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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): March 25, 1999
CWMBS, INC., (as depositor under the Trust Agreement, dated
as of March 25, 1999, providing for the issuance of the
CWMBS, INC., Resecuritization Mortgage Trust Series 1999-5,
Mortgage Resecuritization Certificates, Series 1999-5).
CWMBS, INC.
-----------
(Exact name of registrant as specified in its charter)
Delaware 333-53861 95-4596514
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(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.)
4500 Park Granada
Calabasas, California 91302
---------------------- -----
(Address of Principal (Zip Code)
Executive Offices)
Registrant's telephone number, including area code (818) 225-3240
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<PAGE>
Item 5. Other Events.
------------
On March 25, 1999, CWMBS, Inc. (the "Company") entered into a Trust
Agreement dated as of March 25, 1999 (the "Trust Agreement"), by and among the
Company, as depositor, Greenwich Capital Markets, inc. ("GCM"), as underlying
certificate seller, and The Bank of New York, as trustee
(the "Trustee"), providing for the issuance of the Company's Mortgage
Resecuritization Certificates, Series 1999-5. The Trust Agreement is annexed
hereto as Exhibit 99.1.
<PAGE>
Item 7. Financial Statements, Pro Forma Financial
-----------------------------------------
Information and Exhibits.
------------------------
(a) Not applicable.
(b) Not applicable.
(c) Exhibits:
99.1. The Trust Agreement, dated as of March 25, 1999, by and among the
Company, GCM and the Trustee.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CWMBS, INC.
By: /s/ Celia Coulter
-----------------
Celia Coulter
Vice President
Dated: November 5, 1999
<PAGE>
Exhibit Index
Exhibit Page
- ------- ----
99.1. Trust Agreement,
dated as of March 25, 1999, by
and among, the Company, GCM
and the Trustee. 6
<PAGE>
EXHIBIT 99.1
Execution Copy
CWMBS, INC.,
Depositor
GREENWICH CAPITAL MARKETS, INC.,
Underlying Certificate Seller
and
THE BANK OF NEW YORK,
Trustee
-------------------------------
TRUST AGREEMENT
Dated as of March 25, 1999
-------------------------------
CWMBS, Inc.
Resecuritization Mortgage Trust
Series 1999-5
<PAGE>
<TABLE>
<CAPTION>
Table of Contents
Page
<S> <C>
ARTICLE I
DEFINITIONS
Section 1.01. Defined Terms..........................................................................5
ARTICLE II
CONVEYANCE OF THE DEPOSITED UNDERLYING CERTIFICATES;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01. Conveyance of the Deposited Underlying Certificates...................................17
Section 2.02. Acceptance by Trustee.................................................................18
Section 2.03. Representations and Warranties of the Underlying Certificate Seller...................18
Section 2.04. Representations and Warranties of the Depositor.......................................20
Section 2.05. Issuance of Certificates..............................................................21
Section 2.06. Miscellaneous REMIC Provisions........................................................21
Section 2.07. Presentation for Transfer.............................................................22
ARTICLE III
ADMINISTRATION OF THE TRUST FUND; PAYMENTS AND REPORTS TO
CERTIFICATEHOLDERS
Section 3.01. Defaults by the Underlying Trust......................................................23
Section 3.02. Distribution Account; Class A-3 Reserve Fund..........................................23
Section 3.03. Permitted Withdrawals From the Distribution Account and the Class A-3 Reserve Fund....24
Section 3.04. Distributions.........................................................................25
Section 3.05. Distributions in Reduction of the Class A-3 Certificates..............................26
Section 3.06. Allocation of Realized Losses.........................................................30
Section 3.07. Policy Matters........................................................................31
Section 3.08. Statements to Certificateholders......................................................34
Section 3.09. Reports of the Trustee; Distribution Account..........................................35
Section 3.10. Access to Certain Documentation and Information.......................................35
ARTICLE IV
THE CERTIFICATES
Section 4.01. The Certificates......................................................................36
Section 4.02. Certificate Register; Registration of Transfer and Exchange of Certificates...........36
Section 4.03. Mutilated, Destroyed, Lost or Stolen Certificates.....................................40
Section 4.04. Persons Deemed Owners.................................................................41
Section 4.05. Access to List of Certificateholders' Names and Addresses.............................41
Section 4.06. Maintenance of Office or Agency.......................................................41
ARTICLE V
CONCERNING THE TRUSTEE
Section 5.01. Duties of Trustee.....................................................................42
Section 5.02. Certain Matters Affecting the Trustee.................................................42
Section 5.03. Trustee Not Liable for Certificates or Deposited Underlying Certificates..............44
Section 5.04. Trustee May Own Certificates..........................................................44
Section 5.05. Trustee's Fees and Expenses...........................................................44
Section 5.06. Indemnification of the Trustee........................................................44
Section 5.07. Eligibility Requirements for Trustee..................................................45
Section 5.08. Resignation and Removal of Trustee....................................................45
Section 5.09. Successor Trustee.....................................................................46
Section 5.10. Merger or Consolidation of Trustee....................................................46
Section 5.11. Appointment of Co-Trustee or Separate Trustee.........................................46
Section 5.12. Tax Matters...........................................................................48
Section 5.13. Periodic Filings......................................................................50
ARTICLE VI
THE DEPOSITOR
Section 6.01. Liability of the Depositor............................................................51
Section 6.02. Merger, Consolidation or Conversion of the Depositor..................................51
Section 6.03. Limitation on Liability of the Depositor and Others...................................51
ARTICLE VII
TERMINATION
Section 7.01. Termination upon Liquidation or Purchase of Deposited Underlying Certificates.........53
Section 7.02. Final Distribution on the Certificates................................................53
Section 7.03. Additional Termination Requirements...................................................54
ARTICLE VIII
MISCELLANEOUS PROVISIONS
Section 8.01. Amendment.............................................................................56
Section 8.02. Action Under and Conflicts With the Underlying Agreement..............................57
Section 8.03. Recordation of Agreement..............................................................57
Section 8.04. Certain REMIC Matters.................................................................58
Section 8.05. Limitation on Rights of Certificateholders............................................58
Section 8.06. Governing Law.........................................................................59
Section 8.07. Notices...............................................................................59
Section 8.08. Severability of Provisions............................................................59
Section 8.09. Successors and Assigns................................................................60
Section 8.10. Article and Section Headings..........................................................60
Section 8.11. Certificates Nonassessable and Fully Paid.............................................60
Schedule I - List of Deposited Underlying Certificates and Underlying Agreements
Exhibit A-1 - Form of Class [A-1][A-2] Certificate............................................................A-1-1
Exhibit A-2 - Form of Class A-3 Certificate...................................................................A-2-1
Exhibit A-3 - Form of Class A-4 Certificate...................................................................A-3-1
Exhibit B - Form of Class T Certificate.........................................................................B-1
Exhibit C - Form of Residual Certificate........................................................................C-1
Exhibit D - Form of Reverse of Certificate......................................................................D-1
Exhibit E - Form of Transferor Affidavit........................................................................E-1
Exhibit F - Form of Transfer Affidavit for the Class A-R Certificate ...........................................F-1
Exhibit G - Form of Financial Guaranty Insurance Policy ........................................................G-1
</TABLE>
<PAGE>
TRUST AGREEMENT, dated as of March 25, 1999, by and among CWMBS, Inc., as
depositor (the "Depositor"), Greenwich Capital Markets, Inc., as underlying
certificate seller (the "Underlying Certificate Seller"), and The Bank of New
York, as trustee (the "Trustee").
W I T N E S S E T H:
WHEREAS, the Depositor, the Underlying Certificate Seller and the Trustee
desire to enter into a trust agreement dated as of the date hereof (the "Trust
Agreement"); and
WHEREAS, the Underlying Certificate Seller has transferred the Deposited
Underlying Certificates (as defined herein) to the Depositor pursuant to a
bill of sale executed by the Underlying Certificate Seller in favor of the
Depositor;
NOW THEREFORE, in consideration of the mutual agreements herein
contained, the parties hereto agree as follows:
PRELIMINARY STATEMENT
The Depositor is the owner of the Trust Fund that is hereby conveyed to
the Trustee in return for the Certificates. The Trust Fund for federal income
tax purposes will consist of two REMICs. The Subsidiary REMIC will consist of
all of the assets constituting the Trust Fund and will be evidenced by the
Subsidiary REMIC Regular Interests (which will be uncertificated and will
represent the "regular interests" in the Subsidiary REMIC) and the SR Interest
as the single "residual interest" in the Subsidiary REMIC. The Trustee will
hold the Subsidiary REMIC Regular Interests. The Master REMIC will consist of
the Subsidiary REMIC Regular Interests and will be evidenced by the Regular
Certificates (which will represent the "regular interests" in the Master
REMIC) and the MR Interest as the single "residual interest" in the Master
REMIC. The Class A-R Certificate will represent beneficial ownership of the SR
Interest and the MR Interest. The "latest possible maturity date" for federal
income tax purposes of all interests created hereby will be the Latest
Possible Maturity Date.
The following table sets forth characteristics of the Certificates,
together with the minimum denominations and integral multiples in excess
thereof in which such Classes shall be issuable (except that one Certificate
of each Class of Certificates may be issued in a different amount and, in
addition, one Residual Certificate representing the Tax Matters Person
Certificate may be issued in a different amount):
<PAGE>
<TABLE>
<CAPTION>
Integral
Initial Class Multiples
Certificate Pass-Through Minimum in Excess of
Class Designation Balance Rate Denomination Minimum
- ---------------------- ------------------------- ---------------- ----------------------------- ---------------------
<S> <C> <C> <C> <C>
Class A-1 $259,877,800.00 6.75% $25,000.00 $1,000.00
Class A-2 $14,955,000.00 6.75% $25,000.00 $1,000.00
Class A-3 $15,045,000.00 6.55% $1,000.00 $1,000.00
Class A-4 (1) 0.12% $25,000.00(2) $1,000.00(2)
Class T $120,000.00 6.75% $120,000.00 N/A
Class A-R(3) $268.32 6.75% $268.32 N/A
</TABLE>
- ----------------------
(1) The Class A-4 Certificates will be Notional Amount Certificates, will
have no principal balance and will bear interest on their Notional Amount
(initially $15,045,000.00).
(2) Minimum Denomination is based on the Notional Amount of such Class.
(3) The Class A-R Certificates will represent the beneficial ownership of the
SR Interest (described in the table below) and the MR Interest. The
initial principal balance and interest rate applicable to the MR Interest
shall be equal to the initial Class Certificate Balance and Pass-Through
Rate, respectively, of the Class A-R Certificate.
Principal of and interest on the Subsidiary REMIC Regular Interests
and the SR Interest shall be allocated to the Corresponding Classes of
Certificates in the manner set forth in the following table:
<TABLE>
<CAPTION>
Corresponding Class of Certificates(1)
Subsidiary REMIC Initial Principal Allocation Allocation
Interest Balance Interest Rate of Principal of Interest
-------- ------- ------------- ------------ -----------
<S> <C> <C> <C> <C>
1 $259,877,800.00 6.75% A-1 A-1
2 $14,955,000.00 6.75% A-2 A-2
3 $15,045,000.00 6.75% A-3 A-3, A-4, FSA
Premium(2)
4 $268.32 6.75% A-R(3) A-R(3)
5 $120,000.00 6.75% T T
SR (4) (4) MR(3) MR(3)
</TABLE>
- ----------------------
(1) The amount of principal and interest allocable from a Subsidiary REMIC
Regular Interest to its Corresponding Class of Certificates on any
Distribution Date shall be 100%.
(2) Interest at a rate of 0.12% on Subsidiary REMIC Regular Interest 1 will
be allocated to the Class A-4 Certificates; interest at a rate of 6.55%
on Subsidiary REMIC Regular Interest 1 will be allocated to the Class A-3
Certificates and the remaining interest at a rate of 0.08% will be
payable to Financial Security as the FSA Premium pursuant to Section
3.04(a)(i).
(3) The beneficial ownership of the MR Interest and the SR Interest is
represented by the Class A-R Certificates.
(4) The SR Interest will have no principal balance and will not bear
interest.
<TABLE>
<CAPTION>
Set forth below are designations of Classes of Certificates to the categories
used herein:
<S> <C>
Accretion Directed
Certificates........................ None.
Accrual Certificates................ None.
Accrual Components.................. None.
Book-Entry Certificates............. All Classes of Certificates other than the Physical Certificates.
Component Certificates.............. None.
Components.......................... For purposes of calculating distributions, the Component Certificates will be
comprised of multiple payment components having the designations, Initial Component
Balances and Pass-Through Rates set forth below:
Initial
Component
Designation Balance Pass-Through Rate
----------- --------- -----------------
N/A N/A N/A
Delay Certificates.................. All interest-bearing Classes of Certificates other than the Non-Delay Certificates,
if any.
ERISA-Restricted
Certificates........................ Residual Certificates.
Floating Rate Certificates.......... None.
Inverse Floating Rate
Certificates........................ None.
COFI Certificates................... None.
LIBOR Certificates.................. None.
Non-Delay Certificates.............. None.
Notional Amount
Certificates........................ Class A-4 Certificates.
Offered Certificates................ All Classes of Certificates other than the Class T Certificate.
Physical Certificates............... Class T Certificate and the Residual Certificates.
Planned Principal Classes........... None.
Primary Planned Principal
Classes............................. None.
Principal Only
Certificates........................ None.
Private Certificates................ Class T Certificate.
Rating Agencies..................... S&P and Fitch.
Regular Certificates................ All Classes of Certificates other than the Residual Certificates.
Residual Certificates............... Class A-R Certificate.
Scheduled Principal
Classes............................. None.
Secondary Planned Principal
Class............................... None.
Senior Certificates................. Class A-1, Class A-2, Class A-3, Class A-4, Class T and Class A-R Certificates.
Subordinated Certificates .......... None.
Support Classes..................... None.
Targeted Principal
Classes............................. None.
</TABLE>
With respect to any of the foregoing designations as to which the
corresponding reference is "None," all defined terms and provisions herein
relating solely to such designations shall be of no force or effect, and any
calculations herein incorporating references to such designations shall be
interpreted without reference to such designations and amounts. Defined terms
and provisions herein relating to statistical rating agencies not designated
above as Rating Agencies shall be of no force or effect.
ARTICLE I
DEFINITIONS
Section 1.01. Defined Terms. Whenever used in this Agreement, the
following words and phrases, unless the context otherwise requires, shall have
the following meanings:
Aggregate FSA Premium: On any Distribution Date, the sum of (a) the FSA
Premium for such Distribution Date and (b) the amount of any FSA Premium which
was not distributed to Financial Security on any prior Distribution Date.
Agreement: This Trust Agreement and all amendments hereof and supplements
hereto.
Allocated Underlying Net Interest Shortfalls: As to any Distribution
Date, the Underlying Net Interest Shortfalls allocated to the Deposited
Underlying Certificates in accordance with the Underlying Agreement in
connection with distributions thereon for such Distribution Date.
Allocated Underlying Net Prepayment Interest Shortfalls: As to any
Distribution Date, the Underlying Net Prepayment Interest Shortfalls allocated
to the Deposited Underlying Certificates in accordance with the Underlying
Agreement in connection with distributions thereon for such Distribution Date.
Allocated Underlying Realized Losses: As to any Distribution Date, the
Underlying Realized Losses (including Underlying Excess Losses) allocated to
the Deposited Underlying Certificates in accordance with the Underlying
Agreement in connection with distributions thereon for such Distribution Date.
Allocated Underlying Relief Act Reductions: As to any Distribution Date,
the Underlying Relief Act Reductions allocated to the Deposited Underlying
Certificates in accordance with the Underlying Agreement in connection with
distributions thereon for such Distribution Date.
Available Interest Funds: As to any Distribution Date, the aggregate of
all previously undistributed amounts received by the Trustee on or prior to
such Distribution Date as distributions of interest on the Deposited
Underlying Certificates.
Available Principal Funds: As to any Distribution Date, the aggregate of
all previously undistributed amounts received by the Trustee on or prior to
such Distribution Date as distributions of principal on the Deposited
Underlying Certificates, reduced by the sum of expenses and liabilities
reimbursable to the Depositor pursuant to Section 6.03 hereof and any taxes
imposed on the Trust to be paid from amounts otherwise distributable to
Certificateholders pursuant to Section 5.12 hereof (in each case, that have
not been previously paid by a reduction of Available Principal Funds).
Book-Entry Certificate: As specified in the Preliminary Statement.
Business Day: Any day other than (i) a Saturday or a Sunday, or (ii) a
day on which banking institutions in the City of New York, New York, or the
State of California or the city in which the Corporate Trust Office of the
Trustee is located are authorized or obligated by law or executive order to be
closed.
Certificate: Any one of the Certificates executed by the Trustee
substantially in the forms attached hereto as exhibits.
Certificate Balance: With respect to any Certificate at any date, the
maximum dollar amount of principal to which the Holder thereof is then
entitled hereunder, such amount being equal to the Denomination thereof minus
the sum of (i) all distributions of principal previously made with respect
thereto and (ii) all Allocated Underlying Realized Losses allocated thereto,
except in the case of a Class A-3 Certificate, as provided in the proviso to
Section 3.06(d).
Certificateholder or Holder: The person in whose name a Certificate is
registered in the Certificate Register, except that, solely for the purpose of
giving any consent pursuant to this Agreement, any Certificate registered in
the name of the Depositor or any affiliate of the Depositor shall be deemed
not to be Outstanding and the Percentage Interest evidenced thereby shall not
be taken into account in determining whether the requisite amount of
Percentage Interests necessary to effect such consent has been obtained;
provided, however, that if any such Person (including the Depositor) owns 100%
of the Percentage Interests evidenced by a Class of Certificates, such
Certificates shall be deemed to be Outstanding for purposes of any provision
hereof that requires the consent of the Holders of Certificates of a
particular Class as a condition to the taking of any action hereunder. The
Trustee is entitled to rely conclusively on a certification of the Depositor
or any affiliate of the Depositor in determining which Certificates are
registered in the name of an affiliate of the Depositor.
Certificate Owner: With respect to a Book-Entry Certificate, the Person
who is the beneficial owner of such Book-Entry Certificate.
Certificate Register: The register maintained pursuant to Section
4.02(a).
Class: All Certificates bearing the same designation as set forth in the
Preliminary Statement.
Class A Certificates: All of the Class A-1, Class A-2, Class A-3 and
Class A-4 Certificates.
Class A-1 Certificates: The Certificates executed and countersigned by
the Trustee substantially in the form set forth in Exhibit A-1 hereto.
Class A-2 Certificates: The Certificates executed and countersigned by
the Trustee substantially in the form set forth in Exhibit A-1 hereto.
Class A-3 Certificates: The Certificates executed and countersigned by
the Trustee substantially in the form set forth in Exhibit A-2 hereto.
Class A-4 Certificates: The Certificates executed and countersigned by
the Trustee substantially in the form set forth in Exhibit A-3 hereto.
Class A-R Certificate: Collectively, the single Certificate and the Tax
Matters Person Certificate, in each case executed and countersigned by the
Trustee substantially in the form set forth in Exhibit C hereto.
Class T Certificate: The single Certificate executed and countersigned by
the Trustee substantially in the form set forth in Exhibit B hereto.
Class A-3 Policy: The irrevocable Financial Guaranty Insurance Policy,
No. 50791-N, including any endorsements thereto, issued by Financial Security
with respect to the Class A-3 Certificates, in the form attached hereto as
Exhibit G.
Class A-3 Policy Payments Account: The separate Eligible Account created
and maintained by the Trustee pursuant to Section 3.07(d) in the name of the
Trustee for the benefit of the Class A-3 Certificateholders and designated
"The Bank of New York in trust for registered holders of CWMBS, Inc.
Resecuritization Mortgage Certificates, Series 1999-5, Class A-3". Funds in
the Class A-3 Policy Payments Account shall be held in trust for the Class A-3
Certificateholders for the uses and purposes set forth in this Agreement.
Class A-3 Prepayment Interest Shortfall Amount: With respect to any
Distribution Date, the Allocated Underlying Net Prepayment Interest Shortfalls
for such Distribution Date allocated to the Class A-3 Certificates pursuant to
Section 3.04(d).
Class A-3 Reserve Fund: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 3.02(c) with a depository
institution in the name of the Trustee for the benefit of the
Certificateholders specified in Section 3.02(c) and designated "The Bank of
New York Class A-3 Reserve Fund in trust for registered holders of CWMBS, Inc.
Resecuritization Mortgage Certificates, Series 1999-5, Class A-3". The Class
A-3 Reserve Fund will not be a part of the Trust Fund or any REMIC created
hereunder and, for all federal income tax purposes, will be beneficially owned
by Greenwich Capital Markets, Inc.
Class A-3 Rounding Account: The separate Eligible Account established and
maintained by the Trustee pursuant to Section 3.05(e) in the name of the
Trustee for the benefit of the Class A-3 Certificateholders and designated
"The Bank of New York in trust for registered holders of CWMBS, Inc.
Resecuritization Mortgage Certificates, Series 1999-5, Class A-3". Funds in
the Class A-3 Rounding Account shall be held in trust for the Class A-3
Certificateholders for the uses and purposes set forth in this Agreement. The
Class A-3 Rounding Account will not be a part of the Trust Fund or either
REMIC created hereunder and, for all federal income tax purposes, will be
beneficially owned by Greenwich Capital Markets, Inc.
Class A-3 Rounding Amount: With respect to any Distribution Date, the
amount, if any, required to be withdrawn from the Class A-3 Rounding Account
pursuant to Section 3.05(e).
Class Certificate Balance: With respect to any Class and as to any date
of determination, the aggregate of the Certificate Balances of all
Certificates of such Class as of such date.
Class Interest Shortfall: As to any Distribution Date and Class, the
amount by which the amount described in clause (i) of the definition of Class
Optimal Interest Distribution Amount for such Class exceeds the amount of
interest actually distributed on such Class on such Distribution Date pursuant
to such clause (i).
Class Optimal Interest Distribution Amount: With respect to any
Distribution Date and interest bearing Class, the sum of (i) one month's
interest accrued during the related Interest Accrual Period at the
Pass-Through Rate for such Class on the related Class Certificate Balance,
subject to reduction as provided in 3.04(e) and (ii) any Class Unpaid Interest
Amounts for such Class.
Class Unpaid Interest Amounts: As to any Distribution Date and Class of
interest bearing Certificates, the amount by which the aggregate Class
Interest Shortfalls for such Class on prior Distribution Dates exceeds the
amount distributed on such Class on prior Distribution Dates pursuant to
clause (ii) of the definition of Class Optimal Interest Distribution Amount.
Closing Date: March 25, 1999.
Code: The Internal Revenue Code of 1986, including any successor or
amendatory provisions.
Corporate Trust Office: The designated office of the Trustee in the State
of New York at which at any particular time its corporate trust business with
respect to this Agreement shall be administered, which office at the date of
the execution of this Agreement is located at 101 Barclay Street, 12E, New
York, New York 10286 (Attn: Mortgage-Backed Securities Group, CWMBS, Inc.
Series 1999-5), facsimile no. (212) 815-4135, and which is the address to
which notices to and correspondence with the Trustee should be directed.
Corresponding Classes of Certificates: With respect to each Subsidiary
REMIC Regular Interest, any Class of Certificates or Components appearing
opposite such Subsidiary REMIC Regular Interest in the Preliminary Statement.
Deceased Holder: With respect to a Class A-3 Certificateholder as defined
in Section 3.05(b).
Denomination: With respect to each Certificate, the amount set forth on
the face thereof as the "Initial Certificate Balance of this Certificate" or
the "Initial Notional Amount of this Certificate" or, if neither of the
foregoing, the Percentage Interest appearing on the face thereof.
Deposited Underlying Certificates: As set forth on Schedule I hereto.
Depositor: CWMBS, Inc., a Delaware corporation, or its successors in
interest.
Depository: The Depository Trust Company, or any successor Depository
hereafter named. The nominee of the initial Depository for purposes of
registering those Certificates that are to be Book-Entry Certificates is Cede
& Co. The Depository shall at all times be a "clearing corporation" as defined
in Section 8-102(a)(5) of the Uniform Commercial Code of the State of New York
and a "clearing agency" registered pursuant to the provisions of Section 17A
of the Securities Exchange Act of 1934, as amended.
Depository Participant: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
Definitive Certificate: Any definitive, fully registered Certificate.
Distribution Account: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 3.02 in the name of the Trustee
for the benefit of the Certificateholders and designated "The Bank of New York
in trust for registered holders of CWMBS, Inc. Resecuritization Mortgage
Certificates, Series 1999-5." Funds in the Distribution Account shall be held
in trust for the Certificateholders for the uses and purposes set forth in
this Agreement.
Distribution Account Deposit Date: As to any Distribution Date, 12:30
p.m. Pacific time on the Business Day immediately preceding such Distribution
Date.
Distribution Date: The 25th day of each calendar month after the initial
issuance of the Certificates, or if such 25th day is not a Business Day, the
next succeeding Business Day, commencing in April 1999.
Eligible Account: Any of (i) an account or accounts maintained with a
federal or state chartered depository institution or trust company the
short-term unsecured debt obligations of which (or, in the case of a
depository institution or trust company that is the principal subsidiary of a
holding company, the debt obligations of such holding company) have the
highest short-term ratings of each Rating Agency at the time any amounts are
held on deposit therein, or (ii) an account or accounts in a depository
institution or trust company in which such accounts are insured by the FDIC
(to the limits established by the FDIC) and the uninsured deposits in which
accounts are otherwise secured such that, as evidenced by an Opinion of
Counsel delivered to the Trustee and to each Rating Agency, the
Certificateholders have a claim with respect to the funds in such account or a
perfected first priority security interest against any collateral (which shall
be limited to Permitted Investments) securing such funds that is superior to
claims of any other depositors or creditors of the depository institution or
trust company in which such account is maintained, or (iii) a trust account or
accounts maintained with (a) the trust department of a federal or state
chartered depository institution or (b) a trust company, acting in its
fiduciary capacity or (iv) any other account acceptable to each Rating Agency.
Eligible Accounts may bear interest, and may include, if otherwise qualified
under this definition, accounts maintained with the Trustee.
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
ERISA-Restricted Certificate: As specified in the Preliminary Statement.
Financial Security: Financial Security Assurance Inc., a stock insurance
company organized and created under the laws of the State of New York, or any
successor thereto.
Financial Security Contact Person: The officer designated by the
Depositor to provide information to Financial Security pursuant to section
3.07(i).
Financial Security Default: As defined in Section 3.07(l).
Fitch: Fitch IBCA, Inc., or any successor thereto. If Fitch is designated
as a Rating Agency in the Preliminary Statement, for purposes of Section 8.07
the address for notices to Fitch shall be Fitch IBCA, Inc., One State Street
Plaza, New York, New York 10004, Attention: Residential Mortgage Surveillance
Group, or such other address as Fitch may hereafter furnish to the Depositor
and the Trustee.
FSA Premium: With respect to any Distribution Date and the Class A-3
Policy an amount equal to the sum of (i) 1/12th of the product of (a) the
Class Certificate Balance of the Class A-3 Certificates as of such
Distribution Date (prior to giving effect to any distributions thereon on such
Distribution Date) and (b) 0.08%.
Guaranteed Distributions: With respect to any Distribution Date, (i) the
interest accrued on the Class A-3 Certificates for the related Interest
Accrual Period at the applicable Pass-Through Rate, reduced by the amount of
Allocated Underlying Net Interest Shortfalls allocated to the Class A-3
Certificates for such Distribution Date arising from Allocated Underlying
Relief Act Reductions and Allocated Underlying Net Prepayment Interest
Shortfalls allocated to the Class A-3 Certificates for such Distribution Date,
(ii) the amount of Allocated Underlying Net Prepayment Interest Shortfalls
allocated to the Class A-3 Certificates for such Distribution Date, to the
extent not covered by payments from the Class A-3 Reserve Fund, (iii) the
amount of Allocated Underlying Realized Losses allocated to the Class A-3
Certificates for such Distribution Date and (iv) the Certificate Balances of
all Class A-3 Certificates to the extent unpaid on the Distribution Date in
May 2028 or such earlier date as the Trust is terminated pursuant to Section
7.01.
Individual Class A-3 Certificate: Any Class A-3 Certificate with a $1,000
Certificate Balance.
Initial Certificate Principal Balance: With respect to each Class of
Certificates, the Class Certificate Balance of such Class on the Closing Date.
Interest Accrual Period: With respect to each Class of Delay Certificates
and any Distribution Date, the calendar month prior to the month of such
Distribution Date.
Interest Rate: With respect to each Subsidiary REMIC Interest, the
applicable rate set forth or calculated in the manner described in the
Preliminary Statement.
Investment Company Act: The Investment Company Act of 1940, as amended.
Living Holders: Holders of the Class A-3 Certificates, other than the
Deceased Holders.
Majority in Interest: As to any Class of Certificates, the Holders of
Certificates of such Class evidencing, in the aggregate, at least 51% of the
Percentage Interests evidenced by all Certificates of such Class.
MR Interest: The sole class of "residual interest" in the Master REMIC.
Notional Amount: With respect to any Distribution Date and the Class A-4
Certificates, an amount equal to the Class Certificate Balance of the Class
A-3 Certificates immediately prior to such Distribution Date.
Notional Amount Certificates: As specified in the Preliminary Statement.
Officers' Certificate: A certificate signed by the Chairman of the Board,
the President or a Vice President or Assistant Vice President and by the
Treasurer, the Secretary or one of the Assistant Treasurers or Assistant
Secretaries of the Depositor as required by this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be counsel for
the Depositor, including, in-house counsel, reasonably acceptable to the
Trustee; provided, however, that with respect to the interpretation or
application of the REMIC Provisions, such counsel must (i) in fact be
independent of the Depositor, (ii) not have any direct financial interest in
the Depositor or in any affiliate thereof, and (iii) not be connected with the
Depositor as an officer, employee, promoter, underwriter, trustee, partner,
director or person performing similar functions.
Ownership Interest: As to any Certificate, any ownership interest in such
Certificate including any interest in such Certificate as the Holder thereof
and any other interest therein, whether direct or indirect, legal or
beneficial.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore executed and authenticated under
this Agreement except:
(i) Certificates theretofore cancelled by the Trustee or delivered
to the Trustee for cancellation; and
(ii) Certificates in exchange for which or in lieu of which other
Certificates have been executed and delivered by the Trustee pursuant to
this Agreement.
Pass-Through Rate: For any interest bearing Class of Certificates, the
per annum rate set forth in the Preliminary Statement.
Percentage Interest: As to any Certificate, the percentage interest
evidenced thereby in distributions required to be made on the related Class,
such percentage interest being set forth on the face thereof or equal to the
percentage obtained by dividing the Denomination of such Certificate by the
aggregate of the Denominations of all Certificates of the same Class.
Permitted Investments: At any time, any one or more of the following
obligations and securities:
(i) obligations of the United States or any agency thereof, provided
such obligations are backed by the full faith and credit of the United
States;
(ii) general obligations of or obligations guaranteed by any state
of the United States or the District of Columbia receiving the highest
long-term debt rating of each Rating Agency, or such lower rating as will
not result in the downgrading or withdrawal of the ratings then assigned
to the Certificates by each Rating Agency;
(iii) commercial or finance company paper which is then receiving
the highest commercial or finance company paper rating of each Rating
Agency, or such lower rating as will not result in the downgrading or
withdrawal of the ratings then assigned to the Certificates by each
Rating Agency, without regard to the Class A-3 Policy;
(iv) certificates of deposit, demand or time deposits, or bankers'
acceptances issued by any depository institution or trust company
incorporated under the laws of the United States or of any state thereof
and subject to supervision and examination by federal and/or state
banking authorities, provided that the commercial paper and/or long term
unsecured debt obligations of such depository institution or trust
company (or in the case of the principal depository institution in a
holding company system, the commercial paper or long-term unsecured debt
obligations of such holding company, but only if Moody's is not a Rating
Agency) are then rated one of the two highest long-term and the highest
short-term ratings of each Rating Agency for such securities, or such
lower ratings as will not result in the downgrading or withdrawal of the
rating then assigned to the Certificates by either Rating Agency, without
regard to the Class A-3 Policy;
(v) demand or time deposits or certificates of deposit issued by any
bank or trust company or savings institution to the extent that such
deposits are fully insured by the FDIC;
(vi) guaranteed reinvestment agreements issued by any bank,
insurance company or other corporation containing, at the time of the
issuance of such agreements, such terms and conditions as will not result
in the downgrading or withdrawal of the rating then assigned to the
Certificates by either Rating Agency, without regard to the Class A-3
Policy;
(vii) repurchase obligations with respect to any security described
in clauses (i) and (ii) above, in either case entered into with a
depository institution or trust company (acting as principal) described
in clause (iv) above;
(viii) securities (other than stripped bonds, stripped coupons or
instruments sold at a purchase price in excess of 115% of the face amount
thereof) bearing interest or sold at a discount issued by any corporation
incorporated under the laws of the United States or any state thereof
which, at the time of such investment, have one of the two highest
ratings of each Rating Agency (except if the Rating Agency is Moody's,
such rating shall be the highest commercial paper rating of Moody's for
any such securities), or such lower rating as will not result in the
downgrading or withdrawal of the rating then assigned to the Certificates
by either Rating Agency as evidenced by a signed writing delivered by
each Rating Agency without regard to the Class A-3 Policy;
(ix) units of a taxable money-market portfolio having the highest
rating assigned by each Rating Agency (except if Fitch or Duff & Phelps
is a Rating Agency and has not rated the portfolio, the highest rating
assigned by Moody's) and restricted to obligations issued or guaranteed
by the United States of America or entities whose obligations are backed
by the full faith and credit of the United States of America and
repurchase agreements collateralized by such obligations; and
(x) such other investments bearing interest or sold at a discount
acceptable to each Rating Agency as will not result in the downgrading or
withdrawal of the rating then assigned to the Certificates by either
Rating Agency, without regard to the guaranty provided by the Class A-3
Policy, as evidenced by a signed writing delivered by each Rating Agency;
provided, that no such instrument shall be a Permitted Investment if such
instrument evidences the right to receive interest only payments with respect
to the obligations underlying such instrument.
Permitted Transferee: Any person other than (i) the United States, any
State or political subdivision thereof, or any agency or instrumentality of
any of the foregoing, (ii) a foreign government, International Organization or
any agency or instrumentality of either of the foregoing, (iii) an
organization (except certain farmers' cooperatives described in section 521 of
the Code) which is exempt from tax imposed by Chapter 1 of the Code (including
the tax imposed by section 511 of the Code on unrelated business taxable
income) on any excess inclusions (as defined in section 860E(c)(l) of the
Code) with respect to any Residual Certificate, (iv) rural electric and
telephone cooperatives described in section 1381(a)(2)(C) of the Code, (v) an
"electing large partnership" as defined in section 775 of the Code, (vi) a
Person that is not a citizen or resident of the United States, a corporation,
partnership, or other entity created or organized in or under the laws of the
United States, any state thereof or the District of Columbia, an estate whose
income from sources without the United States is includible in gross income
for United States federal income tax purposes regardless of its connection
with the conduct of a trade or business within the United States or a trust if
a court within the United States is able to exercise primary supervision over
the administration of the trust and one or more United States persons have the
authority to control all substantial decisions of the trust unless such Person
has furnished the transferor and the Trustee with a duly completed Internal
Revenue Service Form 4224 or any applicable successor form, and (vii) any
other Person so designated by the Depositor based upon an Opinion of Counsel
that the Transfer of an Ownership Interest in a Residual Certificate to such
Person may cause either REMIC hereunder to fail to qualify as a REMIC at any
time that the Certificates are outstanding. The terms "United States," "State"
and "International Organization" shall have the meanings set forth in section
7701 of the Code or successor provisions. A corporation will not be treated as
an instrumentality of the United States or of any State or political
subdivision thereof for these purposes if all of its activities are subject to
tax and, with the exception of the Federal Home Loan Mortgage Corporation, a
majority of its board of directors is not selected by such government unit.
Person: Any individual, corporation, partnership, joint venture, bank,
joint-stock company, trust (including any beneficiary thereof), unincorporated
organization or government or any agency or political subdivision thereof.
Purchase Price: As defined in Section 2.03(a) hereof.
Rating Agencies: S&P and Fitch.
Record Date: The last Business Day of the calendar month preceding the
month in which such Distribution Date occurs.
Regular Certificates: As described in the Preliminary Statement.
REMIC: A "real estate mortgage investment conduit" within the meaning of
section 860D of the Code.
REMIC Change of Law: Any proposed, temporary or final regulation, revenue
ruling, revenue procedure or other official announcement or interpretation
relating to REMICs and the REMIC Provisions issued after the Closing Date.
REMIC Provisions: Provisions of the federal income tax law relating to
real estate mortgage investment conduits, which appear at sections 860A
through 860G of Subchapter M of Chapter 1 of the Code, and related provisions,
and regulations promulgated thereunder, as the foregoing may be in effect from
time to time as well as provisions of applicable state laws.
Required Coupon: 6.75% per annum.
Residual Certificates: As described in the Preliminary Statement.
Responsible Officer: When used with respect to the Trustee, any Vice
President, any Assistant Vice President, the Secretary, any Assistant
Secretary, any Trust Officer or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also to whom, with respect to a particular matter, such matter is
referred because of such officer's knowledge of and familiarity with the
particular subject.
Rule 3a-7: Rule 3a-7 of the Investment Company Act, as then in effect (or
any successor rule).
S&P: Standard & Poor's, a division of The McGraw-Hill Companies, Inc. If
S&P is designated as a Rating Agency in the Preliminary Statement, for
purposes of Section 8.07 the address for notices to S&P shall be Standard &
Poor's, 26 Broadway, 15th Floor, New York, New York 10004, Attention: Mortgage
Surveillance Monitoring, or such other address as S&P may hereafter furnish to
the Depositor and the Trustee.
SR Interest: The sole class of "residual interest" in the Subsidiary
REMIC.
Start-up Day: With respect to each REMIC hereunder, the day designated as
such pursuant to Section 2.06(b).
Subsidiary REMIC: As described in the Preliminary Statement.
Subsidiary REMIC Interest: Any one of the Subsidiary REMIC Regular
Interests or the SR Interest.
Subsidiary REMIC Interest Rate: With respect to each Subsidiary REMIC
Interest, the applicable rate set forth or calculated in the manner described
in the Preliminary Statement.
Subsidiary REMIC Regular Interest: Any one of the "regular interests" in
the Subsidiary REMIC described in the Preliminary Statement.
Tax Matters Person: The person designated as "tax matters person" in the
manner provided under Treasury regulation ss. 1.860F-4(d) and temporary
Treasury regulation ss. 301.6231(a)(7)1T. Initially, the Tax Matters Person
shall be the Trustee.
Tax Matters Person Certificate: The Class A-R Certificate with a
Denomination of $0.05.
Transfer: Any direct or indirect transfer or sale of any Ownership
Interest in a Residual Certificate.
Transfer Affidavit: A certificate substantially in the form of Exhibit F
annexed hereto.
Transferor Affidavit: A certificate substantially in the form of Exhibit
E hereto.
Trustee: The Bank of New York and its successors and, if a successor
trustee is appointed hereunder, such successor.
Trust Fund: The corpus of the trust created by this Agreement and
evidenced by the Certificates, consisting of: (i) the Deposited Underlying
Certificates, (ii) all distributions due on the Deposited Underlying
Certificates after March 25, 1999, (iii) the Distribution Account, the Class
A-3 Policy Payments Account and such assets as are deposited therein from time
to time, (iv) the Class A-3 Policy and (v) all proceeds of the conversion,
voluntary or involuntary, of any of the foregoing. The Class A-3 Rounding
Account and the Class A-3 Reserve Fund will not be a part of the Trust Fund.
UCC: The Uniform Commercial Code as in effect in the State of New York as
of the date hereof.
Underlying Agreement: The Pooling and Servicing Agreement dated as of
April 1, 1998 among CWMBS, Inc., as depositor, Countrywide Home Loans, Inc.,
as seller and master servicer, and The Bank of New York, as trustee, as may be
amended, supplemented or otherwise modified from time to time in accordance
with its terms.
Underlying Certificate Account: Means the "Certificate Account" as
defined in the Underlying Agreement.
Underlying Certificate Seller: Greenwich Capital Markets, Inc., a
Delaware corporation, or its successors in interest.
Underlying Excess Losses: Means "Excess Losses" as defined in the
Underlying Agreement.
Underlying Net Interest Shortfalls: Means "Net Interest Shortfalls" as
defined in the Underlying Agreement.
Underlying Net Prepayment Interest Shortfalls: Means "Net Prepayment
Interest Shortfalls" as defined in the Underlying Agreement.
Underlying Realized Losses: Means "Realized Losses" as defined in the
Underlying Agreement.
Underlying Relief Act Reductions: Means any "Relief Act Reductions" as
defined in the Underlying Agreement.
Underlying Senior Credit Support Depletion Date: Means the "Senior Credit
Support Depletion Date" as defined in the Underlying Agreement.
Underlying Trust: Means the "Trust Fund" as defined in the Underlying
Agreement.
Underlying Trustee: Means "Trustee" as defined in the Underlying
Agreement.
Voting Rights: The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. As of any date of
determination, (a) 1% of all Voting Rights shall be allocated to each Class of
Notional Amount Certificates, if any (such Voting Rights to be allocated among
the holders of Certificates of each such Class in accordance with their
respective Percentage Interests), and (b) the remaining Voting Rights (or 100%
of the Voting Rights if there is no Class of Notional Amount Certificates)
shall be allocated among Holders of the remaining Classes of Certificates in
proportion to the Certificate Balances of their respective Certificates on
such date.
<PAGE>
ARTICLE II
CONVEYANCE OF THE DEPOSITED UNDERLYING CERTIFICATES;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01. Conveyance of the Deposited Underlying Certificates. The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, convey, sell and assign to the Trustee, on behalf of the Holders of
the Certificates, without recourse, all the right, title and interest of the
Depositor in and to the Deposited Underlying Certificates with appropriate
endorsements and other documentation sufficient under the Underlying Agreement
to transfer each such Deposited Underlying Certificate to the Trustee,
including all distributions thereon due after March 25, 1999, and all proceeds
of the foregoing. Each of the Underlying Certificate Seller and the Depositor
severally agrees to transfer to the Trustee promptly upon receipt (by wire
transfer of immediately available funds), any amounts it receives in respect
of the Deposited Underlying Certificates due thereon after March 25, 1999.
The transfer of the Deposited Underlying Certificates and all other
assets constituting the Trust Fund is absolute and is intended by the parties
hereto as a sale. The Trustee shall cause the Deposited Underlying
Certificates to be registered in the name of "The Bank of New York, in trust
for registered Holders of CWMBS, Inc., Resecuritization Mortgage Trust, Series
1999-5, Resecuritization Mortgage Certificates, Series 1999-5." The Trustee
shall at all times maintain physical possession of the Deposited Underlying
Certificates in the State of New York, and shall not assign, sell, dispose of
or transfer any interest in the Deposited Underlying Certificates or any other
asset constituting the Trust Fund (except as may be expressly provided by this
Agreement), or permit the Deposited Underlying Certificates or any other asset
constituting the Trust Fund to be subjected to any lien, claim or encumbrance
arising by, through or under the Trustee or any person claiming by, through or
under the Trustee. The Depositor agrees to provide to the Trustee all
documents required for the transfer to the Trustee of the Deposited Underlying
Certificates.
It is intended that the conveyance of the Deposited Underlying
Certificates by the Depositor to the Trustee as provided in this Section be,
and be construed as, a sale of the Deposited Underlying Certificates by the
Depositor to the Trustee for the benefit of the Certificateholders. It is,
further, not intended that such conveyance be deemed a pledge of the Deposited
Underlying Certificates by the Depositor to the Trustee to secure a debt or
other obligation of the Depositor. However, in the event that the Deposited
Underlying Certificates are held to be the property of the Depositor, or if
for any reason this Agreement is held or deemed to create a security interest
in the Deposited Underlying Certificates, then it is intended that (a) this
Agreement shall also be deemed to be a security agreement within the meaning
of Articles 8 and 9 of the UCC and the corresponding articles of the Uniform
Commercial Code of any other applicable jurisdiction; (b) the conveyance
provided for in this Section shall be deemed to be a grant by the Depositor to
the Trustee for the benefit of the Certificateholders of a security interest
in all of the Depositor's right, title and interest, whether now owned or
hereafter acquired, in and to (A) the Deposited Underlying Certificates, (B)
all distributions thereon due to the holders of the Deposited Underlying
Certificates after March 25, 1999 in respect of the terms thereof and (C) all
proceeds of the conversion, voluntary or involuntary, of the foregoing into
cash, instruments, securities or other property, including without limitation
all amounts from time to time held or invested in the Distribution Account,
whether in the form of cash, instruments, securities or other property; (c)
the possession by the Trustee or its agent of the Deposited Underlying
Certificates and such other items of property as constitute instruments,
money, negotiable documents or chattel paper shall be deemed to be "possession
by the secured party" or possession by a purchaser or a person designated by
such secured party, for purposes of perfecting the security interest pursuant
to the UCC and the Uniform Commercial Code of any other applicable
jurisdiction; and (d) notifications to persons holding such property, and
acknowledgments, receipts or confirmations from persons holding such property,
shall be deemed notifications to, or acknowledgments, receipts or
confirmations from, financial intermediaries, bailees or agents (as
applicable) of the Trustee for the purpose of perfecting such security
interest under applicable law. The Depositor and the Trustee, at the
Depositor's direction and expense, shall, to the extent consistent with this
Agreement, take such actions as may be necessary to ensure that, if this
Agreement were deemed to create a security interest in the Deposited
Underlying Certificates and other assets constituting the Trust Fund described
above, such security interest would be deemed to be a perfected security
interest of first priority under applicable law and will be maintained as such
throughout the term of the Agreement.
Section 2.02. Acceptance by Trustee. The Trustee hereby acknowledges
receipt of the Deposited Underlying Certificates and declares that it holds
and will hold the Deposited Underlying Certificates, all proceeds of any of
the foregoing and all other rights, titles, or interests of the Trustee in any
asset included in the Trust Fund from time to time, in trust for the use and
benefit of all present and future Certificateholders. The Trustee agrees, for
the benefit of Certificateholders, to confirm that the class designation and
original principal balance with respect to the Deposited Underlying
Certificates conform to the information set forth on Schedule I on the Closing
Date.
Section 2.03. Representations and Warranties of the Underlying
Certificate Seller. The Underlying Certificate Seller hereby represents and
warrants to the Depositor and the Trustee
(a) With respect to the Deposited Underlying Certificates as of the
Closing Date as follows:
(i) prior to the transfer of the Deposited Underlying Certificates
to the Depositor, the Underlying Certificate Seller was the sole owner of
the Deposited Underlying Certificates free and clear of any lien, pledge,
charge or encumbrance of any kind;
(ii) the Underlying Certificate Seller has not assigned any interest
in the Deposited Underlying Certificates or any distributions thereon,
except as contemplated herein; and
(iii) the endorsements and other documents furnished to the
Depositor and the Trustee in connection with the Deposited Underlying
Certificates are sufficient to effect the transfer of the Deposited
Underlying Certificates to the Trustee pursuant to Section 2.01 hereof.
The representations and warranties set forth in this Section 2.03(a)
shall survive the transfer and assignment of the Deposited Underlying
Certificates by the Depositor to the Trustee. Upon discovery by the Underlying
Certificate Seller, the Depositor or a Responsible Officer of the Trustee of a
breach of any of the foregoing representations and warranties which materially
and adversely affects the interests of the Certificateholders in the Deposited
Underlying Certificates, the Underlying Certificate Seller, the Depositor or
the Trustee shall give prompt written notice to the other parties and to the
Certificateholders. On or prior to the Distribution Date in June 1999, the
Underlying Certificate Seller shall cure such breach in all material respects
or, if such breach cannot be cured, the Underlying Certificate Seller shall
repurchase the Deposited Underlying Certificates from the Trustee on the
Distribution Date immediately following the date on which the Underlying
Certificate Seller is so directed by Holders of a Majority in Interest of the
related Class or Classes of Regular Certificates. Any such repurchase of the
Deposited Underlying Certificates by the Underlying Certificate Seller shall
be accomplished on the Distribution Date of repurchase, by the payment on the
Business Day prior to such Distribution Date by the Underlying Certificate
Seller to the Trustee of an amount (in immediately available funds) (the
"Purchase Price") equal to the principal balance of the Deposited Underlying
Certificates immediately prior to the Distribution Date of such repurchase
plus unpaid interest thereon due on or prior to the Distribution Date of such
repurchase (it being understood that all distributions made on the Deposited
Underlying Certificates up to immediately prior to the Distribution Date of
such repurchase shall be property of the Trust Fund). The payment of the
Purchase Price shall be considered a prepayment in full of the Deposited
Underlying Certificates and shall be delivered to the Trustee for deposit in
the Distribution Account in accordance with the provisions of Section 3.02
hereof. Upon such deposit into such Distribution Account, the repurchased
Deposited Underlying Certificates shall be released to the Underlying
Certificate Seller, and the Trustee and the Depositor shall execute and
deliver such instruments of transfer or assignment, in each case without
recourse, as shall be reasonably requested and provided by the Underlying
Certificate Seller to vest in the Underlying Certificate Seller, or its
designee or assignee, title to the Deposited Underlying Certificates
repurchased pursuant hereto. The obligation of the Underlying Certificate
Seller to cure such breach of representations and warranties or effect such
repurchase of the Deposited Underlying Certificates shall constitute the sole
remedy respecting such breach available to Certificateholders or the Trustee
on behalf of Certificateholders.
(b) With respect to the Underlying Certificate Seller:
(i) The Underlying Certificate Seller is a corporation duly
organized, validly existing and in good standing under the laws of the
State of Delaware with full power and authority to execute, deliver and
perform this Agreement.
(ii) This Agreement has been duly authorized, executed and delivered
by the Underlying Certificate Seller and constitutes the legal, valid and
binding agreement of the Underlying Certificate Seller, enforceable in
accordance with its terms, except as enforcement hereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
now or hereafter in effect relating to or affecting creditors' rights
generally or by general principles of equity, regardless of whether such
enforceability is considered in a proceeding in equity or at law.
(iii) Neither the execution nor the delivery of this Agreement nor
the issuance, delivery and sale of the Certificates, nor the consummation
of any other of the transactions contemplated herein nor the fulfillment
of the terms of this Agreement or the Certificates will result in the
breach of any term or provision of the charter, by-laws or resolutions of
the Underlying Certificate Seller or conflict with, result in a breach,
violation or acceleration of or constitute a default under, the terms of
any material indenture or other agreement or instrument to which the
Underlying Certificate Seller is a party or by which it is bound, or any
statute, order or regulation applicable to the Underlying Certificate
Seller of any court, regulatory body, administrative agency or
governmental body having jurisdiction over the Underlying Certificate
Seller.
(iv) There are no actions or proceedings against, or investigations
of, the Underlying Certificate Seller pending, or, to the knowledge of
the Underlying Certificate Seller, threatened, before any court,
administrative agency or other tribunal (A) asserting the invalidity of
this Agreement or the Certificates, (B) seeking to prevent the issuance
of the Certificates or the consummation of any of the transactions
contemplated by this Agreement, or (C) which might materially and
adversely affect the validity or enforceability of this Agreement or the
Certificates.
It is understood and agreed that the representations and warranties
set forth in this Section 2.03(b) shall survive delivery of the Trust Fund to
the Trustee. Upon discovery by the Underlying Certificate Seller, the
Depositor or a Responsible Officer of the Trustee of a breach of any of the
foregoing representations and warranties which breach materially and adversely
affects the interests of the Certificateholders, the party discovering such
breach shall give prompt written notice to the other parties and to the Rating
Agencies.
Section 2.04. Representations and Warranties of the Depositor. The
Depositor hereby represents and warrants to the Trustee as of the Closing Date
as follows:
(i) The Depositor is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware with full
power and authority to execute, deliver and perform this Agreement.
(ii) This Agreement has been duly authorized, executed and delivered
by the Depositor and constitutes the legal, valid and binding agreement
of the Depositor, enforceable in accordance with its terms, except as
enforcement hereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in
effect relating to or affecting creditors' rights generally or by general
principles of equity, regardless of whether such enforceability is
considered in a proceeding in equity or at law.
(iii) Neither the execution nor the delivery of this Agreement nor
the issuance, delivery and sale of the Certificates, nor the consummation
of any other of the transactions contemplated herein nor the fulfillment
of the terms of this Agreement or the Certificates will result in the
breach of any term or provision of the charter or by-laws of the
Depositor or conflict with, result in a breach, violation or acceleration
of or constitute a default under, the terms of any material indenture or
other agreement or instrument to which the Depositor is a party or by
which it is bound, or any statute, order or regulation applicable to the
Depositor of any court, regulatory body, administrative agency or
governmental body having jurisdiction over the Depositor.
(iv) There are no actions or proceedings against, or investigations
of, the Depositor pending, or, to the knowledge of the Depositor,
threatened, before any court, administrative agency or other tribunal (A)
asserting the invalidity of this Agreement or the Certificates, (B)
seeking to prevent the issuance of the Certificates or the consummation
of any of the transactions contemplated by this Agreement, or (C) which
might materially and adversely affect the validity or enforceability of
this Agreement or the Certificates.
It is understood and agreed that the representations and warranties
set forth in this Section 2.04 shall survive delivery of the Trust Fund to the
Trustee. Upon discovery by the Depositor or a Responsible Officer of the
Trustee of a breach of any of the foregoing representations and warranties
which breach materially and adversely affects the interests of the
Certificateholders, the party discovering such breach shall give prompt
written notice to the other party and to the Rating Agencies.
Section 2.05. Issuance of Certificates. The Trustee acknowledges the
receipt by it of the Deposited Underlying Certificates and concurrently with
such receipt, the Trustee has duly executed, countersigned and delivered, to
or upon the order of the Depositor, the Certificates in authorized
denominations and registered in such names as the Depositor has directed in
writing.
Section 2.06. Miscellaneous REMIC Provisions. (a) The Class A-1, Class
A-2, Class A-3, Class A-4 and Class T Certificates are hereby designated as
"regular interests," and the Class MR Interest is hereby designated as the
single class of "residual interests," in the Master REMIC for purposes of
Sections 860G(a)(1) and 860G(a)(2) of the Code. The Subsidiary REMIC Regular
Interests are hereby designated as "regular interests" and the Class SR
Interest is hereby designated as the single class of "residual interests" in
the Subsidiary REMIC for purposes of Sections 860(G)(a)(1) and 860(G)(a)(2) of
the Code. The "latest possible maturity date" of each class of REMIC regular
interests will be the Distribution Date in May 2028.
(b) The Closing Date will be the "Start-up Day" of each REMIC hereunder
within the meaning of Section 860G(a)(9) of the Code.
(c) The Trustee, is hereby designated as the "tax matters person" of each
REMIC hereunder within the meaning of Section 6231(a)(7) of the Code.
Section 2.07. Presentation for Transfer. On the Closing Date, the
Underlying Certificate Seller, the Depositor and/or the Trustee (as
appropriate) shall present the documents described in Section 2.01 for
registration of transfer of the Deposited Underlying Certificates to the
Trustee, pursuant to the requirements under the Underlying Agreement.
<PAGE>
ARTICLE III
ADMINISTRATION OF THE TRUST FUND;
PAYMENTS AND REPORTS TO CERTIFICATEHOLDERS
Section 3.01. Defaults by the Underlying Trust. In connection with its
receipt of any distribution on the Deposited Underlying Certificates on any
Distribution Date, if (i) the amount of any distribution varies from the
amount due thereon pursuant to the terms of the Underlying Agreement, (ii) the
Trustee shall not have received a distribution by the close of business on
such Distribution Date, or (iii) a Responsible Officer of the Trustee shall
gain actual knowledge of any default under the Underlying Agreement, the
Trustee shall promptly notify the Depositor, the Underlying Certificate Seller
and the Certificateholders, and shall, subject to the provisions of Article V
hereof, pursue such remedies as may be available to it as holder of such
Deposited Underlying Certificates in accordance with the terms of the
Underlying Agreement.
Section 3.02. Distribution Account; Class A-3 Reserve Fund. (a) The
Trustee, for the benefit of the Certificateholders, shall establish and
maintain an account (the "Distribution Account"), which shall be an Eligible
Account, entitled "CWMBS, Inc. Resecuritization Mortgage Trust, Series
1999-5". The Trustee shall upon receipt deposit in the Distribution Account
the following payments and collections in respect of the Deposited Underlying
Certificates:
(i) all distributions due and received on the Deposited Underlying
Certificates after March 25, 1999;
(ii) any amount required to be deposited in the Distribution Account
pursuant to Section 2.03(a) hereof in connection with the repurchase of a
Deposited Underlying Certificate by the Underlying Certificate Seller;
and
(iii) any amounts required to be deposited in the Distribution
Account pursuant to Section 7.01 in connection with the purchase by the
Holder of the Residual Certificate of the Deposited Underlying
Certificates.
The foregoing requirements for deposit in the Distribution Account shall
be exclusive. The Trustee shall give notice to the Depositor of the location
of the Distribution Account upon establishment thereof and prior to any change
thereof.
(b) Upon a determination by the Trustee that the final distribution shall
be made in respect of a Deposited Underlying Certificate, the Trustee shall
take such steps as may be necessary in connection with the final payment
thereon in accordance with the terms and conditions of the Underlying
Agreement. The Trustee shall promptly deposit in the Distribution Account the
final distribution received upon presentment and surrender of the affected
Deposited Underlying Certificate.
(c) The Trustee shall establish and maintain the Class A-3 Reserve Fund
which shall be an Eligible Account into which there shall have been deposited
the amount of $17,000.00 on the Closing Date. No additional funds will be
deposited in the Class A-3 Reserve Fund and all interest thereon shall be held
in trust for the benefit of the Holders of the Class A-3 Certificates until
withdrawn in accordance with Section 3.03. Greenwich Capital Markets, Inc.
will be the beneficial owner of the Class A-3 Reserve Fund for all federal
income tax purposes.
(d) The institution at which the Class A-3 Reserve Fund is maintained
shall invest the funds therein as directed in writing by the Underlying
Certificate Seller in Permitted Investments, which shall mature not later than
the second Business Day next preceding the related Distribution Account
Deposit Date (except that if such Permitted Investment is an obligation of the
institution that maintains such account, then such Permitted Investment shall
mature not later than the Business Day next preceding such Distribution
Account Deposit Date). All such Permitted Investments shall be made in the
name of the Trustee, for the benefit of the Certificateholders. All income or
gain (net of any losses) realized from any such investment of funds on deposit
in the Class A-3 Reserve Fund shall be credited thereto. The Trustee in its
fiduciary capacity shall not be liable for the amount of any loss incurred in
respect of any investment or lack of investment of funds held in the Class A-3
Reserve Fund and made in accordance with this Section 3.02.
(e) The Depositor shall give notice to the Trustee, the Underlying
Certificate Seller, Financial Security and each Rating Agency of any proposed
change of the location of the Distribution Account or the Class A-3 Reserve
Fund prior to any change thereof.
Section 3.03. Permitted Withdrawals From the Distribution Account and the
Class A-3 Reserve Fund. (a) The Trustee may from time to time withdraw funds
from the Distribution Account for the following purposes:
(i) to make payments to Certificateholders and Financial Security in
the amounts and in the manner provided in Section 3.04;
(ii) to make deposits to the Class A-3 Rounding Account in the
manner provided in Section 3.05(d);
(iii) to reimburse the Depositor for expenses incurred by and
reimbursable to the Depositor with respect to each REMIC hereunder
pursuant to Section 6.03;
(iv) to pay any taxes imposed upon each REMIC hereunder, as provided
in Section 5.12; and
(v) to clear and terminate the Distribution Account upon the
termination of the Trust Fund.
(b) The Trustee shall from time to time make withdrawals from the Class
A-3 Reserve Fund on behalf of the Trust Fund on or prior to each Distribution
Date, to withdraw from the Class A-3 Reserve Fund an amount equal to the
lesser of (a) the Class A-3 Prepayment Interest Shortfall Amount for the
related Distribution Date, and (b) the amount on deposit in the Class A-3
Reserve Fund, and remit such amount to the Distribution Account for
distribution to the Class A-3 Certificateholders on such Distribution Date.
Section 3.04. Distributions.
(a) On each Distribution Date, the Trustee shall withdraw from the
Distribution Account the Available Interest Funds for such Distribution Date
and apply such funds to the payment of the FSA Premium and to distributions of
interest on the Certificates, in the following order of priority:
(i) to Financial Security, the Aggregate FSA Premium;
(ii) to each Class of Certificates, an amount equal to the related
Class Optimal Interest Distribution Amount; and
(iii) the amount remaining (if any) to the Holder of the Class A-R
Certificate.
(b) On each Distribution Date, the Trustee shall withdraw from the
Distribution Account the Available Principal Funds for such Distribution Date
and apply such funds to distributions in respect of principal on the
Certificates in the following order of priority:
(i) to the Class T Certificate in an amount equal to the product of
(x) Available Principal Funds for such Distribution Date and (y) the
percentage equivalent of a fraction, the numerator of which is the Class
Certificate Balance of the Class T Certificate immediately prior to such
Distribution Date and the denominator of which is the aggregate Class
Certificate Balances of all Certificates immediately prior to such
Distribution Date;
(ii) to the Class A-R Certificate until the Class Certificate
Balance thereof is reduced to zero;
(iii) commencing with the April 2002 Distribution Date and as long
as the Class Certificate Balance of the Class A-1 Certificates is greater
than zero, to the Class A-3 Certificates, an amount up to $15,045 (the
"Controlled Amortization Amount") until the Class Certificate Balance
thereof is reduced to zero;
(iv) to the Class A-1 Certificates, until the Class Certificate
Balance thereof is reduced to zero;
(v) to the Class A-2 and Class A-3 Certificates, pro rata in
accordance with their respective Class Certificate Balances immediately
prior to such Distribution Date (unless the Class A-3 Certificates are
paid the Controlled Amortization Amount on such Distribution Date, in
which case such Class Certificate Balance of the Class A-3 Certificates
will be determined after giving effect to the payment of the Controlled
Amortization Amount), until the respective Class Certificate Balances
thereof are reduced to zero; and
(vi) the amount remaining (if any) to the Holder of the Class A-R
Certificate.
(c) On each Distribution Date, Available Interest Funds and Available
Principal Funds shall each be distributed on the Subsidiary REMIC Regular
Interests, in each case in an amount sufficient to make the distributions to
the Corresponding Classes of Certificates on such Distribution Date in
accordance with the provisions of Sections 3.04(a) and 3.04(b).
(d) On each Distribution Date, the Trustee shall distribute the amount
withdrawn from the Class A-3 Reserve Fund with respect to such Distribution
Date pursuant to Section 3.03(b) and shall apply such funds to distributions
on the Class A-3 Certificates as interest thereon.
On each Distribution Date, the amount referred to in clause (i) of the
definition of Class Optimal Interest Distribution Amount for each Class of
Certificates for such Distribution Date shall be reduced by such Class's pro
rata share (based on interest then due and payable to such Class) of Allocated
Underlying Net Interest Shortfalls for such Distribution Date, except as
provided in Section 3.07 with respect to the Class A-3 Certificates, such
reductions shall not include Allocated Underlying Net Interest Shortfalls to
the extent covered by the Class A-3 Policy.
Section 3.05. Distributions in Reduction of the Class A-3 Certificates. (a)
Except as provided in subclauses (d) and (f) below, on each Distribution Date
on which distributions in reduction of the Class Certificate Balance of the
Class A-3 Certificates (collectively, the "Designated Certificates" and each a
"Designated Certificate") are made, such distributions will be made in the
following priority:
(i) any request by the personal representative of a Deceased Holder
or by a surviving tenant by the entirety, by a surviving joint tenant or
by a surviving tenant in common or other Person empowered to act on
behalf of such Deceased Holder upon his or her death, in an amount up to
but not exceeding $100,000 per request; and
(ii) any request by a Living Holder, in an amount up to but not
exceeding $10,000 per request.
Thereafter, distributions will be made as provided in clauses (i) and
(ii) above up to a second $100,000 and $10,000 per request, respectively. This
sequence of priorities will be repeated for each request for principal
distributions made by the Certificate Owners of Designated Certificates until
all such requests have been honored.
Requests for distributions in reduction of the Certificate Balances of
Designated Certificates presented on behalf of the Deceased Holders in
accordance with the provisions of clause (i) above will be accepted in the
order of their receipt by the Depository. Requests for distributions in
reduction of the Certificate Balances of Designated Certificates presented in
accordance with the provisions of clause (ii) above will be accepted in the
order of priority established by the random lot procedures of the Depository
after all requests with respect to such Certificates presented in accordance
with clause (i) have been honored. All requests for distributions in reduction
of the Certificate Balances of the Designated Certificates with respect to any
Distribution Date shall be made in accordance with Section 3.05(c) below and
must be received by the Depository and forwarded to, and received by, the
Trustee no later than the close of business on the related Record Date.
Requests for distributions which are received by the Depository and forwarded
to the Trustee after the related Record Date and requests, in either case, for
distributions timely received but not accepted with respect to any
Distribution Date, will be treated as requests for distributions in reduction
of the Certificate Balances of the applicable Designated Certificates on the
next succeeding Distribution Date, and each succeeding Distribution Date
thereafter, until each such request is accepted or is withdrawn as provided in
Section 3.05(c). Such requests as are not so withdrawn shall retain their
order of priority without the need for any further action on the part of the
appropriate Certificate Owner of the related Designated Certificate, all in
accordance with the procedures of the Depository and the Trustee. Upon the
transfer of beneficial ownership of any Designated Certificate, any
distribution request previously submitted with respect to such Certificate
will be deemed to have been withdrawn only upon the receipt by the Trustee of
notification of such withdrawal using a form required by the Depository.
Distributions in reduction of the Certificate Balances of Designated
Certificates will be applied, in the aggregate, to such related Designated
Certificates in an amount equal to the portion of the Available Principal
Funds distributable to the related Designated Certificates pursuant to Section
3.04(b), plus any amounts available for distribution from the Class A-3
Rounding Account pursuant to Section 3.05(e), provided that the aggregate
distribution in reduction of the Class Certificate Balance of a Designated
Certificate on any Distribution Date is made in an integral multiple of
$1,000.
(b) A "Deceased Holder" is a Certificate Owner of a Class A-3 Certificate
who was living at the time such interest was acquired and whose authorized
personal representative, surviving tenant by the entirety, surviving joint
tenant or surviving tenant in common or other person empowered to act on
behalf of such Certificate Owner upon his or her death, causes to be furnished
to the Trustee a certified copy of the death certificate of such Certificate
Owner and any additional evidence of death required by and satisfactory to the
Trustee and any tax waivers requested by the Trustee. Designated Certificates
beneficially owned by tenants by the entirety, joint tenants or tenants in
common will be considered to be beneficially owned by a single owner. The
death of a tenant by the entirety, joint tenant or tenant in common will be
deemed to be the death of the Certificate Owner, and the Designated
Certificates so beneficially owned will be eligible for priority with respect
to distributions in reduction of the Class Certificate Balance of the related
Class of Designated Certificates, subject to the limitations stated above.
Designated Certificates beneficially owned by a trust will be considered to be
beneficially owned by each beneficiary of the trust to the extent of such
beneficiary's beneficial interest therein, but in no event will a trust's
beneficiaries collectively be deemed to be Certificate Owners of a number of
Individual Designated Certificates greater than the number of Individual
Designated Certificates of which such trust is the beneficial owner. The death
of a beneficiary of a trust will be deemed to be the death of a Certificate
Owner of the Designated Certificates beneficially owned by the trust to the
extent of such beneficiary's beneficial interest in such trust. The death of
an individual who was a tenant by the entirety, joint tenant or tenant in
common in a tenancy which is the beneficiary of a trust will be deemed to be
the death of the beneficiary of the trust. The death of a person who, during
his or her lifetime, was entitled to substantially all of the beneficial
ownership interests in Designated Certificates will be deemed to be the death
of the Certificate Owner of such Designated Certificates regardless of the
registration of ownership of such Designated Certificates, if such beneficial
interest can be established to the satisfaction of the Trustee. Such
beneficial interest will be deemed to exist in typical cases of street name or
nominee ownership, ownership by a trustee, ownership under the Uniform Gifts
to Minors Act and community property or other joint ownership arrangements
between a husband and wife. Beneficial interests shall include the power to
sell, transfer or otherwise dispose of a Designated Certificate and the right
to receive the proceeds therefrom, as well as interest and distributions in
reduction of the Certificate Balances of the Designated Certificates payable
with respect thereto. The Trustee shall not be under any duty to determine
independently the occurrence of the death of any deceased Certificate Owner.
The Trustee may rely entirely upon documentation delivered to it pursuant to
Section 3.05(a) in establishing the eligibility of any Certificate Owner to
receive the priority accorded Deceased Holders in Section 3.05(a).
(c) Requests for distributions in reduction of the Certificate Balance of
a Designated Certificate must be made by delivering a written request therefor
to the Depository Participant or Indirect Participant that maintains the
account evidencing the Certificate Owner's interest in such Designated
Certificate. Such Depository Participant or Indirect Participant should in
turn make the request of the Depository (or, in the case of an Indirect
Participant, such Indirect Participant must notify the related Depository
Participant of such request, which Depository Participant should make the
request of the Depository) on a form required by the Depository and provided
to the Depository Participant. Upon receipt of such request, the Depository
will date and time stamp such request and forward such request to the Trustee.
The Depository may establish such procedures as it deems fair and equitable to
establish the order of receipt or requests for such distributions received by
it on the same day. The Trustee shall not be liable for any delay in delivery
of requests for distributions or withdrawals of such requests by the
Depository, a Depository Participant or any Indirect Participant.
In the event any requests for distributions in reduction of the
Certificate Balance of a Designated Certificate are rejected by the Trustee
for failure to comply with the requirements of this Section 3.05, the Trustee
shall return such requests to the appropriate Depository Participant with a
copy to the Depository with an explanation as to the reason for such
rejection.
The Trustee shall maintain a list of those Depository Participants
representing the Certificate Owners of Designated Certificates that have
submitted requests for distributions in reduction of the Certificate Balances
of such Designated Certificates, together with the order of receipt and the
amounts of such requests. The Trustee shall notify the Depository and the
appropriate Depository Participants as to which requests should be honored on
each Distribution Date. Requests shall be honored by the Depository in
accordance with the procedures, and subject to the priorities and limitations,
described in this Section 3.05. The exact procedures to be followed by the
Trustee and the Depository for purposes of determining such priorities and
limitations shall be those established from time to time by the Trustee or the
Depository, as the case may be. The decisions of the Trustee and the
Depository concerning such matters shall be final and binding on all affected
Persons.
Payments in reduction of the Certificate Balance of a Designated
Certificate shall be made on the applicable Distribution Date and the
Certificate Balances as to which such payments are made shall cease to bear
interest after the last day of the month preceding the month in which such
Distribution Date occurs.
Any Certificate Owner of a Designated Certificate which has requested a
distribution may withdraw its request by so notifying in writing the
Depository Participant or Indirect Participant that maintains such Certificate
Owner's account. In the event that such account is maintained by an Indirect
Participant, such Indirect Participant must notify the related Depository
Participant which in turn must forward the withdrawal of such request, on a
form required by the Depository, to the Trustee. If such notice of withdrawal
of a request for distribution has not been received by the Depository and
forwarded to the Trustee on or before the Record Date for the next
Distribution Date, the previously made request for distribution will be
irrevocable with respect to the making of distributions in reduction of the
Certificate Balance of such Designated Certificate on such Distribution Date.
(d) To the extent, if any, that distributions in reduction of the Class
Certificate Balance of a Class of Designated Certificates on a Distribution
Date exceed the aggregate Certificate Balances of the Designated Certificates
with respect to which distribution requests have been received by the related
Record Date, as provided in Sections 3.04(a) and 3.04(b) above, distributions
in reduction of the Class Certificate Balance of such Class of Designated
Certificates will be made by mandatory distributions in reduction thereof. The
Trustee shall notify the Depository of the aggregate amount of the mandatory
distribution in reduction of the Class Certificate Balance of the Class of
Designated Certificates to be made on the next Distribution Date. The
Depository shall then allocate such aggregate amount among its Depository
Participants on a random lot basis. Each Depository Participant and, in turn,
each Indirect Participant, will then select, in accordance with its own
procedures, Individual Designated Certificates from among those held in its
accounts to receive mandatory distributions in reduction of the Class
Certificate Balance of the related Designated Certificates, such that the
total amount so selected is equal to the aggregate amount of such mandatory
distributions allocated to such Depository Participant by the Depository and
to such Indirect Participant by its related Depository Participant, as the
case may be. Depository Participants and Indirect Participants which hold
Designated Certificates selected for mandatory distributions in reduction of
the Class Certificate Balance are required to provide notice of such mandatory
distributions to the affected Certificate Owners.
(e) On the Closing Date, the Class A-3 Rounding Account shall be
established with the Trustee and Greenwich Capital Markets, Inc. shall cause
to be initially deposited the sum of $1000 therein. On each Distribution Date
on which a distribution is made in reduction of the Class Certificate Balance
of the Class of Designated Certificates, funds on deposit in the Class A-3
Rounding Account shall be, to the extent needed, withdrawn by the Trustee and
applied to round upward to an integral multiple of $1,000 the aggregate
distribution in reduction of the Class Certificate Balance to be made on the
Class of Designated Certificates. Rounding of such distribution on the
Designated Certificates shall be accomplished, on the first such Distribution
Date, by withdrawing from the Class A-3 Rounding Account the amount of funds,
if any, needed to round the amount otherwise available for such distribution
in reduction of the Class Certificate Balance of such Class of Designated
Certificates upward to the next integral multiple of $1,000. On each
succeeding Distribution Date on which distributions in reduction of the Class
Certificate Balance of a Class of Designated Certificates are to be made, the
aggregate amount of such distributions allocable to a Designated Certificate
shall be applied first to repay any funds withdrawn from the Class A-3
Rounding Account and not previously repaid, and then the remainder of such
allocable amount, if any, shall be similarly rounded upward and applied as
distributions in reduction of the Class Certificate Balance of the Class of
Designated Certificates; this process shall continue on succeeding
Distribution Dates until the Class Certificate Balance of the Class of
Designated Certificates has been reduced to zero. The Class A-3 Rounding
Account shall be an "outside reserve fund" under the REMIC Provisions that is
beneficially owned for all federal income tax purposes by Greenwich Capital
Markets, Inc. Greenwich Capital Markets, Inc. shall report all income, gain,
deduction or loss with respect thereto. The Trustee shall distribute interest
earnings, if any, on amounts held in the Class A-3 Rounding Account as such
interest is earned pursuant to written instructions from Greenwich Capital
Markets, Inc. to the Trustee.
Notwithstanding anything herein to the contrary, on the Distribution Date
on which distributions in reduction of the Class Certificate Balance of the
Class of Designated Certificates will reduce the Class Certificate Balance
thereof to zero or in the event that distributions in reduction of the Class
Certificate Balance of the Class of Designated Certificates are made in
accordance with the provisions set forth in Section 3.05(f), an amount equal
to the difference between $1,000 and the sum then held in the Class A-3
Rounding Account shall be paid from the Available Principal Funds for such
Distribution Date to the Class A-3 Rounding Account. Any funds then on deposit
in the Class A-3 Rounding Account shall be distributed to Greenwich Capital
Markets, Inc.
(f) Notwithstanding any provisions herein to the contrary, on each
Distribution Date following the first Distribution Date on or after the
Underlying Senior Credit Support Depletion Date, distributions in reduction of
the Class Certificate Balances of the Designated Certificates will be made
among the Holders of the Class of Designated Certificates, pro rata, based on
Certificate Balances, and will not be made in integral multiples of $1,000 or
pursuant to requested distributions or mandatory distributions by random lot.
In the event that Definitive Certificates representing the Designated
Certificates are issued pursuant to Section 4.02(e), an amendment to this
Agreement, which may be approved without the consent of any
Certificateholders, shall establish procedures relating to the manner in which
distributions in reduction of the Class Certificate Balances of the Classes of
Designated Certificates are to be made, provided, that such procedures shall
be consistent, to the extent practicable and customary for certificates
similar to the Designated Certificates with the Certificates, with the
provisions of this Section 3.05.
Section 3.06. Allocation of Realized Losses.
(a) On or prior to the beginning of the second Business Day prior to each
Distribution Date, the Trustee shall determine the total amount of Allocated
Underlying Realized Losses for such Distribution Date. The Trustee shall make
such determination on the basis of amounts on deposit in the Underlying
Certificate Account (which Underlying Certificate Account it holds as
Underlying Trustee) or on the basis of the agreement referred to in the last
sentence of Section 5.07.
(b) Allocated Underlying Realized Losses with respect to any Distribution
Date shall be allocated to the Certificates, pro rata on the basis of their
respective Class Certificate Balances until the respective Class Certificate
Balance of each such Class is reduced to zero.
(c) Any Allocated Underlying Realized Loss allocated to a Class of
Certificates or any reduction in the Class Certificate Balance of a Class of
Certificates pursuant to Section 3.06(b) above shall be allocated among the
Certificates of such Class in proportion to their respective Certificate
Balances.
(d) Any allocation of Allocated Underlying Realized Losses to a
Certificate or any reduction in the Certificate Balance of a Certificate,
pursuant to Section 3.06(a) above shall be accomplished by reducing the
Certificate Balance thereof immediately following the distributions made on
the related Distribution Date in accordance with the definition of
"Certificate Balance"; provided, however, that no such reduction of the
related Certificate Balance of a Class A-3 Certificate shall be made to the
extent a payment is made in respect thereof under the Class A-3 Policy
pursuant to Section 3.07.
(e) Any Allocated Underlying Realized Loss allocated to the Class A-3
Certificates will be covered by the Class A-3 Policy.
Section 3.07. Policy Matters.
(a) On or prior to second Business Day before each Distribution Date, the
Trustee shall determine the amount to be received as distributions on the
Deposited Underlying Certificates that is distributable to the Class A-3
Certificateholders pursuant to Section 3.04 on such Distribution Date. The
Trustee shall make such determination on the basis of amounts on deposit in
the Underlying Certificate Account (which Underlying Certificate Account it
holds as Underlying Trustee) or on the basis of the agreement referred to in
the last sentence of Section 5.07.
(b) If, on the second Business Day before any Distribution Date, the
Trustee determines that the amount to be received as distributions on the
Deposited Underlying Certificates that is distributable to the Class A-3
Certificateholders pursuant to Section 3.04 on such Distribution Date will be
insufficient to pay the Guaranteed Distribution on such Distribution Date, the
Trustee shall determine the amount of any such deficiency and shall give
notice to Financial Security and the Fiscal Agent (as defined in the Policy),
if any, by telephone or telecopy of the amount of such deficiency, confirmed
in writing by the Notice of Claim by 5:00 p.m., New York City time on such
second Business Day. If the Trustee and the Underlying Trustee are not the
same person, then the Trustee's responsibility for delivering the notice to
Financial Security as provided in the preceding sentence is limited to the
availability, timeliness and accuracy of the information provided by the
Underlying Trustee to the Trustee.
(c) In the event the Trustee receives a certified copy of an order of the
appropriate court that any scheduled payment of principal or interest on a
Class A-3 Certificate has been avoided in whole or in part as a preference
payment under applicable bankruptcy, insolvency, receivership or similar law,
the Trustee shall (i) promptly notify Financial Security, and the Fiscal
Agent, if any, and (ii) comply with the provisions of the Policy to obtain
payment by Financial Security of such avoided scheduled payment. In addition,
the Trustee shall mail notice to all Holders of the Class A-3 Certificates so
affected that, in the event that any such Holder's scheduled payment is so
recovered, such Holder will be entitled to payment pursuant to the terms of
the Policy, a copy of which shall be made available to such Holders by the
Trustee. The Trustee shall furnish to Financial Security and the Fiscal Agent,
if any, its records listing the payments on the affected Class A-3
Certificates, if any, that have been made by the Trustee and subsequently
recovered from the affected Holders, and the dates on which such payments were
made by the Trustee.
(d) At the time of the execution hereof, and for the purposes hereof, the
Trustee shall establish a separate special purpose trust account on behalf of
the Trustee for the benefit of Holders of the Class A-3 Certificates (the
"Class A-3 Policy Payments Account") over which the Trustee shall have
exclusive control and sole right of withdrawal. The Class A-3 Policy Payments
Account shall be an Eligible Account. The Trustee shall deposit any amount
paid under the Policy into the Class A-3 Policy Payments Account and
distribute such amount only for the purposes of making the payments to Holders
of the Class A-3 Certificates in respect of the Guaranteed Distribution (or
other amounts payable pursuant to clause (c) above on the Class A-3
Certificates by Financial Security pursuant to the Policy) for which the
related claim was made under the Policy. Such amounts shall be allocated by
the Trustee to Holders of Class A-3 Certificates affected by such shortfalls
in the same manner as principal and interest payments are to be allocated with
respect to such Certificates pursuant to Section 3.04. It shall not be
necessary for such payments to be made by checks or wire transfers separated
from the checks or wire transfers used to make regular payments hereunder with
funds withdrawn from the Distribution Account. However, any payments made on
the Class A-3 Certificates from funds in the Class A-3 Policy Payments Account
shall be noted as provided in subsection (e) below. Funds held in the Class
A-3 Policy Payments Account shall not be invested by the Trustee.
(e) Any funds received from Financial Security for deposit into the Class
A-3 Policy Payments Account pursuant to the Class A-3 Policy in respect of a
Distribution Date or otherwise as a result of any claim under such Policy
shall be applied by the Trustee directly to the payment in full (i) of the
Guaranteed Distributions due on such Distribution Date on the Class A-3
Certificates or (ii) of other amounts payable under the Policy. Funds received
by the Trustee as a result of any claim under the Policy shall be used solely
for payment to the Holders of the Class A-3 Certificates and may not be
applied for any other purpose, including, without limitation, satisfaction of
any costs, expenses or liabilities of the Trustee, the Depositor or the Trust
Fund. Any funds remaining in the Class A-3 Policy Payments Account on the
first Business Day after each Distribution Date shall be remitted promptly to
Financial Security pursuant to the written instruction of Financial Security.
(f) The Trustee shall keep complete and accurate records in respect of
(i) all funds remitted to it by Financial Security and deposited into the
Class A-3 Policy Payments Account and (ii) the allocation of such funds to (A)
payments of interest on and principal in respect of any Class A-3
Certificates, (B) Allocated Underlying Realized Losses allocated to the Class
A-3 Certificates and (C) the Class A-3 Prepayment Interest Shortfall Amount
for such Distribution Date. Financial Security shall have the right to inspect
such records at reasonable times during normal business hours upon three
Business Days' prior notice to the Trustee.
(g) The Trustee acknowledges, and each Holder of a Class A-3 Certificate
by its acceptance of the Class A-3 Certificate agrees, that, without the need
for any further action on the part of Financial Security or the Trustee, to
the extent Financial Security makes payments, directly or indirectly, on
account of principal of or interest on any Class A-3 Certificate, Financial
Security will be fully subrogated to the rights of the Holders of such Class
A-3 Certificates to receive such principal and interest from the Trust Fund.
The Class A-3 Certificateholders, by acceptance of the Class A-3 Certificates,
assign their rights as Holders of the Class A-3 Certificates to the extent of
Financial Security's interest with respect to amounts paid under the Policy.
Anything herein to the contrary notwithstanding, solely for purposes of
determining Financial Security's rights, as subrogee for payments
distributable pursuant to Section 3.04, any payment with respect to
distributions to the Class A-3 Certificates which is made with funds received
pursuant to the terms of the Policy shall not be considered payments of the
Class A-3 Certificates from the Trust Fund and shall not result in the
distribution or the provision for the distribution in reduction of the Class
Certificate Balance of the Class A-3 Certificates within the meaning of
Article III.
(h) The Trustee shall promptly notify Financial Security of either of the
following as to which it has actual knowledge: (A) the commencement of any
proceeding by or against the Depositor commenced under the Bankruptcy Code or
any other applicable bankruptcy, insolvency, receivership, rehabilitation or
similar law (an "Insolvency Proceeding") and (B) the making of any claim in
connection with any Insolvency Proceeding seeking the avoidance as a
preferential transfer (a "Preference Claim") of any distribution made with
respect to the Class A-3 Certificates as to which it has actual knowledge.
Each Holder of a Class A-3 Certificate, by its purchase of Class A-3
Certificates, and the Trustee hereby agrees that Financial Security (so long
as no Financial Security Default exists) may at any time during the
continuation of any proceeding relating to a Preference Claim direct all
matters relating to such Preference Claim, including, without limitation, (i)
the direction of any appeal of any order relating to any Preference Claim and
(ii) the posting of any surety, supersedeas or performance bond pending any
such appeal. In addition and without limitation of the foregoing, Financial
Security shall be subrogated to the rights of the Trustee and each Holder of a
Class A-3 Certificate in the conduct of any Preference Claim, including,
without limitation, all rights of any party to an adversary proceeding action
with respect to any court order issued in connection with any such Preference
Claim.
(i) The Trustee shall designate a Financial Security Contact Person who
shall be available to Financial Security to provide reasonable access to
information regarding the Deposited Underlying Certificates. The initial
Financial Security Contact Person is Kelly A. Sheahan, Assistant Vice
President, (212) 815-2279.
(j) The Trustee shall surrender the Class A-3 Policy to Financial
Security for cancellation upon the expiration of the term of such Policy as
provided in such Policy.
(k) The Trustee shall send to Financial Security the statements prepared
pursuant to Section 3.08, as well as any other statements or communications
sent to Holders of the Class A-3 Certificates, in each case at the same time
such reports, statements and communications are otherwise sent.
(l) For so long as there is no default by Financial Security under its
obligations under the Class A-3 Policy (a "Financial Security Default"),
Financial Security shall be treated by the Depositor and the Trustee as if
Financial Security were the Holder of all of the Class A-3 Certificates for
the purpose (and solely for the purpose) of the giving of any consent, the
making of any direction or the exercise of any voting or other control rights
otherwise given to the Class A-3 Certificateholders hereunder.
With respect to this Section 3.07, (i) the terms "Receipt" and "Received"
shall mean actual delivery to Financial Security and Financial Security's
Fiscal Agent, if any, prior to 5:00 p.m., New York City time, on a Business
Day; delivery either on a day that is not a Business Day or after 5:00 p.m.,
New York City time, shall be deemed to be Receipt on the next succeeding
Business Day. If any notice or certificate given under the Policy by the
Trustee is not in proper form or is not properly completed, executed or
delivered, it shall be deemed not to have been Received, Financial Security or
its Fiscal Agent, if any, shall promptly so advise the Trustee and the Trustee
may submit an amended notice.
Section 3.08. Statements to Certificateholders. Concurrently with each
distribution on a Distribution Date, the Trustee will forward by mail to the
Holder of each Certificate, each Rating Agency and Financial Security a
statement generally setting forth the following information:
(i) Available Interest Funds and Available Principal Funds for such
Distribution Date, and the amount (if any) by which Available Principal
Funds has been reduced on account of the payment of certain expenses,
liabilities and taxes described in the definition thereof;
(ii) with respect to such Distribution Date, the aggregate amount of
principal and interest, stated separately, distributed to Holders of each
Class of Certificates;
(iii) with respect to such Distribution Date, the amount of any
interest shortfall for each Class of Certificates, together with the
amount of any unpaid interest shortfall for such Class immediately
following such Distribution Date;
(iv) with respect to each Class of Certificates, the losses
allocated to such Class with respect to such Distribution Date;
(v) the Certificate Principal Balance of each Class of Certificates,
after giving effect to distributions of principal of such Certificates on
such Distribution Date;
(vi) any additional amount distributed to the Holder of the Class
A-R Certificate in such Distribution Date;
(vii) the amount of any withdrawal from the Class A-3 Reserve Fund
on such Distribution Date;
(viii) the amount remaining in the Class A-3 Reserve Fund after
taking into account amounts withdrawn from the Class A-3 Reserve Fund on
such Distribution Date; and
(ix) the amount of any claim for such Distribution Date made under
the Class A-3 Policy.
In addition, the Trustee will furnish to Certificateholders and Financial
Security copies of the statements received by the Trustee as the holder of the
Deposited Underlying Certificates on behalf of the Trust Fund.
Within a reasonable period of time after the end of each calendar year,
the Trustee will prepare and deliver to each person who at any time during the
previous calendar year was a Certificateholder of record a statement
containing the information required to satisfy any requirements of the Code,
the REMIC Provisions and regulations thereunder as from time to time are in
force. For purposes of this Section 3.08, the Trustee's duties are limited to
the extent that adequate information is reasonably available to the Trustee as
described herein.
Section 3.09. Reports of the Trustee; Distribution Account. Upon request
of a Certificateholder and at the expense of such Certificateholder, the
Trustee shall make available to Certificateholders within 15 days after the
date of receipt of such request a statement setting forth the status of the
Distribution Account as of the close of business on the last day of the
calendar month immediately preceding such request, and showing, for the period
covered by such statement, the aggregate of deposits into and withdrawals from
the Distribution Account.
Section 3.10. Access to Certain Documentation and Information. The
Trustee shall provide the related Certificateholders with access to a copy of
each report, if any, received by it as holder of the Deposited Underlying
Certificates under the Underlying Agreement. The Trustee shall also provide
the Depositor, the Underlying Certificate Seller and Financial Security with
access to any such report and to all written reports, documents and records
required to be maintained by the Trustee in respect of its duties hereunder.
Such access shall be afforded without charge but only upon reasonable request
evidenced by prior written notice received by the Trustee two Business Days
prior to the date of such proposed access and during normal business hours at
offices designated by the Trustee.
<PAGE>
ARTICLE IV
THE CERTIFICATES
Section 4.01. The Certificates.
The Certificates shall be substantially in the forms attached hereto as
exhibits. The Certificates shall be issuable in registered form, in the
minimum denominations, integral multiples in excess thereof (except that one
Certificate in each Class may be issued in a different amount which must be in
excess of the applicable minimum denomination) and aggregate denominations per
Class set forth in the Preliminary Statement.
Subject to Section 7.01 hereof respecting the final distribution on the
Certificates, on each Distribution Date the Trustee shall make distributions
to each Certificateholder of record on the preceding Record Date either (x) by
wire transfer in immediately available funds to the account of such holder at
a bank or other entity having appropriate facilities therefor, if (i) such
Holder has so notified the Trustee at least five Business Days prior to the
related Record Date and (ii) such Holder shall hold (A) a Notional Amount
Certificate, (B) 100% of the Class Certificate Balance of any Class of
Certificates or (C) Certificates of any Class with aggregate principal
Denominations of not less than $1,000,000 or (y) by check mailed by first
class mail to such Certificateholder at the address of such holder appearing
in the Certificate Register. Payments to Financial Security shall be by wire
transfer of immediately available funds.
The Certificates shall be executed by manual or facsimile signature on
behalf of the Trust by an authorized officer of the Trustee. Certificates
bearing the manual or facsimile signatures of individuals who were, at the
time when such signatures were affixed, authorized to sign on behalf of the
Trustee shall bind the Trustee, notwithstanding that such individuals or any
of them have ceased to be so authorized prior to the countersignature and
delivery of such Certificates or did not hold such offices at the date of such
Certificate. No Certificate shall be entitled to any benefit under this
Agreement, or be valid for any purpose, unless countersigned by the Trustee by
manual signature, and such countersignature upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been
duly executed and delivered hereunder. All Certificates shall be dated the
date of their countersignature. On the Closing Date, the Trustee shall
countersign the Certificates to be issued at the direction of the Depositor,
or any affiliate thereof.
The Depositor shall provide, or cause to be provided, to the Trustee on a
continuous basis, an adequate inventory of Certificates to facilitate
transfers.
Section 4.02. Certificate Register; Registration of Transfer and Exchange
of Certificates.
(a) The Trustee shall maintain, or cause to be maintained in accordance
with the provisions of Section 4.06 hereof, a Certificate Register for the
Trust Fund in which, subject to the provisions of subsections (b) and (c)
below and to such reasonable regulations as it may prescribe, the Trustee
shall provide for the registration of Certificates and of transfers and
exchanges of Certificates as herein provided. Upon surrender for registration
of transfer of any Certificate, the Trustee shall execute and deliver, in the
name of the designated transferee or transferees, one or more new Certificates
of the same Class and aggregate Percentage Interest.
At the option of a Certificateholder, Certificates may be exchanged for
other Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest upon surrender of the
Certificates to be exchanged at the office or agency of the Trustee. Whenever
any Certificates are so surrendered for exchange, the Trustee shall execute,
authenticate, and deliver the Certificates which the Certificateholder making
the exchange is entitled to receive. Every Certificate presented or
surrendered for registration of transfer or exchange shall be accompanied by a
written instrument of transfer in form satisfactory to the Trustee duly
executed by the holder thereof or his attorney duly authorized in writing.
No service charge to the Certificateholders shall be made for any
registration of transfer or exchange of Certificates, but payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates may be required.
All Certificates surrendered for registration of transfer or exchange
shall be cancelled and subsequently destroyed by the Trustee in accordance
with the Trustee's customary procedures.
(b) The Class T Certificate may not be transferred to any Person other
than a successor Trustee hereunder. By accepting the Class T Certificate, each
Holder of such Class of Certificates shall be deemed to have agreed to this
restriction on transfer. In addition, the Class T Certificate shall bear a
legend setting forth the foregoing restriction on transfer.
(c) No transfer of an ERISA-Restricted Certificate shall be made unless
the Trustee shall have received either (i) a representation from the
transferee of such Certificate acceptable to and in form and substance
satisfactory to the Trustee, to the effect that such transferee is not an
employee benefit plan or arrangement subject to Section 406 of ERISA or a plan
or arrangement subject to Section 4975 of the Code, nor a person acting on
behalf of any such plan or arrangement, nor using the assets of any such plan
or arrangement to effect such transfer, (ii) if the purchaser of a Residual
Certificate is an insurance company, a representation that the purchaser is an
insurance company which is purchasing such Certificates with funds contained
in an "insurance company general account" (as such term is defined in Section
V(e) of Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60")) and that
the purchase and holding of such Certificates are covered under PTCE 95-60 or
(iii) in the case of any such ERISA-Restricted Certificate presented for
registration in the name of an employee benefit plan subject to ERISA, or a
plan or arrangement subject to Section 4975 of the Code (or comparable
provisions of any subsequent enactments), or a trustee of any such plan or any
other person acting on behalf of any such plan or arrangement, or using such
plan's or arrangement's assets, an Opinion of Counsel satisfactory to the
Trustee, which Opinion of Counsel shall not be an expense of either the
Trustee or the Trust Fund, addressed to the Trustee to the effect that the
purchase or holding of such ERISA-Restricted Certificate will not result in
the assets of the Trust Fund being deemed to be "plan assets" and subject to
the prohibited transaction provisions of ERISA and the Code and will not
subject the Trustee to any obligation in addition to those expressly
undertaken in this Agreement or to any liability. For purposes of the
preceding sentence, with respect to an ERISA-Restricted Certificate in the
event the representation letter referred to in the preceding sentence is not
so furnished, such representation shall be deemed to have been made to the
Trustee by the transferee's (including an initial acquiror's) acceptance of
the ERISA-Restricted Certificates. Notwithstanding anything else to the
contrary herein, any purported transfer of an ERISA-Restricted Certificate to
or on behalf of an employee benefit plan subject to ERISA or to the Code
without the delivery to the Trustee of an Opinion of Counsel satisfactory to
the Trustee as described above shall be void and of no effect.
To the extent permitted under applicable law (including, but not limited
to, ERISA), the Trustee shall be under no liability to any Person for any
registration of transfer of any ERISA-Restricted Certificate that is in fact
not permitted by this Section 4.02(c) or for making any payments due on such
Certificate to the Holder thereof or taking any other action with respect to
such Holder under the provisions of this Agreement so long as the transfer was
registered by the Trustee in accordance with the foregoing requirements.
(d) Each Person who has or who acquires any Ownership Interest in a
Residual Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions, and
the rights of each Person acquiring any Ownership Interest in a Residual
Certificate are expressly subject to the following provisions:
(i) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall be a Permitted Transferee and shall promptly
notify the Trustee of any change or impending change in its status as a
Permitted Transferee.
(ii) No Ownership Interest in a Residual Certificate may be
registered on the Closing Date or thereafter transferred, and the Trustee
shall not register the Transfer of any Residual Certificate unless, in
addition to the certificates required to be delivered to the Trustee
under subparagraph (b) above, the Trustee shall have been furnished with
an affidavit (a "Transfer Affidavit") of the initial owner or the
proposed transferee in the form attached hereto as Exhibit F.
(iii) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall agree (A) to obtain a Transfer Affidavit from
any other Person to whom such Person attempts to Transfer its Ownership
Interest in a Residual Certificate, (B) to obtain a Transfer Affidavit
from any Person for whom such Person is acting as nominee, trustee or
agent in connection with any Transfer of a Residual Certificate and (C)
not to Transfer its Ownership Interest in a Residual Certificate or to
cause the Transfer of an Ownership Interest in a Residual Certificate to
any other Person if it has actual knowledge that such Person is not a
Permitted Transferee.
(iv) Any attempted or purported Transfer of any Ownership Interest
in a Residual Certificate in violation of the provisions of this Section
4.02(d) shall be absolutely null and void and shall vest no rights in the
purported Transferee. If any purported transferee shall become a Holder
of a Residual Certificate in violation of the provisions of this Section
4.02(d), then the last preceding Permitted Transferee shall be restored
to all rights as Holder thereof retroactive to the date of registration
of Transfer of such Residual Certificate. The Trustee shall be under no
liability to any Person for any registration of Transfer of a Residual
Certificate that is in fact not permitted by Section 4.02(c) and this
Section 4.02(d) or for making any payments due on such Certificate to the
Holder thereof or taking any other action with respect to such Holder
under the provisions of this Agreement so long as the Transfer was
registered after receipt of the related Transfer Affidavit and Transferor
Certificate. The Trustee shall be entitled but not obligated to recover
from any Holder of a Residual Certificate that was in fact not a
Permitted Transferee at the time it became a Holder or, at such
subsequent time as it became other than a Permitted Transferee, all
payments made on such Residual Certificate at and after either such time.
Any such payments so recovered by the Trustee shall be paid and delivered
by the Trustee to the last preceding Permitted Transferee of such
Certificate.
(v) The Depositor shall use its best efforts to make available, upon
receipt of written request from the Trustee, all information necessary to
compute any tax imposed under Section 860E(e) of the Code as a result of
a Transfer of an Ownership Interest in a Residual Certificate to any
Holder who is not a Permitted Transferee.
The restrictions on Transfers of a Residual Certificate set forth in this
Section 4.02(d) shall cease to apply (and the applicable portions of the
legend on a Residual Certificate may be deleted) with respect to Transfers
occurring after delivery to the Trustee of an Opinion of Counsel, which
Opinion of Counsel shall not be an expense of the Trust Fund, the Trustee, the
Underlying Certificate Seller or the Depositor, to the effect that the
elimination of such restrictions will not cause each REMIC hereunder to fail
to qualify as a REMIC at any time that the Certificates are outstanding or
result in the imposition of any tax on the Trust Fund, a Certificateholder or
another Person. Each Person holding or acquiring any Ownership Interest in a
Residual Certificate hereby consents to any amendment of this Agreement which,
based on an Opinion of Counsel furnished to the Trustee, is reasonably
necessary (a) to ensure that the record ownership of, or any beneficial
interest in, a Residual Certificate is not transferred, directly or
indirectly, to a Person that is not a Permitted Transferee and (b) to provide
for a means to compel the Transfer of a Residual Certificate which is held by
a Person that is not a Permitted Transferee to a Holder that is a Permitted
Transferee.
(e) The preparation and delivery of all certificates and opinions
referred to above in this Section 4.02(e) in connection with transfer shall be
at the expense of the parties to such transfers.
(f) Except as provided below, the Book-Entry Certificates shall at all
times remain registered in the name of the Depository or its nominee and at
all times: (i) registration of the Certificates may not be transferred by the
Trustee except to another Depository; (ii) the Depository shall maintain
book-entry records with respect to the Certificate Owners and with respect to
ownership and transfers of such Book-Entry Certificates; (iii) ownership and
transfers of registration of the Book-Entry Certificates on the books of the
Depository shall be governed by applicable rules established by the
Depository; (iv) the Depository may collect its usual and customary fees,
charges and expenses from its Depository Participants; (v) the Trustee shall
deal with the Depository, Depository Participants and indirect participating
firms as representatives of the Certificate Owners of the Book-Entry
Certificates for purposes of exercising the rights of holders under this
Agreement, and requests and directions for and votes of such representatives
shall not be deemed to be inconsistent if they are made with respect to
different Certificate Owners; and (vi) the Trustee may rely and shall be fully
protected in relying upon information furnished by the Depository with respect
to its Depository Participants and furnished by the Depository Participants
with respect to indirect participating firms and persons shown on the books of
such indirect participating firms as direct or indirect Certificate Owners.
All transfers by Certificate Owners of Book-Entry Certificates shall be
made in accordance with the procedures established by the Depository
Participant or brokerage firm representing such Certificate Owner. Each
Depository Participant shall only transfer Book-Entry Certificates of
Certificate Owners it represents or of brokerage firms for which it acts as
agent in accordance with the Depository's normal procedures.
If (x) (i) the Depository or the Depositor advises the Trustee in writing
that the Depository is no longer willing or able to properly discharge its
responsibilities as Depository, and (ii) the Trustee or the Depositor is
unable to locate a qualified successor or (y) the Depositor at its option
advises the Trustee in writing that it elects to terminate the book-entry
system through the Depository, the Trustee shall notify all Certificate
Owners, through the Depository, of the occurrence of any such event and of the
availability of definitive, fully-registered Certificates (the "Definitive
Certificates") to Certificate Owners requesting the same. Upon surrender to
the Trustee of the related Class of Certificates by the Depository,
accompanied by the instructions from the Depository for registration, the
Trustee shall issue the Definitive Certificates. Neither the Depositor nor the
Trustee shall be liable for any delay in delivery of such instruction and each
may conclusively rely on, and shall be protected in relying on, such
instructions. The Depositor shall provide the Trustee with an adequate
inventory of certificates to facilitate the issuance and transfer of
Definitive Certificates. Upon the issuance of Definitive Certificates all
references herein to obligations imposed upon or to be performed by the
Depository shall be deemed to be imposed upon and performed by the Trustee, to
the extent applicable with respect to such Definitive Certificates and the
Trustee shall recognize the Holders of the Definitive Certificates as
Certificateholders hereunder; provided that the Trustee shall not by virtue of
its assumption of such obligations become liable to any party for any act or
failure to act of the Depository.
Section 4.03. Mutilated, Destroyed, Lost or Stolen Certificates.
If (a) any mutilated Certificate is surrendered to the Trustee, or the
Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Certificate and (b) there is delivered to the Depositor and the
Trustee such security or indemnity as may be required by them to save each of
them harmless, then, in the absence of notice to the Trustee that such
Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute, countersign 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 Percentage Interest. In connection with the issuance of any
new Certificate under this Section 4.03, the Trustee may require the payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and any other expenses (including the fees and
expenses of the Trustee) connected therewith. Any replacement Certificate
issued pursuant to this Section 4.03 shall constitute complete and
indefeasible evidence of ownership, as if originally issued, whether or not
the lost, stolen or destroyed Certificate shall be found at any time.
Section 4.04. Persons Deemed Owners.
The Depositor, the Trustee and any agent of the Depositor or the Trustee
may treat the Person in whose name any Certificate is registered as the owner
of such Certificate for the purpose of receiving distributions as provided in
this Agreement and for all other purposes whatsoever, and neither the
Depositor, the Trustee nor any agent of the Depositor or the Trustee shall be
affected by any notice to the contrary.
Section 4.05. Access to List of Certificateholders' Names and Addresses.
If three or more Certificateholders (a) request such information in
writing from the Trustee, (b) state that such Certificateholders desire to
communicate with other Certificateholders with respect to their rights under
this Agreement or under the Certificates, and (c) provide a copy of the
communication which such Certificateholders propose to transmit, or if the
Depositor shall request such information in writing from the Trustee, then the
Trustee shall, within ten Business Days after the receipt of such request,
provide the Depositor or such Certificateholders at such recipients' expense
the most recent list of the Certificateholders of such Trust Fund held by the
Trustee, if any. The Depositor and every Certificateholder, by receiving and
holding a Certificate, agree that the Trustee shall not be held accountable by
reason of the disclosure of any such information as to the list of the
Certificateholders hereunder, regardless of the source from which such
information was derived.
Section 4.06. Maintenance of Office or Agency. The Trustee will maintain
or cause to be maintained at its expense an office or offices or agency or
agencies in New York City where Certificates may be surrendered for
registration of transfer or exchange. The Trustee initially designates its
Corporate Trust Office for such purposes. The Trustee will give prompt written
notice to the Certificateholders and Financial Security of any change in such
location of any such office or agency.
<PAGE>
ARTICLE V
CONCERNING THE TRUSTEE
Section 5.01. Duties of Trustee.
The Trustee shall undertake to perform such duties and only such duties
as are specifically set forth in this Agreement.
The Trustee, upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments furnished to the
Trustee that are specifically required to be furnished pursuant to any
provision of this Agreement shall examine them to determine whether they are
in the form required by this Agreement; provided, however, that the Trustee
shall not be responsible for the accuracy or content of any such resolution,
certificate, statement, opinion, report, document, order or other instrument.
No provision of this Agreement shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act
or its own willful misconduct; provided, however, that:
(i) the duties and obligations of the Trustee shall be determined solely
by the express provisions of this Agreement, the Trustee shall not be liable
except for the performance of such duties and obligations as are specifically
set forth in this Agreement, no implied covenants or obligations shall be read
into this Agreement against the Trustee and the Trustee may conclusively rely,
as to the truth of the statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished to the Trustee
and conforming to the requirements of this Agreement which it believed in good
faith to be genuine and to have been duly executed by the proper authorities
respecting any matters arising hereunder;
(ii) the Trustee shall not be liable for an error of judgment made in
good faith by a Responsible Officer or Responsible Officers of the Trustee,
unless it shall be finally proven that the Trustee was negligent in
ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action taken,
suffered or omitted to be taken by it in good faith in accordance with the
direction of Holders of Certificates evidencing not less than 25% of the
Voting Rights of Certificates relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee under this Agreement.
Section 5.02. Certain Matters Affecting the Trustee. Except as otherwise
provided in Section 5.01:
(i) the Trustee may request and rely upon and shall be protected in
acting or refraining from acting upon any resolution, Officers' Certificate,
certificate of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond or other
paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties and the Trustee shall have no
responsibility to ascertain or confirm the genuineness of any signature of any
such party or parties;
(ii) the Trustee may consult with counsel, financial advisers or
accountants and the advice of any such counsel, financial advisers or
accountants and any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken or suffered or
omitted by it hereunder in good faith and in accordance with such advice or
Opinion of Counsel;
(iii) the Trustee shall not be liable for any action taken, suffered or
omitted by it in good faith and believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Agreement;
(iv) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond or other
paper or document, unless requested in writing so to do by Holders of
Certificates evidencing not less than 25% of the Voting Rights allocated to
each Class of Certificates;
(v) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents,
accountants, attorneys and the Trustee shall not be responsible for any
misconduct or negligence on the part of any agent, attorney or accountant
appointed with due care by it hereunder;
(vi) the Trustee shall not be required to risk or expend its own funds or
otherwise incur any financial liability in the performance of any of its
duties or in the exercise of any of its rights or powers hereunder if it shall
have reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not assured to it;
(vii) the Trustee shall not be liable for any loss on any investment of
funds pursuant to this Agreement;
(viii) the Trustee shall be under no obligation to exercise any of the
trusts, rights or powers vested in it by this Agreement or to institute,
conduct or defend any litigation hereunder or in relation hereto at the
request, order or direction of any of the Certificateholders, pursuant to the
provisions of this Agreement, unless such Certificateholders shall have
offered to the Trustee reasonable security or indemnity satisfactory to the
Trustee against the costs, expenses and liabilities which may be incurred
therein or thereby;
(ix) 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, conclusively rely upon an Officers' Certificate; and
(x) the Trustee shall not be deemed to have notice of any breach by the
Underlying Certificate Seller of any representation, warranty or covenant or
any default or event of default unless a Responsible Officer of the Trustee
has actual knowledge thereof or unless written notice of any event which is in
fact such a default or breach is received by the Trustee at the Corporate
Trust Office of the Trustee, and such notice references the Certificates and
this Agreement.
(b) All rights of action under this Agreement or under any of the
Certificates, enforceable by the Trustee, may be enforced by it without the
possession of any of such Certificates, or the production thereof at the trial
or other proceeding relating thereto, and any such suit, action or proceeding
instituted by the Trustee shall be brought in its name for the benefit of all
the Holders of such Certificates, subject to the provisions of this Agreement.
Section 5.03. Trustee Not Liable for Certificates or Deposited Underlying
Certificates. The recitals contained herein and in the Certificates shall be
taken as the statements of the Depositor or the Underlying Certificate Seller,
as the case may be, and the Trustee assumes no responsibility for their
correctness. The Trustee makes no representations as to the validity or
sufficiency of this Agreement or of the Certificates or of any Deposited
Underlying Certificates or related document other than with respect to the
Trustee's execution and counter-signature of the Certificates. The Trustee
shall not be accountable for the use or application by the Depositor or the
Underlying Certificate Seller of any funds paid to the Depositor or the
Underlying Certificate Seller in respect of the Deposited Underlying
Certificates.
Section 5.04. Trustee May Own Certificates. The Trustee in its individual
or any other capacity may become the owner or pledgee of Certificates with the
same rights as it would have if it were not the Trustee.
Section 5.05. Trustee's Fees and Expenses. The Trustee acknowledges that
it will receive the Class T Certificate on the Closing Date and be entitled to
all of the rights therein as holder thereof, as compensation for all services
rendered by it in the execution of the trusts hereby created and in the
exercise and performance of any of the powers and duties hereunder. In the
event of the resignation or removal of the Trustee pursuant to the terms of
this Agreement, such Trustee will transfer, deliver and otherwise convey the
Class T Certificate to the successor Trustee as compensation to the successor
trustee.
Section 5.06. Indemnification of the Trustee. The Underlying Certificate
Seller hereby covenants and agrees to indemnify the Trustee and any director,
officer, employee, or agent of the Trustee for and to hold them harmless
against, any and all losses, liabilities, damages, claims or expenses arising
out of or in connection with the acceptance or administration of the trust or
trusts hereunder (including, without limitation, any losses, liabilities,
damages, claims or expenses arising from the failure of the Underlying
Certificate Seller to perform its obligations in accordance with the
provisions of this Agreement or of defending itself against any claim or
liability in connection with the exercise or performance of any powers or
duties hereunder), other than those resulting from the negligence or bad faith
in the performance of any of the Trustee's duties hereunder or by reason of
reckless disregard of the Trustee's obligations and duties hereunder. Such
indemnification shall survive the termination of this Agreement and the Trust
Fund created hereby or the resignation or removal of the Trustee pursuant to
the terms hereof.
Section 5.07. Eligibility Requirements for Trustee. The Trustee hereunder
shall at all times be a corporation or association organized and doing
business under the laws of a state or the United States of America, authorized
under such laws to exercise corporate trust powers, having a combined capital
and surplus of at least $50,000,000, subject to super-vision or examination by
federal or state authority and with a credit rating which would not cause
either of the Rating Agencies to reduce their respective then current ratings
of the Certificates (or having provided such security from time to time as is
sufficient to avoid such reduction). If such corporation or association
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purposes of this Section 5.07 the combined capital and surplus of such
corporation or association shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 5.07, the Trustee shall resign immediately in the
manner and with the effect specified in Section 5.08 hereof. The entity
serving as Trustee may have normal banking and trust relationships with the
Depositor and its affiliates and with the Underlying Certificate Seller and
its affiliates; provided, however, that such entity cannot be an affiliate of
the Depositor or the Underlying Certificate Seller. The Trustee hereunder
shall at all times be the same Person as the Underlying Trustee or shall have
an agreement with the Underlying Trustee to have access to the information
relating to the Underlying Certificate Account in order to enable the Trustee
to perform its duties under Sections 3.06(a) and 3.07(a) and (b).
Section 5.08. Resignation and Removal of Trustee.
The Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice of resignation to the Depositor, the
Underlying Certificate Seller and each Rating Agency and Financial Security
not less than 60 days before the date specified in such notice when, subject
to Section 5.09, such resignation is to take effect, and acceptance by a
successor trustee in accordance with Section 5.09 meeting the qualifications
set forth in Section 5.07. If no successor trustee meeting such qualifications
shall have been so appointed and have accepted appointment within 30 days
after the giving of such notice or resignation, the resigning Trustee may
petition any court of competent jurisdiction for the appointment of a
successor trustee.
If at any time the Trustee shall cease to be eligible in accordance with
the provisions of Section 5.07 hereof and shall fail to resign after written
request thereto by the Depositor, or if at any time the Trustee shall become
incapable of acting, or shall be adjudged as bankrupt or insolvent, or a
receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, or a
tax is imposed with respect to the Trust Fund by any state in which the
Trustee or the Trust Fund is located and the imposition of such tax would be
avoided by the appointment of a different trustee, then the Depositor may
remove the Trustee and appoint a successor trustee by written instrument, in
triplicate, one copy of which instrument shall be delivered to the Trustee,
one copy of which shall be delivered to the Depositor and one copy to the
successor trustee.
The Holders of Certificates entitled to at least 51% of the Voting Rights
may at any time remove the Trustee and appoint a successor trustee by written
instrument or instruments, in triplicate, signed by such Holders or their
attorneys-in-fact duly authorized, one complete set of which instruments shall
be delivered by the successor Trustee to the Depositor, one complete set to
the Trustee so removed and one complete set to the successor so appointed.
Notice of any removal of the Trustee shall be given to each Rating Agency, the
Underlying Certificate Seller and Financial Security by the successor trustee.
Any resignation or removal of the Trustee and appointment of a successor
trustee pursuant to any of the provisions of this Section 5.08 shall become
effective upon acceptance of appointment by the successor trustee as provided
in Section 5.09 hereof.
Section 5.09. Successor Trustee.
Any successor trustee appointed as provided in Section 5.08 hereof shall
execute, acknowledge and deliver to the Depositor and to its predecessor
trustee and the Depositor an instrument accepting such appointment hereunder
and thereupon the resignation or removal of the predecessor trustee shall
become effective and such successor trustee, without any further act, deed or
conveyance, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor hereunder, with the like effect as if
originally named as trustee herein. The Depositor and the predecessor trustee
shall execute and deliver such instruments and do such other things as may
reasonably be required for more fully and certainly vesting and confirming in
the successor trustee all such rights, powers, duties, and obligations.
No successor trustee shall accept appointment as provided in this Section
5.09 unless at the time of such acceptance such successor trustee shall be
eligible under the provisions of Section 5.07 hereof and its appointment shall
not adversely affect the then current rating of the Certificates.
Upon acceptance of appointment by a successor trustee as provided in this
Section 5.09, the Depositor shall mail notice of the succession of such
trustee hereunder to all Holders of Certificates. If the Depositor fails to
mail such notice within 10 days after acceptance of appointment by the
successor trustee, the successor trustee shall cause such notice to be mailed
at the expense of the Depositor.
Section 5.10. Merger or Consolidation of Trustee.
Any corporation into which the Trustee 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 Trustee shall be a party, or any
corporation succeeding to the business of the Trustee, shall be the successor
of the Trustee hereunder, provided that such corporation shall be eligible
under the provisions of Section 5.07 hereof without the execution or filing of
any paper or further act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding.
Section 5.11. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for
the purpose of meeting any legal requirements of any jurisdiction in which any
part of the Trust Fund at the time be located, the Depositor and the Trustee
acting jointly shall have the power and shall execute and deliver all
instruments to appoint one or more Persons approved by the Trustee to act as
co-trustee or co-trustees jointly with the Trustee, or separate trustee or
separate trustees, of all or any part of the Trust Fund, and to vest in such
Person or Persons, in such capacity and for the benefit of the
Certificateholders, such title to the Trust Fund or any part thereof,
whichever is applicable, and, subject to the other provisions of this Section
5.11, such powers, duties, obligations, rights and trusts as the Depositor and
the Trustee may consider necessary or desirable. If the Depositor shall not
have joined in such appointment within 15 days after the receipt by it of a
request to do so, the Trustee alone shall have the power to make such
appointment. No co-trustee or separate trustee hereunder shall be required to
meet the terms of eligibility as a successor trustee under Section 5.07 and no
notice to Certificateholders of the appointment of any co-trustee or separate
trustee shall be required under Section 5.09.
Every separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
(i) To the extent necessary to effectuate the purposes of this Section
5.11, 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 Depositor
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 applicable Trust Fund or any portion
thereof in any such jurisdiction) shall be exercised and performed singly by
such separate trustee or co-trustee, but solely at the direction of the
Trustee;
(ii) No trustee hereunder shall be held personally liable by reason of
any act or omission of any other trustee hereunder and such appointment shall
not, and shall not be deemed to, constitute any such separate trustee or
co-trustee as agent of the Trustee; and
(iii) The Trustee 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 separate trustees and co-trustees, when and
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the
conditions of this Article V. 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 Depositor.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its
estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
Section 5.12. Tax Matters.
It is intended that the assets with respect to which any REMIC election
is to be made, as set forth in the Preliminary Statement, shall constitute,
and that the conduct of matters relating to such assets shall be such as to
qualify such assets as, a "real estate mortgage investment conduit" as defined
in and in accordance with the REMIC Provisions. In furtherance of such
intention, the Trustee covenants and agrees that it shall act as agent (and
the Trustee is hereby appointed to act as agent) on behalf of any such REMIC
and that in such capacity it shall: (a) prepare and file, or cause to be
prepared and filed, in a timely manner, a U.S. Real Estate Mortgage Investment
Conduit Income Tax Return (Form 1066 or any successor form adopted by the
Internal Revenue Service) and prepare and file or cause to be prepared and
filed with the Internal Revenue Service and applicable state or local tax
authorities income tax or information returns for each taxable year with
respect to any such REMIC, containing such information and at the times and in
the manner as may be required by the Code or state or local tax laws,
regulations, or rules, and furnish or cause to be furnished to
Certificateholders the schedules, statements or information at such times and
in such manner as may be required thereby; (b) within thirty days of the
Closing Date, furnish or cause to be furnished to the Internal Revenue
Service, on Forms 8811 or as otherwise may be required by the Code, the name,
title, address, and telephone number of the person that the holders of the
Certificates may contact for tax information relating thereto, together with
such additional information as may be required by such Form, and update such
information at the time or times in the manner required by the Code; (c) make
or cause to be made elections that such assets be treated as a REMIC on the
federal tax return for its first taxable year (and, if necessary, under
applicable state law); (d) prepare and forward, or cause to be prepared and
forwarded, to the Certificateholders and to the Internal Revenue Service and,
if necessary, state tax authorities, all information returns and reports as
and when required to be provided to them in accordance with the REMIC
Provisions, including without limitation, the calculation of any original
issue discount using the Prepayment Assumption; (e) provide information
necessary for the computation of tax imposed on the transfer of a Residual
Certificate to a Person that is not a Permitted Transferee, or an agent
(including a broker, nominee or other middleman) of a Non-Permitted
Transferee, or a pass-through entity in which a Non-Permitted Transferee is
the record holder of an interest (the reasonable cost of computing and
furnishing such information may be charged to the Person liable for such tax);
(f) to the extent that they are under its control conduct matters relating to
such assets at all times that any Certificates are outstanding so as to
maintain the status as a REMIC under the REMIC Provisions; (g) not knowingly
or intentionally take any action or omit to take any action that would cause
the termination of the REMIC status; (h) pay, from the sources specified in
the last paragraph of this Section 5.12, the amount of any federal or state
tax, including prohibited transaction taxes as described below, imposed on any
such REMIC prior to its termination when and as the same shall be due and
payable (but such obligation shall not prevent the Trustee or any other
appropriate Person from contesting any such tax in appropriate proceedings and
shall not prevent the Trustee from withholding payment of such tax, if
permitted by law, pending the outcome of such proceedings); (i) ensure that
federal, state or local income tax or information returns shall be signed by
the Trustee or such other person as may be required to sign such returns by
the Code or state or local laws, regulations or rules; (j) maintain records
relating to any such REMIC, including but not limited to the income, expenses,
assets and liabilities thereof and the fair market value and adjusted basis of
the assets determined at such intervals as may be required by the Code, as may
be necessary to prepare the foregoing returns, schedules, statements or
information; and (k) as and when necessary and appropriate, represent any such
REMIC in any administrative or judicial proceedings relating to an examination
or audit by any governmental taxing authority, request an administrative
adjustment as to any taxable year of any such REMIC, enter into settlement
agreements with any governmental taxing agency, extend any statute of
limitations relating to any tax item of any such REMIC, and otherwise act on
behalf of any such REMIC in relation to any tax matter or controversy
involving it.
In order to enable the Trustee to perform its duties as set forth herein,
the Depositor and the Underlying Certificate Seller shall provide, or cause to
be provided, to the Trustee within ten (10) days after the Closing Date all
information or data that the Trustee requests in writing and determines to be
relevant for tax purposes to the valuations and offering prices of the
Certificates, including, without limitation, the price, yield, prepayment
assumption and projected cash flows of the Certificates and the Deposited
Underlying Certificates. Thereafter, the Depositor and the Underlying
Certificate Seller shall provide to the Trustee promptly upon written request
therefor, any such additional information or data that the Trustee may, from
time to time, reasonably request in order to enable the Trustee to perform its
duties as set forth herein. The Underlying Certificate Seller hereby
indemnifies the Trustee for any losses, liabilities, damages, claims or
expenses of the Trustee arising from any errors or miscalculations of the
Trustee that result from any failure of the Depositor or the Underlying
Certificate Seller to provide, or to cause to be provided, accurate
information or data to the Trustee on a timely basis.
In the event that any tax is imposed on "prohibited transactions" of any
REMIC hereunder as defined in Section 860F(a)(2) of the Code, on the "net
income from foreclosure property" of such REMIC as defined in Section 860G(c)
of the Code, on any contribution to such REMIC after the Startup Day pursuant
to Section 860G(d) of the Code, or any other tax is imposed, including,
without limitation, any minimum tax imposed upon any REMIC hereunder pursuant
to Sections 23153 and 24874 of the California Revenue and Taxation Code, if
not paid as otherwise provided for herein, such tax shall be paid by (i) the
Trustee, if any such other tax arises out of or results from a breach by the
Trustee of any of its obligations under this Agreement, (ii) the Depositor, in
the case of any such minimum tax, or if such tax arises out of or results from
a breach by the Depositor of any of its obligations under this Agreement,
(iii) the Underlying Certificate Seller, if any such tax arises out of or
results from the Underlying Certificate Seller's obligation to repurchase a
Deposited Underlying Certificate pursuant to Section 2.03 or (iv) in all other
cases, or in the event that the Trustee, the Depositor or the Underlying
Certificate Seller fails to honor its obligations under the preceding clauses
(i),(ii) or (iii), any such tax will be paid with amounts otherwise to be
distributed to the Certificateholders, as provided in Section 3.03.
Section 5.13. Periodic Filings. Pursuant to written instructions from the
Depositor, the Trustee shall prepare, execute and file all periodic reports
required under the Securities Exchange Act of 1934 in conformity with the
terms of the relief granted to the Depositor in CWMBS, Inc. (February 3,
1994), a copy of which has been supplied to the Trustee by the Depositor. In
connection with the preparation and filing of such periodic reports, the
Depositor shall timely provide to the Trustee all material information
available to them which is required to be included in such reports and not
known to them to be in the possession of the Trustee and such other
information as the Trustee reasonably may request from either of them and
otherwise reasonably shall cooperate with the Trustee. The Trustee shall have
no liability with respect to any failure to properly prepare or file such
periodic reports resulting from or relating to the Trustee's inability or
failure to obtain any information not resulting from its own negligence or
willful misconduct.
<PAGE>
ARTICLE VI
THE DEPOSITOR
Section 6.01. Liability of the Depositor. The Depositor shall be liable
in accordance herewith only to the extent of the obligations specifically
imposed upon and undertaken by the Depositor herein.
Section 6.02. Merger, Consolidation or Conversion of the Depositor. The
Depositor will keep in full effect its existence, rights and franchises as a
corporation under the laws of the United States or under the laws of one of
the states thereof and will each obtain and preserve its qualification to do
business as a foreign corporation in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Agreement to perform its duties under this Agreement.
Any Person into which the Depositor may be merged or consolidated, or any
Person resulting from any merger or consolidation to which the Depositor shall
be a party, or any person succeeding to the business of the Depositor, shall
be the successor of the Depositor hereunder, without the execution or filing
of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.
Section 6.03. Limitation on Liability of the Depositor and Others. None
of the Depositor, or any of the directors, officers, employees or agents of
the Depositor shall be under any liability to the Certificateholders for any
action taken or for refraining from the taking of any action in good faith
pursuant to this Agreement, or for errors in judgment; provided, however, that
this provision shall not protect the Depositor or any such Person against any
breach of representations or warranties made by it herein or protect the
Depositor or any such Person from any liability which would otherwise be
imposed by reasons of willful misfeasance, bad faith or gross negligence in
the performance of duties or by reason of reckless disregard of obligations
and duties hereunder. The Depositor and any director, officer, employee or
agent of the Depositor may rely in good faith on any document of any kind
prima facie properly executed and submitted by any Person respecting any
matters arising hereunder. The Depositor and any director, officer, employee
or agent of the Depositor shall be indemnified by the Trust Fund and held
harmless against any loss, liability or expense incurred in connection with
any audit, controversy or judicial proceeding relating to a governmental
taxing authority or any legal action relating to this Agreement or the
Certificates, other than any loss, liability or expense incurred by reason of
willful misfeasance, bad faith or gross negligence in the performance of
duties hereunder or by reason of reckless disregard of obligations and duties
hereunder. The Depositor, shall be under no obligation to appear in, prosecute
or defend any legal action that is not incidental to its respective duties
hereunder and which in its opinion may involve it in any expense or liability;
provided, however, that the Depositor may in its discretion undertake any such
action that it may deem necessary or desirable in respect of this Agreement
and the rights and duties of the parties hereto and interests of the Trustee
and the Certificateholders hereunder. In such event, the legal expenses and
costs of such action and any liability resulting therefrom shall be expenses,
costs and liabilities of the Trust Fund, and the Depositor shall be entitled
to be reimbursed therefor out of the Distribution Account.
<PAGE>
ARTICLE VII
TERMINATION
Section 7.01. Termination upon Liquidation or Purchase of Deposited
Underlying Certificates.
Subject to Section 7.03, the obligations and responsibilities of the
Depositor, the Underlying Certificate Seller and the Trustee created hereby
with respect to the Trust Fund shall terminate upon the earlier of (a) the
purchase by the Holder of the Class A-R Certificate of the Deposited
Underlying Certificates remaining in the Trust Fund at the price equal to the
Certificate Balances of all Certificates on the Distribution Date of such
purchase, plus any unpaid accrued interest thereon at the applicable
Pass-Through Rate, (b) the later of (i) a termination of the Underlying Trust
pursuant to Article IX of the Underlying Agreement, (ii) the receipt of the
final distribution to be made on the Deposited Underlying Certificates in
accordance with the terms and conditions of the Underlying Agreement and (iii)
the distribution to Certificateholders of all amounts required to be
distributed pursuant to this Agreement. No purchase pursuant to clause (a)
above is permitted if it could result in a draw on the Class A-3 Policy unless
Financial Security consents to such purchase. In no event shall the trusts
created hereby continue beyond the earlier of (i) the expiration of 21 years
from the death of the survivor of the descendants of Joseph P. Kennedy, the
late Ambassador of the United States to the Court of St. James's, living on
the date hereof and (ii) the Latest Possible Maturity Date. The right to
purchase all Deposited Underlying Certificates pursuant to clause (a) above
shall be conditioned upon the Certificate Balances of all Certificates, at the
time of such repurchase, aggregating less than ten percent of the Certificate
Balance of all Certificates on the Closing Date.
Section 7.02. Final Distribution on the Certificates.
If (a) the Holder of the Class A-R Certificate elects to terminate the
Trust Fund pursuant to clause (a) of Section 7.01, at least 20 days prior to
the date notice is to be mailed to the affected Certificateholders, the Holder
of the Class A-R Certificate shall notify the Trustee of the date such
Certificateholder intends to terminate the Trust Fund and of the applicable
repurchase price of the Deposited Underlying Certificates or (b) the Trustee
receives notice that the Underlying Trust is to be terminated in accordance
with the terms of the Underlying Agreement, notice shall be given by the
Trustee to Certificateholders as promptly as practicable thereafter.
Notice of any termination of the Trust Fund, specifying the Distribution
Date on which Certificateholders may surrender their Certificates for payment
of the final distribution and cancellation, shall be given promptly by the
Trustee by letter to Certificateholders mailed (x) , in the case of a
termination specified in clause (a) of the preceding paragraph, not earlier
than the 15th day and no later than the 10th day of the month next preceding
the month of such final distribution or (y), in the case of a termination
specified in clause (b) of the preceding paragraph, not earlier than the 15th
day of the month next preceding the month of such final distribution and not
later than as promptly practicable after the Trustee receives notice that the
Underlying Trust is to be terminated in accordance with the terms of the
Underlying Agreement. Any such notice shall specify (a) the Distribution Date
upon which final distribution on the Certificates will be made upon
presentation and surrender of Certificates at the office therein designated,
(b) the amount of such final distribution, (c) the location of the office or
agency at which such presentation and surrender must be made, and (d) that the
Record Date otherwise applicable to such Distribution Date is not applicable,
distributions being made only upon presentation and surrender of the
Certificates at the office therein specified. The Trustee will also give such
notice to each Rating Agency at the time such notice is given to
Certificateholders.
In the event such notice is given, the Trustee shall cause all funds on
deposit in the Class A-3 Reserve Fund to be distributed to Greenwich Capital
Markets, Inc., the beneficial owner of the Class A-3 Reserve Fund, and all
funds on deposit in the Class A-3 Rounding Account to be distributed to
Greenwich Capital Markets, Inc., the beneficial owner of the Class A-3
Rounding Account, at the addresses supplied by Greenwich Capital Markets, Inc.
to the Trustee for such purpose. Upon the final distribution with respect to
the Trust Fund, the Trustee shall promptly release to the Holder of the Class
A-R Certificate the Deposited Underlying Certificates.
Upon presentation and surrender of the Certificates, the Trustee shall
cause to be distributed to Financial Security and the Certificateholders of
each Class, in the order set forth in Section 3.04. hereof, on the final
Distribution Date, (a) in the case of Financial Security, all amounts required
to be distributed to it pursuant to Section 3.04 and (b) in the case of the
Certificateholders, in proportion to their respective Percentage Interests,
with respect to Certificateholders of the same Class, an amount equal to (i)
as to each Class of Regular Certificates, the Certificate Balance thereof plus
accrued interest thereon (or on their Notional Amount, if applicable) in the
case of an interest bearing Certificate and (ii) as to the Residual
Certificates, the amount, if any, which remains on deposit in the Distribution
Account (other than the amounts retained to meet claims) after application
pursuant to clause (i) above.
In the event that any affected Certificateholders shall not surrender
Certificates for cancellation within six months after the date specified in
the above mentioned written notice, the Trustee shall give a second written
notice to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If
within six months after the second notice all the applicable Certificates
shall not have been surrendered for cancellation, the Trustee may take
appropriate steps, or may appoint an agent to take appropriate steps, to
contact the remaining Certificateholders concerning surrender of their
Certificates, and the cost thereof shall be paid out of the funds and other
assets which remain a part of the Trust Fund. If within one year after the
second notice all Certificates shall not have been surrendered for
cancellation, the Class A-R Certificateholder shall be entitled to all
unclaimed funds and other assets of the Trust Fund which remain subject
hereto.
Section 7.03. Additional Termination Requirements.
(a) In the event the Holder of the Class A-R Certificate exercises its
purchase option as provided in Section 7.01, the Trust Fund shall be
terminated in accordance with the following additional requirements, unless
the Trustee has been supplied with an Opinion of Counsel, at the expense of
the Holder of the Class A-R Certificate, to the effect that the failure to
comply with the requirements of this Section 7.03 will not (i) result in the
imposition of taxes on "prohibited transactions" on any REMIC as defined in
section 860F of the Code, or (ii) cause any REMIC to fail to qualify as a
REMIC at any time that any Certificates are outstanding:
(1) Within 90 days prior to the final Distribution Date set
forth in the notice given by the Holder of the Class A-R Certificate
under Section 7.02, the Trustee shall prepare, at the expense of the "tax
matters person," and adopt a plan of complete liquidation within the
meaning of section 860F(a)(4) of the Code which, as evidenced by an
Opinion of Counsel (which opinion shall not be an expense of the Trustee
or the Tax Matters Person), meets the requirements of a qualified
liquidation; and
(2) Within 90 days after the time of adoption of such a plan of
complete liquidation, the Trustee shall sell all of the assets of the
Trust Fund to the Holder of the Class A-R Certificate for cash in
accordance with Section 7.01.
(b) The Trustee as agent for any REMIC hereby agrees to adopt and sign
such a plan of complete liquidation upon the written request of the Holder of
the Class A-R Certificate, and the receipt of the Opinion of Counsel referred
to in Section 7.03(a)(1) and to take such other action in connection therewith
as may be reasonably requested by the Holder of the Class A-R Certificate.
(c) By their acceptance of the Certificates, the Holders thereof hereby
authorize the Holder of the Class A-R Certificate to prepare and the Trustee
to adopt and sign a plan of complete liquidation.
<PAGE>
ARTICLE VIII
MISCELLANEOUS PROVISIONS
Section 8.01. Amendment. This Agreement may be amended from time to time
by the Depositor and the Trustee without the consent of any of the
Certificateholders (i) to cure any ambiguity or mistake, (ii) to correct any
defective provision herein or to supplement any provision herein which may be
inconsistent with any other provision herein, (iii) to add to the duties of
the Depositor, (iv) to add any other provisions with respect to matters or
questions arising hereunder or (v) to modify, alter, amend, add to or rescind
any of the terms or provisions contained in this Agreement; provided that any
action pursuant to clauses (iv) or (v) above shall not, as evidenced by an
Opinion of Counsel (which Opinion of Counsel shall not be an expense of the
Trustee or the Trust Fund), adversely affect in any material respect the
interests of any Certificateholder or Financial Security; provided, however,
that the amendment shall not be deemed to adversely affect in any material
respect the interests of the Certificateholders if the Person requesting the
amendment obtains a letter from each Rating Agency stating that the amendment
would not result in the downgrading or withdrawal of the respective ratings
then assigned to the Certificates without regard to the guaranty provided by
the Class A-3 Policy; it being understood and agreed that any such letter in
and of itself will not represent a determination as to the materiality of any
such amendment and will represent a determination only as to the credit issues
affecting any such rating. The Trustee and the Depositor also may at any time
and from time to time amend this Agreement without the consent of the
Certificateholders to modify, eliminate or add to any of its provisions to
such extent as shall be necessary or helpful to (i) maintain the qualification
of any REMIC as a REMIC under the Code, (ii) avoid or minimize the risk of the
imposition of any tax on any REMIC pursuant to the Code that would be a claim
at any time prior to the final redemption of the Certificates or (iii) comply
with any other requirements of the Code, provided that the Trustee has been
provided an Opinion of Counsel, which opinion shall be an expense of the party
requesting such opinion but in any case shall not be an expense of the Trustee
or the Trust Fund, to the effect that such action is necessary or helpful to,
as applicable, (i) maintain such qualification, (ii) avoid or minimize the
risk of the imposition of such a tax or (iii) comply with any such
requirements of the Code.
This Agreement may also be amended from time to time by the Depositor and
the Trustee with the consent of the Holders of a Majority in Interest of each
Class of Certificates affected thereby for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions
of this Agreement or of modifying in any manner the rights of the Holders of
Certificates; provided, however, that no such amendment shall (i) reduce in
any manner the amount of, or delay the timing of, payments required to be
distributed on any Certificate without the consent of the Holder of such
Certificate, (ii) adversely affect in any material respect the interests of
the Holders of any Class of Certificates in a manner other than as described
in (i), without the consent of the Holders of Certificates of such Class
evidencing, as to such Class, Percentage Interests aggregating 66%, (iii)
reduce the aforesaid percentages of Certificates the Holders of which are
required to consent to any such amendment, without the consent of the Holders
of all such Certificates then outstanding or (iv) adversely affect in any
material respect the rights and interests of Financial Security without its
consent.
Any amendment made pursuant to either of the preceding two paragraphs
that materially and adversely affects the rights of the Underlying Certificate
Seller shall not be made without the prior written consent of the Underlying
Certificate Seller.
Notwithstanding any contrary provision of this Agreement, the Trustee
shall not consent to any amendment to this Agreement unless it shall have
first received an Opinion of Counsel, which opinion shall not be an expense of
the Trustee or the Trust Fund, to the effect that such amendment will not
cause the imposition of any tax on any REMIC or the Certificateholders or
cause any REMIC to fail to qualify as a REMIC at any time that any
Certificates are outstanding.
Promptly after the execution of any amendment to this Agreement requiring
the consent of Certificateholders, the Trustee shall furnish written
notification of the substance or a copy of such amendment to each
Certificateholder and each Rating Agency and Financial Security.
It shall not be necessary for the consent of Certificateholders 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. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Certificateholders shall be subject to such reasonable
regulations as the Trustee may prescribe.
Nothing in this Agreement shall require the Trustee to enter into an
amendment without receiving an Opinion of Counsel (which Opinion shall not be
an expense of the Trustee or the Trust Fund) satisfactory to the Trustee that
(i) such amendment is permitted and is not prohibited by this Agreement and
that all requirements for amending this Agreement have been complied with; and
(ii) either (A) the amendment does not adversely affect in any material
respect the interests of any Certificateholder or (B) the conclusion set forth
in the immediately preceding clause (A) is not required to be reached pursuant
to this Section 8.01.
Section 8.02. Action Under and Conflicts With the Underlying Agreement.
Subject to the terms hereof, in the event that there shall be any matters
arising under the Underlying Agreement which require the vote or direction of
the holders of the Deposited Underlying Certificates, the Trustee, as holder
of the Deposited Underlying Certificates, shall vote the Deposited Underlying
Certificates in accordance with instructions received from Holders of a
Majority in Interest of the related Class of Regular Certificates. In the
absence of any such instructions, the Trustee shall not vote; provided,
however, that, notwithstanding the absence of such instructions, in the event
a required distribution pursuant to the Underlying Agreement shall not have
been made, the Trustee shall, subject to the provisions of Article V hereof,
pursue such remedies as may be available to it as holder of such Deposited
Underlying Certificates in accordance with the terms of the Underlying
Agreement.
Section 8.03. Recordation of Agreement. This Agreement (or an abstract
hereof, if acceptable by the applicable recording office) is subject to
recordation in all appropriate public offices, such recordation to be effected
by the Depositor at its expense if such recordation beneficially affects the
interests of the Certificateholders.
For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one
and the same instrument.
Section 8.04. Certain REMIC Matters. The Depositor, upon request, shall
promptly furnish the Trustee with all such information as may be reasonably
required in connection with the Trustee's preparation of all Tax Returns of
each REMIC hereunder or to enable the Trustee to respond to reasonable
requests for information made by related Certificateholders in connection with
tax matters.
Section 8.05. Limitation on Rights of Certificateholders. The death or
incapacity of any Certificateholder shall not operate to terminate this
Agreement or the trust created hereby, nor entitle such Certificateholder's
legal representative or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a petition or winding up of the trust
created hereby, or otherwise affect the rights, obligations and liabilities of
the parties hereto or any of them.
No Certificateholder shall have any right to vote (except as provided
herein) or in any manner otherwise control the operation and management of the
Trust Fund, or the obligations of the parties hereto, nor shall anything
herein set forth or contained in the terms of the Certificates be construed so
as to constitute the Certificateholders from time to time as partners or
members of an association; nor shall any Certificateholder be under any
liability to any third party by reason of any action taken by the parties to
this Agreement pursuant to any provision hereof.
No Certificateholder shall have any right by virtue or by availing itself
of any provisions of this Agreement to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this
Agreement, unless there shall have been a failure to pay amounts due under
this Agreement to the Certificateholders and the Holders of Certificates
evidencing not less than 25% of the Voting Rights evidenced by the
Certificates shall also have made written request to the Trustee to institute
such action, suit or proceeding in its own name as Trustee hereunder and shall
have offered to the Trustee such reasonable indemnity as it may require
against the costs, expenses, and liabilities to be incurred therein or
thereby, and the Trustee, for 60 days after its receipt of such notice,
request and offer of indemnity shall have neglected or refused to institute
any such action, suit or proceeding; it being understood and intended, and
being expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more Holders of Certificates
shall have any right in any manner whatever by virtue or by availing itself or
themselves of any provisions of this Agreement to affect, disturb or prejudice
the rights of the Holders of any other of the Certificates, or to obtain or
seek to obtain priority over or preference to any other such Holder or to
enforce any right under this Agreement, except in the manner herein provided
and for the common benefit of all Certificateholders. For the protection and
enforcement of the provisions of this Section 8.05, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
Section 8.06. Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE SUBSTANTIVE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN THE STATE OF NEW YORK AND
THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HERETO AND THE
CERTIFICATEHOLDERS SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 8.07. Notices. (a) The Trustee shall use its best efforts to
promptly provide notice to each Rating Agency and Financial Security with
respect to each of the following of which it has actual knowledge:
1. Any material change or amendment to this Agreement;
2. The resignation or termination of the Trustee and the appointment of
any successor;
3. The repurchase of the Deposited Underlying Certificates pursuant to
Section 2.03;
4. The final payment to Certificateholders; and
5. Any rating action involving the Deposited Underlying Certificates,
which notice shall be made by first-class mail within two Business
Days after the Trustee gains actual knowledge thereof.
In addition, the Trustee shall promptly furnish to each Rating Agency,
the Underlying Certificate Seller and Financial Security copies of each report
to Certificateholders described in Section 3.08.
(b) All demands, notices and directions hereunder shall be in writing and
shall be deemed effective when delivered to: (i) in the case of the Depositor,
CWMBS, Inc., 4500 Park Granada, Calabasas, California 91302, Attention:
Structured Finance, and a copy to CWMBS, Inc., 4500 Park Granada, Calabasas,
California 91302, Attention: General Counsel, (ii) in the case of the
Underlying Certificate Seller, Greenwich Capital Markets, Inc., 600 Steamboat
Road, Greenwich, Connecticut, 06830, Attention: General Counsel, (iii) in the
case of the Trustee, The Bank of New York, 101 Barclay Street, 12E, New York,
New York 10286, Attention: Corporate Trust - MBS Administration, and (iv) in
the case of Financial Security, Financial Security Assurance Inc., 350 Park
Avenue, New York, New York 10022, Attention: Senior Vice
President-Surveillance, or such other address as may hereafter be furnished by
any party to the others. Any notice required or permitted to be mailed to a
Certificateholder shall be given by first class mail, postage prepaid, at the
address of such Holder as shown in the Certificate Register; any notice so
mailed within the time prescribed in this Agreement shall be conclusively
presumed to have been duly given, whether or not the Certificateholder
receives such notice.
Section 8.08. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity
or enforceability of the other provisions of this Agreement or of the
Certificates or the rights of the Holders thereof.
Section 8.09. Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the respective successors
and assigns of the parties hereto, and all such provisions shall inure to the
benefit of the Certificateholders.
Section 8.10. Article and Section Headings. The article and section
headings herein are for convenience of reference only, and shall not limit or
otherwise affect the meaning hereof.
Section 8.11. Certificates Nonassessable and Fully Paid. It is the
intention of the Depositor that Certificateholders shall not be personally
liable for obligations of the Trust Fund, that the interests in the Trust Fund
represented by the Certificates shall be nonassessable for any reason
whatsoever, and that the Certificates, upon due authentication thereof by the
Trustee pursuant to this Agreement, are and shall be deemed fully paid.
* * *
IN WITNESS WHEREOF, the Depositor, the Underlying Certificate Seller and
the Trustee have caused their names to be signed hereto by their respective
officers thereunto duly authorized, all as of the day and year first above
written.
CWMBS, INC.,
as Depositor
By: /s/ Celia Coulter
---------------------------------
Name: Celia Coulter
Title: Vice President
GREENWICH CAPITAL MARKETS, INC.,
as Underlying Certificate Seller
By: /s/ John Paul Graham
----------------------------------
Name: John Paul Graham
Title: Vice President
THE BANK OF NEW YORK,
not in its individual
capacity, but solely as
Trustee
By: /s/ Robert P. Muller
----------------------------------
Name: Robert P. Muller
Title: Assistant Vice President
<PAGE>
SCHEDULE I
LIST OF DEPOSITED UNDERLYING CERTIFICATES AND THE UNDERLYING AGREEMENT
<TABLE>
<CAPTION>
PRINCIPAL BALANCE AS
DEPOSITED UNDERLYING CERTIFICATES OF MARCH 25, 1999(1) UNDERLYING AGREEMENT
<S> <C> <C>
CWMBS, Inc. Series 1998-5 Pooling and Servicing Agreement, dated as
$289,988,521.34 (2) of April 1, 1998 among CWMBS, Inc.,
Class A Countrywide Home Loans, Inc. and The Bank
of New York
</TABLE>
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(1) After giving effect to distributions made on such date.
(2) This amount represents 97.38% of the aggregate principal balance of all
CWMBS, Inc., Class A Mortgage Pass-Through Certificates, Series 1998-5.
