gain actually
received by the Trustee on Eligible Investments.
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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 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,
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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 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
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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, applicable to distributions to the Owners, including but
not limited to backup withholding under Section 3406 of the Code and
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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 refraining from acting in good faith on any
certificate, notice or other document of any kind prima facie properly executed
and
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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;
(ii) No co-Trustee hereunder shall be held personally liable by
reason of any act or omission of any other co- Trustee hereunder; and
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(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 into this
Agreement or shall otherwise exist against the Master Servicer.
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(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 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
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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.
(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
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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 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
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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 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
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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
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
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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;
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 from
its own funds and subsequently collected from the related
Mortgagor; and
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(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;
(F) a schedule regarding cumulative foreclosures since the
Cut-Off Date;
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(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.
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
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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 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
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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.
(d) The Seller shall indemnify the Master Servicer for any loss
to the Master Servicer if any Mortgage Loan does not, at
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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 Servicer may be restricted by law from preventing, for any reason
whatsoever.
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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 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
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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 repurchase of any
Mortgage Loan or any liquidation of such Mortgage Loan through foreclosure or
otherwise), or the receipt by the
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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 July 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 August 1, 1996 through July 31, 1997, 4.50%
during the period August 1, 1997 through July 31, 1998, 5.25% during the
period August 1, 1998 through July 31, 1999, 6.25% during the period
August 1, 1999 through July 31, 2000, 7.25% during the period August 1,
2000 through July 31, 2001, or 10.00% after August 1, 2001; or
(ix) If on any Payment Date occurring in August of any year,
commencing in August 1997, the aggregate Pool Cumulative Net Realized
Losses over the prior twelve month period exceed 0.075% 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 12.19 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 66 2/3%
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. Reports to the Securities and Exchange Commission.
The Trustee shall, on behalf of the Trust, cause to filed with the Securities
and Exchange Commission any periodic reports required to be filed under the
provisions of the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Securities and Exchange Commission thereunder. Upon the
request of the Trustee, each of the Master Servicer and the Seller shall
cooperate with the Trustee in the preparation of any such report and shall
provide to the Trustee in a timely manner all such information as the Trustee
may reasonably request in connection with the performance of its duties and
obligations under this Section.
Section 12.20. Notices. All notices hereunder shall be
given as follows, until any superseding instructions are given to
all other Persons listed below:
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The Trustee: Norwest Bank Minnesota, National
- ----------- Association
Sixth Street & Marquette Avenue
Minneapolis, Minnesota 55479-0070
Attention: Corporate Trust Department
Access Financial Mortgage
Loan Trust 1996-3
Tel: (612) 667-1117
Fax: (612) 667-3539
with a copy to:
Norwest Bank Minnesota, National
Association
11000 Broken Land Parkway
Columbia, Maryland 21044
Attention: Securities Administration
Services -- Access Financial Mortgage
Loan Trust 1996-3
Tel: (410) 884-2000
Fax: (410) 884-2360
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.
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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 400 Highway 169 South
Servicer Suite 400
- ---------- St. Louis Park, Minnesota 55426-0365
Attention: Operations
Tel: (612) 542-6500
Fax: (612) 542-6510
Section 12.21. 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 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
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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 12.22. 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 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
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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 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
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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 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.
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'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,
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/ MICHAEL L. MAYER
--------------------------------
Name: Michael L. Mayer
Title: Vice President
[Pooling and Servicing Agreement]
<PAGE>
<PAGE>
STATE OF MARYLAND )
: ss.:
COUNTY OF HARFORD )
On the 27th day of August 1996, before me personally came Michael
L. Mayer, to me known, who, being by me duly sworn did depose and say that his
office is located at 11000 Broken Land Parkway, Columbia, Maryland, 21044-3662;
that he 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 he signed his 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/ MARY F. GREMIN
--------------------------------
Notary Public
[Pooling and Servicing Agreement]
<PAGE>
<PAGE>
STATE OF MINNESOTA )
: ss.:
COUNTY OF HENNEPIN )
On the 27th day of August, 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 27th day of August, 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 400 Highway 169 South, Suite 400, St. Louis Park,
Minnesota 55426-0365, 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 1996-3
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 August 27, 1996
Date
$44,843,000 May 18, 2011 003916 AN3
- --------------- ------------- ----------
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
1996-3 (the "Trust") pursuant to that certain Pooling and Servicing Agreement
dated as of August 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
August 27, 1996 (the "Startup Day"), which aggregate amount on August 27, 1996
was $44,843,000. 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
<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 1996-3, 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 1996-3, 6.900% Mortgage Loan Pass-Through Certificates, Class A-2
Group I (the "Class A-2 Group I Certificates"), Access Financial Mortgage Loan
Trust 1996-3, 7.250% Mortgage Loan Pass-Through Certificates, Class A-3 Group I
(the "Class A-3 Group I Certificates"), Access Financial Mortgage Loan Trust
1996-3, 7.500% Mortgage Loan Pass-Through Certificates, Class A-4 Group I (the
"Class A-4 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-3,
7.600% Mortgage Loan Pass-Through Certificates, Class A-5 Group I (the "Class
A-5 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-3 Mortgage
Loan Pass-Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates"), Access Financial Mortgage Loan Trust 1996- 3, Mortgage Loan
Pass-Through Certificates, Class B Group I
A-1-3
<PAGE>
<PAGE>
Certificates (the "Class B Group I Certificates"), Access Financial Mortgage
Loan Trust 1996-3, Mortgage Loan Pass-Through Certificates, Class B Group II
(the "Class B Group II Certificates"), Access Financial Mortgage Loan Trust
1996-3, 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 1996-3, 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 September 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 September 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
<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-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 $44,843,000.
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
<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-1-6
<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-1-7
<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-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
<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: August 27, 1996
A-1-9
<PAGE>
<PAGE>
EXHIBIT A-2
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-3
6.900% MORTGAGE LOAN PASS-THROUGH CERTIFICATE
CLASS A-2 GROUP I
(6.900% 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 August 27, 1996
Date
$28,572,000 May 18, 2011 003916 AP8
- ------------------ --------------- ----------
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
1996-3 (the "Trust") pursuant to that certain Pooling and Servicing Agreement
dated as of August 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
August 27, 1996 (the "Startup Day"), which aggregate amount on August 27, 1996
was $28,572,000. 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
<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 1996-3, 6.900%
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 1996-3, Mortgage Loan Pass-Through Certificates, Class A-1 Group I
(the "Class A-1 Group I Certificates"), Access Financial Mortgage Loan Trust
1996-3, 7.250% Mortgage Loan Pass-Through Certificates, Class A-3 Group I (the
"Class A-3 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-3,
7.500% Mortgage Loan Pass-Through Certificates, Class A-4 Group I (the "Class
A-4 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-3, 7.600%
Mortgage Loan Pass-Through Certificates, Class A-5 Group I (the "Class A-5 Group
I Certificates"), Access Financial Mortgage Loan Trust 1996-3 Mortgage Loan
Pass-Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-3, Mortgage Loan
Pass-Through Certificates, Class B Group I
A-2-3
<PAGE>
<PAGE>
Certificates (the "Class B Group I Certificates"), Access Financial Mortgage
Loan Trust 1996-3, Mortgage Loan Pass-Through Certificates, Class B Group II
(the "Class B Group II Certificates"), Access Financial Mortgage Loan Trust
1996-3, 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 1996-3 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 September 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 September 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
<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-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 $28,572,000.
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
<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-2-6
<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-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: August 27, 1996
A-2-9
<PAGE>
<PAGE>
EXHIBIT A-3
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-3
7.250% MORTGAGE LOAN PASS-THROUGH CERTIFICATE
CLASS A-3 GROUP I
(7.250% 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 August 27, 1996
Date
$13,552,000 November 18, 2015 003916 AQ6
- ------------------ ----------------- ----------
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
1996-3 (the "Trust") pursuant to that certain Pooling and Servicing Agreement
dated as of August 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
August 27, 1996 (the "Startup Day"), which aggregate amount on August 27, 1996
was $13,552,000. 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 1996-3, 7.250%
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 1996-3, Mortgage Loan Pass-Through Certificates, Class A-1 Group I
(the "Class A-1 Group I Certificates"), Access Financial Mortgage Loan Trust
1996-3, 6.900% Mortgage Loan Pass-Through Certificates, Class A-2 Group I (the
"Class A-2 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-3,
7.500% Mortgage Loan Pass-Through Certificates, Class A-4 Group I (the "Class
A-4 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-3, 7.600%
Mortgage Loan Pass-Through Certificates, Class A-5 Group I (the "Class A-5 Group
I Certificates"), Access Financial Mortgage Loan Trust 1996-3 Mortgage Loan
Pass-Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-3, 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 1996-3, Mortgage Loan Pass-Through Certificates, Class B Group II
(the "Class B Group II Certificates"), Access Financial Mortgage Loan Trust
1996-3, 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 1996-3, 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 September 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 September 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 $13,552,000.
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: August 27, 1996
A-3-9
<PAGE>
<PAGE>
EXHIBIT A-4
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-3
7.500% MORTGAGE LOAN PASS-THROUGH CERTIFICATE
CLASS A-4 GROUP I
(7.500% 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 August 27, 1996
Date
$10,000,000 June 18, 2021 003916 AR4
- ------------------ --------------- ----------
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
1996-3 (the "Trust") pursuant to that certain Pooling and Servicing Agreement
dated as of August 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
August 27, 1996 (the "Startup Day"), which aggregate amount on August 27, 1996
was $10,000,000. 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
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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 1996-3, 7.500%
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 1996-3, Mortgage Loan Pass-Through Certificates, Class A-1 Group I
(the "Class A-1 Group I Certificates"), Access Financial Mortgage Loan Trust
1996-3, 6.900% Mortgage Loan Pass-Through Certificates, Class A-2 Group I (the
"Class A-2 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-3,
7.250% Mortgage Loan Pass-Through Certificates, Class A-3 Group I (the "Class
A-3 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-3, 7.600%
Mortgage Loan Pass-Through Certificates, Class A-5 Group I (the "Class A-5 Group
I Certificates"), Access Financial Mortgage Loan Trust 1996-3 Mortgage Loan
Pass-Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-3, Mortgage Loan
Pass-Through Certificates, Class B Group I
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<PAGE>
Certificates (the "Class B Group I Certificates"), Access Financial Mortgage
Loan Trust 1996-3, Mortgage Loan Pass-Through Certificates, Class B Group II
(the "Class B Group II Certificates"), Access Financial Mortgage Loan Trust
1996-3, 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 1996-3, 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 September 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 September 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
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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 $10,000,000.
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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<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
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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
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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.
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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: August 27, 1996
A-4-9
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<PAGE>
EXHIBIT A-5
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-3
7.600% MORTGAGE LOAN PASS-THROUGH CERTIFICATE
CLASS A-5 GROUP I
(7.600% 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 August 27, 1996
Date
$10,744,000 September 18, 2027 003916 AS2
- ------------------ ------------------ ----------
Original Principal Final Scheduled CUSIP
Amount Payment Date
Cede & Co.
- --------------------------------------------------------------------------------
Registered Owner
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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
1996-3 (the "Trust") pursuant to that certain Pooling and Servicing Agreement
dated as of August 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
August 27, 1996 (the "Startup Day"), which aggregate amount on August 27, 1996
was $10,744,000. 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
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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 1996-3, 7.600%
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 1996-3, Mortgage Loan Pass-Through Certificates, Class A-1 Group I
(the "Class A-1 Group I Certificates"), Access Financial Mortgage Loan Trust
1996-3, 6.900% Mortgage Loan Pass-Through Certificates, Class A-2 Group I (the
"Class A-2 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-3,
7.250% Mortgage Loan Pass-Through Certificates, Class A-3 Group I (the "Class
A-3 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-3, 7.500%
Mortgage Loan Pass-Through Certificates, Class A-4 Group I (the "Class A-4 Group
I Certificates"), Access Financial Mortgage Loan Trust 1996-3 Mortgage Loan
Pass-Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-3, Mortgage Loan
Pass-Through Certificates, Class B Group I
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Certificates (the "Class B Group I Certificates"), Access Financial Mortgage
Loan Trust 1996-3, Mortgage Loan Pass-Through Certificates, Class B Group II
(the "Class B Group II Certificates"), Access Financial Mortgage Loan Trust
1996-3, 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 1996-3, 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 September 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 September 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
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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-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 $10,744,000.
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
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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
<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-5-7
<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-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: August 27, 1996
A-5-9
<PAGE>
<PAGE>
EXHIBIT A-6
ACCESS FINANCIAL MORTGAGE LOAN TRUST 1996-3
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 August 27, 1996
Date
$98,886,000 January 18, 2027 003916 AT0
- ------------------ ---------------- ----------
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
1996-3 (the "Trust") pursuant to that certain Pooling and Servicing Agreement
dated as of August 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 August 27, 1996 (the "Startup Day"), which aggregate amount on August 27,
1996 was $98,886,000. 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 1996-3 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 1996-3, Mortgage Loan Pass-Through Certificates, Class A-1 Group I
(the "Class A-1 Group I Certificates"), Access Financial Mortgage Loan Trust
1996-3, 6.900% Mortgage Loan Pass-Through Certificates, Class A-2 Group I (the
"Class A-2 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-3,
7.250% Mortgage Loan Pass-Through Certificates, Class A-3 Group I (the "Class
A-3 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-3, 7.500%
Mortgage Loan Pass-Through Certificates, Class A-4 Group I (the "Class A-4 Group
I Certificates"), Access Financial Mortgage Loan Trust 1996-3, 7.600% Mortgage
Loan Pass-Through Certificates, Class A-5 Group I (the "Class A-5 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-3, Mortgage Loan
Pass-Through Certificates, Class B Group I Certificates (the "Class B Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-3, Mortgage Loan Pass-
Through Certificates, Class B Group II (the "Class B Group II Certificates"),
Access Financial Mortgage Loan Trust 1996-3, 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 1996-3,
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 September 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 September 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 $98,886,000.
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: August 27, 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 1996-3
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 August 27, 1996
Date
$655.82 September 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
1996-3 (the "Trust") pursuant to that certain Pooling and Servicing Agreement
dated as of August 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 1996-3, 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 1996-3, Mortgage Loan Pass-Through Certificates, Class A-1 Group I
(the "Class A-1 Group I Certificates"), Access Financial Mortgage Loan Trust
1996-3, 6.900% Mortgage Loan Pass-Through Certificates, Class A-2 Group I (the
"Class A-2 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-3,
7.250% Mortgage Loan Pass-Through Certificates, Class A-3 Group I (the "Class
A-3 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-3, 7.500%
Mortgage Loan Pass-Through Certificates, Class A-4 Group I (the "Class A-4 Group
I Certificates"), Access Financial Mortgage Loan Trust 1996-3, 7.600% Mortgage
Loan Pass-Through Certificates, Class A-5 Group I (the "Class A-5 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-3 Mortgage Loan
Pass-Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-3, Mortgage Loan Pass-
Through Certificates, Class B Group II (the "Class B Group II Certificates"),
Access Financial Mortgage Loan Trust 1996-3, 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 September 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: August 27, 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 1996-3
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 August 27, 1996
Date
$999,343.08 January 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
1996-3 (the "Trust") pursuant to that certain Pooling and Servicing Agreement
dated as of August 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 1996-3, 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 1996-3, Mortgage Loan Pass-Through Certificates, Class A-1 Group I
(the "Class A-1 Group I Certificates"), Access Financial Mortgage Loan Trust
1996-3, 6.900% Mortgage Loan Pass-Through Certificates, Class A-2 Group I (the
"Class A-2 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-3,
7.250% Mortgage Loan Pass-Through Certificates, Class A-3 Group I (the "Class
A-3 Group I Certificates"), Access Financial Mortgage Loan Trust 1996-3, 7.500%
Mortgage Loan Pass-Through Certificates, Class A-4 Group I (the "Class A-4 Group
I Certificates"), Access Financial Mortgage Loan Trust 1996-3, 7.600% Mortgage
Loan Pass-Through Certificates, Class A-5 Group I (the "Class A-5 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-3 Mortgage Loan
Pass-Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-3, Mortgage Loan Pass-
Through Certificates, Class B Group I Certificates (the "Class B Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-3, 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
1996-3, 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 September 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: August 27, 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 1996-3
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: August 27, 1996
Percentage Interest: 100% September 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 August 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 1996-3, 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 September 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
B-3-2
<PAGE>
<PAGE>
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 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
B-3-3
<PAGE>
<PAGE>
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 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
B-3-4
<PAGE>
<PAGE>
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.
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 1996-3
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: August 27, 1996
Percentage Interest: 100% January 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 August 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 1996-3, 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 September 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
B-4-2
<PAGE>
<PAGE>
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 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
B-4-3
<PAGE>
<PAGE>
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 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 1996-3
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: August 27, 1996
Percentage Interest: 100% September 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 1996-3, 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 1996-3, Mortgage Loan
Pass-Through Certificates, Class A-1 Group I (the "Class A-1 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-3, 6.900% Mortgage
Loan Pass-Through Certificates, Class A-2 Group I (the "Class A-2 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-3, 7.250% Mortgage
Loan Pass-Through Certificates, Class A-3 Group I (the "Class A-3 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-3, 7.500% Mortgage
Loan Pass-Through Certificates, Class A-4 Group I (the "Class A-4 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-3, 7.600% Mortgage
Loan Pass-Through Certificates, Class A-5 Group I (the "Class A-5 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-3 Mortgage Loan
Pass-Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-3, Mortgage Loan Pass-
Through Certificates, Class B Group I Certificates (the "Class B Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-3, Mortgage Loan
Pass-Through Certificates, Class B Group II (the "Class B Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-3, 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
1996-3 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 September 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: August 27, 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 1996-3
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: August 27, 1996
Percentage Interest: 100% September 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 1996-3, 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 1996-3, Mortgage Loan
Pass-Through Certificates, Class A-1 Group I (the "Class A-1 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-3, 6.900% Mortgage
Loan Pass-Through Certificates, Class A-2 Group I (the "Class A-2 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-3, 7.250% Mortgage
Loan Pass-Through Certificates, Class A-3 Group I (the "Class A-3 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-3, 7.500% Mortgage
Loan Pass-Through Certificates, Class A-4 Group I (the "Class A-4 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-3, 7.600% Mortgage
Loan Pass-Through Certificates, Class A-5 Group I (the "Class A-5 Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-3 Mortgage Loan Pass-
Through Certificates, Class A-6 Group II (the "Class A-6 Group II
Certificates"), Access Financial Mortgage Loan Trust 1996-3, Mortgage Loan
Pass-Through Certificates, Class B Group I Certificates (the "Class B Group I
Certificates"), Access Financial Mortgage Loan Trust 1996-3, Mortgage Loan Pass-
Through Certificates, Class B Group II (the "Class B Group II Certificates"),
Access Financial Mortgage Loan Trust 1996-3, 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 1996-3
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 September 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: August 27, 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.
400 Highway 169 South, Suite 400
St. Louis Park, Minnesota 55426-0365
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 Investment Company licensed by the
U.S.
<PAGE>
<PAGE>
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
million of securities other than Excluded
D-2
<PAGE>
<PAGE>
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 August 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
<PAGE>
<PAGE>
time of the 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 August 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
August 27, 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 August 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 1996-3 Mortgage Loan Pass-Through Certificates,
Series 1996-3, 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
August 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: August 27, 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 August 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 1996-3 of the Pooling and
Servicing Agreement.
The Mortgage Loan Schedule relating to Access Financial Mortgage
Loan Trust 1996-3 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: August 27, 1996
J-1
<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.
400 Highway 169 South, Suite 400
St. Louis Park, Minnesota 55426-0365
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 August 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
1996-3 (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:
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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.
400 Highway 169 South, Suite 400
St. Louis Park, Minnesota 55426-0365
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 August 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
1996-3 (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:
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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.
400 Highway 169 South, Suite 400
St. Louis Park, Minnesota 55426-0465
Re: Pooling and Servicing Agreement, dated as of August 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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INDEMNIFICATION AGREEMENT
This Agreement, dated as of August 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 1996-3, 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, Class
RU, Class BI-S and Class BII-S issued pursuant to a Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement") dated as of
August 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 1996-3, 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
August 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 August 23, 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 August 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 August
22, 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, and the balance sheets of the Insurer as
of June 30, 1996 and the related statements of income, and cash flows
for the six months then ended, and the accompanying footnotes (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
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accounting principles consistently applied (subject to year-end
adjustments with respect to the June 30, 1996 unaudited information),
and, since June 30, 1996, there has been no material change in such
financial condition of the Insurer which would 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.
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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"
(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
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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 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")
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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 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.
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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 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
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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.
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
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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 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
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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 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
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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
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
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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 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
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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 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
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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
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
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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 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.
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(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.
(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
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If to the Seller: Access Financial Lending Corp.
400 Highway 169 South, Suite 400
St. Louis Park, MN 55426-0365
Attention: General Counsel
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
/s/ WARREN K. TONG
By:______________________________
Name: Warren K. Tong
Title: Team Leader
CARGILL FINANCIAL SERVICES
CORPORATION
/s/ KENNETH M. DUNCAN
By:______________________________
Name: Kenneth M. Duncan
Title: Senior Vice President
ACCESS FINANCIAL LENDING CORP.
/s/ LESLIE ZEJDLIK FOSTER
By:______________________________
Name: Leslie Zejdlik Foster
Title: President
PRUDENTIAL SECURITIES INCORPORATED
/s/ LEN BLUM
By:______________________________
Name: Len Blum
Title: Managing Director
J.P. MORGAN SECURITIES INC.
/s/ JACQUELINE V. BRADY
By:______________________________
Name: Jacqueline V. Brady
Title: Vice President
[Indemnification Agreement]
