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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) October 22, 1998
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ABN AMRO Mortgage Corporation
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(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware
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(STATE OR OTHER JURISDICTION OF INCORPORATION)
333-57027 363886007
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(COMMISSION FILE NUMBER) (I.R.S. EMPLOYER IDENTIFICATION NO.)
181 West Madison Street
Chicago, Illinois 60602
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(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
248-643-2530
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(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
Not Applicable
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(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
Description of the Certificates and the Mortgage Pool.
On October 27, 1998, a single series of certificates, entitled ABN AMRO
Mortgage Corporation, Mortgage Pass-Through Certificates, Series 1998-4 (the
"Certificates"), was issued pursuant to a Pooling and Servicing Agreement
(the "Pooling and Servicing Agreement") attached hereto as Exhibit 4.1 dated
as of October 1, 1998, among ABN AMRO Mortgage Corporation as depositor (the
"Depositor"), LaSalle Home Mortgage Corporation as servicer and Chase Bank of
Texas, National Association as trustee. The Certificates consist of
twenty-five classes identified as the "Class A-1 Certificates", the "Class
A-2 Certificates", the "Class A-3 Certificates", the "Class A-4
Certificates", the "Class A-5 Certificates", the "Class A-6 Certificates",
the "Class A-7 Certificates", the "Class A-8 Certificates", the "Class A-9
Certificates", the "Class A-10 Certificates", the "Class A-11 Certificates",
the "Class A-12 Certificates", the "Class A-13 Certificates", the "Class A-14
Certificates", the "Class A-15 Certificates", the "Class A-16 Certificates",
the "Class A-X Certificates", the "Class A-P Certificates", the "Class M
Certificates", the "Class B-1 Certificates", the "Class B-2 Certificates",
the "Class B-3 Certificates", the "Class B-4 Certificates", the "Class B-5
Certificates" and the "Class R Certificate", respectively, and were issued in
exchange for, and evidence the entire beneficial ownership interest in, the
assets of a trust fund (the "Trust Fund") consisting primarily of a pool (the
"Mortgage Pool") of conventional, one-to-four unit residential first mortgage
loans (the "Mortgage Loans"), having as of the close of business on October
1, 1998 (the "Cut-off Date"), an aggregate principal balance of $359,835,571
(the "Initial Pool Balance"), after taking into account all payments of
principal due on the Mortgage Loans on or before such date, whether or not
received. The Depositor acquired the Trust Fund assets from Standard Federal
Bank ("Standard Federal") pursuant to a Mortgage Loan Purchase Agreement (the
"Standard Federal Mortgage Loan Purchase Agreement") dated October 27, 1998,
attached hereto as Exhibit 4.2, between Standard Federal as seller and the
Depositor as purchaser. The Class A-1, Class A-2, Class A-3, Class A-4, Class
A-5, Class A-6, Class A-7, Class A-8, Class A-9, Class A-10, Class A-11,
Class A-12, Class A-13, Class A-14, Class A-14, Class A-15, Class A-16, Class
A-X, Class A-P, Class M, Class B-1, Class B-2 and Class R Certificates were
publicly offered, as described in a Prospectus, dated September 18, 1998, and
a Prospectus Supplement, dated October 22, 1998, pursuant to an Underwriting
Agreement (the "Underwriting Agreement") dated October 22, 1998, attached
hereto as Exhibit 1.1, among the Depositor, Standard Federal Bancorporation,
Inc. ("Standard Federal Bancorporation"), Lehman Brothers Inc. ("Lehman") and
ABN AMRO Incorporated ("AAI") (Lehman and AAI being referred to herein,
collectively, as the "Underwriters") and the Terms Agreement (the "Terms
Agreement") dated October 22, 1998, attached hereto as Exhibit 1.2, among the
Depositor, Standard Federal Bancorporation and the Underwriters. The
Depositor sold the Class B-3, Class B-4 and Class B-5 Certificates to Lehman
as initial purchaser (in such capacity, the "Initial Purchaser") pursuant to
a purchase agreement dated October 22, 1998 among the Depositor, Standard
Federal Bancorporation and the Initial Purchaser.
Each Class of Certificates will have either an initial certificate
principal balance ("Certificate Principal Balance") or represent the right to
receive distributions of interest as provided in the Pooling and Servicing
Agreement on a hypothetical or notional principal balance ("Notional
Principal Balance"). The Class A-1 Certificates have an initial Certificate
Principal Balance of $16,413,000.00. The Class A-2 Certificates have an
initial Certificate Principal Balance of $25,740,000.00. The Class A-3
Certificates have an initial Certificate Principal Balance of $44,700,000.00.
The Class A-4 Certificates have an initial Certificate Principal Balance of
$2,112,000.00. The Class A-5 Certificates have an initial Notional Principal
Balance of $11,497,044.00. The Class A-6 Certificates have an initial
Certificate Principal Balance of $43,144,000.00. The Class A-7 Certificates
have an initial Certificate Principal Balance of $51,500,00.00. The Class
A-8 Certificates have an initial Certificate Principal Balance of
$5,356,000.00. The Class A-9 Certificates have an initial Certificate
Principal Balance of $14,000,000.00. The Class A-10 Certificates have an
initial Certificate Principal Balance of $5,500,000.00. The Class A-11
Certificates have an initial Certificate Principal Balance of $1,035,000.00.
The Class A-12 Certificates have an initial Certificate Principal Balance of
$41,760,000.00. The Class A-13 Certificates have an initial Certificate
Principal Balance of $51,318,000.00. The Class A-14 Certificates have an
initial Certificate Principal Balance of $16,418,000.00. The Class A-15
Certificates have an initial Certificate Principal Balance of
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$15,050,000.00. The Class A-16 Certificates have an initial Certificate
Principal Balance of $9,750,000.00. The Class A-X Certificates have an
initial Notional Principal Balance of $16,137,992.00. The Class A-P
Certificates have an initial Certificate Principal Balance of $1,643,016.00.
The Class M Certificates have an initial Certificate Principal Balance of
$6,837,000.00. The Class B-1 Certificates have an initial Certificate
Principal Balance of $3,059,000.00. The Class B-2 Certificates have an
initial Certificate Principal Balance of $1,620,000.00. The Class B-3
Certificates have an initial Certificate Principal Balance of $1,080,000.00.
The Class B-4 Certificates have an initial Certificate Principal Balance of
$900,000.00. The Class B-5 Certificates have an initial Certificate
Principal Balance of $900,454.00. The Class R Certificate has an initial
Certificate Principal Balance of $100.00.
Capitalized terms used herein and not otherwise defined shall have the
meanings assigned to them in the Pooling and Servicing Agreement.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Not applicable
(b) Not applicable
(c) Exhibits
<TABLE>
<CAPTION>
EXHIBIT
NO. DOCUMENT DESCRIPTION
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1.1 Underwriting Agreement, dated as of October 22, 1998, among ABN AMRO
Mortgage Corporation, Standard Federal Bancorporation, Inc., ABN AMRO
Incorporated and Lehman Brothers Inc.
1.2 Terms Agreement, dated October 22, 1998, among ABN AMRO Mortgage
Corporation, Standard Federal Bancorporation, Inc., ABN AMRO
Incorporated and Lehman Brothers Inc.
4.1 Pooling and Servicing Agreement, dated as of October 1, 1998, among
ABN AMRO Mortgage Corporation as depositor, LaSalle Home Mortgage
Corporation as servicer, and Chase Bank of Texas, National Association
as trustee.
4.2 Mortgage Loan Purchase Agreement, dated as of October 27, 1998,
between Standard Federal Bank as seller and ABN AMRO Mortgage
Corporation as purchaser.
</TABLE>
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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.
ABN AMRO MORTGAGE CORPORATION
(Registrant)
Dated: November 3, 1998 By: /s/ Maria Fregosi
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Name: Maria Fregosi
Title: Vice-President
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INDEX TO EXHIBITS
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<CAPTION>
EXHIBIT
NO. DOCUMENT DESCRIPTION
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1.1 Underwriting Agreement, dated as of October 22, 1998, among ABN AMRO
Mortgage Corporation, Standard Federal Bancorporation, Inc., ABN AMRO
Incorporated and Lehman Brothers Inc.
1.2 Terms Agreement, dated October 22, 1998, among ABN AMRO Mortgage
Corporation, Standard Federal Bancorporation, Inc., ABN AMRO
Incorporated and Lehman Brothers Inc.
4.1 Pooling and Servicing Agreement, dated as of October 1, among ABN AMRO
Mortgage Corporation as depositor, LaSalle Home Mortgage Corporation
as servicer, and Chase Bank of Texas, National Association as trustee.
4.2 Mortgage Loan Purchase Agreement, dated as of October 27, 1998,
between Standard Federal Bank as seller and ABN AMRO Mortgage
Corporation as purchaser.
</TABLE>
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EXECUTION COPY
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AMAC, SERIES 1998-4
MORTGAGE PASS-THROUGH CERTIFICATES
UNDERWRITING AGREEMENT
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October 22, 1998
Lehman Brothers Inc.
Three World Financial Center
New York, New York 10285
ABN AMRO Incorporated
181 West Madison Street
Chicago, Illinois 60602
Ladies and Gentlemen:
ABN AMRO Mortgage Corporation (the "Company"), a Delaware corporation,
has authorized the issuance and sale of Mortgage Pass-Through Certificates
(the "Certificates") evidencing interests in pools of mortgage loans (the
"Mortgage Loans"). The Certificates may be issued in various series, and,
within each series, in one or more classes, and, within each class, in one or
more sub-classes, in one or more offerings on terms determined at the time of
sale (each such series, a "Series" and each such class, a "Class"). Each
Series of the Certificates will be issued under a separate Pooling and
Servicing Agreement (each, a "Pooling and Servicing Agreement") with respect
to such Series among the Company, as depositor, a servicer to be identified
in the prospectus supplement for each such Series (the "Servicer") and a
trustee to be identified in the prospectus supplement for each such Series
(the "Trustee"). The Certificates of each Series will evidence specified
interests in separate pools of Mortgage Loans (each a "Mortgage Pool"), and
certain other property held in trust with respect to such Series (each, a
"Trust Fund").
The Certificates are more fully described in a Registration Statement
which the Company has furnished to you. Capitalized terms used but not
defined herein shall have the meanings given to them in the Pooling and
Servicing Agreement. The term "you" as used herein, unless the context
otherwise requires, shall mean you and such persons as are named as
co-managers in the applicable Terms Agreement (defined below).
Whenever the Company determines to make an offering of Certificates
pursuant to this Agreement through you or through an underwriting syndicate
managed by you it will enter into an agreement (the "Terms Agreement")
providing for the sale of such Certificates to, and the purchase
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and offering thereof by, you and such other underwriters, if any, selected by
you as have authorized you to enter into such Terms Agreement on their behalf
(the "Underwriters," which term shall include you whether acting alone in the
sale of Certificates or as a member of an underwriting syndicate; as the
context requires, Lehman Brothers Inc. is sometimes referred to individually
herein as "Lehman Brothers" and ABN AMRO Incorporated is sometimes referred
to individually herein as "AAI"). The Terms Agreement relating to each
offering of Certificates shall specify, among other things, the stated
balance or balances of Certificates to be issued, the price or prices at
which the Certificates are to be purchased by the Underwriters from the
Company and the initial public offering price or prices or the method by
which the price or prices at which such Certificates are to be sold will be
determined. A Terms Agreement, which shall be substantially in the form of
Exhibit A hereto, may take the form of an exchange of any standard form of
written telecommunication between you and the Company. Each such offering of
Certificates which the Company elects to make pursuant to this Agreement will
be governed by this Agreement, as supplemented by the applicable Terms
Agreement, and this Agreement and such Terms Agreement shall inure to the
benefit of and be binding upon the Underwriters participating in the offering
of such Certificates.
SECTION 1. REPRESENTATIONS AND WARRANTIES. (a) The Company represents
and warrants to you as of the date hereof, and to the Underwriters named in
the applicable Terms Agreement, all as of the date of such Terms Agreement
(in each case, the "Representation Date"), as follows (any representations
and warranties so made to the Underwriters named in an applicable Terms
Agreement respecting the Certificates being deemed to relate only to the
Certificates described therein):
(1) The Company has filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (No. 333-57027),
relating to the offering of Certificates from time to time in accordance
with Rule 415 under the Securities Act of 1933, as amended (the "1933
Act"), and has filed, and proposes to file, such amendments thereto as may
have been required to the date hereof and the same has become effective
under the 1933 Act and the rules of the Commission thereunder (the
"Regulations") and no stop order suspending the effectiveness of such
registration statement has been issued and no proceedings for that purpose
have been initiated or, to the Company's knowledge, threatened, by the
Commission. Such registration statement, including incorporated documents,
exhibits and financial statements, as amended at the time when it became
effective under the 1933 Act, and the prospectus relating to the sale of
Certificates by the Company constituting a part thereof, as from time to
time each is amended or supplemented pursuant to the 1933 Act or otherwise,
are referred to herein as the "Registration Statement" and the
"Prospectus," respectively; provided, however, that a supplement to the
Prospectus contemplated by Section 3(a) hereof (a "Prospectus Supplement")
shall be deemed to have supplemented the Prospectus only with respect to
the offering or offerings of Certificates to which it relates. Any
reference herein to the Registration Statement, a preliminary prospectus,
the Prospectus or the Prospectus Supplement shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to Item 12
of Form S-3 which were filed under the Securities Exchange Act of 1934, as
amended (the "1934 Act") on or before the date on which the Registration
Statement, as amended, became effective or
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the issue date of such preliminary prospectus, Prospectus, or Prospectus
Supplement, as the case may be; and any reference herein to the terms
"amend," "amendment" or supplement with respect to the Registration
Statement, any preliminary prospectus, the Prospectus or the Prospectus
Supplement shall be deemed to refer to and include the filing of any
document under the 1934 Act after the date on which the Registration
Statement became effective or the issue date of any preliminary prospectus,
the Prospectus or the Prospectus Supplement, as the case may be, deemed to
be incorporated therein by reference. The Registration Statement and
Prospectus, at the time the Registration Statement became effective did,
and as of the applicable Representation Date will, conform in all material
respects to the requirements of the 1933 Act and the Regulations. The
Registration Statement, at the time it became effective did not, and as of
the applicable Representation Date and the applicable Closing Time (as
defined in Section 2 hereof) will not, contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading. The
Prospectus, as amended or supplemented as of the applicable Representation
Date and the applicable Closing Time (as defined in Section 2 hereof),
will not contain any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
provided, however, that the representations and warranties in this
subsection shall not apply to (i) statements in, or omissions from, the
Registration Statement or Prospectus made in reliance upon and in
conformity with information furnished to the Company in writing by the
Underwriters expressly for use in the Registration Statement or Prospectus
or (ii) the Lehman Brothers Information (as defined in Section 10 hereof).
The conditions to the use by the Company of a registration statement on
Form S-3 under the 1933 Act, as set forth in the General Instructions to
Form S-3, have been satisfied with respect to the Registration Statement
and the Prospectus. There are no contracts or documents of the Company
which are required to be described in the Registration Statement or
Prospectus or filed as exhibits to the Registration Statement pursuant
to the 1933 Act or the Regulations which have not been so described or
filed.
(2) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Delaware with
corporate power and authority to enter into and perform its obligations
under this Agreement, the applicable Pooling and Servicing Agreement, and
with respect to a Series of Certificates, the Certificates and the
applicable Terms Agreement; and the Company is duly qualified or registered
as a foreign corporation to transact business and is in good standing in
each jurisdiction in which the ownership or lease of its properties or the
conduct of its business requires such qualification.
(3) The Company is not in violation of its certificate of
incorporation or by-laws or in default in the performance or observance of
any material obligation, agreement, covenant or condition contained in any
material contract, indenture, mortgage, loan agreement, note, lease or
other material instrument to which it is a party or by which it or its
properties may be bound, which default might result in any material adverse
change in the
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financial condition, earnings, affairs or business of the Company or
which might materially and adversely affect the properties or
assets thereof or the Company's ability to perform its obligations under
this Agreement, the applicable Terms Agreement or the applicable Pooling
and Servicing Agreement.
(4) The execution and delivery by the Company of this Agreement, the
applicable Terms Agreement and the applicable Pooling and Servicing
Agreement and the signing of the Registration Statement by the Company are
within the corporate power of the Company and have been duly authorized by
all necessary corporate action on the part of the Company; and with respect
to a Series of Certificates described in the applicable Terms Agreement,
neither the issuance and sale of the Certificates to the Underwriters, nor
the execution and delivery by the Company of this Agreement, such Terms
Agreement and the related Pooling and Servicing Agreement, nor the
consummation by the Company of the transactions herein or therein
contemplated, nor compliance by the Company with the provisions hereof or
thereof, will conflict with or result in a breach or violation of any of
the terms or provisions of, or constitute a default under, or result in the
creation or imposition of any lien, charge or encumbrance upon any property
or assets of the Company other than as contemplated by a Pooling and
Servicing Agreement, pursuant to any material indenture, mortgage, contract
or other material instrument to which the Company is a party or by which it
is bound or to which the property or assets of the Company are subject, or
result in the violation of the provisions of the certificate of
incorporation or by-laws of the Company or any statute or any material
order, rule or regulation of any court or governmental agency or body
having jurisdiction over the Company or any of its properties.
(5) This Agreement has been, and each applicable Terms Agreement when
executed and delivered as contemplated hereby and thereby will have been,
duly authorized, executed and delivered by the Company, and each
constitutes, or will constitute when so executed and delivered, a legal,
valid and binding instrument enforceable against the Company in accordance
with its terms (assuming due authorization, execution and delivery by the
other parties thereto), subject (a) to applicable bankruptcy, insolvency,
reorganization, moratorium, or other similar laws affecting creditors'
rights generally, (b) as to enforceability to general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity or
at law) and (c) as to enforceability with respect to rights of indemnity
thereunder, to limitations of public policy under applicable securities
laws.
(6) Each applicable Pooling and Servicing Agreement when executed and
delivered as contemplated hereby and thereby will have been duly
authorized, executed and delivered by the Company, and will constitute when
so executed and delivered, a legal, valid and binding instrument
enforceable against the Company in accordance with its terms (assuming due
authorization, execution and delivery by the other parties thereto),
subject (a) to applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting creditors' rights generally and
(b) as to enforceability to general principles of equity (regardless of
whether enforcement is sought in a proceeding in equity or at law); and as
of
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the Closing Time, the representations and warranties made by the Company
in the applicable Pooling and Servicing Agreement will be true and correct
as of the date made.
(7) As of the Closing Time (as defined in Section 2 hereof) with
respect to a Series of Certificates, the Certificates will have been duly
and validly authorized by the Company, and, when executed and authenticated
as specified in the related Pooling and Servicing Agreement, will be
validly issued and outstanding and will be entitled to the benefits of the
related Pooling and Servicing Agreement, and the Classes of Certificates so
designated in the related Prospectus Supplement will be "mortgage related
securities," as defined in Section 3(a)(41) of the 1934 Act.
(8) There are no actions, proceedings or investigations now pending
against the Company or, to the knowledge of the Company, threatened against
the Company, before any court, administrative agency or other tribunal (i)
asserting the invalidity of this Agreement, the applicable Terms Agreement,
the applicable Pooling and Servicing Agreement or with respect to a Series
of Certificates, the Certificates, (ii) seeking to prevent the issuance of
such Certificates or the consummation of any of the transactions
contemplated by this Agreement, the applicable Terms Agreement or such
Pooling and Servicing Agreement, (iii) which would be likely to materially
and adversely affect the performance by the Company of its obligations
under, or which would if adversely determined materially and adversely
affect the validity or enforceability of, this Agreement, the applicable
Terms Agreement, such Pooling and Servicing Agreement or such Certificates
or (iv) seeking to adversely affect the federal income tax attributes of
such Certificates described in the Prospectus and the related Prospectus
Supplement.
(9) Any material taxes, fees and other governmental charges that are
assessed and due in connection with the execution, delivery and issuance of
this Agreement, the applicable Terms Agreement, the applicable Pooling and
Servicing Agreement and with respect to a Series of Certificates shall have
been paid at or prior to the Closing Time.
(10) No filing or registration with, notice to or consent, approval,
authorization, order or qualification of or with any court or governmental
agency or body is required for the issuance and sale of the Certificates or
the consummation by the Company of the transactions contemplated by this
Agreement, the applicable Pooling and Servicing Agreement or the applicable
Terms Agreement, except the registration under the 1933 Act of the
Certificates, and such consents, approvals, authorizations, registrations
or qualifications as may be required under state securities or Blue Sky
laws in connection with the purchase and distribution of the Certificates
by the Underwriters.
(11) The Company possesses all material licenses, certificates,
authorities or permits issued by the appropriate state, federal or foreign
regulatory agencies or bodies deemed by the Company to be reasonably
necessary to conduct the business now operated by it and as described in
the Prospectus and the Company has received no notice of proceedings
relating to the revocation or modification of any such license,
certificate,
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authority or permit which, singly or in the aggregate, if the subject of
an unfavorable decision, ruling or finding, would materially and
adversely affect the conduct of the business, operations, financial
condition or income of the Company.
(12) No litigation is pending or, to the best of the Company's
knowledge, threatened, against the Company which would prohibit the
Company's entering into this Agreement or the applicable Pooling and
Servicing Agreement.
(13) As of the Closing Time, with respect to a Series of Certificates
described in the relevant Terms Agreement evidencing interests in a
Mortgage Pool, the Trustee will have either good and marketable title, free
and clear of all prior liens, charges, pledges, mortgages, security
interests and encumbrances, to or a validly perfected first priority
security interest in the Mortgage Notes and the related Mortgages included
in the Trust Fund, with respect to (a) the Mortgage Notes, upon delivery
thereof to the Trustee and (b) the Mortgages, upon delivery to the Trustee
of instruments of assignment in recordable form assigning each Mortgage to
the Trustee and the recording of each such instrument of assignment in the
appropriate recording office in which the Mortgaged Property is located, or
if supported by an opinion of counsel, without recording.
(14) As of the Closing Time, with respect to a Series of Certificates,
the Mortgage Pool will have substantially the characteristics described in
the Prospectus Supplement and in the Form 8-K of the Company prepared with
respect to such Certificates, if the Mortgage Pool is described in such
Form 8-K.
(15) Neither the Company nor the Trust Fund created by the applicable
Pooling and Servicing Agreement will be subject to registration as an
"investment company" under the Investment Company Act of 1940, as amended
(the "1940 Act").
(16) The Certificates, the applicable Pooling and Servicing Agreement,
the applicable Terms Agreement and any primary insurance policies, mortgage
pool insurance policies, standard hazard insurance policies, special hazard
insurance policies, mortgagor bankruptcy insurance and alternate credit
enhancement related to the Certificates described in the relevant Terms
Agreement conform in all material respects to the descriptions thereof
contained in the Prospectus.
(17) As of the Closing Time, the Mortgage Loans will have been duly
and validly assigned and delivered by the Company to the Trustee under the
related Pooling and Servicing Agreement.
(18) As of the Closing Time, the representations and warranties of the
Company contained in the applicable Pooling and Servicing Agreement are
true and correct in all material respects.
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(b) Standard Federal Bancorporation, Inc. ("Standard Federal") represents
and warrants to you as of the date hereof, and to the Underwriters named in the
applicable Terms Agreement, all as of the date of such Terms Agreement (in each
case, the "Representation Date"), as follows (any representations and warranties
so made to the Underwriters named in an applicable Terms Agreement respecting
the Certificates being deemed to relate only to the Certificates described
therein):
(1) Standard Federal has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Michigan with corporate power and authority to enter into and perform its
obligations under this Agreement, and with respect to a Series of
Certificates, the applicable Terms Agreement; and Standard Federal is duly
qualified or registered as a foreign corporation to transact business and
is in good standing in each jurisdiction in which the ownership or lease of
its properties or the conduct of its business requires such qualification.
(2) Standard Federal is not in violation of its certificate of
incorporation or by-laws or in default in the performance or observance of
any material obligation, agreement, covenant or condition contained in any
material contract, indenture, mortgage, loan agreement, note, lease or
other material instrument to which it is a party or by which it or its
properties may be bound, which default might result in any material adverse
change in the financial condition, earnings, affairs or business of
Standard Federal or which might materially and adversely affect the
properties or assets thereof or Standard Federal's ability to perform its
obligations under this Agreement or the applicable Terms Agreement.
(3) The execution and delivery by Standard Federal of this Agreement
and the applicable Terms Agreement are within the corporate power of
Standard Federal and have been duly authorized by all necessary corporate
action on the part of Standard Federal; and with respect to a Series of
Certificates described in the applicable Terms Agreement, neither the
execution and delivery by Standard Federal of this Agreement and such Terms
Agreement, nor the consummation by Standard Federal of the transactions
herein or therein contemplated, nor compliance by Standard Federal with the
provisions hereof or thereof, will conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of Standard Federal, pursuant to
any material indenture, mortgage, contract or other material instrument to
which Standard Federal is a party or by which it is bound or to which the
property or assets of Standard Federal are subject, or result in the
violation of the provisions of the certificate of incorporation or by-laws
of Standard Federal or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over Standard
Federal or any of its properties.
(4) This Agreement has been, and each applicable Terms Agreement when
executed and delivered as contemplated hereby and thereby will have been,
duly authorized, executed and delivered by Standard Federal, and each
constitutes, or will constitute when
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so executed and delivered, a legal, valid and binding instrument
enforceable against Standard Federal in accordance with its terms
(assuming due authorization, execution and delivery by the other parties
thereto), subject (a) to applicable bankruptcy, insolvency, reorganization,
moratorium, or other similar laws affecting creditors' rights generally,
(b) as to enforceability to general principles of equity (regardless of
whether enforcement is sought in a proceeding in equity or at law) and
(c) as to enforceability with respect to rights of indemnity thereunder,
to limitations of public policy under applicable securities laws.
(5) This Agreement when executed and delivered as contemplated hereby
and thereby will have been duly authorized, executed and delivered by
Standard Federal, and will constitute when so executed and delivered, a
legal, valid and binding instrument enforceable against Standard Federal in
accordance with its terms (assuming due authorization, execution and
delivery by the other parties thereto), subject (a) to applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally and (b) as to enforceability to
general principles of equity (regardless of whether enforcement is sought
in a proceeding in equity or at law).
(6) There are no actions, proceedings or investigations now pending
against Standard Federal or, to the knowledge of Standard Federal,
threatened against Standard Federal, before any court, administrative
agency or other tribunal (i) asserting the invalidity of this Agreement or
the applicable Terms Agreement, (ii) seeking to prevent the issuance of
such Certificates or the consummation of any of the transactions
contemplated by this Agreement or the applicable Terms Agreement, (iii)
which would be likely to materially and adversely affect the performance by
Standard Federal of its obligations under, or which would if adversely
determined materially and adversely affect the validity or enforceability
of, this Agreement, the applicable Terms Agreement, or such Certificates or
(iv) seeking to adversely affect the federal income tax attributes of such
Certificates described in the Prospectus and the related Prospectus
Supplement.
SECTION 2. PURCHASE AND SALE. The commitment of each Underwriter to
purchase Certificates pursuant to any Terms Agreement shall be several and not
joint and shall be deemed to have been made on the basis of the representations
and warranties herein contained and shall be subject to the terms and conditions
herein set forth.
Payment of the purchase price for, and delivery of, any Certificates to be
purchased by the Underwriters shall be made at the offices of Mayer, Brown &
Platt, Chicago, Illinois or at such other place as shall be agreed upon by you
and the Company, at such time or date as shall be agreed upon by you and the
Company in the Terms Agreement (each such time and date being referred to as a
"Closing Time"). Unless otherwise specified in the applicable Terms Agreement,
payment shall be made to the Company in immediately available Federal funds
wired to such bank as may be designated by the Company. Such Certificates shall
be in such denominations and registered in such names as you may request in
writing at least two business days prior to the applicable Closing Time.
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Such Certificates will be made available for examination and packaging by you no
later than 12:00 noon on the first business day prior to the applicable Closing
Time.
It is understood that the Underwriters intend to offer the Certificates for
sale to the public as set forth in the Prospectus Supplement.
SECTION 3. COVENANTS OF THE COMPANY. The Company covenants with each of
you and each Underwriter participating in an offering of Certificates pursuant
to a Terms Agreement, with respect to such Certificates and such offering, as
follows:
(a) Immediately following the execution of each Terms Agreement, the
Company will prepare a Prospectus Supplement setting forth the principal
amount of Certificates covered thereby, the price or prices at which the
Certificates are to be purchased by the Underwriters, either the initial
public offering price or prices or the method by which the price or prices
by which the Certificates are to be sold will be determined, the selling
concession(s) and reallowance(s), if any, any delayed delivery
arrangements, and such other information as you and the Company deem
appropriate in connection with the offering of the Certificates. The
Company will furnish you a copy of the Prospectus Supplement for your
review prior to filing such Prospectus Supplement with the Commission.
Thereafter, the Company will promptly transmit copies of the Prospectus
Supplement to the Commission for filing pursuant to Rule 424 under the 1933
Act and will furnish to the Underwriters as many copies of the Prospectus
and such Prospectus Supplement as you shall reasonably request.
(b) If the delivery of a prospectus is required at any time in
connection with the offering or sale of the Certificates described in the
relevant Terms Agreement and if at such time any event shall have occurred
as a result of which the Prospectus as then amended or supplemented would
include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made when such Prospectus
is delivered, not misleading, or, if for any other reason it shall be
necessary during such period of time to amend or supplement the Prospectus
in order to comply with the 1933 Act, the Company agrees to notify you
promptly and upon your request so to amend or supplement the Prospectus and
to prepare and furnish without charge to each Underwriter and to any dealer
in securities as many copies as you may from time to time reasonably
request of an amended Prospectus or a supplement to the Prospectus which
will correct such statement or omission or effect such compliance.
(c) During any period in which the delivery of a prospectus is
required at any time in connection with the offering or sale of the
Certificates described in the relevant Terms Agreement the Company will
give you reasonable notice of its intention to file any amendment to the
Registration Statement or any amendment or supplement to the Prospectus,
whether pursuant to the 1933 Act or otherwise, and will furnish you with
copies
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of any such amendment or supplement or other documents proposed to
be filed a reasonable time in advance of filing.
(d) During any period in which the delivery of a prospectus is
required at any time in connection with the offering or sale of the
Certificates described in the relevant Terms Agreement the Company will
notify you promptly (i) of the effectiveness of any amendment to the
Registration Statement, (ii) of the mailing or the delivery to the
Commission for filing of any supplement to the Prospectus or any document
other than quarterly and annual reports to be filed pursuant to the 1934
Act, (iii) of the receipt of any comments from the Commission with respect
to the Registration Statement, the Prospectus or any Prospectus Supplement,
(iv) of any request by the Commission for any amendment to the Registration
Statement or any amendment or supplement to the Prospectus or for
additional information, (v) of the receipt by the Company of any
notification with respect to the suspension of the qualification of the
Certificates for sale in any jurisdiction or the threat of any proceeding
for that purpose and (vi) of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose. The Company will use its
best efforts to prevent the issuance of any such stop order and, if any
stop order is issued, to obtain the lifting thereof as soon as possible.
(e) The Company agrees, so long as the Certificates shall be
outstanding, or until such time as you shall cease to maintain a secondary
market in the Certificates, whichever first occurs, to deliver to you the
annual statement as to compliance delivered to the Trustee pursuant to the
applicable Pooling and Servicing Agreement and the annual statement of a
firm of independent public accountants furnished to the Trustee pursuant to
the applicable Pooling and Servicing Agreement, as soon as such statements
are furnished to the Company.
(f) The Company will deliver to you as many conformed copies of the
Registration Statement (as originally filed) and of each amendment thereto
(including exhibits filed therewith or incorporated by reference therein
and documents incorporated by reference in the Prospectus) as you may
reasonably request.
(g) The Company will endeavor, in cooperation with you, to qualify
the Certificates for offering and sale under the applicable securities laws
of such states and other jurisdictions of the United States as you may
reasonably designate, and will maintain or cause to be maintained such
qualifications in effect for as long as may be required for the
distribution of the Certificates, provided that in connection therewith the
Company shall not be required to qualify as a foreign corporation or to
file a general consent to service of process in any jurisdiction. The
Company will file or cause the filing of such statements and reports as may
be required by the laws of each jurisdiction in which the Certificates have
been qualified as above provided.
SECTION 4. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of the
Underwriters to purchase Certificates pursuant to any Terms Agreement shall be
subject to the accuracy of the
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representations and warranties on the part of the Company herein contained,
to the accuracy of the statements of the Company's officers made pursuant
hereto, to the performance by the Company of all of its obligations hereunder
and to the following additional conditions precedent:
(a) At the applicable Closing Time (i) no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been initiated or threatened by the
Commission and the Prospectus Supplement shall have been filed or
transmitted for filing by means reasonably calculated to result in filing
with the Commission not later than the time required by Rule 424(b) under
the 1933 Act, (ii) the Certificates shall have received the rating or
ratings specified in the applicable Terms Agreement, and (iii) there shall
not have come to your attention any facts that would cause you to believe
that the Prospectus, together with the applicable Prospectus Supplement at
the time it was required to be delivered to a purchaser of the
Certificates, contained an untrue statement of a material fact or omitted
to state a material fact necessary in order to make the statements therein,
in light of the circumstances existing at such time, not misleading. No
challenge by the Commission shall have been made to the accuracy or
adequacy of the Registration Statement and any request of the Commission
for inclusion of additional information in the Registration Statement or
the Prospectus or the Prospectus Supplement shall have been complied with
and the Company shall not have filed with the Commission any amendment or
supplement to the Registration Statement, the Prospectus or the Prospectus
Supplement without prior written notice to the Underwriters.
(b) At the applicable Closing Time you shall have received:
(1) The opinion, dated as of the applicable Closing Time, of
Mayer Brown & Platt, counsel for the Company, in form and substance
satisfactory to such of you as may be named in the applicable Terms
Agreement, to the effect that:
(i) The Company is validly existing as a corporation in good
standing under the laws of the State of Delaware.
(ii) This Agreement and the applicable Terms Agreement have
been duly authorized, executed and delivered by the Company, and each
is a valid and binding obligation of the Company.
(iii) The applicable Pooling and Servicing Agreement has been
duly authorized, executed and delivered by the Company, and is a
legal, valid and binding obligation of the Company enforceable against
the Company in accordance with its terms, except that (A) such
enforceability thereof may be subject to bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally and (B) the remedy of
specific performance and injunctive and other forms of equitable
relief may be subject to equitable defenses and to the discretion of
the court before which any proceeding therefor may be brought.
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(iv) The execution and delivery by the Company of this
Agreement, the applicable Terms Agreement and applicable Pooling and
Servicing Agreement and the signing of the Registration Statement by
the Company are within the corporate power of the Company and have
been duly authorized by all necessary corporate action on the part of
the Company; and neither the issue and sale of the Certificates nor
the consummation of the transactions contemplated herein or therein
nor the fulfillment of the terms hereof or thereof will, conflict with
or constitute a breach or violation of any of the terms or provisions
of, or constitute a default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or
assets of the Company pursuant to, any contract, indenture, mortgage,
or other instrument to which the Company is a party or by which it may
be bound of which such counsel is aware, other than the lien or liens
created by the applicable Pooling and Servicing Agreement, nor will
such action result in any violation of the provisions of the
certificate of incorporation or by-laws of the Company or, any
statute, rule or regulation to which the Company is subject or by
which it is bound or any writ, injunction or decree of any court,
governmental authority or regulatory body to which it is subject or by
which it is bound of which such counsel is aware.
(v) The Certificates have been duly authorized and, when
executed and authenticated as specified in the related Pooling and
Servicing Agreement and delivered and paid for, will be validly
issued, fully paid, nonassessable and entitled to the benefits of the
related Pooling and Servicing Agreement.
(vi) Assuming strict compliance by the Underwriters with the
provisions of this Agreement, no filing or registration with or notice
to or consent, approval, authorization, order or qualification of or
with any court or governmental agency or body is required for the
issuance and sale of the Certificates or the consummation by the
Company of the transactions contemplated by this Agreement, the
applicable Pooling and Servicing Agreement or the applicable Terms
Agreement, except the registration under the 1933 Act of the
Certificates, and such consents, approvals, authorizations,
registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the purchase and
distribution of the Certificates by the Underwriters.
(vii) Other than as may be set forth or contemplated in the
Prospectus, there is no action, suit or proceeding of which such
counsel is aware before or by any court or governmental agency or
body, domestic or foreign, now pending or, to the best of such
counsel's knowledge, threatened against the Company which might result
in any material adverse change in the financial condition, earnings,
affairs or business of the Company, or which might materially and
adversely affect the properties or assets thereof or might materially
and adversely affect the performance by the Company of its obligations
under, or the validity or enforceability of, the Certificates, this
Agreement or the Pooling and Servicing Agreement, or which is required
to be disclosed in the Registration Statement.
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(viii) The Registration Statement is effective under the 1933
Act and, to the best of such counsel's knowledge, no stop order
suspending the effectiveness of the Registration Statement has been
issued under the 1933 Act or proceedings therefor initiated or
threatened by the Commission.
(ix) The applicable Pooling and Servicing Agreement is not
required to be qualified under the Trust Indenture Act of 1939, as
amended.
(x) The Registration Statement and the Prospectus (other than
the financial statements and other financial and statistical
information included therein, as to which no opinion need be rendered)
as of their respective effective or issue dates, complied as to form
in all material respects with the requirements of the 1933 Act and the
Regulations thereunder.
(xi) (A) The statements in the Prospectus under the headings
"ERISA Considerations" and "Certain Federal Income Tax Consequences"
and the statements in the applicable Prospectus Supplement under the
headings "Certain Federal Income Tax Consequences" and "ERISA
Considerations", to the extent that they describe matters of United
States federal income tax law or ERISA or legal conclusions with
respect thereto, have been prepared or reviewed by such counsel and
are accurate in all material respects and (B) the statements in the
Prospectus under the heading "Certain Legal Aspects of the Mortgage
Loans," to the extent they constitute matters of United States federal
law or legal conclusions with respect thereto, while not purporting to
discuss all possible consequences of investment in the Certificates,
are accurate in all material respects with respect to those
consequences or matters discussed therein.
(xii) The statements in the Prospectus and the applicable
Prospectus Supplement under the caption "Description of the
Certificates", insofar as they purport to summarize certain terms of
the Certificates and the applicable Pooling and Servicing Agreement,
constitute a fair summary of the provisions purported to be
summarized.
(xiii) The Trust Funds created by the applicable Pooling and
Servicing Agreement is not, and will not as a result of the offer and
sale of the Certificates as contemplated in the Prospectus and in this
Agreement become, required to be registered as an "investment company"
under the 1940 Act.
(xiv) The Classes of Certificates so designated in the
Prospectus Supplement will be "mortgage related securities", as
defined in Section 3(a)(41) of the 1934 Act, so long as the
Certificates are rated in one of the two highest grades by at least
one nationally recognized statistical rating organization.
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(xv) Assuming (a) ongoing compliance with all of the provisions
of the Pooling and Servicing Agreement and (b) the filing of
elections, in accordance with the Pooling and Servicing Agreement, to
be treated as "real estate mortgage investment conduits" ("REMICs")
pursuant to Section 860D of the Internal Revenue Code of 1986, as
amended (the "Code") for Federal income tax purposes, REMIC I and
REMIC II of the Trust Fund will qualify as REMICs as of the Closing
Date and will continue to qualify as REMICs for so long as there is
compliance with amendments after the date hereof to any applicable
provisions of the Code and applicable Treasury Regulations.
(xvi) Assuming that REMIC I and REMIC II of the Trust Fund are
treated as REMICs for Federal income tax purposes, neither of them nor
the Trust Fund will be subject as an entity to any tax imposed on
income, franchise or capital stock by the laws of Illinois.
Such counsel shall deliver to you such additional opinions addressing the
transfer by the Company to the Trustee of its right, title and interest in and
to the Mortgage Loans and other property included in the Trust Fund at the
Closing Time as may be required by each Rating Agency rating the Certificates.
Such counsel shall state that it has participated in conferences with
officers and other representatives of the Company, your counsel, representatives
of the independent accountants for the Company and you at which the contents of
the Registration Statement and the Prospectus and related matters were discussed
and, although such counsel is not passing upon and does not assume
responsibility for, the factual accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectus (except as
stated in paragraphs (xi) and (xii) above) and has made no independent check or
verification thereof for the purpose of rendering its opinion, on the basis of
the foregoing, nothing has come to their attention that leads such counsel to
believe that either the Registration Statement, at the time it became effective
and at the applicable Closing Time, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or that the Prospectus
contained or contains as of the date thereof and at the applicable Closing Time
any untrue statement of a material fact or omitted or omits to state a material
fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, except that such counsel need
express no view with respect to the financial statements, schedules and other
financial and statistical data included in or incorporated by reference into the
Registration Statement, the Prospectus or the Prospectus Supplement.
Such counsel may state that their opinions relate only to laws of the State
of New York, the Federal laws of the United States and the General Corporation
Law of the State of Delaware.
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In rendering such opinions, such counsel may rely, as to matters of fact,
to the extent deemed proper and stated therein, on certificates of responsible
officers of the Company, the Trustee or public officials.
(2) The favorable opinion of counsel to the Trustee, dated as
of the applicable Closing Time, addressed to you and in form and scope
satisfactory to your counsel, to the effect that:
(i) The Trustee is a national association, duly organized
and validly existing in good standing under the laws of the United
States, and has all requisite power and authority to enter into the
Pooling and Servicing Agreement and to perform its obligations
thereunder.
(ii) To the knowledge of such counsel, there is no action,
suit, proceeding or investigation pending or threatened against the
Trustee that could materially adversely affect the ability of the
Trustee to perform its obligations under the Pooling and Servicing
Agreement.
(iii) The Trustee has duly authorized, executed and
delivered the applicable Pooling and Servicing Agreement and such
Pooling and Servicing Agreement will constitute the legal, valid and
binding obligation of the Trustee.
(iv) The Trustee has full power and authority to execute
and deliver the applicable Pooling and Servicing Agreement and to
perform its obligations thereunder.
(v) No consent, approval or authorization of, or
registration, declaration or filing with, any court or governmental
agency or body of the jurisdiction of its organization is required for
the execution, delivery or performance by the Trustee of the Pooling
and Servicing Agreement.
(vi) The Certificates have been duly and validly executed,
authenticated and delivered by the Trustee in accordance with the
Pooling and Servicing Agreement.
(vii) The performance by the Trustee of its duties pursuant
to the Pooling and Servicing Agreement does not conflict with or
result in a breach or violation of any term or provision of, or
constitute a default under, any statute or regulation currently
governing the Trustee.
In rendering such opinion, such counsel may rely, as to matters of
fact, to the extent deemed proper and stated therein, on certificates of
responsible officers of the Trustee or public officials.
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(3) The favorable opinion of counsel to the Servicer, dated as
of the applicable Closing Time, addressed to you and in form and scope
satisfactory to your counsel, to the effect that:
(i) The Servicer is validly existing as a corporation in
good standing under the laws of the jurisdiction of its incorporation.
(ii) The execution and delivery by the Servicer of the
applicable Pooling and Servicing Agreement is within the corporate
power of the Servicer and has been duly authorized by all necessary
corporate action on the part of the Servicer; and to the knowledge of
such counsel, neither the execution and delivery of either such
instrument, nor the consummation of the transactions provided for
therein, nor compliance with the provisions thereof, will conflict
with or constitute a breach of, or default under, any contract,
indenture, mortgage, loan agreement, note, lease, deed of trust, or
other instrument to which the Servicer is a party or by which it may
be bound, nor will such action result in any violation of the
provisions of the charter or by-laws of the Servicer or to the
knowledge of such counsel, any law, administrative regulation or
administrative or court decree.
(iii) The applicable Pooling and Servicing Agreement has
been duly executed and delivered by the Servicer and constitutes a
legal, valid and binding obligation of the Servicer enforceable
against the Servicer in accordance with its terms, except that such
enforceability thereof may be subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights generally and subject, as to enforceability, to
general principles of equity (regardless whether enforcement is sought
in a proceeding in equity or at law).
(iv) To the knowledge of such counsel, the execution,
delivery and performance by the Servicer of the applicable Pooling and
Servicing Agreement do not require the consent or approval of, the
giving of notice to, the registration with, or the taking of any other
action in respect of any federal, state or other governmental agency
or authority which has not previously been effected.
(v) To the knowledge of such counsel, there is no action,
suit or proceeding of which such counsel is aware before or by any
court or governmental agency or body, domestic or foreign, now pending
or threatened against the Servicer which might materially and
adversely affect the performance by the Servicer under, or the
validity or enforceability of the applicable Pooling and Servicing
Agreement.
(vi) The description of the Servicer in the applicable
Prospectus Supplement is true and correct in all material respects.
(4) The favorable opinion or opinions, dated as of the
applicable Closing Time, of counsel for the Underwriters, acceptable
to the Underwriters.
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(5) The favorable opinion, dated the applicable Closing Time of
counsel for Standard Federal, acceptable to the Underwriters.
(c) At the applicable Closing Time you shall have received a
certificate of the President or a Vice President and the Treasurer or the
Secretary of each of the Company and Standard Federal, dated as of such
Closing Time, to the effect that the representations and warranties of the
Company or Standard Federal, as the case may be, contained in Section 1 are
true and correct with the same force and effect as though such Closing Time
were a Representation Date and that the Company or Standard Federal, as the
case may be, has complied with all agreements and satisfied all the
conditions on its part to be performed or satisfied at or prior to the
Closing Time.
(d) You shall have received from Ernst & Young with respect to
certain information relating to the Company and from Deloitte & Touche with
respect to certain other information in the Prospectus Supplement, or other
independent certified public accountants acceptable to you, letters, dated
as of the date of the applicable Terms Agreement and as of the applicable
Closing Time, delivered at such times, in the form and substance reasonably
satisfactory to you.
(e) At the applicable Closing Time, with respect to a Series of
Certificates, each of the representations and warranties of the Servicer
set forth in the related Pooling and Servicing Agreement will be true and
correct and you shall have received a Certificate of an Executive Vice
President, Senior Vice President or Vice President of the Servicer, dated
as of such Closing Time, to such effect.
(f) At the applicable Closing Time, with respect to a Series of
Certificates, the Certificates shall have received the certificate rating
or ratings specified in the related Terms Agreement.
(g) At the applicable Closing Time, counsel for the Underwriters
shall have been furnished with such other documents and opinions as they
may reasonably require for the purpose of enabling them to pass upon the
issuance and sale of the Certificates as herein contemplated and related
proceedings or in order to evidence the accuracy and completeness of any of
the representations and warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings taken by the Company in
connection with the issuance and sale of the Certificates as herein
contemplated shall be reasonably satisfactory in form and substance to you
and counsel for the Underwriters.
If any condition specified in this Section shall not have been fulfilled
when and as required to be fulfilled or, if any of the opinions and certificates
required hereby shall not be in all material respects reasonably satisfactory to
you and your counsel, the applicable Terms Agreement may be terminated by you by
notice to the Company at any time at or prior to the applicable Closing Time,
and such termination shall be without liability of any party to any other party
except as provided in Section 5.
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SECTION 5. PAYMENT OF EXPENSES. The Company covenants and agrees
with the Underwriters that the Company will pay or cause to be paid all expenses
incident to the performance of its obligations under this Agreement and all
other fees and expenses associated with the transactions referred to herein,
including, but not limited to, the fees and expenses of the Trustee, Rating
Agencies, printer, accounting firms, the fees and expenses relating to the
establishment of the Company's shelf registration statement and related ongoing
fees and expenses; provided, however, that the Underwriters covenant and agree
to pay all of their own costs and expenses, including underwriting and due
diligence expenses, the fees of their counsel, transfer taxes on resale of any
of the Certificates by them and any advertising expenses connected with any
offers they may make.
SECTION 6. INDEMNIFICATION.
(a) The Company and Standard Federal, jointly and severally, will
indemnify and hold harmless the Underwriters and each person, if any, who
controls the Underwriters within the meaning of the 1933 Act, against any
losses, claims, damages, expenses or liabilities, joint or several, to
which such Underwriter or such controlling person may become subject, under
the 1933 Act or otherwise, insofar as such losses, claims, damages,
expenses or liabilities (or actions in respect thereof) arise out of or are
based upon an untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement (or any amendment thereto) or
the Prospectus (or any amendment or supplement thereto), or arise out of or
are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading in each case in respect of the relevant Certificates, and will
reimburse each such indemnified party for any legal or other expenses
reasonably incurred by it in connection with investigating or defending any
such action or claim; provided, however, that the Company shall not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in any such document
in reliance upon and in conformity with written information furnished to
the Company by or on behalf of the Underwriters expressly for use therein.
This indemnity agreement will be in addition to any liability which the
Company may otherwise have.
(b) The Underwriters, severally and not jointly, will indemnify and
hold harmless the Company, each of its officers who signed the Registration
Statement, its directors, and any person controlling the Company within the
meaning of the 1933 Act against any losses, claims, damages, expenses or
liabilities to which the Company or any such officer, director or
controlling person may become subject, under the 1933 Act or otherwise,
insofar as such losses, claims, damages, expenses or liabilities (or
actions in respect thereof) arise out of or are based upon an untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto) or the Prospectus (or any
amendment or supplement thereto), or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make
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the statements therein, in light of the circumstances under which they
were made, not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon and in conformity with
written information furnished to the Company by or on behalf of the
Underwriters expressly for use therein and will reimburse the Company or
any such director, officer or controlling person for any legal or other
expenses reasonably incurred by the Company, any such officer, director
or controlling person in connection with investigating or defending any
such action or claim. This indemnity agreement is in addition to any
liability which the Underwriters may otherwise have. The Company
acknowledges that, unless otherwise set forth in the applicable Terms
Agreement, the statements set forth in the last paragraph of the cover
page, and fourth sentence of the first paragraph under the caption
"Method of Distribution" each as included in the applicable Prospectus
Supplement relating to a Series of Certificates, together with the Lehman
Brothers Information (as defined in Section 10 hereof) relating to a
Series of Certificates constitute the only information furnished in
writing by or on behalf of the Underwriters expressly for use in the
Registration Statement relating to such Series of Certificates as
originally filed or in any amendment thereof, any related preliminary
prospectus or the Prospectus or in any amendment thereof or supplement
thereto, as the case may be.
(c) Promptly after receipt by an indemnified party under this Section
of notice of the commencement of any action, such indemnified party shall,
if a claim in respect thereof is to be made against an indemnifying party
under this Section, notify such indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party
shall not relieve it from any liability which it may have to any
indemnified party otherwise than under this Section. In case any such
action shall be brought against any indemnified party and it shall notify
the indemnifying party of the commencement thereof, the indemnifying party
shall be entitled to participate therein and, to the extent that it shall
wish, jointly with any other indemnifying party similarly notified, to
assume the defense thereof, with counsel satisfactory to such indemnified
party (who shall not, except with the consent of the indemnified party, be
counsel to the indemnifying party); and, after notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof, the indemnifying party shall not be liable to such indemnified
party under this Section for any legal expenses of other counsel or any
other expenses, in each case subsequently incurred by such indemnified
party, in connection with the defense thereof other than reasonable costs
of investigation. Notwithstanding the foregoing, the indemnified party or
parties shall have the right to employ its or their own counsel in any such
case and the fees and expenses of one such counsel shall be at the expense
of the indemnifying party if (i) the employment of such counsel shall have
been authorized in writing by the indemnifying party in connection with the
defense of such action, (ii) the indemnifying party shall not have employed
counsel to have charge of the defense of such action within a reasonable
time after notice of commencement of the action, or (iii) the indemnified
party or parties shall have reasonably concluded that there may be defenses
available to it or them and/or other indemnified parties which are
different from or additional to those available to the indemnifying party
(in which case the indemnifying party shall not
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have the right to direct the defense of such action on behalf of the
indemnified party). Anything in this subsection to the contrary
notwithstanding, an indemnifying party shall not be liable for any
settlement of any claim or action effected without its written consent;
provided, however, that such consent was not unreasonably withheld.
(d) If the indemnification provided for in this Section 6 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages,
expenses or liabilities (or actions in respect thereof) referred to
therein, then each indemnifying party shall contribute to the amount paid
or payable by such indemnified party as a result of such losses, claims,
damages, expenses or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative benefits received by
the Company on the one hand and the Underwriters on the other from the
offering of the Certificates to which such loss, claim, damage, expense or
liability (or actions in respect thereof) relates. If, however, the
allocation provided by the immediately preceding sentence is not permitted
by applicable law, then each indemnifying party shall contribute to such
amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the
relative fault of the Company on the one hand and the Underwriters on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities (or actions in respect thereof), as
well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the Underwriters on the other
shall be deemed to be in the same proportion as the total net proceeds from
such offering (before deducting expenses) received by the Company bear to
the total underwriting discounts and commissions (or in the case of a
public offering in negotiated transactions, the difference between the
proceeds to the Company and the aggregate price received from the public)
received by such Underwriters. The relative fault of the Company on the
one hand and the Underwriters on the other shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company on the one hand or such
Underwriters on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement
or omission. Notwithstanding anything to the contrary in this Section
6(d), if the losses, claims, damages or liabilities (or actions in respect
thereof) referred to in this Section 6(d) arise out of an untrue statement
or alleged untrue statement of a material fact contained in any Lehman
Brothers 8-K (as such term is defined in Section 10 hereof) then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect the relative fault of the Company on the one hand
and the Underwriters on the other (determined in accordance with the
preceding sentence) in connection with the statements or omissions in such
Lehman Brothers 8-K which resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other equitable
considerations. The Company and the Underwriters agree that it would not
be just and equitable if contribution pursuant to this subsection (d) were
determined by pro rata allocation even if the Underwriters were treated as
one entity for such purpose or by any
-20-
<PAGE>
other method of allocation which does not take account of the equitable
considerations referred to in this subsection (d). The amount paid or
payable by an indemnified party as a result of the losses, claims, damages
or liabilities (or actions in respect thereof) referred to above in this
subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with
investigation or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at
which the Certificates underwritten by it and distributed to the public
were sold to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue
or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f)
of the 1933 Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. The obligations of the
Underwriters to contribute pursuant to this subsection (d) are several in
proportion to their respective underwriting obligations with respect to
such Certificates and not joint.
SECTION 7. REPRESENTATIONS, WARRANTIES, AND AGREEMENTS TO SURVIVE
DELIVERY. All representations, warranties and agreements contained in this
Agreement, or contained in certificates of officers of the Company submitted
pursuant hereto, shall remain operative and in full force and effect, regardless
of any termination of this Agreement, or the applicable Terms Agreement or any
investigation made by or on behalf of the Underwriters or any controlling person
thereof, or by or on behalf of the Company, its officers or directors and shall
survive delivery of any Certificates to the Underwriters.
SECTION 8. TERMINATION OF AGREEMENT. This Agreement may be terminated for
any reason at any time by either the Company or you upon the giving of thirty
days' notice of such termination to the other party hereto; provided, however,
that if a Terms Agreement has been entered into with respect to a particular
transaction, this Agreement and the Terms Agreement may not be terminated in the
manner set forth in this sentence with respect to such particular transaction.
You, as Representative of the Underwriters named in any Terms Agreement may also
terminate such Terms Agreement, immediately upon notice to the Company, at any
time at or prior to the applicable Closing Time (i) if there has been, since the
date of such Terms Agreement or since the respective dates as of which
information is given in the Registration Statement or Prospectus, any change, or
any development involving a prospective change, in or affecting the condition,
financial or otherwise, earnings, affairs or business of the Company or Standard
Federal, whether or not arising in the ordinary course of business, which in
your judgment would materially impair the market for, or the investment quality
of, the Certificates, or (ii) if there has occurred any material outbreak or
escalation of hostilities or other calamity or crisis the effect of which on the
financial markets of the United States is such as to make it, in your reasonable
judgment, impracticable to market the Certificates or enforce contracts for the
sale of the Certificates, or (iii) if trading in securities generally on either
the New York Stock Exchange or the American Stock Exchange has been suspended or
materially limited or any setting of minimum prices shall have been established
or (iv) if a general moratorium of commercial banking activities has been
declared by either Federal or New York State authorities. In the event of any
such termination, (A) the covenants set forth in Section
-21-
<PAGE>
3 with respect to any offering of Certificates shall remain in effect so long
as the Underwriters own any such Certificates purchased from the Company
pursuant to the applicable Terms Agreement and (B) the covenant set forth in
Section 3(c), the provisions of Section 5, the indemnity agreement and
contribution provisions set forth in Section 6, and the provisions of
Sections 7 and 12 shall remain in effect.
SECTION 9. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS.
(a) If one or more of the Underwriters participating in an offering
of Certificates shall fail at the applicable Closing Time to purchase the
Certificates which it or they are obligated to purchase hereunder and under
the applicable Terms Agreement (the "Defaulted Certificates"), then such of
you as are named therein shall arrange for you or another party or other
parties to purchase the Defaulted Certificates upon the terms contained
herein. If within thirty-six hours after such default by any Underwriter
you do not arrange for the purchase of such Defaulted Certificates, then
the Company shall be entitled to a further period of thirty-six hours
within which to procure another party or other parties reasonably
satisfactory to you to purchase such Defaulted Certificates on the terms
contained herein. In the event that, within the respective prescribed
periods, you notify the Company that you have so arranged for the purchase
of such Defaulted Certificates, or the Company notifies you that it has so
arranged for the purchase of such Defaulted Certificates, you or the
Company shall have the right to postpone the Closing Time for a period of
not more than seven days, in order to effect whatever changes may thereby
be made necessary in the Registration Statement or the Prospectus, or in
any other documents or arrangements, and the Company agrees to file
promptly any amendments to the Registration Statement or the Prospectus
which in your opinion may thereby be made reasonably necessary. The term
"Underwriter" as used in this Agreement shall include any person
substituted under this Section with like effect as if such person had
originally been party to this Agreement with respect to the Certificate.
(b) If, after giving effect to any arrangements for the purchase of
Defaulted Certificates of a defaulting Underwriter or Underwriters by you
and the Company as provided in subsection (a) above, the aggregate
principal amount of such Defaulted Certificates which remains unpurchased
does not exceed 10% of the aggregate principal amount of the Certificates
to be purchased pursuant to the applicable Terms Agreement, then the
Company shall have the right to require each non-defaulting Underwriter to
purchase the principal amount of Certificates which such Underwriter agreed
to purchase hereunder and, in addition, to require each non-defaulting
Underwriter to purchase its pro rata share (based on the principal amount
of Certificates which such Underwriter agreed to purchase pursuant to the
applicable Terms Agreement) of the Defaulted Certificates of the defaulting
Underwriter or Underwriters for which such arrangements have not been made;
but nothing herein shall relieve a defaulting Underwriter from liability
for its default.
(c) If, after giving effect to any arrangements for the purchase of
the Defaulted Certificates of the defaulting Underwriter or Underwriters by
you and the Company as
-22-
<PAGE>
provided in subsection (a) above, the aggregate principal amount of such
Defaulted Certificates which remains unpurchased exceeds 10% of the
aggregate principal amount of the Certificates to be purchased pursuant
to the applicable Terms Agreement, or if the Company shall not exercise
the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Defaulted Certificates of a defaulting Underwriter
or Underwriters, then this Agreement shall thereupon terminate, without
liability on the part of any non-defaulting Underwriter or the Company,
except for the expenses to be borne by the Company and the Underwriters as
provided in Section 5 hereof and the indemnity agreement and contribution
provisions in Section 6 hereof; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
SECTION 10. COMPUTATIONAL MATERIALS AND ABS TERM SHEETS.
(a) Lehman Brothers acknowledges that, subsequent to the date on
which the Registration Statement became effective and up to and including
the date on which the Prospectus Supplement and Prospectus with respect to
a Series of Certificates is first made available to Lehman Brothers, Lehman
Brothers may furnish to various potential investors in such Series of
Certificates, in writing: (i) "Computational Materials", as defined in a
no-action letter (the "Kidder No-Action Letter") issued by the staff of the
Commission on May 20, 1994 to Kidder, Peabody Acceptance Corporation I, et
al., as modified by a no-action letter (the "First PSA No-Action Letter")
issued by the staff of the Commission on May 27, 1994 to the Public
Securities Association (the "PSA") and as further modified by a no-action
letter (the "Second PSA No-Action Letter", and together with the Kidder
No-Action Letter and the First PSA No-Action Letter, the "No-Action
Letters") issued by the staff of the Commission on February 17, 1995 to
the PSA; (ii) "Structural Term Sheets" as defined in the Second PSA
No-Action Letter; and/or (iii) "Collateral Term Sheets" as defined in
the Second PSA No-Action Letter. AAI covenants and agrees that it will
not prepare any Computational Materials, Structural Term Sheets or
Collateral Term Sheets in connection with the offering of Certificates
pursuant to this Underwriting Agreement except as provided for in the
Terms Agreement which relates to an offering of Certificates.
(b) In connection with each Series of Certificates, Lehman Brothers
shall furnish to the Company (via hard copy), at least one (1) business day
prior to the time of filing of the Prospectus pursuant to Rule 424 under
the 1933 Act, all Computational Materials used by Lehman Brothers and
required to be filed with the Commission in accordance with the No-Action
Letters (such Computational Materials, the "Lehman Brothers Furnished
Computational Materials").
(c) In connection with each Series of Certificates, Lehman Brothers
shall furnish to the Company (via hard copy), at least one (1) business day
prior to the time of filing of the Prospectus pursuant to Rule 424 under
the Act, all Structural Term Sheets used by Lehman Brothers and required to
be filed with the Commission in accordance with the No-Action Letters (such
Structural Term Sheets, the "Lehman Brothers Furnished Structural Term
Sheets").
-23-
<PAGE>
(d) In connection with each Series of Certificates, Lehman Brothers
shall furnish to the Company (via hard copy), within one (1) business day
after the first use thereof, all Collateral Term Sheets used by Lehman
Brothers and required to be filed with the Commission in accordance with
the No-Action Letters (such Collateral Term Sheets, the "Lehman Brothers
Furnished Collateral Term Sheets") and shall advise the Company of the date
on which each such Collateral Term Sheet was first used.
(e) The Company shall prepare and file with the Commission, in
accordance with the No-Action Letters, one or more current reports on Form
8-K (collectively, together with any amendments and supplements thereto,
the "Lehman Brothers 8-K," and each a "Lehman Brothers 8-K") which shall
include as one or more exhibits thereto the Lehman Brothers Furnished
Computational Materials, the Lehman Brothers Furnished Structural Term
Sheets and the Lehman Brothers Furnished Collateral Term Sheets.
Notwithstanding any other provision in the Underwriting Agreement, Lehman
Brothers agrees to pay up to $500.00 to the Company for the reasonable and
customary costs and expenses of the Company incurred in connection with the
filing by the Company of any Computational Materials with the Commission,
provided, however, that in the event that the hardship exemption granted by
the Commission allowing for the paper filing of Computational Materials is
no longer available, Lehman Brothers will provide the Company with the
Computational Materials in an electronic format.
(f) Lehman Brothers shall cooperate with the Company and with
Deloitte & Touche in obtaining a letter, in form and substance satisfactory
to the Company and Lehman Brothers, of Deloitte & Touche regarding the
information in any Lehman Brothers 8-K consisting of Lehman Brothers
Furnished Computational Materials and/or Lehman Brothers Furnished
Structural Term Sheets.
(g) Lehman Brothers represents and warrants to, and covenants with,
the Company that the Lehman Brothers Information (defined below) is not
misleading and not inaccurate in any material respect and that any Pool
Information (defined below) contained in any Lehman Brothers 8-K which is
not otherwise inaccurate in any material respect is not presented in the
Lehman Brothers 8-K in a way that is either misleading or inaccurate in any
material respect. Lehman Brothers further covenants with the Company that
if any Computational Materials or ABS Term Sheets (as such term is defined
in the Second PSA No-Action Letter) contained in any Lehman Brothers 8-K
are found to include any information that is misleading or inaccurate in
any material respect, Lehman Brothers promptly shall inform the Company of
such finding, provide the Company with revised and/or corrected
Computational Materials or ABS Term Sheets, as the case may be, and
promptly prepare and deliver to the Company (in hard copy) for filing with
the Commission in accordance herewith, revised and/or corrected
Computational Materials or ABS Term Sheets, as the case may be.
(h) Lehman Brothers covenants that all Computational Materials and
ABS Term Sheets used by it shall contain a legend substantially as set
forth below:
-24-
<PAGE>
Collateral Term Sheets (other than the initial Collateral Term
Sheet):
THIS INFORMATION DOES NOT CONSTITUTE EITHER AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES REFERRED TO
HEREIN. OFFERS TO SELL AND SOLICITATIONS OF OFFERS TO BUY THE
SECURITIES ARE MADE ONLY BY, AND THIS INFORMATION MUST BE READ IN
CONJUNCTION WITH, THE FINAL PROSPECTUS SUPPLEMENT AND THE RELATED
PROSPECTUS OR, IF NOT REGISTERED UNDER THE SECURITIES LAWS, THE FINAL
OFFERING MEMORANDUM (THE "OFFERING DOCUMENT"). INFORMATION CONTAINED
HEREIN DOES NOT PURPORT TO BE COMPLETE AND IS SUBJECT TO THE SAME
QUALIFICATIONS AND ASSUMPTIONS, AND SHOULD BE CONSIDERED BY INVESTORS
ONLY IN THE LIGHT OF THE SAME WARNINGS, LACK OF ASSURANCES AND
REPRESENTATIONS AND OTHER PRECAUTIONARY MATTERS, AS DISCLOSED IN THE
OFFERING DOCUMENT. INFORMATION REGARDING THE UNDERLYING ASSETS HAS
BEEN PROVIDED BY THE ISSUER OF THE SECURITIES OR AN AFFILIATE THEREOF
AND HAS NOT BEEN INDEPENDENTLY VERIFIED BY LEHMAN BROTHERS INC. OR ANY
AFFILIATE. THE ANALYSES CONTAINED HEREIN HAVE BEEN PREPARED AND
DISSEMINATED BY LEHMAN BROTHERS INC. AND THE CONTENTS AND ACCURACY
THEREOF HAVE NOT BEEN REVIEWED BY THE ISSUER. THIS INFORMATION WAS
PREPARED ON THE BASIS OF CERTAIN ASSUMPTIONS (INCLUDING, IN CERTAIN
CASES ASSUMPTIONS SPECIFIED BY THE RECIPIENT HEREOF) REGARDING
PAYMENTS, INTEREST RATES, WEIGHTED AVERAGE LIVES AND WEIGHTED AVERAGE
LOAN AGE, LOSS AND OTHER MATTERS, INCLUDING, BUT NOT LIMITED TO, THE
ASSUMPTIONS DESCRIBED IN THE OFFERING DOCUMENT. LEHMAN BROTHERS INC.,
AND ANY OF ITS AFFILIATES, MAKE NO REPRESENTATION OR WARRANTY AS TO
THE ACTUAL RATE OR TIMING OF PAYMENTS ON ANY OF THE UNDERLYING ASSETS
OR THE PAYMENTS OR YIELD ON THE SECURITIES. THIS INFORMATION
SUPERSEDES ANY PRIOR VERSIONS HEREOF AND WILL BE DEEMED TO BE
SUPERSEDED BY ANY SUBSEQUENT VERSIONS (INCLUDING, WITH RESPECT TO ANY
DESCRIPTION OF THE SECURITIES OR THE UNDERLYING ASSETS, THE
INFORMATION CONTAINED IN THE OFFERING DOCUMENT).
(i) For purposes of this Agreement, the term "Lehman Brothers
Information" means such portion, if any, of the information contained in
the Lehman Brothers 8-K that is not Pool Information. "Pool Information"
means the information furnished to the Underwriters by the Company
regarding the Mortgage Loans; provided, however, that if any information
that would otherwise constitute Pool Information is presented in the Lehman
-25-
<PAGE>
Brothers 8-K in a way that is either inaccurate or misleading in any
material respect, such information shall not be Pool Information.
(j) If the Underwriters do not provide any Computational Materials
or ABS Term Sheets to the Company pursuant to subsections (b) - (d) above,
the Underwriters shall be deemed to have represented, as of the Closing
Time, that they did not provide any prospective investors with any
information in written or electronic form in connection with the offering
of the Certificates that is required to be filed with the Commission in
accordance with the No-Action Letters, and the Underwriters shall provide
the Company with a certification to that effect at the Closing Time.
SECTION 11. NOTICES. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed, delivered,
telexed, or telegraphed and confirmed or transmitted by any standard form of
telecommunication. Notices to Lehman Brothers shall be directed to you at the
address set forth on the first page hereof, to the attention of Stanley P.
Labanowski, with a copy to the General Counsel's office and notices to AAI shall
be directed to you at the address set forth on the first page hereof, to the
attention of Fixed Income Department--Maria Fregosi; with a copy to Legal
Department, ABN AMRO Incorporated, 1325 Avenue of the Americas, New York, New
York 10019, attention: Mark Egert. Notices to the Company or to Standard
Federal shall be directed to ABN AMRO Mortgage Corporation Securitization
Department, c/o Standard Federal Bank, 2600 West Big Beaver Road, Troy,
Michigan, attention: Stewart Fleming, with a copy to Legal Department, ABN AMRO
North America, 135 S. LaSalle Street, Suite 925, Chicago, Illinois.
SECTION 12. PARTIES. This Agreement shall be binding upon and inure
solely to the benefit of you and the Company and to the extent provided in
Section 6 hereof, the officers and directors of the Company and each person who
controls the Company or any Underwriter and their respective heirs, executors,
administrators, successors and assigns and any Terms Agreement shall be binding
upon and inure solely to the benefit of the Company and any Underwriter who
becomes a party to a Terms Agreement and to the extent provided in Section 6
hereof, the officers and directors of the Company and each person who controls
the Company or any Underwriter and their respective heirs, executors,
administrators, successors and assigns. Nothing expressed or mentioned in this
Agreement or a Terms Agreement is intended or shall be construed to give any
person, firm or corporation, other than the parties hereto or thereto and their
respective successors and the controlling person and officers and directors
referred to in Section 6 hereof and their heirs any legal or equitable right,
remedy or claim under or with respect to this Agreement or a Terms Agreement or
any provision herein or therein contained.
SECTION 13. GOVERNING LAW AND TIME. This Agreement and each Terms
Agreement shall be governed by and construed in accordance with the laws of the
State of New York. Specified times of day refer to New York City time.
SECTION 14. COUNTERPARTS. This Agreement and any Terms Agreement may be
executed in any number of counterparts (which execution may take the form of an
exchange of any standard
-26-
<PAGE>
form of written telecommunication between you and the Company), each of which
shall constitute an original of any party whose signature appears on it, and
all of which shall together constitute a single instrument.
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
-27-
<PAGE>
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us a counterpart hereof, whereupon this instrument
along with all counterparts will become a binding agreement between you and the
Company in accordance with its terms.
Very truly yours,
ABN AMRO MORTGAGE CORPORATION
By: /s/
-----------------------------------
Name:
Title:
STANDARD FEDERAL BANCORPORATION, INC.
By: /s/
------------------------------------
Name:
Title:
CONFIRMED AND ACCEPTED, as of
the date first above written:
LEHMAN BROTHERS INC.
By: /s/
-------------------------------
Name:
Title:
ABN AMRO INCORPORATED
By: /s/
-------------------------------
Name:
Title:
<PAGE>
EXHIBIT A
PASS-THROUGH CERTIFICATES
ABN AMRO MORTGAGE CORPORATION, DEPOSITOR
TERMS AGREEMENT
Dated: _________, 19__
To: ABN AMRO MORTGAGE CORPORATION
Re: Underwriting Agreement, dated as of __________ __, 1998 (the "Underwriting
Agreement")
Ladies and Gentlemen:
The undersigned (being herein called the "Underwriters"), understand that
ABN AMRO Mortgage Corporation, a Delaware corporation (the "Company"), proposes
to issue and sell $_________ original principal amount of Pass-Through
Certificates described below (the "Certificates"). The Certificates will be
issued under a Pooling and Servicing Agreement dated as of _______________ among
the Company, as depositor, _______________, as servicer and _____________ as
trustee. The terms of the Certificates are summarized below and are more fully
described in the Company's Prospectus supplement prepared with respect to the
Certificates.
All the provisions (including defined terms) contained in the Underwriting
Agreement are incorporated by reference herein in their entirety and shall be
deemed to be part of this Terms Agreement to the same extent as if such
provisions had been set forth in full herein. The Closing Time referred to in
Section 2 of the Underwriting Agreement shall be _______ a.m., [Chicago,
Illinois] time, on _____________. Subject to the terms and conditions set forth
or incorporated by reference herein, the Company hereby agrees to sell and the
Underwriters agree to purchase [, severally and not jointly,] the [respective]
original principal amount[ s] of Certificates set forth opposite [its] [their]
name[s] in Exhibit I hereto at the purchase price set forth below.
The Underwriters will offer the Certificates for sale upon the terms and
conditions set forth in the Prospectus.
Subject to the terms and conditions set forth or incorporated by reference
herein, the Underwriters will pay for the Certificates at the time and place and
in the manner set forth in the Underwriting Agreement.
SERIES DESIGNATION: ____________
TERMS OF THE CERTIFICATES AND UNDERWRITING COMPENSATION:
-1-
<PAGE>
Original
Principal Remittance Price to
Classes Amount* Rate Public
- --------- ----------- ----------- ---------
**
* Approximate. Subject to permitted variance in each case of plus or
minus 5%.
** The Class __ Certificates are being offered by the Underwriter from
time to time in negotiated transactions or otherwise at varying prices
to be determined, in each case, at the time of sale.
CERTIFICATE RATING:
_____ by [Rating Agency]
_____ by [Rating Agency]
REMIC ELECTION:
The Company [does not] intend[s] to cause the Mortgage Pool to be
treated as a REMIC.
CREDIT ENHANCEMENT:
CUT-OFF DATE:
The Cut-off Date is ___________, 19__.
REMITTANCE DATE:
The ____ day of each month (or, if such ____ day is not a business
day, the business day immediately following) commencing __________, 19__.
PURCHASE PRICE:
The purchase price payable by the Underwriter for the Class __
Certificates is ___% of the aggregate principal balance of the Class __
Certificates as of the Closing Date plus accrued interest at the per annum rate
of ___% from __________, 19__ up to but not including the Closing Date.
-2-
<PAGE>
UNDERWRITING COMMISSION:
Notwithstanding anything to the contrary in the Underwriting
Agreement, no additional underwriting commission shall be payable by the Company
to the Underwriter in connection with the purchase of the Certificates.
INFORMATION PROVIDED BY UNDERWRITER:
CLOSING DATE AND LOCATION:
__________ 19__ at the [Chicago, Illinois] offices of Mayer,
Brown & Platt
-3-
<PAGE>
Please confirm your agreement by having an authorized Officer sign a
copy of this Agreement in the space set forth below and returning a signed copy
to us.
LEHMAN BROTHERS INC.
By:
--------------------------------------
Name:
Title:
ABN AMRO INCORPORATED
By:
--------------------------------------
Name:
Title:
ACCEPTED:
ABN AMRO MORTGAGE CORPORATION
By:
----------------------------------
Name:
Title:
STANDARD FEDERAL BANCORPORATION, INC.
By:
--------------------------------
Name:
Title:
<PAGE>
Exhibit I
Original
Principal
Amount of
Name Certificates
- ----- ----------------
Total ==============
-5-
<PAGE>
EXECUTION COPY
--------------
PASS-THROUGH CERTIFICATES
ABN AMRO MORTGAGE CORPORATION, DEPOSITOR
TERMS AGREEMENT
---------------
Dated: October 22, 1998
To: ABN AMRO MORTGAGE CORPORATION
Re: Underwriting Agreement, dated as of October 22, 1998 (the "Underwriting
Agreement")
Ladies and Gentlemen:
The undersigned (being herein called the "Underwriters"), understand
that ABN AMRO Mortgage Corporation, a Delaware corporation (the "Company"),
proposes to issue and sell $356,955,116 original principal amount of
Pass-Through Certificates described below (the "Certificates"). The
Certificates will be issued under a Pooling and Servicing Agreement dated as
of October 1, 1998 among the Company as depositor, LaSalle Home Mortgage
Corporation as servicer and Chase Bank of Texas, National Association as
trustee. The terms of the Certificates are summarized below and are more
fully described in the Company's Prospectus Supplement prepared with respect
to the Certificates.
All the provisions (including defined terms) contained in the
Underwriting Agreement are incorporated by reference herein in their entirety
and shall be deemed to be part of this Terms Agreement to the same extent as
if such provisions had been set forth in full herein. The Closing Time
referred to in Section 2 of the Underwriting Agreement shall be 9:00 a.m.,
Chicago, Illinois time, on October 27, 1998. Subject to the terms and
conditions set forth or incorporated by reference herein, the Company hereby
agrees to sell and the Underwriters agree to purchase , severally and not
jointly, the respective original principal amounts of Certificates set forth
opposite their names in Exhibit I hereto at the purchase price set forth
below.
The Underwriters will offer the Certificates for sale upon the terms and
conditions set forth in the Prospectus.
Subject to the terms and conditions set forth or incorporated by
reference herein, the Underwriters will pay for the Certificates at the time
and place and in the manner set forth in the Underwriting Agreement.
The Underwriters will pay their pro rata share (based upon the principal
amount of Offered Certificates each of the Underwriters has agreed to
purchase as indicated on Exhibit I hereto) of all fees and expenses relating
to any letter of independent certified public accountants delivered in
connection with the Computational Materials.
<PAGE>
SERIES DESIGNATION: 1998-4
- ------------------
TERMS OF THE CERTIFICATES AND UNDERWRITING COMPENSATION:
- -------------------------------------------------------
<TABLE>
<CAPTION>
Original
Principal Remittance Price to
Classes Amount Rate * Public
- ------- ------------- ---------- --------
<S> <C> <C> <C>
Class A-1 $ 16,413,000 5.90%
Class A-2 $ 25,740,000 5.60%
Class A-3 $ 44,700,000 6.00%
Class A-4 $ 2,112,000 6.50%
Class A-5 $ 11,497,044** 6.75%
Class A-6 $ 43,144,000+ 6.75%
Class A-7 $ 51,500,000+ 6.62%
Class A-8 $ 5,356,000+ 8.00%
Class A-9 $ 14,000,000+ 6.75%++
Class A-10 $ 5,500,000+ 6.75%++
Class A-11 $ 1,035,000 6.75%++
Class A-12 $ 41,760,000 6.75%
Class A-13 $ 51,318,000 6.35%
Class A-14 $ 16,418,000 8.00%
Class A-15 $ 15,050,000 6.75%
Class A-16 $ 9,750,000 6.75%
Class A-X $ 16,137,992*** 6.75%****
Class A-P $ 1,643,016*** 0.00%******
Class M $ 6,837,000 6.75%
Class B-1 $ 3,059,000 6.75%
Class B-2 $ 1,620,000 6.75%
Class R ****** $ 100 6.75%
</TABLE>
* Interest distributed to the Offered Certificates on each Distribution
Date will have accrued during the preceding calendar month at the
applicable per annum Remittance Rate (as defined in the Prospectus
Supplement).
** Not entitled to receive distributions of principal.
*** Pennies removed for purposes of delivery to DTC.
**** Will accrue interest on the Class A-X Notional Amount. Will not be
entitled to receive distributions of principal.
***** Will not be entitled to distributions of interest and will only
receive principal in respect of the Loans with Pass-Through Rates that
are less than 6.750% per annum.
<PAGE>
****** Will be comprised of two Components, Component R-1, which represents
the sole residual interest in REMIC I (as defined in the Prospectus
Supplement), and Component R-2, which represents the sole residual
interest in REMIC II (as defined in the Prospectus Supplement).
+ Will receive distributions of principal payable from the amounts of
interest not paid to the Class A-9, Class A-10 and Class A-11
Certificates.
++ Interest accrued on these classes of certificates will initially be
added to their principal balances rather than distributed to the
holders of these classes of certificates on each distribution date.
CERTIFICATE RATING:
- ------------------
Standard & Poor's, a division of the McGraw-Hill Companies, Inc.
("S&P") shall assign a rating of "AAA" to the Class A and Class R Certificates
(except for the Class A-5, Class A-P and Class A-X Certificates, which will be
rated "AAAr") and Fitch IBCA, Inc. ("Fitch") shall assign a rating of "AAA" to
the Class A and Class R Certificates. Fitch shall assign a rating of not less
than"AA" to the Class M Certificates, not less than"A" to the Class B-1
Certificates and not less than "BBB" to the Class B-2 Certificates.
REMIC ELECTION:
- --------------
The Company intends to cause an election to be made to treat REMIC I
and REMIC II as "real estate mortgage investment conduits" (each, a "REMIC") for
federal income tax purposes. All of the Certificates issued by REMIC I and
REMIC II, other than the Class R Certificate, will represent ownership of REMIC
"regular interests". The Class R Certificate will represent ownership of the
REMIC "residual interest" in REMIC II and REMIC I.
CREDIT ENHANCEMENT:
- ------------------
Senior/Subordinated: Shifting interest
CUT-OFF DATE:
- ------------
The Cut-off Date is October 1, 1998.
REMITTANCE DATE:
- ---------------
The 25th day of each month (or, if such 25th day is not a business
day, the business day immediately following) commencing November 1998.
<PAGE>
PURCHASE PRICE:
- --------------
The purchase price payable by the Underwriters for the Certificates is
100.39% of the aggregate principal balance of the Certificates as of the Closing
Date plus accrued interest from October 1, 1998 up to but not including the
Closing Date.
UNDERWRITING COMMISSION:
- -----------------------
Notwithstanding anything to the contrary in the Underwriting
Agreement, no additional underwriting commission shall be payable by the Company
to the Underwriter in connection with the purchase of the Certificates.
CLOSING DATE AND LOCATION:
- -------------------------
October 27, 1998 at the Chicago, Illinois offices of Mayer, Brown &
Platt.
<PAGE>
Please confirm your agreement by having an authorized Officer sign
a copy of this Agreement in the space set forth below and returning a signed
copy to us.
LEHMAN BROTHERS INC.
By: /s/
-----------------------------------------
Name:
Title:
ABN AMRO INCORPORATED
By: /s/
-----------------------------------------
Name:
Title:
ACCEPTED:
ABN AMRO MORTGAGE CORPORATION
By: /s/
-----------------------------------------
Name:
Title:
STANDARD FEDERAL BANCORPORATION, INC.
By: /s/
-----------------------------------------
Name:
Title:
<PAGE>
EXHIBIT I
---------
<TABLE>
<CAPTION>
Original
Principal
Amount of
Name Certificates
- ---- ------------
<S> <C>
LEHMAN BROTHERS INC. 100% of the Certificates
Total $356,955,116
</TABLE>
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
ABN AMRO MORTGAGE CORPORATION
Depositor
and
LASALLE HOME MORTGAGE CORPORATION,
Servicer
and
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION
Trustee
________________
POOLING AND SERVICING AGREEMENT
Dated as of October 1, 1998
________________
$359,835,570.65
Mortgage Pass-Through Certificates
SERIES 1998-4
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
-----------------
<TABLE>
<S> <C>
PRELIMINARY STATEMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE I DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE II CONVEYANCE OF TRUST FUND; ORIGINAL ISSUANCE OF
CERTIFICATES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 2.1. Conveyance of Trust Fund. . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 2.2. Acceptance by Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 2.3. Representations and Warranties of the Depositor . . . . . . . . . . . . . . . . 42
Section 2.4. Authentication and Delivery of Certificates; Designation of Certificates as
REMIC Regular and Residual Interests. . . . . . . . . . . . . . . . . . . . . . 45
Section 2.5. Designation of Startup Day. . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 2.6. No Contributions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 2.7. Representations and Warranties of the Servicer. . . . . . . . . . . . . . . . . 47
ARTICLE III ADMINISTRATION AND SERVICING OF LOANS. . . . . . . . . . . . . . . 48
Section 3.1. Servicer to Act as Servicer; Administration of the Loans. . . . . . . . . . . . 48
Section 3.2. Collection of Certain Loan Payments; Certificate Account. . . . . . . . . . . . 51
Section 3.3. Permitted Withdrawals from the Custodial Account for P&I. . . . . . . . . . . . 53
Section 3.4. Taxes, Assessments and Similar Items. . . . . . . . . . . . . . . . . . . . . . 54
Section 3.5. Maintenance of Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 3.6. Enforcement of Due-on-Sale Clauses; Assumption and
Substitution Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 3.7. Realization upon Defaulted Loans. . . . . . . . . . . . . . . . . . . . . . . . 57
Section 3.8. Trustee to Cooperate; Release of Mortgage Files . . . . . . . . . . . . . . . . 59
Section 3.9. Servicing Compensation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
Section 3.10. Reports to the Trustee; Custodial Account for P&I Statements. . . . . . . . . . 60
Section 3.11. Annual Statement as to Compliance . . . . . . . . . . . . . . . . . . . . . . . 61
Section 3.12. Annual Independent Public Accountants' Servicing Report . . . . . . . . . . . . 61
Section 3.13. Access to Certain Documentation and Information Regarding the Loans . . . . . . 61
Section 3.14. [Reserved]. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Section 3.15. Sale of Defaulted Loans and REO Properties. . . . . . . . . . . . . . . . . . . 62
Section 3.16. Delegation of Duties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Section 3.17. [Reserved]. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
ii
<PAGE>
<S> <C>
Section 3.18. [Reserved]. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Section 3.19. Appointment of a Special Servicer . . . . . . . . . . . . . . . . . . . . . . . 64
Section 3.20. Allocation of Realized Losses . . . . . . . . . . . . . . . . . . . . . . . . . 64
ARTICLE IV PAYMENTS TO CERTIFICATEHOLDERS; ADVANCES;
STATEMENTS AND REPORTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 4.1. Distributions to Certificateholders . . . . . . . . . . . . . . . . . . . . . . 65
Section 4.2. Statements to Certificateholders. . . . . . . . . . . . . . . . . . . . . . . . 66
Section 4.3. Advances by the Servicer; Distribution Reports to the Trustee . . . . . . . . . 68
Section 4.4. Nonrecoverable Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Section 4.5. Foreclosure Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Section 4.6. Adjustment of Servicing Fees with Respect to Payoffs. . . . . . . . . . . . . . 70
Section 4.7. Prohibited Transactions Taxes and Other Taxes . . . . . . . . . . . . . . . . . 70
Section 4.8. Tax Administration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Section 4.9. Equal Status of Servicing Fee . . . . . . . . . . . . . . . . . . . . . . . . . 71
Section 4.10. Appointment of Paying Agent and Certificate Administrator . . . . . . . . . . . 71
ARTICLE V THE CERTIFICATES . . . . . . . . . . . . . . . . . . . . . . . . . 72
Section 5.1. The Certificates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
Section 5.2. Certificates Issuable in Classes; Distributions of Principal and Interest;
Authorized Denominations. . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
Section 5.3. Registration of Transfer and Exchange of Certificates . . . . . . . . . . . . . 79
Section 5.4. Mutilated, Destroyed, Lost or Stolen Certificates . . . . . . . . . . . . . . . 80
Section 5.5. Persons Deemed Owners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
Section 5.6. Temporary Certificates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
Section 5.7. Book-Entry for Book-Entry Certificates. . . . . . . . . . . . . . . . . . . . . 81
Section 5.8. Notices to Clearing Agency. . . . . . . . . . . . . . . . . . . . . . . . . . . 82
Section 5.9. Definitive Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
Section 5.10. Office for Transfer of Certificates . . . . . . . . . . . . . . . . . . . . . . 83
ARTICLE VI THE DEPOSITOR AND THE SERVICER . . . . . . . . . . . . . . . . . . 83
Section 6.1. Liability of the Depositor and the Servicer . . . . . . . . . . . . . . . . . . 83
Section 6.2. Merger or Consolidation of the Depositor or the Servicer. . . . . . . . . . . . 83
Section 6.3. Limitation on Liability of the Servicer and Others. . . . . . . . . . . . . . . 83
Section 6.4. Servicer Not to Resign. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
ARTICLE VII DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
iii
<PAGE>
<S> <C>
Section 7.1. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
Section 7.2. Other Remedies of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
Section 7.3. Directions by Certificateholders and Duties of Trustee During
Event of Default. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
Section 7.4. Action upon Certain Failures of Servicer and upon Event of Default. . . . . . . 87
Section 7.5. Appointment of Successor Servicer . . . . . . . . . . . . . . . . . . . . . . . 87
Section 7.6. Notification to Certificateholders. . . . . . . . . . . . . . . . . . . . . . . 89
ARTICLE VIII CONCERNING THE TRUSTEE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
Section 8.1. Duties of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
Section 8.2. Certain Matters Affecting Trustee . . . . . . . . . . . . . . . . . . . . . . . 91
Section 8.3. Trustee Not Required to Make Investigation. . . . . . . . . . . . . . . . . . . 92
Section 8.4. Trustee Not Liable for Certificates or Loans. . . . . . . . . . . . . . . . . . 92
Section 8.5. Trustee May Own Certificates. . . . . . . . . . . . . . . . . . . . . . . . . . 93
Section 8.6. Servicer to Pay Trustee's Fees and Expenses . . . . . . . . . . . . . . . . . . 93
Section 8.7. Eligibility Requirements for Trustee. . . . . . . . . . . . . . . . . . . . . . 93
Section 8.8. Resignation and Removal of Trustee. . . . . . . . . . . . . . . . . . . . . . . 94
Section 8.9. Successor Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
Section 8.10. Merger or Consolidation of Trustee. . . . . . . . . . . . . . . . . . . . . . . 95
Section 8.11. Appointment of Co-Trustee or Separate Trustee . . . . . . . . . . . . . . . . . 95
Section 8.12. Appointment of Custodians . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
Section 8.13. Authenticating Agent. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
Section 8.14. Bloomberg . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
Section 8.15. Reports to Securities and Exchange Commission . . . . . . . . . . . . . . . . . 97
ARTICLE IX TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
Section 9.1. Termination upon Purchase by the Depositor or Liquidation of All Loans. . . . . 98
Section 9.2. Trusts Irrevocable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
Section 9.3. Additional Termination Requirements . . . . . . . . . . . . . . . . . . . . . . 99
ARTICLE X MISCELLANEOUS PROVISIONS . . . . . . . . . . . . . . . . . . . . . 100
Section 10.1. Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
Section 10.2. Recordation of Agreement. . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
Section 10.3. Limitation on Rights of Certificateholders. . . . . . . . . . . . . . . . . . . 101
Section 10.4. Governing Law; Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . 102
Section 10.5. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
Section 10.6. Severability of Provisions. . . . . . . . . . . . . . . . . . . . . . . . . . . 103
</TABLE>
iv
<PAGE>
v
<PAGE>
EXHIBITS
<TABLE>
<S> <C>
Exhibit A - Forms of Class A and Subordinate Certificates
Exhibit B - Form of Residual Certificate
Exhibit C - [Reserved]
Exhibit D - Schedule of Loans
Exhibit E - Fields of Loan Information
Exhibit F - Form of Transferor Certificate for Privately Offered Certificates
Exhibit G - Form of Transferee's Certificate for Privately Offered Certificates
Exhibit H - [Reserved]
Exhibit I - Form of Transferor Certificate
Exhibit J - Form of Transferee Affidavit and Agreement
Exhibit K - Form of Additional Matter Incorporated into the Form of the Certificates
Exhibit L - Form of Rule 144A Investment Representation
Exhibit M - [Reserved]
Exhibit N - [Reserved]
Exhibit O - Planned Principal Balances
Exhibit P-1 - First Targeted Principal Balances
Exhibit P-2 - Second Targeted Principal Balances
Exhibit Q - Bloomberg Data
Exhibit R - Form of Special Servicing and Collateral Fund Agreement
</TABLE>
vi
<PAGE>
This Pooling and Servicing Agreement, dated and effective as of
October 1, 1998 (this "Agreement"), is executed by and among ABN AMRO Mortgage
Corporation, as depositor (the "Depositor"), LaSalle Home Mortgage
Corporation, as servicer (the "Servicer"), and Chase Bank of Texas, National
Association, as trustee (the "Trustee"). Capitalized terms used in this
Agreement and not otherwise defined have the meanings ascribed to such terms
in Article I hereof.
PRELIMINARY STATEMENT
The Depositor at the Closing Date is the owner of the Loans and the
other property being conveyed by it to the Trustee for inclusion in the Trust
Fund. On the Closing Date, the Depositor will acquire the Certificates from
the Trust Fund as consideration for its transfer to the Trust Fund of the
Loans and certain other assets and will be the owner of the Certificates.
The Depositor has duly authorized the execution and delivery of this
Agreement to provide for the conveyance to the Trustee of the Loans and the
issuance to the Depositor of the Certificates representing in the aggregate
the entire beneficial ownership of the Trust Fund. All covenants and
agreements made by the Depositor, the Servicer and the Trustee herein with
respect to the Loans and the other property constituting the Trust Fund are
for the benefit of the Holders from time to time of the Certificates. The
Depositor and the Servicer are entering into this Agreement, and the Trustee
is accepting the trust created hereby, for good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged.
The Certificates issued hereunder, other than the Class B-3, Class B-4
and Class B-5 Certificates have been offered for sale pursuant to a
Prospectus, dated September 18, 1998, and a Prospectus Supplement, dated
October 22, 1998, of the Depositor (together, the "Prospectus"). The Class
B-3, Class B-4 and Class B-5 Certificates have been offered for sale pursuant
to a Private Placement Memorandum dated October 27, 1998. The Trust Fund
created hereunder is intended to be the "Trust" as described in the
Prospectus and the Private Placement Memorandum and the Certificates are
intended to be the "Certificates" described therein.
As provided herein, the Trustee will elect to treat the segregated pool
of assets consisting of the Loans and other related assets in the Trust Fund
subject to this Agreement as a REMIC for federal income tax purposes, and
such segregated pool of assets will be designated as "REMIC I." Component
R-1 of the Class R Certificate will represent the sole class of "residual
interests" in REMIC I for purposes of the REMIC Provisions under federal
income tax law.
As provided herein, the Trustee will elect to treat the segregated pool
of assets consisting of the REMIC I Regular Interests as a REMIC for federal
income tax purposes, and such segregated pool of assets will be designated as
"REMIC II". Component R-2 of the Class R Certificate will represent the sole
class of "residual interests" in REMIC II for purposes of the REMIC
Provisions under federal income tax law. The following table irrevocably
sets forth the designations, the Remittance Rate and initial Class Principal
Balance for each Class of Certificates which, together with the Class R-2
Component, constitute the entire beneficial interests in REMIC II. Determined
solely for purposes of satisfying Treasury regulation section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for each of the
REMIC I Regular Interests and for each Class of Certificates shall be
1
<PAGE>
the first Distribution Date that is at least two years after the end of the
remaining amortization schedule of the Loan that has, as of the Closing Date,
the longest remaining amortization schedule, irrespective of its scheduled
maturity. The following table sets forth the designation, Remittance Rate,
initial Class Principal Balance, and Last Scheduled Distribution Date for
each Class of Certificates comprising the beneficial interests in REMIC II
and the Class R Certificate:
<TABLE>
<CAPTION>
INITIAL CLASS
PRINCIPAL
REMITTANCE OR NOTIONAL LAST SCHEDULED
DESIGNATION RATE(1) BALANCE DISTRIBUTION DATE*
----------- ---------- -------------- ------------------
<S> <C> <C> <C>
Class A-1 5.90% $ 16,413,000 November 25, 2028
Class A-2 5.60% 25,740,000 November 25, 2028
Class A-3 6.00% 44,700,000 November 25, 2028
Class A-4 6.50% 2,112,000 November 25, 2028
Class A-5 0.75 11,497,044 November 25, 2028
Class A-6 6.75% 43,144,000 November 25, 2028
Class A-7 6.62% 51,500,000 November 25, 2028
Class A-8 8.00% 5,356,000 November 25, 2028
Class A-9 6.75% 14,000,000 November 25, 2028
Class A-10 6.75% 5,500,000 November 25, 2028
Class A-11 6.75% 1,035,000 November 25, 2028
Class A-12 0.75 41,760,000 November 25, 2028
Class A-13 6.35% 51,318,000 November 25, 2028
Class A-14 8.00% 16,418,000 November 25, 2028
Class A-15 6.75% 15,050,000 November 25, 2028
Class A-16 0.75 9,750,000 November 25, 2028
Class A-X 2.75 16,137,992 November 25, 2028
Class A-P 0 1,643,016 November 25, 2028
Class M 6.75% 6,837,000 November 25, 2028
Class B-1 6.75% 3,059,000 November 25, 2028
Class B-2 6.75% 1,620,000 November 25, 2028
Class B-3 6.75% 1,080,000 November 25, 2028
Class B-4 6.75% 900,000 November 25, 2028
Class B-5 6.75% 900,454 November 25, 2028
Class R+ 6.75% 100(6) November 25, 2028
</TABLE>
* The Distribution Date in the month after the maturity date for the latest
maturing Loan.
+ The Class R Certificate is entitled to receive the Residual Distribution
Amount and Excess Liquidation Proceeds.
(1) Interest distributed to the Certificates (other than the Class A-P
Certificates) on each Distribution Date will have accrued during the
preceding calendar month at the applicable per annum Remittance Rate.
2
<PAGE>
(2) The Class A-5 Certificates will accrue interest on the Class A-5 Notional
Amount (as defined herein). The Class A-5 Certificates will not be
entitled to receive distributions of principal.
(3) The Class A-12 and Class A-16 Certificates will generally not be entitled
to receive any distributions of principal or Principal Prepayments until
the Distribution Date occurring in November 2003.
(4) The Class A-X Certificates will accrue interest on the Class A-X Notional
Amount (as defined herein). The Class A-X Certificates will not be
entitled to receive distributions of principal.
(5) The Class A-P Certificates will not be entitled to distributions of
interest and will only receive principal in respect of the Loans with
Pass-Through Rates that are less than 6.75% per annum.
(6) The Class R Certificate will be comprised of two components, component R-1,
which represents the sole residual interest in REMIC I (as defined herein),
and component R-2, which represents the sole residual interest in REMIC II
(as defined herein).
W I T N E S S E T H
-------------------
In consideration of the mutual agreements herein contained, the Depositor,
Servicer and the Trustee agree as follows:
ARTICLE I
DEFINITIONS
Whenever used herein, the following words and phrases, unless the context
otherwise requires, shall have the meanings specified in this Article:
ACCRETION TERMINATION DATE: The earlier to occur of (i) the
Distribution Date on which the respective Certificate Principal Balances of
each of the Class A-6, Class A-7, Class A-8, Class A-9 and Class A-10
Certificates have been reduced to zero and (ii) the Credit Support Depletion
Date.
ACCRUAL CERTIFICATES: The Class A-9, the Class A-10 and the Class A-11
Certificates.
ADJUSTED CLASS A-12 PERCENTAGE: For any Distribution Date prior to the
Distribution Date in November 2003 will equal 0%, and for any Distribution
Date thereafter will equal the product of (1) the Senior Percentage and (2)
the Class A-12 Percentage.
ADJUSTED CLASS A-16 PERCENTAGE: For any Distribution Date prior to the
Distribution Date in November 2003 will equal 0%, and for any Distribution
Date thereafter will equal the product of (1) the Senior Percentage and (2)
the Class A-16 Percentage.
ADVANCE: An Advance made by the Servicer pursuant to Section 4.3.
AFFILIATE: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified
Person. For the purposes of this definition, "control" when used with respect
to any specified Person means the power to direct the management and policies
of such Person, directly or indirectly, whether through the ownership of
voting securities, by contract or otherwise, and the terms "controlling" and
"controlled" have meanings
3
<PAGE>
correlative to the foregoing. The Trustee may obtain and rely on an
Officer's Certificate of the Servicer or the Depositor to determine whether
any Person is an Affiliate of such party.
AGGREGATE CERTIFICATE PRINCIPAL BALANCE: At any given time, the sum
of the then current Class Principal Balances of all Classes of Certificates.
AGGREGATE SUBORDINATE PERCENTAGE: For any Distribution Date, the
aggregate of the Class Principal Balances of the Subordinate Certificates
immediately prior to such Distribution Date divided by the aggregate
Scheduled Principal Balance of all of the Loans immediately prior to such
Distribution Date.
AGREEMENT: This Pooling and Servicing Agreement and all amendments
and supplements hereto.
ALTA: The American Land Title Association, or any successor.
ANNIVERSARY: Each anniversary of the Cut-off Date.
APPRAISED VALUE: The amount set forth in an appraisal made by or for
the mortgage originator in connection with its origination of each Loan.
ASSIGNMENT: An assignment of the Mortgage, notice of transfer or
equivalent instrument, in recordable form, sufficient under the laws of the
jurisdiction where the related Mortgaged Property is located to reflect of
record the sale and assignment of the Loan to the Trustee, which assignment,
notice of transfer or equivalent instrument may, if permitted by law, be in
the form of one or more blanket assignments covering Mortgages secured by
Mortgaged Properties located in the same county.
AUTHENTICATING AGENT: Any authenticating agent appointed by the
Trustee pursuant to Section 8.13.
AUTHORIZED DENOMINATION: With respect to the Certificates (other than
the Class A-X, Class A-5 and Class R Certificates), an initial Certificate
Principal Balance equal to $25,000 each and integral multiples of $1 in
excess thereof. With respect to the Class A-X and Class A-5 Certificates, a
Class Notional Amount as of the Cut-Off Date equal to $100,000 and integral
multiples of $1 in excess thereof. With respect to the Class R Certificate,
one Certificate with a Percentage Interest equal to 100%.
AVAILABLE DISTRIBUTION AMOUNT: With respect to the Loans, the sum of
the following amounts:
(1) the total amount of all cash received by or on behalf of
the Servicer with respect to such Loans by the Determination Date for
such Distribution Date and not previously distributed (including
Liquidation Proceeds), except:
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(a) all Prepaid Monthly Payments;
(b) all Curtailments received after the applicable
Prepayment Period (together with any interest payment received
with such prepayments to the extent that it represents the payment
of interest accrued on a related Loan subsequent to the applicable
Prepayment Period);
(c) all Payoffs received after the applicable Prepayment
Period immediately preceding such Determination Date (together
with any interest payment received with such Payoffs to the extent
that it represents the payment of interest accrued on such Loan
for the period subsequent to the applicable Prepayment Period);
(d) Insurance Proceeds and Liquidation Proceeds on such
Loans received after the applicable Prepayment Period;
(e) all amounts in the Certificate Account which are due
and reimbursable to the Servicer pursuant to the terms of this
Agreement;
(f) the Servicing Fee for each such Loan; and
(g) Excess Liquidation Proceeds;
(2) to the extent advanced by the Servicer and not previously
distributed, the amount of any Advance made by the Servicer to the
Trustee with respect to such Distribution Date relating to such Loans;
(3) to the extent advanced by the Servicer and not previously
distributed, any amount payable as Compensating Interest by the Servicer
on such Distribution Date relating to such Loans; and
(4) the total amount, to the extent not previously distributed,
of all cash received by the Distribution Date by the Trustee or the
Servicer, in respect of a Purchase Obligation under Section 2.2 and
Section 2.3 or any permitted repurchase of a Loan.
BANKRUPTCY COVERAGE: As of the Cut-Off Date, $140,000, and thereafter,
the initial Bankruptcy Coverage amount of $140,000, less (a) any scheduled or
permissible reduction in the amount of Bankruptcy Coverage pursuant to this
definition and (b) Bankruptcy Losses allocated to the Certificates.
Bankruptcy Coverage may be reduced upon written confirmation from the Rating
Agency that such reduction will not adversely affect the then current ratings
assigned to the Certificates by the Rating Agency.
BANKRUPTCY LOSS: A loss on a Loan arising out of (i) a reduction in
the scheduled Monthly Payment for such Loan by a court of competent
jurisdiction in a case under the United States
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Bankruptcy Code, other than any such reduction that arises out of clause (ii)
of this definition of "Bankruptcy Loss," including, without limitation, any
such reduction that results in a permanent forgiveness of principal, or
(ii) with respect to any Loan, a valuation, by a court of competent
jurisdiction in a case under such Bankruptcy Code, of the related Mortgaged
Property in an amount less than the then outstanding Principal Balance of
such Loan.
BENEFICIAL HOLDER: A Person holding a beneficial interest in any
Book-Entry Certificate as or through a DTC Participant or an Indirect DTC
Participant or a Person holding a beneficial interest in any Definitive
Certificate.
BOOK-ENTRY CERTIFICATES: The Class A Certificates, the Class M
Certificates, the Class B-1 Certificates and the Class B-2 Certificates
beneficial ownership and transfers of which shall be made through book
entries as described in Section 5.7.
BUSINESS DAY: Any day other than a Saturday, a Sunday, or a day on
which banking institutions in Chicago, Illinois or New York, New York are
authorized or obligated by law or executive order to be closed.
CERTIFICATE: Any one of the Certificates issued pursuant to this
Agreement, executed by the Trustee and authenticated by or on behalf of the
Trustee hereunder in substantially one of the forms set forth in Exhibits A
and B hereto. The additional matter appearing in Exhibit K shall be deemed
incorporated into Exhibits A and B as though set forth at the end of Exhibit A
and at the end of Exhibit B, as applicable.
CERTIFICATE ACCOUNT: The separate trust account created and
maintained with the Trustee or any other bank or trust company acceptable to
the Rating Agency which is incorporated under the laws of the United States
or any state thereof, which account shall bear a designation clearly
indicating that the funds deposited therein are held in trust for the benefit
of the Trustee on behalf of the Certificateholders or any other account
serving a similar function acceptable to the Rating Agency. Funds in the
Certificate Account in respect of the Loans and amounts withdrawn from the
Certificate Account attributable to the Loans shall be accounted for
separately. If the Trustee has appointed a Certificate Administrator
pursuant to Section 4.10, funds on deposit in the Certificate Account may be
invested in Eligible Investments and reinvestment earnings thereon shall be
paid to the Certificate Administrator as additional compensation for the
Certificate Administrator's performance of the duties delegated to it by the
Trustee. Funds deposited in the Certificate Account (exclusive of the
Servicing Fee) shall be held in trust for the Certificateholders and for the
uses and purposes set forth in Section 3.2, Section 3.3 and Section 4.1.
CERTIFICATE ACCOUNT STATEMENT: With respect to the Certificate
Account, a statement delivered by the Certificate Administrator to the
Trustee pursuant to Section 3.10.
CERTIFICATE ADMINISTRATOR: Any Certificate Administrator appointed by
the Trustee as provided pursuant to Section 4.10. Initially, the Certificate
Administrator will be LaSalle National Bank.
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CERTIFICATE ADMINISTRATOR AND TRUSTEE FEE: For each Loan, a fee per
annum equal to 0.0125% of the outstanding Principal Balance thereof which
shall be paid by the Servicer to the Certificate Administrator and the
Trustee.
CERTIFICATE DISTRIBUTION AMOUNT: (I) For any Distribution Date prior
to the Credit Support Depletion Date, as applicable, the Available
Distribution Amount for the Loans shall be distributed to the Certificates in
the following amounts and priority:
(a) With respect to the Senior Certificates:
(i) First, to the Class A-P Certificates, the Discount
Fractional Principal Amount;
(ii) Second, to the Senior Certificates, concurrently,
the sum of the Interest Distribution Amounts for such Classes of
Certificates remaining unpaid from previous Distribution Dates,
pro rata according to their respective shares of such unpaid
amounts; provided, however, that on or before the Accretion
Termination Date, the amount that would otherwise be payable to
the Class A-9, Class A-10 and Class A-11 Certificates pursuant to
this clause (I)(a)(ii) will be paid instead as principal as
described in clause (I)(a)(iii)(b) of this definition of
Certificate Distribution Amount;
(iii) Third, (a) to the Senior Certificates, concurrently,
the sum of the Interest Distribution Amounts for such Classes of
Certificates for the current Distribution Date, pro rata according
to their respective Interest Distribution Amounts;
(b) on or before the Accretion Termination Date,
the sum of the Class A-9 Accrual Amount, the Class A-10
Accrual Amount and the Class A-11 Accrual Amount, as
principal, as follows:
(1) pro rata, to the Class A-6, Class A-7
and Class A-8 Certificates, to the extent necessary
to reduce their Principal Balances to their
respective First Targeted Principal Balance;
(2) to the Class A-9 Certificates, to the
extent necessary to reduce its Principal Balance to
zero;
(3) pro rata, to the Class A-6, Class A-7
and Class A-8 Certificates, to the extent necessary
to reduce their Principal Balances to their
respective Second Targeted Principal Balance;
(4) to the Class A-10 Certificates, to the
extent necessary to reduce its Principal Balance to
zero;
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(5) pro rata, to the Class A-6, Class A-7
and Class A-8 Certificates, to the extent necessary
to reduce their Principal Balances to zero; and
(6) to the Class A-11 Certificates, to the
extent necessary to reduce its Principal Balance to
zero.
(iv) Fourth, to the Senior Certificates (other than the
Class A-P, Class A-5 and Class A-X Certificates), the Senior
Principal Amount as follows:
(a) first, to the Class R Certificate, to the
extent necessary to reduce its Principal Balance to zero;
(b) second, to the Class A Certificates,
concurrently as follows:
(1) 73.0840382087% sequentially as
follows:
(a) first, to the Class A-12
Certificates, to the extent
necessary to reduce its
Principal Balance to zero, the
lesser of:
(i) 73.0840382087% of the
Class A-12 Priority
Amount; and
(ii) 98.60% of the Senior
Principal Amount
available under this
clause (I)(a)(iv)(b)(1);
(b) second, concurrently,
29.2030674519% to the Class A-1
Certificates, 45.7982669964% to
the Class A-2 Certificates and
24.9986655517% to the Class A-3
Certificates, to the extent
necessary to reduce the
Certificate Principal Balances
of the Class A-1 Certificates
and the Class A-2 Certificates
to their Planned Principal
Balances;
(c) third, to the Class A-3
Certificates, to the extent
necessary to reduce its
Principal Balance to its
Planned Principal Balance;
(d) fourth, to the Class A-4
Certificates, to the extent
necessary to reduce its
Principal Balance to its
Planned Principal Balance;
(e) fifth, to the Class A-6,
Class A-7 and Class A-8
Certificates, on a pro rata
basis, based on the respective
Certificate Principal Balances
thereof, until the respective
Certificate Principal Balances
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thereof have been reduced to
their First Targeted Principal
Balance;
(f) sixth, to the Class A-9
Certificates, until its
Principal Balance has been
reduced to zero;
(g) seventh, to the Class A-6,
Class A-7 and Class A-8
Certificates, on a pro rata
basis, based on the respective
Certificate Principal Balances
thereof, until the Certificate
Principal Balances thereof have
been reduced to their Second
Targeted Principal Balance;
(h) eighth, to the Class A-10
Certificates, until its
Principal Balance has been
reduced to zero;
(i) ninth, to the Class A-6,
Class A-7 and Class A-8
Certificates, on a pro rata
basis, based on the respective
Certificate Principal Balances
thereof, until the Certificate
Principal Balances thereof have
been reduced to zero;
(j) tenth, to the Class A-11
Certificates, until its
Principal Balance has been
reduced to zero;
(k) eleventh, concurrently,
29.2030674519% to the Class A-1
Certificates, 45.7982669964% to
the Class A-2 Certificates and
24.9986655517% to the Class A-3
Certificates, until the
Certificate Principal Balances
of the Class A-1 Certificates
and the Class A-2 Certificates
have been reduced to zero;
(l) twelfth, to the Class A-3
Certificates, until its
Principal Balance has been
reduced to zero;
(m) thirteenth, to the Class A-4
Certificates, until its
Principal Balance has been
reduced to zero;
(n) fourteenth, to the Class A-12
Certificates until its
Principal Balance has been
reduced to zero;
(2) 26.9159617913% sequentially as
follows:
(a) first, to the Class A-16
Certificates, 26.9159617913% of
the Class A-16 Priority Amount,
until its Principal Balance has
been reduced to zero;
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(b) second, pro rata, to the
Class A-13 and Class A-14
Certificates, until their
respective Principal Balances
have been reduced to zero;
(c) third, to the Class A-15
Certificates until its
Principal Balance has been
reduced to zero;
(d) fourth, to the Class A-16
Certificates, until its
Principal Balance has been
reduced to zero;
(v) Fifth, to the Class A-P Certificates, up to the
Subordinate Principal Amount (determined without regard to the
proviso of such definition) for such Distribution Date, the
Discount Fractional Principal Shortfall amount payable to the
Class A-P Certificates on previous Distribution Dates pursuant to
clause (I)(a)(vi) of this definition of "Certificate Distribution
Amount" and remaining unpaid from such previous Distribution
Dates; and
(vi) Sixth, to the Class A-P Certificates, up to the
Subordinate Principal Amount (determined without regard to the
proviso of such definition) for such Distribution Date (less any
amounts distributed to the Class A-P Certificates pursuant to
paragraph (I)(a)(v)), the Discount Fractional Principal Shortfall,
PROVIDED, that any amounts distributed in respect of the Discount
Fractional Principal Shortfall pursuant to paragraph (I)(a)(v) or
this paragraph (I)(a)(vi) of this definition of "Certificate
Distribution Amount" shall not cause a further reduction of the
Class A-P Class Principal Balance;
(b) With respect to the Subordinate Certificates and the
Class R Certificate, on any Distribution Date prior to the Credit Support
Depletion Date, to the extent of the Available Distribution Amount
remaining:
(i) First, to the Class M, B-1, B-2, B-3, B-4 and B-5
Certificates, in that order of seniority, the following:
(1) their respective amounts of previously unpaid
and then current Interest Distribution Amounts;
(2) their respective amounts of the Subordinate
Principal Amount allocable pursuant to the definition of
"Subordinate Principal Amount" herein, until their
Principal Balances have been reduced to zero;
(ii) Second, to the Subordinate Certificates in the order
of seniority, the amount of unreimbursed Realized Losses
previously allocated to such Class, if any, PROVIDED, that any
amounts distributed in respect of losses pursuant to this
paragraph
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<PAGE>
(I)(b)(ii) of this definition of "Certificate Distribution
Amount" shall not cause a further reduction in the Class
Principal Balances of the Subordinate Certificates; and
(iii) Third, to the Class R Certificate, the Residual
Distribution Amount;
(II) For any Distribution Date on or after the Credit Support
Depletion Date, the Available Distribution Amount remaining, shall be
distributed to the outstanding Senior Certificates in the following amounts
and priority:
(a) First, to the Class A-P Certificates, the Discount
Fractional Principal Amount;
(b) Second, to the Senior Certificates (other than the
Class A-P Certificates), previously unpaid and then current Interest
Distribution Amounts, pro rata, according to such amount payable to the
extent of amounts available;
(c) Third, to the Senior Certificates other than the Interest
Only Certificates and Class A-P Certificates, the Senior Principal
Amount, pro rata, according to their respective Class Principal Balances;
(d) Fourth, to the Senior Certificates, pro rata, according to
their respective Class Principal Balances, the amount of unreimbursed
Realized Losses previously allocated to such Class; and
(e) Fifth, to the Class R Certificate, the Residual
Distribution Amount for such Distribution Date.
CERTIFICATE PRINCIPAL BALANCE: For each Certificate of any Class, the
portion of the related Class Principal Balance, if any, represented by such
Certificate.
CERTIFICATE REGISTER AND CERTIFICATE REGISTRAR: The register
maintained and the registrar appointed, respectively, pursuant to Section 5.3.
Initially, the Certificate Registrar shall be LaSalle National Bank.
CERTIFICATEHOLDER OR HOLDER: The person in whose name a Certificate
is registered in the Certificate Register, except that, solely for the
purposes of giving any consent pursuant to this Agreement, any Certificate
registered in the name of the Depositor, the Certificate Administrator, the
Servicer or any affiliate thereof shall be deemed not to be outstanding and
the Percentage Interest evidenced thereby shall not be taken into account in
determining whether the requisite percentage of Percentage Interests
necessary to effect any such consent has been obtained; PROVIDED, that the
Trustee, the Certificate Registrar and the Paying Agent may conclusively rely
upon an Officer's Certificate to determine whether any Person is an affiliate
of the Depositor, the Certificate Administrator or the Servicer.
CERTIFICATEHOLDERS' REPORT: As defined in Section 4.2(a).
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<PAGE>
CLASS: All Certificates having the same priority and rights to
payments from the Available Distribution Amount, designated as a separate
Class, as set forth in the forms of Certificates attached hereto as Exhibits A
and B.
CLASS A-9 ACCRUAL AMOUNT: For any Distribution Date prior to the
Credit Support Depletion Date, an amount equal to the accrued interest that
would otherwise be distributable in respect of the Class A-9 Certificates on
such Distribution Date and which will be added to the Class A-9 Principal
Balance.
CLASS A-10 ACCRUAL AMOUNT: For any Distribution Date prior to the
Credit Support Depletion Date, an amount equal to the accrued interest that
would otherwise be distributable in respect of the Class A-10 Certificates on
such Distribution Date and which will be added to the Class A-10 Principal
Balance.
CLASS A-11 ACCRUAL AMOUNT: For any Distribution Date prior to the
Credit Support Depletion Date, an amount equal to the accrued interest that
would otherwise be distributable in respect of the Class A-11 Certificates on
such Distribution Date and which will be added to the Class A-11 Principal
Balance.
CLASS A CERTIFICATES: The Class A-1, A-2, A-3, A-4, A-5, A-6, A-7,
A-8, A-9, A-10, A-11, A-12, A-13, A-14, A-15, A-16, A-X and A-P Certificates,
collectively, and designated as such on the face thereof in substantially the
forms attached hereto as Exhibits A-1 through A-18, respectively.
CLASS R CERTIFICATE: The Certificate designated as "Class R" on the
face thereof in substantially the form attached hereto as Exhibit B, that is
composed of Components R-1 and R-2, each of which has been designated as the
sole class of "residual interests" in the REMIC I and REMIC II, respectively,
pursuant to Section 2.1.
CLASS R CERTIFICATEHOLDER: The registered Holder of the Class R
Certificate.
CLASS A-12 LIQUIDATION AMOUNT: Is the aggregate, for each Loan which
became a Liquidated Loan during the calendar month preceding the month of the
Distribution Date, of the lesser of (i) the Class A-12 Percentage of the
principal balance of such Loan (exclusive of the Discount Fraction thereof,
if applicable) and (ii) either (a) on any Distribution Date occurring prior
to November 2003, the Class A-12 Percentage and (b) on any Distribution Date
occurring in or after November 2003, the Class A-12 Prepayment Percentage, in
each case, of the Liquidation Principal with respect to such Loan.
CLASS A-16 LIQUIDATION AMOUNT: Is the aggregate, for each Loan which
became a Liquidated Loan during the calendar month preceding the month of the
Distribution Date, of the lesser of (i) the Class A-16 Percentage of the
principal balance of such Loan (exclusive of the Discount Fraction thereof,
if applicable) or (ii) either (a) on any Distribution Date occurring prior to
November 2003, the Class A-16 Percentage and (b) on any Distribution Date
occurring in or after November 2003,
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<PAGE>
the Class A-16 Prepayment Percentage, in each case, of the Liquidation
Principal with respect to such Loan.
CLASS NOTIONAL AMOUNT: With respect to the Class A-X Certificates,
the Class A-X Notional Amount and with respect to the Class A-5 Certificates,
the Class A-5 Notional Amount.
CLASS A-5 NOTIONAL AMOUNT: As of the Closing Date approximately
$11,497,044, and thereafter, an amount equal to the sum of:
(i) 17/135ths of the Class A-1 Certificate Principal Balance,
(ii) 23/135ths of the Class A-2 Certificate Principal Balance,
(iii) 1/9th of the Class A-3 Certificate Principal Balance, and
(iv) 1/27th of the Class A-4 Certificate Principal Balance.
CLASS A-X NOTIONAL AMOUNT: As of the Closing Date approximately
$16,137,992, and thereafter, with respect to any Distribution Date will equal
the aggregate Principal Balance, as of the first day of the month of such
Distribution Date, of the Premium Rate Loans multiplied by the following
fraction:
the weighted average of the Pass-Through Rates of the
Premium Rate Loans as of the first day of such month - 6.75%
------------------------------------------------------------
6.75%
CLASS A-12 PERCENTAGE: For any Distribution Date will equal the lesser
of (i) 100% and (ii) the sum of (a) the Class A-12 Certificate Principal
Balance and (b) $17,400,000; divided by the product of (x) the aggregate
Certificate Principal Balances of the Senior Certificates (exclusive of the
Class A-P Certificates) and (y) 73.0840382087%.
CLASS A-16 PERCENTAGE: For any Distribution Date will equal the lesser
of (i) 100% and (ii) the Class A-16 Certificate Principal Balance divided by
the product of (a) the aggregate Certificate Principal Balances of the Senior
Certificates (exclusive of the Class A-P Certificates) and (b) 26.9159617913%.
CLASS A-12 PREPAYMENT PERCENTAGE: For any Distribution Date will equal
the product of (i) the Senior Percentage, (ii) the Class A-12 Percentage and
(iii) the applicable Step Down Percentage.
CLASS A-16 PREPAYMENT PERCENTAGE: For any Distribution Date will equal
the product of (i) the product of the Senior Percentage, (ii) the Class A-16
Percentage and (iii) the applicable Step Down Percentage.
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CLASS PRINCIPAL BALANCE: For any Class of Certificates, the
applicable Initial Class Principal Balance set forth in the Preliminary
Statement hereto, corresponding to the rights of such Class in payments of
principal due to be passed through to Certificateholders from principal
payments on the Loans, as reduced from time to time by (x) distributions of
principal to Certificateholders of such Class and (y) the portion of Realized
Losses allocated to the Class Principal Balance of such Class pursuant to the
definition of "Realized Loss" with respect to a given Distribution Date. For
any Distribution Date, the reduction of the Class Principal Balance of any
Class of Certificates pursuant to the definition of "Realized Loss" shall be
deemed effective prior to the determination and distribution of principal on
such Class pursuant to the definition of "Certificate Distribution Amount".
Notwithstanding the foregoing, (i) the Class Principal Balance of the most
subordinate Class of Certificates outstanding at any time shall be equal to
the aggregate Scheduled Principal Balance of all of the Loans less the Class
Principal Balance of all other Classes of Certificates and (ii) any amounts
distributed in respect of losses pursuant to paragraphs (I)(a)(v) or (I)(a)(vi)
of the definition of "Certificate Distribution Amount" shall not cause a
further reduction in the Class A-P Class Principal Balance. The Class
Principal Balance for the Class A-2 Certificates shall be referred to as the
"Class A-2 Principal Balance", the Class Principal Balance for the Class A-3
Certificates shall be referred to as the "Class A-3 Principal Balance" and so
on. The Class Principal Balance of the Class A-X and Class A-5 Certificates
shall be zero.
CLASS A-12 PRIORITY AMOUNT: For any Distribution Date will equal the
sum of (i) the Adjusted Class A-12 Percentage of the Principal Payment Amount
(exclusive of the portion attributable to the Discount Fractional Principal
Amount); (ii) the Class A-12 Prepayment Percentage of the Principal
Prepayment Amount (exclusive of the portion attributable to the Discount
Fractional Principal Amount); and (iii) the Class A-12 Liquidation Amount.
CLASS A-16 PRIORITY AMOUNT: For any Distribution Date will equal the
sum of (i) the Adjusted Class A-16 Percentage of the Principal Payment Amount
(exclusive of the portion attributable to the Discount Fractional Principal
Amount); (ii) the Class A-16 Prepayment Percentage of the Principal
Prepayment Amount (exclusive of the portion attributable to the Discount
Fractional Principal Amount); and (iii) the Class A-16 Liquidation Amount.
CLOSING DATE: October 27, 1998, which is the date of settlement of the
sale of the Certificates to the initial purchasers thereof.
CODE: The Internal Revenue Code of 1986, as amended.
COMPENSATING INTEREST: For any Distribution Date with respect to the
Loans contained therein, the lesser of (i) the sum of (a) one-twelfth of
0.125% of the aggregate outstanding Principal Balance of each Loan on such
Distribution Date, (b) the aggregate Payoff Earnings and (c) the aggregate
Payoff Interest and (ii) the aggregate Uncollected Interest.
CORPORATE TRUST OFFICE: The corporate trust office of the Trustee in
the State of Texas, at which at any particular time its corporate trust
business with respect to this Agreement shall be
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administered, which office at the date of the execution of this Agreement is
located at 600 Travis Street, Suite 1150, Houston, Texas 77002, Attention:
S. Whitten Rusk III.
CREDIT SUPPORT DEPLETION DATE: The first Distribution Date on which
the aggregate of the Class Principal Balances of the Subordinate Certificates
has been or will be reduced to zero as a result of principal distributions
thereon and the allocation of Realized Losses on such Distribution Date.
CURTAILMENT: Any payment of principal on a Loan, made by or on behalf
of the related Mortgagor, other than a Monthly Payment, a Prepaid Monthly
Payment or a Payoff, which is applied to reduce the outstanding Principal
Balance of the Loan.
CURTAILMENT SHORTFALL: With respect to any Curtailment applied with a
Monthly Payment other than a Prepaid Monthly Payment, an amount equal to one
month's interest on such Curtailment at the applicable Pass-Through Rate on
such Loan.
CUSTODIAL ACCOUNT FOR P&I: The Custodial Account for Principal and
Interest established and maintained by the Servicer and caused by the
Servicer to be established and maintained pursuant to Section 3.2(b) with the
corporate trust department of the Trustee or another financial institution
approved by the Servicer such that the rights of such Servicer, the Trustee
and the Certificateholders thereto shall be fully protected against the
claims of any creditors of the Servicer and of any creditors or depositors of
the institution in which such account is maintained, (a) within FDIC insured
accounts (or other accounts with comparable insurance coverage acceptable to
the Rating Agency) created, maintained and monitored by the Servicer or (b) in
a separate non-trust account without FDIC or other insurance in an Eligible
Institution. In the event that a Custodial Account for P&I is established
pursuant to clause (a) of the preceding sentence, amounts held in such
Custodial Account for P&I shall not exceed the level of deposit insurance
coverage on such account; accordingly, more than one Custodial Account for
P&I may be established.
CUSTODIAL AGREEMENT: The agreement, if any, among the Servicer, the
Trustee and a Custodian providing for the safekeeping of the Mortgage Files
on behalf of the Certificateholders.
CUSTODIAN: A Custodian which is appointed pursuant to a Custodial
Agreement. Any Custodian so appointed shall act as agent on behalf of the
Trustee, and shall be compensated by the Trustee at no additional charge to
the Servicer. The Trustee shall remain at all times responsible under the
terms of this Agreement, notwithstanding the fact that certain duties have
been assigned to a Custodian.
CUT-OFF DATE: October 1, 1998.
DATA: As defined in Section 8.14
DEFAULTED LOAN: As of any Determination Date, any Loan for which any
payment of principal of or interest on such Loan is more than 89 days past
due, determined without giving effect
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to any grace period permitted by the related Mortgage or Mortgage Note or any
other document in the Mortgage File.
DEFINITIVE CERTIFICATES: As defined in Section 5.7.
DENOMINATION: The amount specified on a Certificate as representing
the aggregate Principal Balance of the Loans as of the Cut-Off Date evidenced
by such Certificate.
DEPOSITARY AGREEMENT: The Letter of Representations, dated October 27,
1998 by and among DTC, the Depositor and the Trustee.
DEPOSITOR: ABN AMRO Mortgage Corporation, a Delaware corporation, or
its successor-in-interest.
DESTROYED MORTGAGE NOTE: A Mortgage Note the original of which was
permanently lost or destroyed and has not been replaced.
DETERMINATION DATE: A day not later than the 10th day preceding a
related Distribution Date.
DISCOUNT FRACTION: For any Discount Loan, a fraction, the numerator
of which is 6.75% minus the Pass-Through Rate on such Discount Loan and the
denominator of which is 6.75%.
DISCOUNT FRACTIONAL PRINCIPAL AMOUNT: On each Distribution Date, an
amount equal to the product of the Discount Fraction multiplied by the sum
of (i) scheduled payments of principal on each Discount Loan due on or before
the related Due Date in respect of which no distribution has been made on any
previous Distribution Date and which were received by the Determination Date,
or which have been advanced as part of an Advance with respect to such
Distribution Date, (ii) the principal portion received in respect of each
Discount Loan during the Prior Period of (a) Curtailments, (b) Insurance
Proceeds, (c) the amount, if any, of the principal portion of the Purchase
Price pursuant to a Purchase Obligation or any repurchase of a Discount Loan
permitted hereunder and (d) Liquidation Proceeds and (iii) the principal
portion of Payoffs received in respect of such Discount Loan during the
applicable Prepayment Period.
DISCOUNT FRACTIONAL PRINCIPAL SHORTFALL: For any Distribution Date,
an amount equal to the Discount Fraction of any Realized Loss on a Discount
Loan, other than a Special Hazard Loss, Fraud Loss or Bankruptcy Loss in
excess of the Special Hazard Coverage, Fraud Coverage or Bankruptcy Coverage,
as applicable.
DISCOUNT LOAN: The Loans having Pass-Through Rates of less than
6.75%.
DISQUALIFIED ORGANIZATION: As defined in Section 5.1(b).
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DISTRIBUTION DATE: With respect to distributions on the Certificates,
the 25th day (or, if such 25th day is not a Business Day, the Business Day
immediately succeeding such 25th day) of each month, with the first such date
being November 25, 1998.
DTC: The Depository Trust Company.
DTC PARTICIPANT: A broker, dealer, bank, other financial institution
or other Person for whom DTC effects book-entry transfers and pledges of
securities deposited with DTC.
DUE DATE: The first day of each calendar month, which is the day on
which the Monthly Payment for each Loan is due.
ELIGIBLE ACCOUNT: Any account or accounts held and established by the
Servicer or the Trustee in trust for the Certificateholders at any Eligible
Institution.
ELIGIBLE INSTITUTION: An institution having (i) the highest
short-term debt rating, and one of the two highest long-term debt ratings of
the Rating Agency, (ii) with respect to any Custodial Account for P&I, an
unsecured long-term debt rating of at least one of the two highest unsecured
long-term debt ratings of the Rating Agency, or (iii) the approval of the
Rating Agency.
ELIGIBLE INVESTMENTS: Any one or more of the following obligations or
securities payable on demand or having a scheduled maturity on or before the
Business Day preceding the following Distribution Date, regardless of
whether issued by the Depositor, the Servicer, the Trustee or any of their
respective Affiliates and having at the time of purchase, or at such other
time as may be specified, the required ratings, if any, provided for in this
definition:
(a) direct obligations of, or guaranteed as to full and timely
payment of principal and interest by, the United States or any agency or
instrumentality thereof, PROVIDED, that such obligations are backed by the
full faith and credit of the United States of America;
(b) direct obligations of, or guaranteed as to timely payment of
principal and interest by, FHLMC, FNMA or the Federal Farm Credit System,
PROVIDED, that any such obligation, at the time or purchase or contractual
commitment providing for the purchase thereof, is qualified by each Rating
Agency as an investment of funds backing securities rated "AAA" in the case
of S&P and Fitch (the initial rating of the Class A Certificates);
(c) demand and time deposits in or certificates of deposit of, or
bankers' acceptances issued by, any bank or trust company, savings and loan
association or savings bank, PROVIDED, that the short-term deposit ratings
and/or long-term unsecured debt obligations of such depository institution or
trust company (or in the case of the principal depository institutions in a
holding company system, the commercial paper or long-term unsecured debt
obligations of such holding company) have, in the case of commercial paper,
the highest rating available for such securities by each Rating Agency and,
in the case of long-term unsecured debt obligations, one of the two highest
ratings available for such securities by each Rating Agency, or in each case
such lower rating as will
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not result in the downgrading or withdrawal of the rating or ratings then
assigned to any Class of Certificates by any Rating Agency but in no event
less than the initial rating of the Senior Certificates;
(d) general obligations of or obligations guaranteed by any state
of the United States or the District of Columbia receiving one of the two
highest long-term debt ratings available for such securities by each Rating
Agency, or such lower rating as will not result in the downgrading or
withdrawal of the rating or ratings then assigned to any Class of
Certificates by any Rating Agency;
(e) commercial or finance company paper (including both
non-interest-bearing discount obligations and interest-bearing obligations
payable on demand or on a specified date not more than one year after the
date of issuance thereof) that is rated by each Rating Agency in its highest
short-term unsecured rating category at the time of such investment or
contractual commitment providing for such investment, and is issued by a
corporation the outstanding senior long-term debt obligations of which are
then rated by each Rating Agency in one of its two highest long-term
unsecured rating categories, or such lower rating as will not result in the
downgrading or withdrawal of the rating or ratings then assigned to any Class
of Certificates by any Rating Agency but in no event less than the initial
rating of the Senior Certificates;
(f) guaranteed reinvestment agreements issued by any bank,
insurance company or other corporation rated in one of the two highest rating
levels available to such issuers by each Rating Agency at the time of such
investment, PROVIDED, that any such agreement must by its term provide that
it is terminable by the purchaser without penalty in the event any such
rating is at any time lower than such level;
(g) repurchase obligations with respect to any security described
in clause (a) or (b) above entered into with a depository institution or
trust company (acting as principal) meeting the rating standards described in
(c) above;
(h) securities bearing interest or sold at a discount that are
issued by any corporation incorporated under the laws of the United States of
America or any State thereof and rated by each Rating Agency in one of its
two highest long-term unsecured rating categories at the time of such
investment or contractual commitment providing for such investment; PROVIDED,
HOWEVER, that securities issued by any such corporation will not be Eligible
Investments to the extent that investment therein would cause the outstanding
principal amount of securities issued by such corporation that are then held
as part of the Certificate Account to exceed 20% of the aggregate principal
amount of all Eligible Investments then held in the Certificate Account;
(i) units of taxable money market funds (including those for which
the Trustee or any affiliate thereof receives compensation with respect to
such investment) which funds have been rated by each Rating Agency in its
highest rating category or which have been designated in writing by each
Rating Agency as Eligible Investments with respect to this definition;
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(j) if previously confirmed in writing to the Trustee, any other
demand, money market or time deposit, or any other obligation, security or
investment, as may be acceptable to each Rating Agency as a permitted
investment of funds backing securities having ratings equivalent to the
initial rating of the Class A Certificates; and
(k) such other obligations as are acceptable as Eligible
Investments to each Rating Agency;
PROVIDED, HOWEVER, that such instrument continues to qualify as a "cash flow
investment" pursuant to Code Section 860G(a)(6) and that no instrument or
security shall be an Eligible Investment if (i) such instrument or security
evidences a right to receive only interest payments or (ii) the right to
receive principal and interest payments derived from the underlying
investment provides a yield to maturity in excess of 120% of the yield to
maturity at par of such underlying investment.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
EVENT OF DEFAULT: Any event of default as specified in Section 7.1.
EXCESS LIQUIDATION PROCEEDS: With respect to any Distribution Date,
the excess, if any, of aggregate Liquidation Proceeds in the applicable
Prepayment Period over the amount that would have been received if a Payoff
had been made on the last day of such applicable Prepayment Period with
respect to each Loan which became a Liquidated Loan during such applicable
Prepayment Period.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended.
FDIC: Federal Deposit Insurance Corporation, or any successor thereto.
FHA: Federal Housing Administration, or any successor thereto.
FHLMC: Federal Home Loan Mortgage Corporation, or any successor
thereto.
FITCH: Fitch IBCA, Inc. provided, that at any time it be a Rating
Agency.
FIRST TARGETED PRINCIPAL BALANCE: For any Distribution Date, the
amount set forth in the table attached hereto as Exhibit P-1 for such
Distribution Date, for the Class A-6, Class A-7 and Class A-8 Certificates.
FNMA: Federal National Mortgage Association, or any successor thereto.
FRAUD COVERAGE: As of the Cut-Off Date approximately $3,598,356, and
thereafter, the Fraud Coverage will generally be equal to (1) prior to the
third Anniversary, an amount equal to 1.00% of the aggregate principal
balance of all Loans as of the Cut-Off Date minus the aggregate amounts
allocated to the Certificates with respect to Fraud Losses on such Loans up
to such date of
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determination and (2) from the third to the fifth Anniversary, an amount
equal to (a) 0.50% of the aggregate principal of all of the Loans as of the
most recent Anniversary minus (b) the aggregate amounts allocated to the
Certificates with respect to Fraud Losses on the Loans since the most recent
Anniversary up to such date of determination. On and after the fifth
Anniversary, the Fraud Coverage will be zero. Fraud Coverage may be reduced
upon written confirmation from the Rating Agency that such reduction will not
adversely affect the then current ratings assigned to the Certificates by the
Rating Agency.
FRAUD LOSS: The occurrence of a loss on a Loan arising from any
action, event or state of facts with respect to such Loan which, because it
involved or arose out of any dishonest, fraudulent, criminal, negligent or
knowingly wrongful act, error or omission by the Mortgagor, originator (or
assignee thereof) of such Loan, Lender, or the Servicer, would result in an
exclusion from, denial of, or defense to coverage which otherwise would be
provided by an insurance policy previously issued with respect to such Loan.
INDEPENDENT: When used with respect to any specified Person, any such
Person who (i) is in fact independent of the Depositor and the Servicer,
(ii) does not have any direct financial interest or any material indirect
financial interest in the Depositor or the Servicer or any Affiliate of
either and (iii) is not connected with the Depositor or the Servicer as an
officer, employee, promotor, underwriter, trustee, partner, director or
person performing similar functions.
INDIRECT DTC PARTICIPANTS: Entities such as banks, brokers, dealers
or trust companies, that clear through or maintain a custodial relationship
with a DTC Participant, either directly or indirectly.
INSTALLMENT DUE DATE: The first day of the month in which the related
Distribution Date occurs.
INSURANCE PROCEEDS: Amounts paid or payable by the insurer under any
insurance policy (including any replacement policy permitted under this
Agreement), covering any Loan or Mortgaged Property, including, without
limitation, any hazard insurance policy required pursuant to Section 3.5, any
title insurance policy required pursuant to Section 2.3, and any FHA
insurance policy or VA guaranty.
INTEREST DISTRIBUTION AMOUNT: On any Distribution Date, for any Class
of Certificates (other than the Class A-P Certificates), the amount of
interest accrued on the respective Class Principal Balance or Class Notional
Amount, as applicable, at 1/12th of the related Remittance Rate for such
Class during the applicable Prepayment Period, before giving effect to
allocations of Realized Losses for the applicable Prepayment Period or
distributions to be made on such Distribution Date, reduced by Uncompensated
Interest Shortfall and the interest portion of Realized Losses allocated to
such Class pursuant to the definitions of "Uncompensated Interest Shortfall"
and "Realized Loss," respectively PROVIDED, HOWEVER, that (a) in the case of
the Class A-9 Certificates, such amount shall be reduced by the Class A-9
Accrual Amount, (b) in the case of Class A-10 Certificates, such amount shall
be reduced by the Class A-10 Accrual Amount and (c) in the case of the Class
A-11
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Certificates, such amount shall be reduced by the Class A-11 Accrual Amount.
The Interest Distribution Amount for the Class A-P Certificates on any
Distribution Date shall equal zero.
INTEREST ONLY CERTIFICATES: The Class A-5 Certificates and the Class
A-X Certificates, which will not be entitled to receive interest.
INTERESTED PERSON: The Depositor, the Servicer, any Holder of a
Certificate, or any Affiliate of any such Person.
JUNIOR SUBORDINATE CERTIFICATES: The Class B-3, B-4 and B-5
Certificates, collectively.
LIQUIDATED LOAN: A Loan as to which the Servicer has determined in
accordance with its customary servicing practices that all amounts which it
expects to recover from or on account of such Loan, whether from Insurance
Proceeds, Liquidation Proceeds or otherwise, have been recovered. For
purposes of this definition, acquisition of a Mortgaged Property by the Trust
Fund shall not constitute final liquidation of the related Loan.
LIQUIDATION EXPENSES: Expenses incurred by the Servicer in connection
with the liquidation of any Defaulted Loan or property acquired in respect
thereof, including, without limitation, legal fees and expenses, any
unreimbursed amount expended by the Servicer pursuant to Section 3.7
respecting the related Loan and any unreimbursed expenditures for real
property taxes or for property restoration or preservation relating to the
Mortgaged Property that secured such Loan.
LIQUIDATION PRINCIPAL: The principal portion of Liquidation Proceeds
received (exclusive of the portion thereof attributable to principal
distributions to the Class A-P Certificates pursuant to the definition of
"Certificate Distribution Amount" herein) with respect to each Loan which
became a Liquidated Loan (but not in excess of the principal balance thereof)
during the applicable Prepayment Period.
LIQUIDATION PROCEEDS: Amounts after deduction of amounts reimbursable
under Section 3.7 received and retained in connection with the liquidation of
defaulted Loans (including the disposition of REO Property), whether through
foreclosure or otherwise, other than Insurance Proceeds.
LOANS: The Mortgages and the related Mortgage Notes, each transferred
and assigned to the Trustee pursuant to the provisions hereof as from time to
time are held as part of the Trust Fund, as so identified in the Loan
Schedule. Each of the Loans is referred to individually in this Agreement as
a "LOAN".
LOAN SCHEDULE: The schedule, as amended from time to time, of Loans
attached hereto as Exhibit D, which shall set forth as to each Loan the
following, among other things:
(i) the loan number of the Loan and name of the related Mortgagor;
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(ii) the street address of the Mortgaged Property;
(iii) the Mortgage Interest Rate as of the Cut-Off Date;
(iv) the original term and maturity date of the related Mortgage
Note;
(v) the original Principal Balance;
(vi) the first payment date;
(vii) the Monthly Payment in effect as of the Cut-Off Date;
(viii) the date of the last paid installment of interest;
(ix) the unpaid Principal Balance as of the close of business on the
Cut-Off Date;
(x) the Loan-to-Value ratio at origination and as of the Cut-Off
Date;
(xi) the type of property;
(xii) the nature of occupancy at origination;
(xiii) the county in which Mortgaged Property is located, if
available; and
(xiv) the closing date.
LOAN-TO-VALUE RATIO: The original principal amount of a Loan divided
by the Original Value; however, references to "current Loan-to-Value Ratio"
shall mean the then current Principal Balance of a Loan divided by the
Original Value.
MONTHLY PAYMENT: The scheduled payment of principal and interest on a
Loan which is due on the related Due Date for such Loan.
MORTGAGE: The mortgage, deed of trust or other instrument securing a
Mortgage Note.
MORTGAGE FILE: The following documents or instruments with respect to
each Loan transferred and assigned pursuant to Section 2.1:
(i) The original Mortgage Note bearing all intervening
endorsements endorsed, "Pay to the order of Chase Bank of Texas,
National Association, as Trustee, for the benefit of the
Certificateholders of ABN AMRO Mortgage Corporation Series 1998-4
Attn: Corporate Trust Department, 600 Travis Street, Houston, TX
77002, without recourse" and signed in the name of the Seller by an
Authorized Officer showing an unbroken chain of title from the
originator thereof to the person endorsing;
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(ii) (a) The original Mortgage with evidence of recording
thereon, and if the Mortgage was executed pursuant to a power of
attorney, a certified true copy of the power of attorney certified by
the recorder's office, with evidence of recording thereon, or
certified by a title insurance company or escrow company to be a true
copy thereof; PROVIDED, that if such original Mortgage or power of
attorney cannot be delivered with evidence of recording thereon on or
prior to the Closing Date because of a delay caused by the public
recording office where such original Mortgage has been delivered for
recordation or because such original Mortgage has been lost, the
Seller shall deliver or cause to be delivered to the Purchaser a true
and correct copy of such Mortgage, together with (1) in the case of a
delay caused by the public recording office, an Officer's Certificate
signed by a Responsible Officer of the Seller stating that such
original Mortgage has been dispatched to the appropriate public
recording official for recordation or (2) in the case of an original
Mortgage that has been lost, a certificate by the appropriate county
recording office where such Mortgage is recorded or from a title
insurance company or escrow company indicating that such original was
lost and the copy of the original mortgage is a true and correct copy;
(b) The original Assignment to "Chase Bank of Texas,
National Association, as Trustee," which assignment shall be in form
and substance acceptable for recording, or a copy certified by the
Seller as a true and correct copy of the original Assignment which has
been sent for recordation. Subject to the foregoing, such assignments
may, if permitted by law, be by blanket assignments for Loans covering
Mortgaged Properties situated within the same county. If the
Assignment is in blanket form, a copy of the Assignment shall be
included in the related individual Mortgage File.
(iii) The originals of any and all instruments that modify the
terms and conditions of the Mortgage Note, including but not limited
to modification, consolidation, extension and assumption agreements
including any adjustable rate mortgage (ARM) rider, if any;
(iv) The originals of all required intervening assignments,
if any, with evidence of recording thereon, and if such assignment was
executed pursuant to a power of attorney, a certified true copy of the
power of attorney certified by the recorder's office, with evidence of
recording thereon, or certified by a title insurance company or escrow
company to be a true copy thereof; PROVIDED, that if such original
assignment or power of attorney cannot be delivered with evidence of
recording thereon on or prior to the Closing Date because of a delay
caused by the public recording office where such original assignment
has been delivered for recordation or because such original assignment
has been lost, the Seller shall deliver or cause to be delivered to
the Purchaser a true and correct copy of such assignment, together
with (a) in the case of a delay caused by the public recording office,
an Officer's Certificate signed by a Responsible Officer of the Seller
stating that such original assignment has been dispatched to the
appropriate public recording official for recordation or (b) in the
case of an original assignment that has been lost, a certificate by
the appropriate county recording office where such assignment is
recorded or from a title insurance company or escrow company
indicating that such original was lost and the copy of the original
assignment is a true and correct copy;
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(v) The original mortgage policy of title insurance
(including, if applicable, the endorsement relating to the negative
amortization of the Loans) or in the event such original title policy
is unavailable, any one of an original title binder, an original
preliminary title report or an original title commitment or a copy
thereof certified by the title company with the original policy of
title insurance to follow within 180 days of the Closing Date;
(vi) The primary mortgage insurance certificate, if any;
(vii) Hazard insurance certificates and copies of the hazard
insurance policy and, if applicable, flood insurance policy; and
(viii) any and all other documents, opinions and certificates
executed and/or delivered by the related Mortgagor and/or its counsel
in connection with the origination of such Mortgage.
MORTGAGE INTEREST RATE: For any Loan, the per annum rate at which
interest accrues on such Loan pursuant to the terms of the related Mortgage
Note.
MORTGAGE NOTE: The note or other evidence of indebtedness evidencing
the indebtedness of a Mortgagor under a Loan.
MORTGAGE POOL: All of the Loans.
MORTGAGED PROPERTY: With respect to any Loan, the real property,
together with improvements thereto, securing the indebtedness of the
Mortgagor under the related Loan.
MORTGAGOR: The obligor on a Mortgage Note.
NONRECOVERABLE ADVANCE: With respect to any Loan, any Advance which
the Servicer shall have determined to be a Nonrecoverable Advance pursuant to
Section 4.4 and which was, or is proposed to be, made by such Servicer.
NON-U.S. PERSON: A Person that is not a U.S. Person.
OFFICER'S CERTIFICATE: With respect to any Person, a certificate
signed both by the Chairman of the Board, the President or a Vice President,
and by the Treasurer, the Secretary or one of the Assistant Treasurers or
Assistant Secretaries of such Person (or, in the case of a Person which is
not a corporation, signed by the person or persons having like
responsibilities), and delivered to the Trustee.
OPINION OF COUNSEL: A written opinion of counsel, who may be outside
or salaried counsel for the Depositor or the Servicer, or any affiliate of
the Depositor or the Servicer, acceptable to the Trustee; PROVIDED, that with
respect to REMIC matters, matters relating to the determination of Eligible
Accounts or matters relating to transfers of Certificates, such counsel shall
be Independent.
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ORIGINAL VALUE: With respect to any Loan other than a Loan originated
for the purpose of refinancing an existing mortgage debt, the lesser of (a)
the Appraised Value (if any) of the Mortgaged Property at the time the Loan
was originated or (b) the purchase price paid for the Mortgaged Property by
the Mortgagor. With respect to a Loan originated for the purpose of
refinancing existing mortgage debt, the Original Value shall be equal to the
Appraised Value of the Mortgaged Property at the time the Loan was originated
or the appraised value at the time the refinanced mortgage debt was incurred.
OTS: The Office of Thrift Supervision, or any successor thereto.
OWNERSHIP INTEREST: As defined in Section 5.1(b).
PASS-THROUGH ENTITY: As defined in Section 5.1(b).
PASS-THROUGH RATE: For each Loan, a rate equal to the Mortgage
Interest Rate for such Loan less the applicable per annum percentage rate of
the Servicing Fee. For each Loan, any calculation of monthly interest at
such rate shall be based upon annual interest at such rate (computed on the
basis of a 360-day year of twelve 30-day months) on the unpaid Principal
Balance of the related Loan divided by twelve, and any calculation of
interest at such rate by reason of a Payoff shall be based upon annual
interest at such rate on the outstanding Principal Balance of the related
Loan multiplied by a fraction, the numerator of which is the number of days
elapsed from the Due Date of the last scheduled payment of principal and
interest to, but not including, the date of such Payoff, and the denominator
of which is (a) for Payoffs received on a Due Date, 360, and (b) for all
other Payoffs, 365.
PAYING AGENT: Any paying agent appointed by the Trustee pursuant to
Section 4.10. Initially, the Paying Agent shall be LaSalle National Bank.
PAYOFF: Any Mortgagor payment of principal on a Loan equal to the
entire outstanding Principal Balance of such Loan, if received in advance of
the last scheduled Due Date for such Loan and accompanied by an amount of
interest equal to accrued unpaid interest on the Loan to the date of such
payment-in-full.
PAYOFF EARNINGS: For any Distribution Date with respect to each Loan
on which a Payoff was received by the Servicer during the Prepayment Period,
the aggregate of the interest earned by Servicer from investment of each such
Payoff from the date of receipt of such Payoff until the last day of such
Prepayment Period (net of investment losses).
PAYOFF INTEREST: For any Distribution Date with respect to a Loan for
which a Payoff was received by the Servicer during the Prepayment Period, an
amount of interest thereon at the applicable Pass-Through Rate from the first
day of such Prepayment Period to the date of receipt thereof. To the extent
(together with Payoff Earnings and the aggregate Servicing Fee) not required
to be distributed as Compensating Interest on such Distribution Date, Payoff
Interest shall be payable to the Servicer of such Loans as additional
servicing compensation.
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PERCENTAGE INTEREST: (a) With respect to the right of each
Certificate of a particular Class in the distributions allocated to such
Class, "Percentage Interest" shall mean the percentage undivided beneficial
ownership interest evidenced by such Certificate of such Class, which
percentage shall equal:
(i) with respect to any Regular Interest Certificate (other
than the Interest Only Certificates), its Certificate Principal
Balance divided by the applicable Class Principal Balance;
(ii) with respect to the Interest Only Certificates, the
portion of the respective Class Notional Amount evidenced by such
Certificate divided by the respective Class Notional Amount; and
(iii) with respect to the Class R Certificate, the percentage
set forth on the face of such Certificate.
(b) With respect to the rights of each Certificate in connection
with Sections 5.9, 7.1, 7.3, 8.1, 8.3, 10.1 and 10.3, "Percentage Interest"
shall mean the percentage undivided beneficial interest evidenced by such
Certificate in the Trust Fund, which for purposes of such rights only shall
equal:
(i) with respect to any Certificate (other than the Class
A-X and Class A-5 Certificates), the product of (x) 98.00% and (y) the
percentage calculated by dividing its Certificate Principal Balance by
the Aggregate Certificate Principal Balance; PROVIDED, HOWEVER, that
the percentage in (x) above shall be increased by one percent (1%)
upon each retirement of the Interest Only Certificates;
(ii) with respect to the Interest Only Certificates, one
percent (1%) of such Certificate's Percentage Interest as calculated
by paragraph (a)(ii) of this definition; and
(iii) with respect to the Class R Certificate, zero.
PERMITTED TRANSFEREE: With respect to the holding or ownership of any
Residual Certificate, any Person other than (i) the United States, a State or
any 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 Code Section 521) which is
exempt from the taxes imposed by Chapter 1 of the Code (unless such
organization is subject to the tax imposed by Section 511 of the Code on
unrelated business taxable income), (iv) rural electric and telephone
cooperatives described in Code Section 1381(a)(2)(C), (v) any electing large
partnership under Section 775 of the Code, (vi) any Person from whom the
Trustee or the Certificate Registrar has not received an affidavit to the
effect that it is not a "disqualified organization" within the meaning of
Section 860E(e)(5) of the Code, 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 the
Trust Fund to fail to qualify as a REMIC at any time that the Certificates
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are outstanding. The terms "United States," "State" and "International
Organization" shall have the meanings set forth in Code Section 7701 or
successor provisions. A corporation shall not be treated as an
instrumentality of the United States or of any State or political subdivision
thereof if all of its activities are subject to tax, and, with the exception
of the FHLMC, a majority of its board of directors is not selected by such
governmental unit.
PERSON: Any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
PLANNED PRINCIPAL BALANCE: For any Distribution Date, the amount set
forth in the table attached hereto as Exhibit O for such Distribution Date,
for the Class A-1, Class A-2, Class A-3 and Class A-4 Certificates.
PREMIUM RATE LOANS: The Loans having Pass-Through Rates in excess of
6.75% per annum.
PREPAID MONTHLY PAYMENT: Any Monthly Payment received prior to its
scheduled Due Date, which is intended to be applied to a Loan on its
scheduled Due Date and held in the related Custodial Account for P&I until
the Withdrawal Date following its scheduled Due Date.
PREPAYMENT PERIOD: The calendar month immediately preceding any
Distribution Date.
PRIME RATE: Means, for any period, a fluctuating interest rate per
annum as shall be in effect from time to time, which rate of interest shall
be announced publicly by LaSalle National Bank from time to time as LaSalle
National Bank's prime rate.
PRINCIPAL BALANCE: At the time of any determination, the principal
balance of a Loan remaining to be paid at the close of business on the
Cut-Off Date, after deduction of all principal payments due on or before the
Cut-Off Date whether or not paid, reduced by all amounts distributed or to be
distributed to Certificateholders through the Distribution Date in the month
of determination that are reported as allocable to principal of such Loan.
In the case of a Substitute Loan, "Principal Balance" shall mean, at
the time of any determination, the principal balance of such Substitute Loan
transferred to the Trust Fund on the date of substitution, reduced by all
amounts distributed or to be distributed to Certificateholders through the
Distribution Date in the month of determination that are reported as
allocable to principal of such Substitute Loan.
The Principal Balance of a Loan (including a Substitute Loan) shall
not be adjusted solely by reason of any bankruptcy or similar proceeding or
any moratorium or similar waiver or grace period. Whenever a Realized Loss
has been incurred with respect to a Loan during a calendar month, the
Principal Balance of such Loan shall be reduced by the amount of such
Realized Loss as of the Distribution Date next following the end of such
calendar month after giving effect to the allocation of Realized Losses and
distributions of principal to the Certificates.
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PRINCIPAL PAYMENT: Any payment of principal on a Loan other than a
Principal Prepayment.
PRINCIPAL PAYMENT AMOUNT: On any Distribution Date and for the Loans,
the sum with respect to the Loans of (i) the scheduled principal payments on
the Loans due on the related Due Date, (ii) the principal portion of
repurchase proceeds received with respect to any Loan which was repurchased
by the Depositor pursuant to a Purchase Obligation or as permitted by this
Agreement during the applicable Prepayment Period, and (iii) any other
unscheduled payments of principal which were received with respect to any
Loan during the applicable Prepayment Period, other than Payoffs,
Curtailments and Liquidation Principal.
PRINCIPAL PREPAYMENT: Any payment of principal on a Loan which
constitutes a Payoff or a Curtailment.
PRINCIPAL PREPAYMENT AMOUNT: On any Distribution Date and for the
Loans, the sum with respect to the Loans of (i) Curtailments received during
the applicable Prepayment Period from such Loans and (ii) Payoffs received
during the applicable Prepayment Period from the Loans.
PRO RATA ALLOCATION: The allocation of the principal portion of
losses relating to a Loan to all the Senior Certificates (other than the
Class A-P Certificates and the Interest Only Certificates) and to the
Subordinate Certificates (in the limited circumstances described below) pro
rata according to their respective Certificate Principal Balances (except if
the loss is recognized with respect to a Discount Loan, in which event the
applicable Discount Fraction of such loss will first be allocated to the
Class A-P Certificates, and the remainder of such loss will be allocated as
described above) or, in the case of the Accrual Certificates, the Certificate
Principal Balance of such certificate on the Closing Date, if lower, and the
allocation of the interest portion of such losses to the Certificates (other
than the Class A-P Certificates) pro rata according to the amount of interest
accrued but unpaid on each such Class in reduction thereof.
PURCHASE OBLIGATION: An obligation of the Depositor to repurchase
Loans under the circumstances and in the manner provided in Section 2.2 or
Section 2.3.
PURCHASE PRICE: With respect to any Loan to be purchased pursuant to
a Purchase Obligation, or any Loan to be purchased or repurchased relating to
an REO Property, an amount equal to the sum of the Principal Balance thereof,
and unpaid accrued interest thereon, if any, to the last day of the calendar
month in which the date of repurchase occurs at a rate equal to the
applicable Pass-Through Rate; provided, HOWEVER, that no Loan shall be
purchased or required to be purchased pursuant to Section 2.3, or more than
two years after the Closing Date under Section 2.2, unless (a) the Loan to be
purchased is in default, or default is in the judgment of the Depositor
reasonably imminent, or (b) the Depositor, at its expense, delivers to the
Trustee an Opinion of Counsel to the effect that the purchase of such Loan
will not give rise to a tax on a prohibited transaction, as defined in
Section 860F(a) of the Code; PROVIDED, FURTHER, that in the case of clause
(b) above, the Depositor will use its reasonable efforts to obtain such
Opinion of Counsel if such opinion is obtainable.
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<PAGE>
RATING AGENCY: Initially, each of S&P and Fitch, thereafter, each
nationally recognized statistical rating organization that has rated the
Certificates at the request of the Depositor, or their respective successors
in interest.
RATINGS: As of any date of determination, the ratings, if any, of the
Certificates as assigned by the Rating Agency.
REALIZED LOSS: For any Distribution Date, with respect to any Loan
which became a Liquidated Loan during the related applicable Prepayment
Period, the sum of (i) the principal balance of such Loan remaining
outstanding after the application of Liquidation Proceeds and the principal
portion of Nonrecoverable Advances actually reimbursed with respect to such
Loan (the principal portion of such Realized Loss), and (ii) the accrued
interest on such Loan remaining unpaid and the interest portion of
Nonrecoverable Advances actually reimbursed with respect to such Loan (the
interest portion of such Realized Loss). For any Distribution Date, with
respect to any Loan which is not a Liquidated Loan, the amount of the
Bankruptcy Loss incurred with respect to such Loan as of the related Due Date.
RECORD DATE: The last Business Day of the month immediately preceding
the month of the related Distribution Date.
REGULAR INTEREST CERTIFICATES: The Certificates, other than the Class
R Certificate.
REMIC: A real estate mortgage investment conduit, as such term is
defined in the Code.
REMIC I: The pool of assets consisting of the Trust Fund.
REMIC I REGULAR INTERESTS: The regular interests in REMIC I as
described in Section 2.4 of this Agreement.
REMIC II: The pool of assets consisting of the REMIC I Regular
Interests and all payments of principal or interest on or with respect to the
REMIC I Regular Interests after the Cut-Off Date.
REMIC PROVISIONS: Sections 860A through 86OG of the Code, related
Code provisions and regulations promulgated thereunder, as the foregoing may
be in effect from time to time.
REMITTANCE RATE: For each Class of Certificates, the per annum rate
set forth as the Remittance Rate for such Class in the Preliminary Statement
hereto.
REO PROPERTY: A Mortgaged Property, title to which has been acquired
by the Servicer on behalf of the Trust Fund through foreclosure, deed in lieu
of foreclosure or otherwise.
RESIDUAL CERTIFICATE: The Class R Certificate, which is being issued
in a single class. Components R-1 and R-2 of the Class R Certificate is
hereby each designated the sole Class of
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<PAGE>
"residual interests" in REMIC I and REMIC II, respectively, for purposes of
Section 860G(a)(2) of the Code.
RESIDUAL DISTRIBUTION AMOUNT: On any Distribution Date, any portion
of the Available Distribution Amount remaining after all distributions to the
Certificates pursuant to the definition of Certificate Distribution Amount.
Upon termination of the obligations created by this Agreement and the Trust
Fund created hereby, the amounts which remain on deposit in the Certificate
Account after payment to the Certificateholders of the amounts set forth in
Section 9.1 of this Agreement, and subject to the conditions set forth
therein.
RESPONSIBLE OFFICER: When used with respect to the Trustee or any
Seller, the Chairman or Vice-Chairman of the Board of Directors or Trustees,
the Chairman or Vice-Chairman of the Executive or Standing Committee of the
Board of Directors or Trustees, the President, the Chairman of the Committee
on Trust Matters, any Vice-President, any Assistant Vice President, the
Secretary, any Assistant Secretary, the Treasurer, any Assistant Treasurer,
the Cashier, any Assistant Cashier, any Trust Officer or Assistant Trust
Officer, the Controller, any Assistant Controller or any other officer of the
Trustee customarily performing functions similar to those performed by any of
the above-designated officers and in each case having direct responsibility
for the administration of this Agreement, and also, with respect to a
particular matter, any other officer to whom such matter is referred because
of such officer's knowledge of and familiarity with the particular subject.
When used with respect to the Servicer, the Chairman or Vice-Chairman of the
Board of Directors or Trustees, the Chairman or Vice-Chairman of the
Executive or Standing Committee of the Board of Directors or Trustees, the
President, any Vice-President, the Secretary, any Assistant Secretary, the
Treasurer, any Assistant Treasurer, the Controller and any Assistant
Controller or any other officer of the Servicer customarily performing
functions similar to those performed by any of the above-designated officers
and also, with respect to a particular matter, any other officer to whom such
matter is referred because of such officer's knowledge of and familiarity
with the particular subject. When used with respect to the Depositor or any
other Person, the Chairman or Vice-Chairman of the Board of Directors, the
Chairman or Vice-Chairman of any executive committee of the Board of
Directors, the President, any Vice President, the Secretary, any Assistant
Secretary, the Treasurer, any Assistant Treasurer, or any other officer of
the Depositor customarily performing functions similar to those performed by
any of the above-designated officers and also, with respect to a particular
matter, any other officer to whom such matter is referred because of such
officer's knowledge of and familiarity with the particular subject.
S & P: Standard & Poor's Rating Services, a division of The McGraw
Hill Companies, Inc., provided, that at any time it be a Rating Agency.
SCHEDULED PRINCIPAL BALANCE: With respect to any Loan as of any
Distribution Date, the unpaid principal balance of such Loan as specified in
the amortization schedule at the time relating thereto (before any adjustment
to such schedule by reason of bankruptcy or similar proceeding or any
moratorium or similar waiver or grace period) as of the first day of the
month preceding the month of such Distribution Date, after giving effect to
any previously applied Curtailments, the payment of principal due on such
first day of the month and any reduction of the principal balance
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<PAGE>
of such Loan by a bankruptcy court, irrespective of any delinquency in
payment by the related Mortgagor.
SECOND TARGETED PRINCIPAL BALANCE: For any Distribution Date, the
amount set forth in the table attached hereto as Exhibit P-2 for such
Distribution Date, for the Class A-6, Class A-7 and Class A-8 Certificates.
SECURITIES ACT: The Securities Act of 1933, as amended.
SELLER: Standard Federal Bank.
SENIOR CERTIFICATES: The Class A and Class R Certificates,
collectively.
SENIOR LIQUIDATION AMOUNT: The aggregate, for each Loan which became
a Liquidated Loan during the applicable Prepayment Period, of the lesser of:
(i) the Senior Percentage of the Principal Balance of such Loan (exclusive of
the Discount Fraction thereof, if applicable), and (ii) the Senior Prepayment
Percentage of the Liquidation Principal with respect to such Loan.
SENIOR PERCENTAGE: As of the Closing Date, approximately 95.98%, and
thereafter, with respect to any Distribution Date, the sum of the Class
Principal Balances of the Senior Certificates (other than the Class A-P
Certificates) divided by aggregate Scheduled Principal Balance of all Loans
(reduced by the Discount Fraction thereof), in each case immediately prior to
such Distribution Date.
SENIOR PREPAYMENT PERCENTAGE: (i) On any Distribution Date occurring
before the Distribution Date in the month of November 2003, 100%; (ii) on any
other Distribution Date on which the Senior Percentage for such Distribution
Date exceeds the initial Senior Percentage as of the Cut-Off Date, 100%; and
(iii) on any other Distribution Date in each of the months of November 2003
and thereafter, 100%, unless:
(a) the mean aggregate Principal Balance of the Loans which
are 60 or more days delinquent (including loans in foreclosure and
property held by the Trust Fund) for each of the immediately preceding
six calendar months is less than or equal to 50% of the mean aggregate
of the Subordinate Amount as of such Distribution Date, and
(b) cumulative Realized Losses on the Loans allocated to the
Subordinate Certificates are less than or equal to the following
amounts:
<TABLE>
<CAPTION>
PERCENTAGE OF THE SUBORDINATE
DISTRIBUTION DATE OCCURRING IN AMOUNT AS OF THE CUT-OFF DATE
------------------------------ ------------------------------
<S> <C>
November 2003 through October 2004 .... 30%
November 2004 through October 2005 .... 35%
November 2005 through October 2006 .... 40%
November 2006 through October 2007 .... 45%
November 2007 and thereafter .......... 50%
</TABLE>
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<PAGE>
in which case, the Senior Prepayment Percentage shall be as follows:
<TABLE>
<CAPTION>
DISTRIBUTION DATE OCCURRING IN SENIOR PREPAYMENT PERCENTAGE
------------------------------ ----------------------------
<S> <C>
November 1998 through October 2003 . . . . . 100%
November 2003 through October 2004 . . . . . SENIOR PERCENTAGE + 70% of SUBORDINATE PERCENTAGE
November 2004 through October 2005 . . . . . SENIOR PERCENTAGE + 60% of SUBORDINATE PERCENTAGE
November 2005 through October 2006 . . . . . SENIOR PERCENTAGE + 40% of SUBORDINATE PERCENTAGE
November 2006 through October 2007 . . . . . SENIOR PERCENTAGE + 20% of SUBORDINATE PERCENTAGE
November 2007 and thereafter . . . . . . . . SENIOR PERCENTAGE
</TABLE>
If on any Distribution Date the allocation to the Certificates (other
than the Class A-P Certificates) of Principal Prepayments in the percentage
required would reduce the sum of the Class Principal Balances of the
Certificates (other than the Class A-P Certificates) below zero, the Senior
Prepayment Percentage for such Distribution Date shall be limited to the
percentage necessary to reduce such sum to zero. Notwithstanding the
foregoing, however, on each Distribution Date, the Class A-P Certificates
will receive the Discount Fraction of all principal payments, including,
without limitation, Principal Prepayments, received in respect of each
Discount Loan.
SENIOR PRINCIPAL AMOUNT: For any Distribution Date, an amount equal
to the sum of (a) the Senior Percentage of the Principal Payment Amount for
the Loans (exclusive of the portion thereof attributable to principal
distributions to the Class A-P Certificates pursuant to clause (I)(a)(i) of
the definition of "Certificate Distribution Amount"), (b) the Senior
Prepayment Percentage of the Principal Prepayment Amount for the Loans
(exclusive of the portion thereof attributable to principal distributions to
the Class A-P Certificates pursuant to clause (I)(a)(i) of the definition of
"Certificate Distribution Amount") and (c) the Senior Liquidation Amount.
SERVICER: LaSalle Home Mortgage Corporation, an Illinois corporation,
or any successor thereto appointed as provided pursuant to Section 7.5,
acting to service and administer such Loans pursuant to Section 3.1.
SERVICER'S SECTION 3.10 REPORT: A report delivered by the Servicer to
the Trustee or the Certificate Administrator pursuant to Section 3.10.
SERVICING FEE: For each Loan, the fee paid to the Servicer to perform
primary servicing functions with respect to such Loan, equal to the per annum
rate of 0.2500% for each Loan in the Loan Schedule on the outstanding
Principal Balance of such Loan.
SERVICING OFFICER: Any individual involved in, or responsible for,
the administration and servicing of the Loans whose name and specimen
signature appear on a list of servicing officers furnished to the Trustee on
the Closing Date by the Servicer in the form of an Officer's Certificate, as
such list may from time to time be amended.
SPECIAL HAZARD COVERAGE: As of the Cut-Off Date approximately
$4,796,879, and thereafter on each anniversary of the Cut-Off Date, the
Special Hazard Coverage shall be reduced, but not
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<PAGE>
increased, to an amount equal to the lesser of (1) the greatest of (a) the
aggregate principal balance of the Loans located in the single California zip
code area containing the largest aggregate principal balance of the Loans,
(b) 1% of the aggregate unpaid principal balance of the Loans and (c) twice
the unpaid principal balance of the largest single Loan, in each case
calculated as of the Due Date in the immediately preceding month, and (2) the
initial Special Hazard Coverage amount of $4,796,879 as reduced by the
Special Hazard Losses allocated to the Certificates since the Cut-Off Date.
Special Hazard Coverage may be reduced upon written confirmation from the
Rating Agency that such reduction will not adversely affect the then current
ratings assigned to the Certificates by the Rating Agency.
SPECIAL HAZARD LOSS: The occurrence of any direct physical loss or
damage to a Mortgaged Property not covered by a standard hazard maintenance
policy with extended coverage which is caused by or results from any cause
except: (ii) fire, lightning, windstorm, hail, explosion, riot, riot
attending a strike, civil commotion, vandalism, aircraft, vehicles, smoke,
sprinkler leakage, except to the extent of that portion of the loss which was
uninsured because of the application of a co-insurance clause of any
insurance policy covering these perils; (ii) normal wear and tear, gradual
deterioration, inherent vice or inadequate maintenance of all or part
thereof, (iii) errors in design, faulty workmanship or materials, unless the
collapse of the property or a part thereof ensues and then only for the
ensuing loss; (iv) nuclear reaction or nuclear radiation or radioactive
contamination, all whether controlled or uncontrolled and whether such loss
be direct or indirect, proximate or remote or be in whole or in part caused
by, contributed to or aggravated by a peril covered by this definition of
Special Hazard Loss; (v) hostile or warlike action in time of peace or war,
including action in hindering, combating or defending against an actual,
impending or expected attack (a) by any government of sovereign power (DEJURE
OR DEFACTO), or by an authority maintaining or using military, naval or air
forces, (b) by military, naval or air forces, or (c) by an agent of any such
government, power, authority or forces; (vi) any weapon of war employing
atomic fission or radioactive force whether in time of peace or war; (vii)
insurrection, rebellion, revolution, civil war, usurped power or action taken
by governmental authority in hindering, combating or defending against such
occurrence; or (viii) seizure or destruction under quarantine or customs
regulations, or confiscation by order of any government or public authority.
STANDARD FEDERAL BANK: Standard Federal Bank, a Federal Savings Bank.
STEP DOWN PERCENTAGE: For any Distribution Date, the percentage
indicated below:
<TABLE>
<CAPTION>
DISTRIBUTION DATE OCCURRING IN STEP DOWN PERCENTAGE
------------------------------ --------------------
<S> <C>
November 1998 through October 2003 0%
November 2003 through October 2004 30%
November 2004 through October 2005 40%
November 2005 through October 2006 60%
November 2006 through October 2007 80%
November 2007 and thereafter 100%
</TABLE>
33
<PAGE>
STRIPPED INTEREST RATE: For each Loan, the excess, if any, of the
Pass-Through Rate for such Loan over 6.75%.
SUBORDINATE AMOUNT: The excess of the aggregate Scheduled Principal
Balance of the Loans over the Senior Certificate Principal Balance.
SUBORDINATE CERTIFICATES: The Class M, Class B-1, Class B-2, Class
B-3, Class B-4 and Class B-5 Certificates, collectively, and designated as
such on the face thereof in substantially the form attached hereto as
Exhibits A-19 through A-24, respectively.
SUBORDINATE LIQUIDATION AMOUNT: The excess, if any, of the aggregate
of Liquidation Principal for all the Loans which became Liquidated Loans
during the applicable Prepayment Period, over the related Senior Liquidation
Amount for such Distribution Date.
SUBORDINATE PERCENTAGE: As of the Closing Date approximately 4.02%,
and thereafter, with respect to any Distribution Date, the excess of 100%
over the Senior Percentage for such date.
SUBORDINATE PREPAYMENT PERCENTAGE: On any Distribution Date, the
excess of 100% over the Senior Prepayment Percentage.
SUBORDINATE PRINCIPAL AMOUNT: On any Distribution Date, will be equal
to the sum of:
(1) the Subordinate Percentage of the Principal Payment Amount
(exclusive of the portion thereof attributable to the Discount
Fractional Principal Amount);
(2) the Subordinate Principal Prepayment Amount; and
(3) the Subordinate Liquidation Amount;
PROVIDED, HOWEVER, that the Subordinate Principal Amount shall be
reduced by the amounts required to be distributed to the Class A-P
Certificates with respect to the Discount Fractional Principal Shortfall
on such Distribution Date.
Any reduction in the Subordinate Principal Amount pursuant to the proviso
above shall offset the amount calculated pursuant to first clause (1), second
clause (3) and then clause (2), in each case of the definition thereof. On
any Distribution Date, the Subordinate Principal Amount shall be allocated
pro rata, by Class Principal Balance, among the Classes of Subordinate
Certificates and paid in the order of distribution to such Classes pursuant
to clause (I)(b) of the definition of "Certificate Distribution Amount"
herein, except as otherwise stated in such definition. Notwithstanding the
foregoing, on any Distribution Date prior to distributions on such date, if
the Subordination Level for any Class of Subordinate Certificates is less
than such percentage as of the Closing Date, the pro rata portion of the
Subordinate Principal Prepayments Amount otherwise allocable to the Class or
Classes junior to such Class will be distributed to the most senior Class of
the Subordinate Certificates for which the Subordination Level is less than
such percentage as of the Closing Date, and to the Classes of Subordinate
Certificates senior thereto, pro rata according to the Class Principal
Balances of such Classes. For purposes of this definition and the definition
of
34
<PAGE>
"Subordination Level," the relative seniority, from highest to lowest, of the
Classes of Subordinate Certificates shall be as follows: Class M, Class B-1,
Class B-2, Class B-3, Class B-4 and B-5.
SUBORDINATE PRINCIPAL PREPAYMENT AMOUNT: On any Distribution Date,
the Subordinate Prepayment Percentage of the Principal Prepayment Amount for
the Loans (exclusive of the portion thereof attributable to the Discount
Fractional Principal Amount (reduced by the Discount Fractional Principal
Shortfall)).
SUBORDINATION LEVEL: On any specified date, with respect to any Class
of Subordinate Certificates, the percentage obtained by dividing: (1) the sum
of the Class Principal Balances of all Classes of Certificates which are
subordinate in right of payment to such Class; by (2) the sum of the Class
Principal Balances of all Classes of Certificates as of such date prior to
giving effect to distributions or allocations of Realized Losses on the Loans
on such date.
SUBSTITUTE LOAN: As defined in Section 2.2.
TAX MATTERS PERSON: The Holder of the Class R Certificate issued
hereunder or any Permitted Transferee of such Class R Certificateholder shall
be the initial "tax matters person" for REMIC I and REMIC II within the
meaning of Section 6231(a)(7) of the Code. For tax years commencing after
any transfer of the Class R Certificate, the holder of the greatest
Percentage Interest in the Class R Certificate at year end shall be
designated as the Tax Matters Person with respect to that year. If the Tax
Matters Person becomes a Disqualified Organization, the last preceding Holder
of such Authorized Denomination of the Class R Certificate that is not a
Disqualified Organization shall be Tax Matters Person pursuant to Section
5.1(c). If any Person is appointed as tax matters person by the Internal
Revenue Service pursuant to the Code, such Person shall be Tax Matters Person.
TRANSFER: As defined in Section 5.1(b).
TRANSFEREE: As defined in Section 5.1(b).
TRANSFEREE AFFIDAVIT AND AGREEMENT: As defined in Section 5.1(c)(i)(B).
TRUST FUND: The corpus of the trust created pursuant to Section 2.1
of this Agreement. The Trust Fund consists of (i) the Loans and all rights
pertaining thereto; (ii) such assets as from time to time may be held by the
Trustee (except amounts representing the Servicing Fee); (iii) such assets as
from time to time may be held by the Servicer in a Custodial Account for P&I
related to the Loans (except amounts representing the Servicing Fee); (iv)
property which secured a Loan and which has been acquired by foreclosure or
deed in lieu of foreclosure after the Cut-Off Date;(v) amounts paid or
payable by the insurer under any FHA insurance policy and proceeds of any VA
guaranty and any other insurance policy related to any Loan or the Mortgage
Pool; and (vi) the rights and remedies of the Depositor contained in Section
8 of the Mortgage Loan Purchase Agreement dated as of October 27, 1998,
between the Seller and the Depositor.
35
<PAGE>
TRUSTEE: Chase Bank of Texas, National Association, or its
successor-in-interest as provided in Section 8.9, or any successor trustee
appointed as herein provided.
UNCOLLECTED INTEREST: With respect to any Distribution Date for any
Loan on which a Payoff was made by a Mortgagor during the related Prepayment
Period, an amount equal to one month's interest at the applicable
Pass-Through Rate on such Loan less the amount of interest actually paid by
the Mortgagor with respect to such Payoff.
UNCOMPENSATED INTEREST SHORTFALL: For any Distribution Date, the
excess, if any, of (i) the sum of (a) aggregate Uncollected Interest and (b)
aggregate Curtailment Shortfall over (ii) Compensating Interest.
UNDERWRITERS: Lehman Brothers Inc. and ABN AMRO Incorporated.
U.S. PERSON: A citizen or resident of the United States, a corporation
or partnership (including an entity treated as a corporation or partnership
for federal income tax purposes) created or organized in, or under the laws
of, the United States or any state thereof or the District of Columbia
(except, in the case of a partnership, to the extent provided in regulations)
or an estate whose income is subject to United States federal income tax
regardless of its source, 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 such U.S. Persons have the authority to control all substantial
decisions of the trust. To the extent prescribed in regulations by the
Secretary of the Treasury, which have not yet been issued, a trust which was
in existence on August 20, 1996 (other than a trust treated as owned by the
grantor under subpart E of part 1 of subchapter J of chapter 1 of the Code),
and which was treated as a U.S. Person on August 20, 1996 may elect to
continue to be treated as a U.S. Person notwithstanding the previous sentence.
VA: The Department of Veterans Affairs, formerly known as the
Veterans Administration, or any successor thereto.
WITHDRAWAL DATE: The Business Day immediately preceding the related
Distribution Date.
All references to the origination date or original date in the Loan
Schedule with respect to a Loan shall refer to the date upon which the
related Mortgage Note was originated or modified, whichever is later.
ARTICLE II
CONVEYANCE OF TRUST FUND;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.1. CONVEYANCE OF TRUST FUND. The Depositor, concurrently
with the execution and delivery hereof, does hereby irrevocably sell, convey
and assign to the Trustee and REMIC I
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<PAGE>
without recourse all the right, title and interest of the Depositor in and to
the Trust Fund and to REMIC II without recourse all the right, title and
interest of the Depositor in and to the REMIC I Regular Interests, for the
benefit respectively of REMIC II and the Certificateholders, including all
interest and principal received by the Depositor with respect to the Loans
after the Cut-Off Date (and including without limitation scheduled payments
of principal and interest due after the Cut-Off Date but received by the
Depositor on or before the Cut-Off Date, but not including payments of
principal and interest due on the Loans on or before the Cut-Off Date). The
Depositor, at its own expense, shall file or cause to be filed protective
Form UCC-1 financing statements with respect to the Loans in the State of
Illinois or other applicable jurisdiction, listing itself as "Debtor" under
such financing statement and listing the Trustee, for the benefit of the
Certificateholders, as "Secured Party" under such financing statement.
In connection with such assignment, the Depositor does hereby deliver
to, and deposit with, the Trustee for the benefit of the Certificateholders
the following documents or instruments with respect to each Loan so assigned:
(i) The original Mortgage Note bearing all intervening
endorsements endorsed, "Pay to the order of Chase Bank of Texas,
National Association, as Trustee, for the benefit of the
Certificateholders of ABN AMRO Mortgage Corporation Series 1998-4
Attn: Corporate Trust Department, 600 Travis Street, Houston, TX
77002, without recourse" and signed in the name of the Seller by an
Authorized Officer showing an unbroken chain of title from the
originator thereof to the person endorsing;
(ii) (a) The original Mortgage with evidence of recording
thereon, and if the Mortgage was executed pursuant to a power of
attorney, a certified true copy of the power of attorney certified by
the recorder's office, with evidence of recording thereon, or
certified by a title insurance company or escrow company to be a true
copy thereof; PROVIDED, that if such original Mortgage or power of
attorney cannot be delivered with evidence of recording thereon on or
prior to the Closing Date because of a delay caused by the public
recording office where such original Mortgage has been delivered for
recordation or because such original Mortgage has been lost, the
Seller shall deliver or cause to be delivered to the Purchaser (with a
copy to the Trustee) a true and correct copy of such Mortgage,
together with (1) in the case of a delay caused by the public
recording office, an Officer's Certificate signed by a Responsible
Officer of the Seller stating that such original Mortgage has been
dispatched to the appropriate public recording official for
recordation or (2) in the case of an original Mortgage that has been
lost, a certificate by the appropriate county recording office where
such Mortgage is recorded or from a title insurance company or escrow
company indicating that such original was lost and the copy of the
original mortgage is a true and correct copy;
(b) The original Assignment to "Chase Bank of Texas,
National Association, as Trustee," which assignment shall be in form
and substance acceptable for recording, or a copy certified by the
Seller as a true and correct copy of the original Assignment which has
been sent for recordation. Subject to the foregoing, such assignments
may, if permitted by
37
<PAGE>
law, be by blanket assignments for Loans covering Mortgaged Properties
situated within the same county. If the Assignment is in blanket form,
a copy of the Assignment shall be included in the related individual
Mortgage File.
(iii) The originals of any and all instruments that modify the
terms and conditions of the Mortgage Note, including but not limited
to modification, consolidation, extension and assumption agreements
including any adjustable rate mortgage (ARM) rider, if any;
(iv) The originals of all required intervening assignments,
if any, with evidence of recording thereon, and if such assignment was
executed pursuant to a power of attorney, a certified true copy of the
power of attorney certified by the recorder's office, with evidence of
recording thereon, or certified by a title insurance company or escrow
company to be a true copy thereof; PROVIDED, that if such original
assignment or power of attorney cannot be delivered with evidence of
recording thereon on or prior to the Closing Date because of a delay
caused by the public recording office where such original assignment
has been delivered for recordation or because such original Assignment
has been lost, the Seller shall deliver or cause to be delivered to
the Purchaser (with a copy to the Trustee) a true and correct copy of
such Assignment, together with (a) in the case of a delay caused by
the public recording office, an Officer's Certificate signed by a
Responsible Officer of the Seller stating that such original
assignment has been dispatched to the appropriate public recording
official for recordation or (b) in the case of an original assignment
that has been lost, a certificate by the appropriate county recording
office where such assignment is recorded or from a title insurance
company or escrow company indicating that such original was lost and
the copy of the original assignment is a true and correct copy;
(v) The original mortgage policy of title insurance
(including, if applicable, the endorsement relating to the negative
amortization of the Loans) or in the event such original title policy
is unavailable, any one of an original title binder, an original
preliminary title report or an original title commitment or a copy
thereof certified by the title company with the original policy of
title insurance to follow within 180 days of the Closing Date;
(vi) The mortgage insurance certificate;
(vii) Hazard insurance certificates and copies of the hazard
insurance policy and, if applicable, flood insurance policy; and
(viii) any and all other documents, opinions and certificates
executed and/or delivered by the related Mortgagor and/or its counsel
in connection with the origination of such Mortgage.
If the Depositor cannot deliver the original Mortgage with evidence of
recording thereon concurrently with the execution and delivery of this
Agreement because of a delay caused by the public recording office where such
original Mortgage has been delivered for recordation, the Depositor shall
deliver to the Trustee an Officer's Certificate, with a photocopy of such
Mortgage
38
<PAGE>
attached thereto, stating that such original Mortgage has been delivered to
the appropriate public recording official for recordation. The Depositor
shall promptly deliver to the Trustee such original Mortgage with evidence of
recording indicated thereon upon receipt thereof from the public recording
official.
The Depositor shall, at its own expense, promptly record or cause to
be recorded in the appropriate public real property or other records each
Assignment referred to in Section 2.1(ii), unless the Depositor delivers to
the Trustee an Independent opinion of counsel admitted to practice law in the
state in which such Mortgaged Property is located to the effect that such
recordation is not necessary to secure the interest in the related Mortgaged
Properties against any other transferee or creditor of the Depositor, in
which case such Assignments shall be delivered to the Trustee for the benefit
of the Certificateholders in recordable form. If the Depositor cannot
deliver the original Assignment concurrently with the execution and delivery
of this Agreement solely because it is in the process of being prepared and
recorded or because of a delay caused by the public recording office where
such original Assignment has been delivered for recordation, the Depositor
shall deliver a blanket Officer's Certificate covering all such Assignments
stating that such original assignment is in the process of being prepared and
recorded or it has been delivered to the appropriate public recording
official for recordation and a photocopy of such Assignment. Any such
original recorded Assignment shall be delivered to the Trustee within 180
days following the execution of this Agreement.
If the Depositor cannot deliver the original title insurance policy
concurrently with the execution and delivery of this Agreement, the Depositor
shall promptly deliver each such original title insurance policy as soon as
such policy becomes available but in no event later than 120 days following
the execution of this Agreement.
All rights arising out of Loans including, without limitation, all
funds received on or in connection with a Loan shall be held by the Depositor
in trust for the benefit of the Certificateholders. The Depositor shall
maintain a complete set of books and records for each Loan which shall be
clearly marked to reflect the ownership of each Loan by the
Certificateholders.
It is the express intent of this Agreement that the conveyance of the
Loans by the Depositor to the Trustee as provided in this Section 2.1 be, and
be construed as, a sale of the Loans by the Depositor to the Trustee and that
the sale of the Certificates to the Certificateholders, if they are sold, be,
and be construed as, a sale of a 100% interest in the Loans and the Trust
Fund to such Certificateholders. It is, further, not the intention of this
Agreement that such conveyance be deemed a pledge of the Loans by the
Depositor to the Trustee to secure a debt or other obligation of the
Depositor. However, in the event that, notwithstanding the intent of this
Agreement, the Loans are held to be property of the Depositor, or if for any
other reason this Agreement is held or deemed to create a security interest
in the Loans, then (a) this Agreement shall also be deemed to be a security
agreement within the meaning of Articles 8 and 9 of the New York Uniform
Commercial Code; (b) the conveyance provided for in this Section 2.1 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 in and to the Loans and all amounts payable to the holders
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of the Loans in accordance with the terms thereof and all proceeds of the
conversion, voluntary or involuntary, of the foregoing into cash,
instruments, securities or other property, including without limitation all
amounts, other than investment earnings, from time to time held or invested
in the Certificate Account, whether in the form of cash, instruments,
securities or other property; (c) the possession by the Trustee or any
Custodian of Mortgage Notes and such other items of property as constitute
instruments, money, negotiable documents or chattel paper shall be deemed to
be "in possession by the secured party" for purposes of perfecting the
security interest pursuant to Section 9-305 of the New York Uniform
Commercial Code; 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 benefit of the Certificateholders for the
purpose of perfecting such security interest under applicable law (except
that nothing in this clause (d) shall cause any person to be deemed to be an
agent of the Trustee for any purpose other than for perfection of such
security interest unless, and then only to the extent, expressly appointed
and authorized by the Trustee in writing). The Depositor and the Trustee,
upon directions from the Depositor, 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 Loans, 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 this Agreement.
The Trustee is authorized to appoint any bank or trust company
approved by the Depositor as Custodian of the documents or instruments
referred to under (i) through (viii) above, and to enter into a Custodial
Agreement for such purpose and any documents delivered thereunder shall be
delivered to the Custodian and any Officer's Certificates delivered with
respect thereto shall be delivered to the Trustee and the Custodian.
Section 2.2. ACCEPTANCE BY TRUSTEE. The Trustee acknowledges,
subject to the provisions of Section 2.1 and to any document exceptions
reported pursuant to the Trustee's reviews as described below, receipt of the
Mortgage Notes, the Mortgages, the assignments of the Mortgages and the
Officer's Certificates referred to in Section 2.1 above, and declares that it
holds and will hold such documents and the other documents constituting a
part of the Mortgage Files delivered to it as Trustee in trust, upon the
trusts herein set forth, for the use and benefit of all present and future
Certificateholders. The Trustee acknowledges that, as of the date of the
execution of this Agreement, the Mortgage Files have been delivered to the
Trustee and the Trustee has conducted a preliminary review of the Mortgage
Files. The Trustee further acknowledges that such review included a review
of the Mortgage Notes to determine that the appropriate Mortgage Notes have
been delivered and endorsed in the manner set forth in Section 2.1(i). In
connection with such review, the Trustee shall have delivered an exceptions
report indicating any discrepancies relating to such review. In addition,
the Trustee agrees, for the benefit of Certificateholders, to review each
Mortgage File within 45 days, or with respect to assignments which must be
recorded, within 180 days, after execution of this Agreement to ascertain
that all required documents set forth in items (i), (ii), (v), (vi) and, to
the extent delivered to the Trustee, items (iii), (iv), (vii) and (viii) of
Section 2.1 have been executed and received, and that such documents relate
to the Loans identified in Exhibit D annexed hereto, and in so doing the
Trustee may rely on the purported due execution
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and genuineness of any such document and on the purported genuineness of any
signature thereon. The Trustee shall have no duty to verify or determine
whether any Mortgage File should contain documents described in Sections 2.1
(iii), (iv), (vii) and (viii). The Trustee shall be under no duty or
obligation to inspect, review or make any independent examination of any
documents contained in each Mortgage File beyond the review specifically
required herein. The Trustee makes no representations as to (i) the
validity, legality, sufficiency, enforceability or genuineness of any of the
documents contained in each Mortgage File or any of the Loans identified on
the Loan Schedule, or (ii) the collectability, insurability, effectiveness or
suitability of any such Loan. If at the conclusion of such 45-day period or
180-day period the Trustee finds any document constituting a part of a
Mortgage File not to have been executed or received or to be unrelated to the
Loans identified in said Exhibit D (each such finding, a "material defect"),
the Trustee shall promptly notify the Depositor, which shall have a period of
90 days after such notice within which to correct or cure any such material
defect; PROVIDED, HOWEVER, that if the Trustee shall not have received a
document by reason of the fact that such document shall not have been
returned by the appropriate recording office then the Depositor shall have
until a date one year later from the Cut-Off Date to correct or cure such
defect. The Depositor hereby covenants and agrees that, if any such material
defect as defined above is not corrected or cured, the Depositor will, not
later than 90 days in the case of repurchase referred to below or not later
than 75 days in the case of a substitution referred to below after the
Trustee's notice to it respecting such defect either (i) repurchase the
related Loan at a price equal to 100% of the Principal Balance of such Loan
(or any property acquired in respect thereof) plus accrued interest on such
Principal Balance at the applicable Pass-Through Rate to the next scheduled
Due Date of such Loan, less any Nonrecoverable Advances made with respect to
any such Loan or (ii) substitute for any Loan to which such material defect
relates a different mortgage loan (a "Substitute Loan") maturing no later
than and not more than two years earlier than the Loan being substituted for
and having a principal balance equal to or less than and a Mortgage Interest
Rate equal to or greater than the Mortgage Interest Rate of the Loan being
substituted for, a Loan-to-Value Ratio equal to or less than the
Loan-to-Value Ratio of the Loan being substituted for and otherwise having
such characteristics so that the representations and warranties of the
Depositor set forth in Section 2.3 hereof would not have been incorrect had
such Substitute Loan originally been a Loan; PROVIDED, HOWEVER, that if the
Principal Balance of the original Loan exceeds the principal balance of the
Substitute Loan, an amount equal to that difference shall be deposited by the
Depositor in the Certificate Account; PROVIDED, FURTHER, HOWEVER, that no
such substitution may occur after 90 days of the Closing Date unless the
Trustee shall have received from the Depositor an Opinion of Counsel to the
effect that such substitution will not adversely affect the REMIC status of
REMIC I or REMIC II or constitute a prohibited transaction or substitution
under the REMIC provisions of the Code, and, if applicable, within the
meaning of the REMIC Provisions of the particular State, if any, which would
impose a tax on the Trust Fund. Monthly Payments due with respect to
Substitute Loans in the month of substitution are not a part of the Trust
Fund and will be retained by the Servicer. The Depositor shall notify the
Rating Agency of any such substitution. For the month of substitution,
distributions to Certificateholders will include the Monthly Payment due on
the Loan being substituted for in such month. The purchase price for the
repurchased Loan or property shall be deposited by the Depositor in the
Certificate Account and in the case of a Substitute Loan, the Mortgage File
relating thereto shall be delivered to the Trustee or the Custodian. Upon
receipt by the Trustee of written notification of such deposit signed by a
Servicing
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Officer or the new Mortgage File, as the case may be, and an Officer's
Certificate that such repurchase or substitution is in accordance with this
Agreement, the Trustee shall release or cause to be released to the Depositor
the related Mortgage File for the Loan being repurchased or substituted for,
as the case may be, and shall execute and deliver or cause to be executed and
delivered such instrument of transfer or assignment presented to it by the
Depositor, in each case without recourse, as shall be necessary to transfer
to the Depositor the Trustee's interest in such original or repurchased Loan
or property and the Trustee shall have no further responsibility with regard
to such Loan. It is understood and agreed that the obligation of the
Depositor to substitute a new Loan for or repurchase any Loan or property as
to which such a material defect in a constituent document exists shall
constitute the sole remedy respecting such defect available to
Certificateholders or the Trustee on behalf of Certificateholders, but such
obligation shall survive termination of this Agreement. Neither the Trustee
nor the Custodian shall be responsible for determining whether any assignment
or mortgage delivered pursuant to Section 2.1(ii) is in recordable form or,
if recorded, has been properly recorded.
Section 2.3. REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR. The
Depositor hereby represents and warrants to the Trustee:
(i) that the information set forth in the Loan Schedule
appearing as an exhibit to this Agreement is true and correct in all
material respects at the date or dates respecting which such information
is furnished as specified therein;
(ii) that the information relating to the Loans set forth in the
Prospectus, Prospectus Supplement and the Form 8-K filed pursuant to the
Securities Exchange Act of 1934 relating to offering of the Certificates
is true and correct in all material respects at the date or dates
respecting which such information is furnished as specified therein;
(iii) that as of the date of the transfer of the Loans to the
Trustee, the Depositor is the sole owner and holder of each Loan free and
clear of all liens, pledges, charges or security interests of any nature
and has full right and authority, subject to no interest or participation
of, or agreement with, any other party, to sell and assign the same;
(iv) that as of the date of initial issuance of the
Certificates, no payment of principal of or interest on or in respect of
any Loan is 30 days or more past due from the Due Date of such Loan;
(v) that to the best of the Depositor's knowledge, as of the
date of the transfer of the Loans to the Trustee, there is no valid
offset, defense or counterclaim to any Mortgage Note or Mortgage;
(vi) that as of the date of the initial issuance of the
Certificates, there is no proceeding pending, or to the best of the
Depositor's knowledge, threatened for the total or partial condemnation
of any of the Mortgaged Property and the Mortgaged Property is free of
material damage and is in good repair and neither the Mortgaged Property
nor any
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improvement located on or being part of the Mortgaged Property is in
violation of any applicable zoning law or regulation;
(vii) that each Loan complies in all material respects with
applicable state or federal laws, regulations and other requirements,
pertaining to usury, equal credit opportunity and disclosure laws, and
each Loan was not usurious at the time of origination;
(viii) that to the best of the Depositor's knowledge, as of the
date of the initial issuance of the Certificates, all taxes, governmental
assessments and insurance premiums previously due and owing with respect
to the Mortgaged Property have been paid;
(ix) that each Mortgage Note and the related Mortgage are
genuine and each is the legal, valid and binding obligation of the maker
thereof, enforceable in accordance with its terms except as such
enforcement may be limited by bankruptcy, insolvency, reorganization or
other similar laws affecting the enforcement of creditors' rights
generally and by general equity principles (regardless of whether such
enforcement is considered in a proceeding in equity or at law); all
parties to the Mortgage Note and the Mortgage had legal capacity to
execute the Mortgage Note and the Mortgage; and each Mortgage Note and
Mortgage have been duly and properly executed by the Mortgagor;
(x) that each Mortgage is a valid and enforceable first lien on
the property securing the related Mortgage Note, and that each Loan is
covered by an ALTA mortgagee title insurance policy or other form of
policy or insurance generally acceptable to FNMA or FHLMC, issued by, and
is a valid and binding obligation of, a title insurer acceptable to FNMA
or FHLMC insuring the originator, its successor and assigns, as to the
lien of the Mortgage in the original principal amount of the Loan subject
only to (a) the lien of current real property taxes and assessments not
yet due and payable, (b) covenants, conditions and restrictions, rights
of way, easements and other matters of public record as of the date of
recording of such Mortgage acceptable to mortgage lending institutions in
the area in which the Mortgaged Property is located or specifically
referred to in the appraisal performed in connection with the origination
of the related Loan and (c) such other matters to which like properties
are commonly subject which do not individually, or in the aggregate,
materially interfere with the benefits of the security intended to be
provided by the Mortgage;
(xi) that as of the initial issuance of the Certificates,
neither the Depositor nor any prior holder of any Mortgage has, except as
the Mortgage File may reflect, modified the Mortgage in any material
respect; satisfied, cancelled or subordinated such Mortgage in whole or
in part; released such Mortgaged Property in whole or in part from the
lien of the Mortgage; or executed any instrument of release,
cancellation, modification or satisfaction;
(xii) that each Mortgaged Property consists of a fee simple
estate or a leasehold estate or condominium form of ownership in real
property;
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(xiii) the condominium projects that include the condominiums that
are the subject of any condominium loan are generally acceptable to FNMA
or FHLMC;
(xiv) no foreclosure action is threatened or has been commenced
(except for the filing of any notice of default) with respect to the
Loan; and except for payment delinquencies not in excess of 30 days, to
the best of the Depositor's knowledge, there is no default, breach,
violation or event of acceleration existing under the Mortgage or the
related Mortgage Note and no event which, with the passage of time or
with notice and the expiration of any grace or cure period, would
constitute a default, breach, violation or event of acceleration; and the
Depositor has not waived any default, breach, violation or event of
acceleration;
(xv) that each Loan was originated on FNMA or FHLMC uniform
instruments;
(xvi) that based upon a representation by each Mortgagor at the
time of origination or assumption of the applicable Loan, 100% of the
Loans measured by Principal Balance were to be secured by owner-occupied
residences and no more than 0% of the Loans measured by Principal Balance
were to be secured by non-owner-occupied residences;
(xvii) that an appraisal of each Mortgaged Property was conducted
at the time of origination of the related Loan, and that each such
appraisal was conducted in accordance with FNMA or FHLMC criteria, on
FNMA or FHLMC forms and comparables on at least three properties were
obtained;
(xviii) that no Loan had a Loan-to-Value Ratio at
origination in excess of 95%;
(xix) the Loans were not selected in a manner to adversely affect
the interests of the Certificateholders and the Depositor knows of no
conditions which reasonably would cause it to expect any Loan to become
delinquent or otherwise lose value;
(xx) each Loan was either (A) originated directly by or closed
in the name of either: (i) a savings and loan association, savings bank,
commercial bank, credit union, insurance company, or similar institution
which is supervised and examined by a federal or state authority or
(ii) a mortgagee approved by the Secretary of Housing and Urban
Development pursuant to Sections 203 and 211 of the National Housing Act
or (B) originated or underwritten by an entity employing underwriting
standards consistent with the underwriting standards of an institution as
described in subclause (A)(i) or (A)(ii) above; and
(xxi) each Loan is a "qualified mortgage" within the meaning of
Section 860G of the Code without regard to Section 1.860G-2(f) of the
REMIC Provisions or any similar rule.
It is understood and agreed that the representations and warranties set
forth in this Section 2.3 shall survive delivery of the respective Mortgage
Files to the Trustee, or to a Custodian,
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as the case may be. Upon discovery by the Depositor, Servicer, the Trustee
or any Custodian of a breach of any of the foregoing representations and
warranties (referred to herein as a "breach"), without regard to any
limitation set forth in such representation or warranty concerning the
knowledge of the Depositor as to the facts stated therein, which breach
materially and adversely affects the interests of the Certificateholders in
the related Loan, the party discovering such breach shall give prompt written
notice to the others and to the Rating Agency.
Within 90 days of its discovery or its receipt or any Seller's receipt of
notice of breach, the Depositor shall or shall cause such Seller to cure such
breach in all material respects or shall repurchase the Loan or any property
acquired in respect thereof from the Trustee at a repurchase price equal to 100%
of the Principal Balance of such Loan plus accrued interest on such Principal
Balance at the Mortgage Interest Rate to the next scheduled Installment Due Date
of such Loan or remove such Loan from the Trust Fund and substitute in its place
a Substitute Loan or Loans with the characteristics set forth in Section 2.2
above for Substitute Loans; PROVIDED, HOWEVER, that if such breach would cause
the Loan to be other than a "qualified mortgage" as defined in Section
860G(a)(3) of the Code, any such cure, repurchase or substitution must occur
within 90 days from the date such breach was discovered; PROVIDED, FURTHER, that
no substitution (or cure which would constitute a loan modification for federal
income tax purposes) may be effected any later than two years after the Closing
Date; PROVIDED, FURTHER, that as a pre-condition to any substitution (or cure
which would constitute a loan modification for federal income tax purposes) to
be effected later than 90 days after the Closing Date (and within two years of
the Closing Date), the Trustee shall receive from the Depositor an Opinion of
Counsel to the effect that such substitution (or cure which would constitute a
loan modification for federal income tax purposes) will not adversely affect the
REMIC status of REMIC I or REMIC II or constitute a prohibited transaction under
the REMIC Provisions of the Code and, if applicable, the REMIC provisions of the
relevant State. Except as expressly set forth herein, neither the Trustee nor
the Servicer is under any obligation to discover any breach of the above
mentioned representations and warranties. It is understood and agreed that the
obligation of the Depositor or the Seller to repurchase or substitute any Loan
or property as to which a breach has occurred and is continuing shall constitute
the sole remedy respecting such breach available to Certificateholders or the
Trustee on behalf of Certificateholders, and such obligation shall survive as
the obligation of ABN AMRO Mortgage Corporation, the Seller or their respective
successors.
Section 2.4. AUTHENTICATION AND DELIVERY OF CERTIFICATES; DESIGNATION OF
CERTIFICATES AS REMIC REGULAR AND RESIDUAL INTERESTS.
(a) The Trustee acknowledges the transfer to the extent
provided herein and assignment to it of the Trust Fund and, concurrently
with such transfer and assignment, has caused to be authenticated and
delivered to or upon the order of the Depositor, in exchange for the
Trust Fund, Certificates evidencing the entire ownership of the Trust
Fund.
(b) This Agreement shall be construed so as to carry out the
intention of the parties that each of REMIC I and REMIC II be treated as
a REMIC at all times prior to the date on which the Trust Fund is
terminated. The "regular interests" (within the meaning of Section
860G(a)(1) of the Code) in REMIC II shall consist of the Class A
Certificates and
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the Subordinate Certificates. The "residual interest" (within the
meaning of Section 860(G)(a)(2) of the Code) in REMIC II shall consist
of Component R-2 of the Class R Certificate. The "regular interests"
(within the meaning of Section 860(G)(a)(1) of the Code) of REMIC I
shall consist of the PAC Regular Interests, the Class A-6 Regular
Interest, the Class A-7 Regular Interest, the Class A-8 Regular
Interest, the Class A-9 Regular Interest, the Class A-10 Regular
Interest, the Class A-11 Regular Interest, the Class A-12 Regular
Interest, the Class A-13 Regular Interest, the Class A-14 Regular
Interest, the Class A-15 Regular Interest, the Class A-16 Regular
Interest, the Class A-X Regular Interest, the Class A-P Regular
Interest, the Class M Regular Interest, the Class B-1 Regular
Interest, the Class B-2 Regular Interest, the Class B-3 Regular
Interest, the Class B-4 Regular Interest and the Class B-5 Regular
Interest. (The PAC Regular Interests shall consist of four REMIC I
regular interests, each of which shall correspond as to principal
amount to one of the Class A-1, Class A-2, Class A-3 and Class A-4
Certificates.) The "residual interest" (within the meaning of Section
860(G)(a)(2) of the Code) of REMIC I shall consist of Component R-1 of
the Class R Certificate.
(c) All payments with respect to each of the Class A-6, A-7,
A-8, A-9, A-10, A-11, A-12, A-13, A-14, A-15, A-16, A-X, M, B-1, B-2,
B-3, B-4 and B-5 Certificates shall be considered to have been made
solely from the Class of Regular Interests of REMIC I having the same
designation. All principal payments with respect to each of the
Class A-1, A-2, A-3 and A-4 Certificates shall be considered to have
been made solely from the principal payments of the corresponding PAC
Regular Interest of REMIC I. All interest payments with respect to the
Class A-1, A-2, A-3, A-4 and A-5 Certificates shall be considered to have
been made solely from the PAC Regular Interests of REMIC I.
The interest rate of each of the REMIC I Regular Interest Classes,
A-6, A-7, A-8, A-9, A-10, A-11, A-12, A-13, A-14, A-15, A-16, A-X, M,
B-1, B-2, B-3, B-4 and B-5 of REMIC I shall be the same as the Remittance
Rate of the Certificate Class of REMIC II having the same designation.
The PAC Regular Interests shall each have an interest rate of
6.75%.
The principal balance of each of the Regular Interests of REMIC I
(except the PAC Regular Interests) is equal to the principal balance of
the Certificate of REMIC II which has the same designation. The principal
balance of each PAC Regular Interest is equal at all times to the
principal balance of the corresponding Class A-1, A-2, A-3 or A-4
Certificates. The notional principal balance of the Class A-X Regular
Interest is equal to the Notional Amount of the Class of Certificates of
REMIC II (i.e., the Class A-X Certificates) which has the same
designation. The notional principal balance of Class A-5 Certificates
shall for purposes of the REMIC provisions be deemed to be composed of
four component notional principal balances, each of which corresponds to
the principal balance of a PAC Regular Interest.
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Section 2.5. DESIGNATION OF STARTUP DAY. The Closing Date is hereby
designated as the "startup day" of each of REMIC I and REMIC II within the
meaning of Section 860G(a)(9) of the Code.
Section 2.6. NO CONTRIBUTIONS. The Trustee shall not accept or make any
contribution of cash to the Trust Fund after 90 days of the Closing Date, and
shall not accept or make any contribution of other assets to the Trust Fund
unless, in either case, it shall have received an Opinion of Counsel to the
effect that the inclusion of such assets in the Trust Fund will not cause either
REMIC I or REMIC II to fail to qualify as a REMIC at any time that any Class A
or Subordinate Certificates are outstanding or subject the Trust Fund to any tax
on contributions to the REMIC under Section 860G(d) of the Code.
Section 2.7. REPRESENTATIONS AND WARRANTIES OF THE SERVICER. The
Servicer hereby represents, warrants and covenants to the Trustee for the
benefit of Certificateholders that, as of the date of execution of this
Agreement:
(a) the Servicer is a corporation duly formed and validly
existing under the laws of the State of Illinois;
(b) the execution and delivery of this Agreement by the
Servicer and its performance of and compliance with the terms of this
Agreement will not violate the Servicer's corporate charter or by-laws or
constitute a default (or an event which, with notice or lapse of time, or
both, would constitute a default) under, or result in the breach of, any
material contract, agreement or other instrument to which the Servicer is
a party or which may be applicable to the Servicer or any of its assets;
(c) this Agreement, assuming due authorization, execution and
delivery by the Trustee and the Depositor, constitutes a valid, legal and
binding obligation of the Servicer, enforceable against it in accordance
with the terms hereof subject to applicable bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the enforcement of
creditors' rights generally and to general principles of equity,
regardless of whether such enforcement is considered in a proceeding in
equity or at law;
(d) the Servicer is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal,
state, municipal or governmental agency, which default might have
consequences that would materially and adversely affect the condition
(financial or other) or operations of the Servicer or its properties or
might have consequences that would affect its performance hereunder;
(e) no litigation is pending or, to the best of the Servicer's
knowledge, threatened against the Servicer which would prohibit its
entering into this Agreement or performing its obligations under this
Agreement; and
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(f) as long as the Servicer has any obligations to service the
Loans hereunder (and it has not assigned such obligations pursuant to
Section 3.1(c)), it shall be a FNMA or a FHLMC-qualified servicer.
It is understood and agreed that the representations and warranties set
forth in this Section 2.7 shall survive delivery of the respective Mortgage
Files to the Trustee, or to a Custodian, as the case may be.
ARTICLE III
ADMINISTRATION AND SERVICING OF LOANS
Section 3.1. SERVICER TO ACT AS SERVICER; ADMINISTRATION OF THE LOANS.
(a) The Servicer shall service and administer the Loans on
behalf of the Trust Fund solely in the best interests of and for the
benefit of the Certificateholders (as determined by the Servicer in its
reasonable judgment) and the Trustee (as trustee for Certificateholders)
in accordance with the terms of this Agreement and the respective Loans
and, to the extent consistent with such terms, in the same manner in
which, and with the same care, skill, prudence and diligence with which,
it services and administers similar mortgage loans for other portfolios,
giving due consideration to customary and usual standards of practice of
prudent institutional residential mortgage lenders and loan servicers,
and taking into account its other obligations hereunder, but without
regard to:
(i) any relationship that the Servicer, any
sub-servicer, any special servicer or any Affiliate of the
Servicer, any sub-servicer or any special servicer may have with
the related Mortgagor;
(ii) the ownership of any Certificate by the Servicer,
any special servicer or any Affiliate of the Servicer, any
sub-servicer or any special servicer;
(iii) the Servicer's, any sub-servicer's or any special
servicer's right to receive compensation for its services
hereunder or with respect to any particular transaction; or
(iv) the ownership, or servicing or management for
others, by the Servicer, any sub-servicer or any special servicer,
of any other mortgage loans or property.
To the extent consistent with the foregoing and subject to any
express limitations set forth in this Agreement, the Servicer shall seek
to maximize the timely and complete recovery of principal and interest on
the Mortgage Notes; PROVIDED, HOWEVER, that nothing herein contained
shall be construed as an express or implied guarantee by the Servicer of
the collectability of the Loans. Subject only to the above-described
servicing standards and the
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terms of this Agreement and of the respective Loans, the Servicer, as
an independent contractor, shall service and administer the Loans and
shall have full power and authority, acting alone or through one or
more subservicers, special servicers or agents (subject to paragraph
(c) of this Section 3.1), to do any and all things in connection with
such servicing and administration which it may deem necessary or
desirable for the purpose of conserving the assets of the Trust Fund.
Without limiting the generality of the foregoing, the Servicer shall
and is hereby authorized and empowered by the Trustee to continue to
execute and deliver, on behalf of itself, the Certificateholders and
the Trustee or any of them, any and all financing statements,
continuation statements and other documents or instruments necessary
to maintain the lien on each Mortgaged Property and related
collateral; and modifications, waivers, consents or amendments to or
with respect to any documents contained in the related Mortgage File;
and any and all instruments of satisfaction or cancellation, or of
partial or full release or discharge and all other comparable
instruments, with respect to the Loans and with respect to the related
Mortgaged Properties. Notwithstanding the foregoing, the Servicer
(whether acting alone or through one or more subservicers, special
servicers or agents) shall not modify, amend, waive or otherwise
consent to the change of the terms of any of the Loans (including
without limitation extending the stated maturity date of any Loan or
forgiving principal of or interest on any Loan), except as permitted
by Section 3.2 hereof. The Servicer shall service and administer the
Loans in accordance with applicable law and shall provide to the
Mortgagors any reports required to be provided to them thereby. To
enable the Servicer to carry out its servicing and administrative
duties hereunder, upon the Servicer's written request accompanied by
the forms of any documents requested, the Trustee shall execute and
deliver to the Servicer any powers of attorney and other documents
necessary or appropriate and the Trustee shall not be responsible for
releasing such powers of attorney. The Trustee shall not be
responsible for, and the Servicer shall indemnify the Trustee for, any
action taken by the Servicer pursuant to the application of any such
power of attorney. The relationship of the Servicer (and of any
successor thereto) to the Trustee under this Agreement is intended by
the parties to be that of an independent contractor and not that of a
joint venturer, partner or agent.
(b) The Servicer, Trustee and Depositor intend that REMIC I and
REMIC II formed hereunder shall constitute, and that the Servicer shall
perform its duties and obligation hereunder so as to qualify each of them
as, a "real estate mortgage investment conduit" as defined in and in
accordance with the REMIC Provisions. The Tax Matters Person, or the
Person acting as attorney-in-fact and agent therefor, shall: (a) prepare
and file, or cause to be prepared and filed, federal tax returns (as well
as any other federal and state information and other returns) using a
calendar year as the taxable year when and as required by the REMIC
Provisions; (b) make (or cause to be made) an election, on behalf of each
of REMIC I and REMIC II, to be treated as a REMIC on the Federal tax
return and any applicable state or local returns for the first taxable
year, in accordance with the REMIC Provisions; (c) prepare and forward,
or cause to be prepared and forwarded, to the Certificateholders all
information reports (including, without limitation, the information
required in connection with the computation of the present value of
anticipated excess inclusions as required by Section 1.860E-2(a)(5) of
the REMIC Provisions) as and when required
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to be provided to them in accordance with the REMIC Provisions; (d)
conduct the affairs of the Trust Fund at all times that REMIC I
Regular Interests or REMIC II Certificates are outstanding so as to
maintain the status of each of REMIC I and REMIC II as a REMIC under
the REMIC Provisions; and (e) not knowingly or intentionally take any
action or omit to take any action that would cause the termination of
the REMIC status of either REMIC I or REMIC II.
(c) The Servicer may enter into sub-servicing agreements with
third parties with respect to any of its respective obligations
hereunder, PROVIDED, that (1) any such agreement shall be consistent with
the provisions of this Agreement and (2) no sub-servicer retained by the
Servicer shall grant any modification, waiver or amendment to any Loan
without the approval of the Servicer. Any such sub-servicing agreement
may permit the sub-servicer to delegate its duties to agents or
subcontractors so long as the related agreements or arrangements with
such agents or subcontractors are consistent with the provisions of this
Section 3.1(c).
Any sub-servicing agreement entered into by the Servicer with a
Person other than the Depositor shall provide that it may be assumed or
terminated by the Trustee if the Trustee has assumed the duties of the
Servicer, without cost or obligation to the assuming or terminating party
or the Trust Fund, upon the assumption by such party of the obligations
of the Servicer pursuant to Section 7.5.
Any sub-servicing agreement, and any other transactions or
services relating to the Loans involving a sub-servicer, including (if
applicable) the Depositor in its capacity as sub-servicer under a
sub-servicing agreement and not in its capacity as a party to this
Agreement, shall be deemed to be between the Servicer and such
sub-servicer (including the Depositor) alone, and the Trustee and the
Certificateholders shall not be deemed parties thereto and shall have no
claims, rights, obligations, duties or liabilities with respect to the
sub-servicer, except as set forth in Section 3.1(d).
In the event that the Trustee assumes the servicing obligations of
the Servicer, upon request of the Trustee, the Servicer shall at its own
expense deliver to the Trustee all documents and records relating to any
sub-servicing agreement and the Loans then being serviced thereunder and
an accounting of amounts collected and held by it, if any, and will
otherwise use its best efforts to effect the orderly and efficient
transfer of any sub-servicing agreement to the Trustee.
(d) Costs incurred by the Servicer in effectuating the timely
payment of taxes and assessments on the Mortgaged Property securing a
Mortgage Note shall be recoverable by the Servicer pursuant to
Section 3.3. The Servicer shall ensure all such taxes and assessments
are timely paid.
The Servicer, as initial servicer, shall pay all of its costs and
proven damages incurred with respect to or arising out of any allegation
of impropriety in its servicing of the
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Loans. Further, the Servicer shall not be entitled to reimbursement or
indemnification from either the Trust Fund or the Certificateholders
with respect to any such costs, claims and damages.
(e) Notwithstanding any sub-servicing agreement, any of the
provisions of this Agreement relating to agreements or arrangements
between the Servicer and any Person (including the Depositor) acting as
sub-servicer (or its agents or subcontractors) or any reference to
actions taken through any Person (including the Depositor) acting as
sub-servicer or otherwise, the Servicer shall remain obligated and
primarily liable to the Trustee and Certificateholders for the servicing
and administering of the Loans in accordance with the provisions of this
Agreement without diminution of such obligation or liability by virtue of
such sub-servicing agreements or arrangements or by virtue of
indemnification from the Depositor or any other Person acting as
sub-servicer (or its agents or subcontractors) to the same extent and
under the same terms and conditions as if the Servicer alone were
servicing and administering the Loans. The Servicer shall be entitled to
enter into an agreement with any sub-servicer providing for
indemnification of the Servicer by such sub-servicer (including the
Depositor), and nothing contained in this Agreement shall be deemed to
limit or modify such indemnification, but no such agreement for
indemnification shall be deemed to limit or modify this Agreement.
Section 3.2. COLLECTION OF CERTAIN LOAN PAYMENTS; CERTIFICATE ACCOUNT.
(a) The Servicer shall make reasonable efforts to collect all
payments called for under the terms and provisions of the Loans, and
shall, to the extent such procedures shall be consistent with this
Agreement, follow such collection procedures as it follows with respect
to conventional mortgage loans it services for itself and any of its
Affiliates; PROVIDED, HOWEVER, that the Servicer agrees not to permit any
modification with respect to any Loan that would change the manner in
which the Mortgage Interest Rate is computed, forgive any principal or
interest or change the term of such Loan. Consistent with the foregoing,
the Servicer may in its discretion (i) waive any assumption fee, late
payment charge or other charge in connection with a Loan, and
(ii) arrange a schedule, running for no more than 180 days after the
scheduled Due Date, for payment of any installment on any Mortgage Note
or after the due date of any other payment due under the related Mortgage
Note for the liquidation of delinquent items, PROVIDED, that the Servicer
shall continue to be obligated to make Advances in accordance with
Section 4.3 during the continuance of such period. With respect to any
Loans which provide for the right of the holder thereof to call for early
repayment thereof at times specified therein, neither the Trustee nor the
Servicer shall exercise any such right, except that the Trustee shall
exercise such right at the written direction of the Servicer set forth in
an Officer's Certificate in connection with a default under the related
Note. Notwithstanding anything herein to the contrary, neither the
Servicer nor any other party may take any action that would cause a
"significant modification" of any Loan within the meaning of the REMIC
Provisions that would cause REMIC I or REMIC II to fail to qualify as a
REMIC at any time or cause a tax to be imposed on the Trust Fund under
the REMIC Provisions.
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(b) The Servicer shall establish and maintain a separate
account as set forth in Article I (the "Custodial Account for P&I"), and
shall on the Closing Date credit any amounts representing scheduled
payments of principal and interest due after the Cut-off Date but
received by the Servicer on or before the Closing Date, and thereafter on
a daily basis the following payments and collections received or made by
it (other than in respect of principal of and interest on the Loans due
on or before the Cut-off Date):
(i) All Mortgagor payments on account of principal,
including Principal Prepayments on the Loans;
(ii) All Mortgagor payments on account of interest on the
Loans, which may be net of that portion thereof which the Servicer
is entitled to retain as Servicing Fees (adjusted for any amounts
related to Compensating Interest) pursuant to Section 3.9, as
adjusted pursuant to Section 4.6;
(iii) All net Liquidation Proceeds;
(iv) All Insurance Proceeds received by the Servicer,
other than proceeds to be applied to the restoration or repair of
the property subject to the related Mortgage or released to the
Mortgagor in accordance with the Servicer's normal servicing
procedures, and all amounts deposited by the Servicer with respect
to the failure to maintain flood or fire and hazard insurance
policies, pursuant to Section 3.5;
(v) All Advances made by the Servicer pursuant to
Section 4.3;
(vi) All repurchase proceeds from the repurchase of a
Loan pursuant to a Purchase Obligation;
(vii) any amounts required to be deposited pursuant to
Section 3.2(c) in connection with net losses realized on Eligible
Investments with respect to funds held in the Custodial Account
for P&I;
(viii) all income and gain realized from any investment of
the funds in the Custodial Account for P&I in Eligible
Investments;
(ix) all net income from the renting of REO Property
pursuant to Section 3.7(c); and
(x) All other amounts required to be deposited in the
Custodial Account for P&I pursuant to this Agreement.
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(c) The Servicer may invest the funds in the Custodial Account
for P&I in Eligible Investments which shall mature not later than the
second Business Day preceding the next Distribution Date unless the
Custodial Account for P&I is maintained with the Trustee in which case
they may mature one Business Day prior to the Distribution Date. The
Eligible Investments may not be sold or disposed of prior to their
maturity. All such Eligible Investments shall be made in the name of the
Servicer (in its capacity as such) or its nominee. All income and gain
realized from any such investment shall be for the benefit of the
Servicer, and shall be payable to the Servicer. The amount of any losses
incurred in respect of any such investments shall be deposited in the
Custodial Account for P&I by the Servicer, out of its own funds
immediately as realized without right to reimbursement therefor.
(d) The foregoing requirements for deposit in the Custodial
Account for P&I shall be exclusive, it being understood and agreed that,
without limiting the generality of the foregoing, payments in the nature
of those described in the last paragraph of this Section 3.2 and payments
in the nature of late payment charges or assumption fees need not be
deposited by the Servicer in the Custodial Account for P&I. All funds
deposited by the Servicer in the Custodial Account for P&I shall be held
by it in trust in the Custodial Account for P&I until disbursed in
accordance with Section 4.1 or withdrawn in accordance with Section 3.3;
PROVIDED, HOWEVER, that the Servicer shall withdraw such funds and
deposit them in such manner as to not result in a downgrading or
withdrawal of the rating then assigned to the Certificates by the Rating
Agency. If the Servicer deposits in the Custodial Account for P&I any
amount not required to be deposited therein, it may at any time withdraw
such amount from the Custodial Account for P&I pursuant to Section 3.3(i)
of this Agreement.
Certain of the Loans may provide for payment by the Mortgagor of amounts
to be used for payment of taxes, assessments, hazard or other insurance premiums
or comparable items for the account of the Mortgagor. The Servicer may deal
with these amounts in accordance with its normal servicing procedures.
Section 3.3. PERMITTED WITHDRAWALS FROM THE CUSTODIAL ACCOUNT FOR P&I.
The Servicer may, from time to time, make withdrawals from the Custodial Account
for P&I for the following purposes:
(a) to reimburse itself for Advances made by it pursuant to
Section 3.4 or 4.3, the Servicer's right to reimburse itself pursuant to
this subclause (a) being limited to amounts received on or in respect of
particular Loans (including, for this purpose, Liquidation Proceeds and
Insurance Proceeds which represent late recoveries of payments of
principal and/or interest respecting which any such Advance was made and
any net income received from the renting of REO Property pursuant to
Section 3.7(c)) or to reimburse itself for Advances from funds in the
Custodial Account for P&I held for future distribution or withdrawal,
such funds to be replaced by the Servicer to the extent that funds in the
Custodial Account for P&I on a future Withdrawal Date are less than the
payment required to be made to the Certificate Account therefrom as of
such future Distribution Date;
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(b) (i) to reimburse itself from Liquidation Proceeds for
Liquidation Expenses, (ii) for amounts expended by it pursuant to
Section 3.7 in good faith in connection with the restoration of damaged
property and (iii) to the extent that Liquidation Proceeds after such
reimbursement are in excess of the Principal Balance of the related Loan
together with accrued and unpaid interest thereon at the applicable
Pass-Through Rate to the date of such liquidation, net of any related
Advances which were unreimbursed prior to the receipt of such Liquidation
Proceeds, to pay to itself any unpaid Servicing Fees, and any assumption
fees, late payment charges or other Mortgage charges on the related Loan;
(c) to pay to itself from any Mortgagor payment as to interest
or other recovery with respect to a particular Loan, to the extent
permitted by this Agreement, that portion of any payment as to interest
in excess of interest at the applicable Pass-Through Rate which the
Servicer is entitled to retain as Servicing Fees pursuant to Section 3.9
or otherwise;
(d) to reimburse itself for expenses incurred by and
recoverable by or reimbursable to it pursuant to Section 3.1 or 3.5 after
the related Mortgagor has reimbursed the Trust Fund for such expenses or
following liquidation of the related Loan, or pursuant to Section 6.3;
(e) to pay to itself with respect to each Loan or property
acquired in respect thereof that has been repurchased pursuant to
Section 2.2 or 2.3 or purchased by the Class R Certificateholder pursuant
to Section 9.1 all amounts received thereon and not distributed as of the
date on which the related Principal Balance is determined;
(f) to reimburse itself for any Nonrecoverable Advances;
(g) to disburse to the Trustee in order that the Trustee may
make payments to Certificateholders in the amounts and in the manner
provided for in Section 4.1;
(h) to pay itself any net interest or other income earned and
received on or investment income received with respect to funds in the
Custodial Account for P&I; and
(i) to make payments to itself or others pursuant to any
provision of this Agreement and to remove any amounts not required to be
deposited therein and to clear and terminate the Custodial Account for
P&I pursuant to Section 9.1.
Since in connection with withdrawals pursuant to subclauses (a), (b),
(c) and (e) the Servicer's entitlement thereto is limited to collections or
other recoveries on the related Loan, the Servicer shall keep and maintain a
separate accounting for each Loan for the purpose of justifying any
withdrawal from the Custodial Account for P&I pursuant to such subclauses.
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The Servicer shall make the withdrawal referred to in subclause (g)
above and shall deposit the amount so withdrawn into the Certificate Account
prior to 4:00 P.M. New York City time on each related Withdrawal Date.
Section 3.4. TAXES, ASSESSMENTS AND SIMILAR ITEMS. With respect to each
Loan, the Servicer shall maintain accurate records with respect to each related
Mortgaged Property reflecting the status of taxes, assessments and other similar
items that are or may become a lien on the related Mortgaged Property and the
status of insurance premiums payable with respect thereto. The Servicer shall
require that payments for taxes, assessments, insurance premiums and other
similar items be made by the Mortgagor at the time they first become due. If a
Mortgagor fails to make any such payment on a timely basis, the Servicer shall
advance the amount of any shortfall unless the Servicer determines in its good
faith judgment that such advance would not be ultimately recoverable from future
payments and collections on the related Loan (including without limitation
Insurance Proceeds and Liquidation Proceeds), or otherwise. The Servicer shall
be entitled to reimbursement of advances it makes pursuant to the preceding
sentence, together with interest thereon at the Prime Rate, from amounts
received on or in respect of the related Loan respecting which such advance was
made or if such advance has become nonrecoverable, in either case to the extent
permitted by Section 3.3 of this Agreement. No costs incurred by the Servicer
in effecting the payment of taxes and assessments on the Mortgaged Properties
shall, for the purpose of calculating distributions to Certificateholders, be
added to the amount owing under the related Loans, notwithstanding that the
terms of such Loans so permit.
Section 3.5. MAINTENANCE OF INSURANCE. The Servicer shall also cause to
be maintained for each Loan fire and hazard insurance with extended coverage as
is customary in the area where the Mortgaged Property is located in an amount
which is at least equal to the lesser of (i) the Principal Balance of such Loan
or (ii) the replacement value costs of improvements securing such Loan. The
Servicer shall cause to be maintained fire and hazard insurance with extended
coverage on each REO Property in an amount which is at least equal to the
greater of (i) an amount not less than is necessary to avoid the application of
any co-insurance clause contained in the related fire and hazard insurance
policy or (ii) the replacement cost of the improvements which are a part of such
property. The Servicer shall also cause to be maintained for each Loan with a
Loan-to-Value Ratio greater than 80% a primary mortgage insurance policy which
will cover at least 75% of the original fair market value of the related
Mortgaged Property until such time as the principal balance of such Loan is
reduced to 80% of the current fair market value or otherwise in accordance with
applicable law. The Servicer on behalf of the Trustee as Mortgagee shall
maintain or cause the related Mortgagor to maintain for each Loan such other
insurance on the related Mortgaged Property as may be required by the terms of
the related Mortgage Note. If the Mortgaged Property is in an area identified
in the Federal Register by the Flood Emergency Management Agency as having
special flood hazards the Servicer will cause to be maintained a flood insurance
policy meeting the requirements of the current guidelines of the Federal
Insurance Administration with a generally acceptable insurance carrier, in an
amount representing coverage not less than the least of (i) the full insurable
value, (ii) the maximum amount of insurance which is available under the Flood
Disaster Protection Act of 1973, and (iii) the Principal Balance of the related
Loan. The Servicer shall also maintain fire and hazard insurance with extended
coverage and, if applicable, flood insurance on
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property acquired upon foreclosure, or by deed in lieu of foreclosure, of any
Loan in an amount that is at least equal to the lesser of (i) the maximum
insurable value of the improvements which are a part of such property and
(ii) the principal balance owing on such Loan at the time of such foreclosure
or grant of deed in lieu of foreclosure plus accrued interest and related
Liquidation Expenses. If an REO Property was located at the time of
origination of the related Loan in a federally designated special flood
hazard area, the Servicer will obtain flood insurance in respect thereof
providing substantially the same coverage as described in the preceding
sentence. If at any time during the term of this Agreement a recovery under
a flood or fire and hazard insurance policy in respect of an REO Property is
not available but would have been available if such insurance were maintained
thereon in accordance with the standards applied to Mortgaged Properties
described herein, the Servicer shall either (i) immediately deposit into the
Custodial Account for P&I from its own funds the amount that would have been
recovered or (ii) apply to the restoration and repair of the property from
its own funds the amount that would have been recovered, if such application
would be consistent with the servicing standard set forth in Section 3.1. It
is understood and agreed that such insurance shall be with insurers approved
by the Servicer and that no earthquake or other additional insurance is to be
required of any Mortgagor, other than pursuant to such applicable laws and
regulations or policies of the Servicer as shall at any time be in force and
as shall require such additional insurance. Pursuant to Section 3.2, any
amounts collected by the Servicer under any insurance policies maintained
pursuant to this Section 3.5 (other than amounts to be applied to the
restoration or repair of the property subject to the related Mortgage or
released to the Mortgagor in accordance with the Servicer's normal servicing
procedures) shall be deposited into the Custodial Account for P&I, subject to
withdrawal pursuant to Section 3.3. Any cost incurred by the Servicer in
maintaining any such insurance shall be recoverable by the Servicer pursuant
to Section 3.3. In the event that the Servicer shall obtain and maintain a
blanket policy issued by an insurer that qualifies under the guidelines set
forth for the Servicer by FNMA or FHLMC, insuring against hazard losses on
all of the Loans, then, to the extent such policy provides coverage in an
amount equal to the unpaid principal balance on the Loans without
co-insurance and otherwise complies with all other requirements set forth in
the first paragraph of this Section 3.5, it shall conclusively be deemed to
have satisfied its obligation as set forth in such first paragraph, it being
understood and agreed that such policy may contain a deductible clause, in
which case the Servicer shall, in the event that there shall not have been
maintained on the related mortgaged or acquired property an insurance policy
complying with the first paragraph of this Section 3.5 and there shall have
been a loss which would have been covered by such a policy had it been
maintained, be required to deposit from its own funds into the Custodial
Account for P&I or apply to the restoration of the property the amount not
otherwise payable under the blanket policy because of such deductible clause.
The Servicer shall obtain and maintain at its own expense throughout
the term of this Agreement a blanket fidelity bond and an errors and
omissions insurance policy with broad coverage with responsible companies
covering the Servicer's officers and employees and other persons acting on
behalf of the Servicer in connection with its activities under this
Agreement. Any such fidelity bond and errors and omissions insurance shall
provide an amount of coverage and will maintain such coverage at a level
which will permit the Servicer to continue to be a FNMA or a FHLMC-qualified
Servicer and shall protect and insure the Servicer against losses, including
forgery, theft, embezzlement, fraud, errors and omissions and negligent acts
of such persons. No provision of this
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Section 3.5 requiring such fidelity bond and errors and omissions insurance
shall diminish or relieve the Servicer from its duties and obligations as set
forth in this Agreement.
Section 3.6. ENFORCEMENT OF DUE-ON-SALE CLAUSES; ASSUMPTION AND
SUBSTITUTION AGREEMENTS. In any case in which property subject to a Mortgage is
conveyed by the Mortgagor, the Servicer reserves the right to enforce any
due-on-sale clause contained in the related Mortgage Note or Mortgage, to the
extent permitted under applicable law and governmental regulations, but only to
the extent that such enforcement will not adversely affect or jeopardize
coverage under any related insurance policy or result in legal action by the
Mortgagor. Subject to the foregoing, the Servicer is authorized to take or
enter into an assumption or substitution agreement from or with the Person to
whom such property has been or is about to be conveyed. The Servicer is also
authorized to release the original Mortgagor from liability upon the Loan and
substitute the new Mortgagor as obligor thereon. In connection with such
assumption or substitution, the Servicer shall apply such underwriting standards
and follow such practices and procedures as shall be normal and usual and as it
applies to mortgage loans owned solely by it or any of its Affiliates. The
Servicer shall notify the Trustee that any such assumption or substitution
agreement has been completed by forwarding to the Trustee the original copy of
such assumption or substitution agreement, which copy shall be added by the
Trustee to the related Mortgage File and shall, for all purposes, be considered
a part of such Mortgage File to the same extent as all other documents and
instruments constituting a part thereof. In connection with any such assumption
or substitution agreement, the interest rate of the related Mortgage Note shall
not be changed. Any fee collected by the Servicer for entering into an
assumption or substitution of liability agreement will be retained by the
Servicer as servicing compensation.
Notwithstanding the foregoing paragraph or any other provision of this
Agreement, the Servicer shall not be deemed to be in default, breach or any
other violation of its obligations hereunder by reason of any conveyance by the
Mortgagor of the Mortgaged Property or any assumption of a Loan by operation of
law which the Servicer in good faith determines it may be restricted by law from
preventing, for any reason whatsoever.
Section 3.7. REALIZATION UPON DEFAULTED LOANS.
(a) Consistent with the servicing standard set forth in Section
3.1 and with a view to the best economic interest of the Trust Fund, the
Servicer shall foreclose upon or otherwise comparably convert (which may
include acquisition of an REO Property) the Mortgaged Properties securing
such of the Loans as come into and continue in default and as to which no
satisfactory arrangements can be made for collection of delinquent
payments pursuant to Section 3.2. In connection with such foreclosure or
other conversion, the Servicer shall follow such practices and procedures
as it shall deem necessary or advisable and as shall be normal and usual
in its general mortgage servicing activities. The foregoing is subject
to the proviso that the Servicer shall not be required to expend its own
funds in connection with any foreclosure or to restore any damaged
property unless it shall determine (i) that such foreclosure and/or
restoration will increase the Liquidation Proceeds to Certificateholders
after reimbursement to itself for such expenses and (ii) that such
expenses
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will be recoverable to it through Liquidation Proceeds (respecting
which it shall have priority for purposes of withdrawal from the
Custodial Account for P&I pursuant to Section 3.3). Any gain on
foreclosure or other conversion of a Liquidated Loan shall be
distributed to the Class R Certificateholder. The Servicer shall be
responsible for all other costs and expenses incurred by it in any
such proceedings; PROVIDED, HOWEVER, that it shall be entitled to
reimbursement thereof (as well as any Servicing Fees and other amounts
due it, if any), to the extent, but only to the extent, that
withdrawals from the Custodial Account for P&I with respect thereto
are permitted under Section 3.3. Within 30 days after receipt of
Liquidation Proceeds in respect of a Liquidated Loan, the Servicer
shall provide to the Trustee a statement of accounting for the related
Liquidated Loan, including without limitation (i) the Loan number,
(ii) the date the Loan was acquired in foreclosure or deed in lieu,
and the date the Loan became a Liquidated Loan, (iii) the gross sales
price and the related selling and other expenses, (iv) accrued
interest calculated from the foreclosure date to the liquidation date,
and (v) such other information as the Trustee may reasonably specify.
(b) Prior to any such foreclosure, the Servicer may, at its
option, repurchase any Loan which is 90 days or more delinquent and which
the Servicer determines in good faith would otherwise become subject to
foreclosure proceedings or any Loan as to which the Mortgagor tenders a
deed in lieu of foreclosure at a price equal to the outstanding Principal
Balance of the Loan plus accrued interest at the applicable Pass-Through
Rate to the next Due Date. Any such repurchase shall be deemed a
Principal Prepayment for purposes of this Agreement and all amounts in
respect thereof shall be deposited into the Custodial Account for P&I
pursuant to Section 3.2(b).
(c) The Trust Fund shall not acquire any real property (or
personal property incident to such real property) except in connection
with a default or imminent default of a Loan. Based on a report prepared
by an Independent Person who regularly conducts environmental audits that
the Mortgaged Property for which foreclosure proceedings are contemplated
is in compliance with applicable environmental laws, and there are no
circumstances present at such Mortgaged Property relating to the use,
management or disposal of any hazardous materials, wastes, or petroleum
based materials for which investigation, testing, monitoring,
containment, clean-up or remediation could be required under any federal,
state or local law or that it would be in the best economic interest of
the Trust Fund to acquire title to such Mortgaged Property and further to
take such actions as would be necessary and appropriate to effect such
compliance and/or respond to such circumstances, the Servicer will not
conduct such foreclosure proceedings. If the Servicer otherwise becomes
aware, under its customary servicing procedures, of an environmental
hazard with respect to a Loan for which foreclosure proceedings are
contemplated, the Servicer will not conduct such foreclosure proceedings
unless it determines in good faith that the liability associated with the
environmental hazard will be less than the Liquidation Proceeds to be
realized from the sale of the related Mortgaged Property. In the event
that the Trust Fund acquires any real property (or personal property
incident to such real property) in connection with a default or imminent
default of a Loan, such REO Property shall be disposed of by the Trust
Fund within three years after its acquisition by the Trust
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Fund unless the Trustee shall have received from the Servicer an
Opinion of Counsel to the effect that the holding by the Trust Fund of
such REO Property subsequent to three years after its acquisition will
not cause either REMIC I or REMIC II to fail to qualify as a REMIC
under the REMIC Provisions at any time that any REMIC I Regular
Interests or Certificates are outstanding, in which case such REO
Property shall be disposed of as soon as possible by the Trust Fund
but in no event shall be held longer than the maximum period of time
during which the Trust Fund is then permitted to hold such REO
Property and allow REMIC I and REMIC II to remain qualified as REMICs
under the REMIC Provisions. The Servicer shall manage, conserve,
protect and operate each such REO Property for the Certificateholders
solely for the purpose of its prompt disposition and sale in a manner
which does not cause such REO Property to fail to qualify as
"foreclosure property" within the meaning of Section 860G(a)(8) of the
Code. Pursuant to its efforts to sell such REO Property, the Servicer
shall either itself or through an agent selected by the Servicer
protect and conserve such REO Property in the same manner and to such
extent as is customary in the locality where such property is located
and may, incident to its conservation and protection of the interests
of the Certificateholders, rent the same, or any part thereof, as the
Servicer deems to be in the best interest of the Servicer and the
Certificateholders for the period prior to the sale of such REO
Property. All proceeds from the renting of such REO Property shall,
net of any costs or expenses of the Servicer in connection therewith,
be deposited into the Custodial Account for P&I pursuant to Section
3.3(b)(ix).
(d) In the event that title to any Mortgaged Property is
acquired in foreclosure or by deed in lieu of foreclosure, the deed or
certificate of sale shall be issued to the Trustee, or to its nominee on
behalf of Certificateholders. Notwithstanding any such acquisition of
title and cancellation of the related Loan, such Loan shall (except for
purposes of Section 9.1) be considered to be a Loan held in the Trust
Fund until such time as the related REO Property shall be sold by the
Trust Fund and shall be reduced only by collections net of expenses.
Consistent with the foregoing, for purposes of all calculations
hereunder, so long as such Loan shall be considered to be an outstanding
Loan, it shall be assumed that, notwithstanding that the indebtedness
evidenced by the related Mortgage Note shall have been discharged, such
Mortgage Note and, for purposes of determining the Scheduled Principal
Balance thereof, the related amortization schedule in effect at the time
of any such acquisition of title remain in effect.
(e) The Servicer shall not acquire for the benefit of the Trust
Fund any personal property pursuant to this Section 3.7 unless either:
(i) such personal property is incident to real property
(within the meaning of Section 856(e)(1) of the Code) so acquired
by the Servicer for the benefit of the Trust Fund; or
(ii) the Servicer shall have requested and received an
Opinion of Counsel (which opinion shall be an expense of the Trust
Fund) to the effect that the holding of such personal property by
the Trust Fund will not cause the imposition of a tax on
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the Trust Fund under the REMIC Provisions or cause either REMIC
I or REMIC II of the Trust Fund to fail to qualify as a REMIC
at any time that any Certificate is outstanding.
Section 3.8. TRUSTEE TO COOPERATE; RELEASE OF MORTGAGE FILES. Upon the
payment in full of any Loan, or the receipt by the Servicer of a notification
that the payment in full will be escrowed in a manner customary for such
purposes, the Servicer will immediately notify the Trustee by an Officer's
Certificate (which Officer's Certificate shall include a statement to the effect
that all amounts received in connection with such payment which are required to
be deposited in the Custodial Account for P&I pursuant to Section 3.2 have been
or will be so deposited) and shall by such Officer's Certificate request
delivery to it of the Mortgage File. Upon receipt of such Officer's Certificate
and request, the Trustee shall promptly release or cause to be released the
related Mortgage File to the Servicer. From time to time and as appropriate for
the servicing or foreclosure of any Loan, the Trustee shall, upon written
request of the Servicer and delivery to the Trustee of a trust receipt signed by
a Servicing Officer, release or cause to be released the related Mortgage File
to the Servicer and shall execute such documents furnished to it as shall be
necessary to the prosecution of any such proceedings. Such trust receipt shall
obligate the Servicer to return each and every document previously requested
from the Mortgage File to the Trustee when the need therefor by the Servicer no
longer exists unless the Loan shall be liquidated, in which case, upon receipt
of a certificate of a Servicing Officer similar to that hereinabove specified,
the trust receipt shall be released by the Trustee to the Servicer by delivery
to a Servicing Officer and the Trustee shall have no further responsibility with
respect to such Mortgage Files.
Section 3.9. SERVICING COMPENSATION. The Servicer shall be entitled to
retain or, if not retained, to withdraw from the Certificate Account as
servicing compensation its Servicing Fee out of each payment on account of
interest on each Loan, subject to adjustment as provided in Section 4.6. The
Servicer shall also be entitled to payment of unpaid Servicing Fees with respect
to a delinquent Loan out of Liquidation Proceeds with respect to such Loan, to
the extent permitted by Section 3.3(b). Servicing compensation in the form of
assumption fees, late payment charges or otherwise shall be retained by the
Servicer and need not be deposited in the Custodial Account for P&I. The
Servicer shall also be entitled to additional servicing compensation out of
Liquidation Proceeds to the extent provided in Section 3.3(b). The Servicer
shall be required to pay all expenses incurred by it in connection with its
servicing activities hereunder (including maintenance of the blanket hazard
insurance policy and the blanket fidelity bond and errors and omissions policy
required by Section 3.5) and shall not be entitled to reimbursement therefor
except as specifically provided in Sections 3.1, 3.3, 3.5 and 3.7.
On each Distribution Date, the Servicer shall pay to the Certificate
Administrator and the Trustee the Certificate Administration and Trustee Fee out
of the Servicing Fee retained by the Servicer on such Distribution Date. Such
amounts shall be compensation for the activities of the Certificate
Administrator and the Trustee hereunder. The Certificate Administrator and the
Trustee shall be required to pay all expenses incurred by it in connection with
its activities hereunder and shall not be entitled to reimbursement therefor,
except as specifically provided herein.
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Section 3.10. REPORTS TO THE TRUSTEE; CUSTODIAL ACCOUNT FOR P&I
STATEMENTS. On or before each Determination Date, the Servicer shall deliver
or cause to be delivered to the Trustee or its designee a statement in
electronic or written form as may be agreed upon by the Servicer and the
Trustee containing the information described in Section 4.2 and such other
information as may be necessary for the Trustee to compute the amounts to be
distributed to the Certificateholders by the Trustee (the "Servicer's Section
3.10 Report"). Not later than 25 days after each Distribution Date, the
Servicer shall forward or cause to be forwarded to the Trustee a statement,
certified by a Servicing Officer, setting forth the status of the Custodial
Account for P&I as of the close of business on the related Distribution Date,
stating that all distributions from the Custodial Account for P&I required to
be made by this Agreement have been made for the period covered by such
statement (or if any required distribution has not been made, specifying the
nature and status thereof) and showing, for the period covered by such
statement, the aggregate of deposits into and withdrawals from the Custodial
Account for P&I for each category of deposit specified in Section 3.2 and
each category of withdrawal specified in Section 3.3. Such statement shall
also include information as to the aggregate Principal Balance of all of the
Loans as of the last day of the calendar month immediately preceding such
Distribution Date. Copies of such statement shall be provided to any
Certificateholder upon request by the Servicer, or by the Trustee so long as
the Trustee has received the report as stipulated above at the Servicer's
expense if the Servicer shall fail to provide such copies.
Section 3.11. ANNUAL STATEMENT AS TO COMPLIANCE. The Servicer will
deliver to the Trustee, on or before December 31 of each year, beginning
December 31, 1999, an Officer's Certificate stating as to each signer
thereof, that (i) a review of the activities of the Servicer during the
preceding calendar year and of performance under this Agreement has been made
under such officer's supervision, and (ii) to the best of such officer's
knowledge, based on such review, the Servicer has fulfilled all of its
obligations under this Agreement throughout such year, or if there has been a
default in the fulfillment of any such obligation, specifying each such
default known to such officer and the nature and status thereof. Copies of
such statement shall be provided to the Rating Agency and to any
Certificateholder upon request by the Servicer, or by the Trustee at the
Servicer's expense if the Servicer shall fail to provide such copies and the
Trustee is aware that the Servicer has not so provided copies and so long as
the Trustee shall have received the report as stipulated above.
Section 3.12. ANNUAL INDEPENDENT PUBLIC ACCOUNTANTS' SERVICING REPORT.
On or before December 31 of each year, beginning December 31, 1999, the
Servicer, at its expense, shall cause a firm of independent public
accountants who are members of the American Institute of Certified Public
Accountants to furnish a statement to the Trustee and the Rating Agency to
the effect that such firm has examined certain documents and records relating
to the servicing of the Loans and that, either (a) on the basis of such
examination conducted substantially in compliance with the audit program for
mortgages serviced for FHLMC, such firm is of the opinion that such servicing
has been conducted in compliance with the manner of servicing set forth in
agreements substantially similar to this Agreement except for (i) such
exceptions as such firm shall believe to be immaterial and (ii) such other
exceptions as shall be set forth in such statement or, (b) that their
examination conducted substantially in compliance with the uniform single
audit program for mortgage bankers
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disclosed no exceptions or errors in records relating to mortgage loans
serviced for others that in their opinion are material and that Paragraph 4
of that program requires them to report. Copies of such statement shall be
provided to Certificateholders upon request by the Servicer, or by the
Trustee at the Servicer's expense if the Servicer shall fail to provide such
copies and the Trustee is aware that the Servicer has not so provided copies
and so long as the Trustee shall have received the report as stipulated above.
Section 3.13. ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION REGARDING
THE LOANS. The Servicer shall provide access to the Trustee or to its designees
at its request, and to Certificateholders which are savings and loan
associations, banks or insurance companies, the OTS, the FDIC and the
Supervisory Agents and examiners of the OTS and the FDIC or examiners of any
other federal or state banking or insurance regulatory authority to the
documentation regarding the Loans if so required by applicable regulations of
the OTS or other regulatory authority, such access to be afforded without charge
but only upon reasonable request and during normal business hours at the offices
of the Servicer designated by it. The Trustee or its designee may without
charge copy any document or electronic record maintained by the Servicer
hereunder.
Section 3.14. [Reserved].
Section 3.15. SALE OF DEFAULTED LOANS AND REO PROPERTIES.
(a) With respect to any Defaulted Loan or REO Property which
the Servicer has determined to sell in accordance with the standards set
forth in Section 3.7, the Servicer shall deliver to the Trustee an
Officer's Certificate to the effect that no satisfactory arrangements can
be made for collection of delinquent payments thereon pursuant to Section
3.2, and, consistent with the servicing standard set forth in Section 3.1
and with a view to the best economic interest of the Trust Fund, the
Servicer has determined to sell such Loan or REO Property in accordance
with this Section 3.15. The Servicer may then offer to sell to any
Person any Defaulted Loan or any REO Property or, subject to the
following sentence, purchase any such Defaulted Loan or REO Property (in
each case at the Repurchase Price therefor), but shall, in any event, so
offer to sell any REO Property no later than the time determined by the
Servicer to be sufficient to result in the sale of such REO Property
within the period specified in Section 3.7(c). The Servicer shall accept
the highest bid received from any Person for any Defaulted Loan or any
REO Property in an amount at least equal to the Purchase Price therefor
or, at its option, if it has received no bid at least equal to the
Purchase Price therefor, purchase the Defaulted Loan or REO Property at
the Purchase Price.
In the absence of any such bid or purchase by the Servicer, the
Servicer shall accept the highest bid received from any Person that is
determined by the Servicer to be a fair price for such Defaulted Loan or
REO Property, if the highest bidder is a Person other than an Interested
Person, or is determined to be such a price by the Trustee, if the
highest bidder is an Interested Person. Notwithstanding anything to the
contrary herein, neither the Trustee, in its individual capacity, nor any
of its Affiliates may bid for or purchase any Defaulted Loan or any REO
Property pursuant hereto.
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The Servicer shall not be obligated by either of the foregoing
paragraphs or otherwise to accept the highest bid if the Servicer
determines, in accordance with the servicing standard stated in Section
3.1, that rejection of such bid would be in the best interests of the
Certificateholders. In addition, the Servicer may accept a lower bid if
it determines, in accordance with the servicing standard stated in
Section 3.1, that acceptance of such bid would be in the best interests
of the Certificateholders (for example, if the prospective buyer making
the lower bid is more likely to perform its obligations, or the terms
offered by the prospective buyer making the lower bid are more
favorable). In the event that the Servicer determines with respect to
any REO Property that the bids being made with respect thereto are not in
the best interests of the Certificateholders and that the end of the
period referred to in Section 3.7(c) with respect to such REO Property is
approaching, the Servicer shall seek an extension of such period in the
manner described in Section 3.7(c).
(b) In determining whether any bid received from an Interested
Person represents a fair price for any Defaulted Loan or any REO
Property, the Trustee may conclusively rely on the opinion of an
Independent appraiser or other expert in real estate matters retained by
the Trustee the expense of which shall be an expense of the Trust Fund.
In determining whether any bid constitutes a fair price for any Defaulted
Loan or any REO Property, the Servicer or the Trustee (or, if applicable,
such appraiser) shall take into account, and any appraiser or other
expert in real estate matters shall be instructed to take into account,
as applicable, among other factors, the period and amount of any
delinquency on the affected Defaulted Loan, the physical condition of the
related Mortgaged Property or such REO Property, the state of the local
economy and the Trust Fund's obligation to dispose of any REO Property
within the time period specified in Section 3.7(c).
(c) The Servicer shall act on behalf of the Trust Fund in
negotiating and taking any other action necessary or appropriate in
connection with the sale of any Defaulted Loan or REO Property, including
the collection of all amounts payable in connection therewith. Any sale
of a Defaulted Loan or any REO Property shall be without recourse to, or
representation or warranty by, the Trustee, the Depositor, the Servicer
or the Trust Fund (except that any contract of sale and assignment and
conveyance documents may contain customary warranties of title, so long
as the only recourse for breach thereof is to the Trust Fund), and, if
consummated in accordance with the terms of this Agreement, neither the
Servicer, the Depositor nor the Trustee shall have any liability to the
Trust Fund or any Certificateholder with respect to the purchase price
therefor accepted by the Servicer or the Trustee.
(d) The proceeds of any sale after deduction of the expenses of
such sale incurred in connection therewith shall be promptly deposited in
the Custodial Account for P&I in accordance with Section 3.2(b).
Section 3.16. DELEGATION OF DUTIES. In the ordinary course of business,
the Servicer or the Trustee may at any time delegate any duties hereunder to any
Person who agrees to conduct such duties in accordance with the applicable terms
of this Agreement. In case of such delegation, the
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Servicer or the Trustee shall supervise, administer, monitor and oversee the
activities of such Person hereunder to insure that such Person performs such
duties in accordance herewith and shall be responsible for the acts and
omissions of such Person to the same extent as it is responsible for its own
actions or omissions hereunder. Any such delegations shall not relieve the
Servicer or the Trustee of its liability and responsibility with respect to
such duties, and shall not constitute a resignation within the meaning of
Section 6.4 hereof and shall be revocable by any successor Servicer or the
Trustee.
Section 3.17. [RESERVED].
Section 3.18. [RESERVED].
Section 3.19. APPOINTMENT OF A SPECIAL SERVICER. The Servicer may enter
into a special servicing agreement with an unaffiliated holder of a 100%
Percentage Interest of a Subordinate Certificate or a holder of a class of
securities representing interests in such Subordinate Certificate and/or other
subordinate mortgage pass-through certificates, such agreement to be (i)
substantially in the form of Exhibit R hereto or (ii) subject to each Rating
Agency's acknowledgment that the ratings of the Certificates in effect
immediately prior to the entering into of such agreement would not be qualified,
downgraded or withdrawn and the Certificates would not be placed on credit
review status (except for possible upgrading) as a result of such agreement.
Any such agreement may contain provisions whereby such holder may instruct the
Servicer to commence or delay foreclosure proceedings with respect to delinquent
Loans and will contain provisions for the deposit of cash by the holder that
would be available for distribution to Certificateholders if Liquidation
Proceeds are less than they otherwise may have been had the Servicer acted in
accordance with its normal procedures.
Section 3.20. ALLOCATION OF REALIZED LOSSES. Prior to each Distribution
Date, the Servicer shall determine the amount of Realized Losses, if any, with
respect to each Loan. The amount of Realized Losses shall be evidenced by an
Officer's Certificate signed by a Responsible Officer of the Servicer. All
Realized Losses, except for Special Hazard Losses, Fraud Losses and Bankruptcy
Losses in excess of the designated amounts of the applicable Special Hazard
Coverage, Fraud Coverage and Bankruptcy Coverage (each, as defined herein), will
be allocated as follows: (i) for losses allocable to principal (a) first, to
the Class B-5 Certificates, until the Class Principal Balance thereof has been
reduced to zero, (b) second, to the Class B-4 Certificates, until the Class
Principal Balance thereof has been reduced to zero, (c) third, to the Class B-3
Certificates, until the Class Principal Balance thereof has been reduced to
zero, (d) fourth, to the Class B-2 Certificates, until the Class Principal
Balance thereof has been reduced to zero, (e) fifth, to the Class B-1
Certificates, until the Class Principal Balance thereof has been reduced to
zero, (f) sixth, to the Class M Certificates, until the Class Principal Balance
thereof has been reduced to zero, and (g) seventh, to the Senior Certificates
(other than the Class A-P and the Interest Only Certificates), pro rata,
according to their Class Principal Balances (or, in the case of any of the
Accrual Certificates, the Class Principal Balance of such certificates on the
Closing Date, if lower) in reduction of their respective Class or Principal
Balances, as applicable; PROVIDED, HOWEVER, that if the loss is recognized with
respect to a Discount Loan, the applicable Discount Fraction of such loss will
first
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be allocated to the Class A-P Certificates and the remainder of such loss
will be allocated as described above in this clause (i) and (ii) for losses
allocable to interest (a) first, to the Class B-5 Certificates, in reduction
of accrued but unpaid interest thereon and then in reduction of the Class
Principal Balance of such Certificates, (b) second, to the Class B-4
Certificates, in reduction of accrued but unpaid interest thereon and then in
reduction of the Class Principal Balance of such Certificates, (c) third, to
the Class B-3 Certificates, in reduction of accrued but unpaid interest
thereon and then in reduction of the Class Principal Balance of such
Certificates, (d) fourth, to the Class B-2 Certificates, in reduction of
accrued but unpaid interest thereon and then in reduction of the Class
Principal Balance of such Certificates, (e) fifth, to the Class B-1
Certificates, in reduction of accrued but unpaid interest thereon and then in
reduction of the Class Principal Balance of such Certificates, (f) sixth, to
the Class M Certificates, in reduction of accrued but unpaid interest thereon
and then in reduction of the Class Principal Balance of such Certificates,
and (g) seventh, to the applicable Senior Certificates (other than the Class
A-P Certificates), pro rata according to accrued but unpaid interest thereon
and then pro rata according to their Class Principal Balances in reduction of
their respective Class Principal Balances, as applicable.
Special Hazard Losses in excess of the Special Hazard Coverage, Fraud
Losses in excess of the Fraud Coverage and Bankruptcy Losses in excess of the
Bankruptcy Coverage shall be allocated among the related Senior Certificates and
the Subordinate Certificates by Pro Rata Allocation.
On each Distribution Date, after giving effect to the principal
distributions and allocations of losses as provided in this Agreement (without
regard to this paragraph), if the Aggregate Certificate Principal Balance of all
outstanding Classes of Certificates exceeds the aggregate principal balance of
the Loans, after deduction of (i) all principal payments due on or before the
Cut-Off Date in respect of each such Loan whether or not paid and (ii) all
amounts of principal in respect of each such Loan that have been received or
advanced and included in the related Available Distribution Amount, and all
losses in respect of such Loans that have been allocated to the Certificates, on
such Distribution Date or prior Distribution Dates, then such excess will be
deemed a principal loss and will be allocated to the most junior Class of
Subordinate Certificates then outstanding, in reduction of the Certificate
Principal Balance thereof.
ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS; ADVANCES;
STATEMENTS AND REPORTS
Section 4.1. DISTRIBUTIONS TO CERTIFICATEHOLDERS. (a) The Trustee shall
establish and maintain a separate account as set forth in Article I (the
"Certificate Account"), the purpose of which is to accept deposits from the
Servicer and to make distributions to the Certificateholders of the amounts set
forth in this Section 4.1.
(b) On each Distribution Date, the Trustee or the Paying Agent,
if any, shall (i) withdraw from the Certificate Account the Available
Distribution Amount for such
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Distribution Date and shall distribute to each Certificateholder, from
the amount so withdrawn and to the extent of the Available
Distribution Amount, such Certificateholder's share (based on the
aggregate Percentage Interests represented by the Certificates of the
applicable Class held by such Certificateholder) of the amounts and in
the order of priority as set forth in the definition of "Certificate
Distribution Amount", and (ii) distribute Excess Liquidation Proceeds
to the Class R Certificateholder by wire transfer in immediately
available funds for the account of the Certificateholder, or by any
other means of payment acceptable to each Certificateholder of record
on the immediately preceding Record Date (other than as provided in
Section 9.1 respecting the final distribution), as specified by each
such Certificateholder and at the address of such Holder appearing in
the Certificate Register; PROVIDED, that if the Trustee has appointed
a Certificate Administrator, such distributions in (i) and (ii) above
shall be made in accordance with written statements received from the
Certificate Administrator pursuant to Section 4.3.
(c) All reductions in the Certificate Principal Balance of a
Certificate effected by distributions of principal or allocations of
Realized Losses with respect to Loans made on any Distribution Date shall
be binding upon all Holders of such Certificate and of any Certificate
issued upon the registration of transfer or exchange therefor or in lieu
thereof, whether or not such distribution is noted on such Certificate.
The final distribution of principal of each Certificate (and the final
distribution with respect to the Class R Certificate upon termination of
the Trust Fund) shall be payable in the manner provided above only upon
presentation and surrender thereof on or after the Distribution Date
therefor at the office or agency of the Trustee or Certificate
Administrator, if any, specified in the notice delivered pursuant to
Section 4.1(d) or Section 9.1.
(d) Whenever, on the basis of Curtailments, Payoffs and Monthly
Payments on the Loans and Insurance Proceeds and Liquidation Proceeds
received and expected to be received during the applicable Prepayment
Period, the Trustee believes, or the Certificate Administrator, if any,
has notified the Trustee that it believes, that the entire remaining
unpaid Class Principal Balance of any Class of Certificates will become
distributable on the next Distribution Date, the Trustee or the
Certificate Administrator, if any, shall, no later than the Determination
Date of the month of such Distribution Date, mail or cause to be mailed
to each Person in whose name a Certificate to be so retired is registered
at the close of business on the Record Date, to the Underwriters and to
each Rating Agency a notice to the effect that:
(i) it is expected that funds sufficient to make such
final distribution will be available in the Certificate Account on
such Distribution Date, and
(ii) if such funds are available, (A) such final
distribution will be payable on such Distribution Date, but only
upon presentation and surrender of such Certificate at the office
or agency of the Certificate Registrar maintained for such purpose
(the address of which shall be set forth in such notice), and (B)
no interest shall accrue on such Certificate after such
Distribution Date.
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Section 4.2. STATEMENTS TO CERTIFICATEHOLDERS. (a) Not later than three
(3) days prior to each Distribution Date, the Servicer shall forward to the
Trustee or the Certificate Administrator, if any, the Servicer's Section 3.10
Report setting forth certain information with respect to the Loans. With each
distribution from the Certificate Account on a Distribution Date, the Trustee or
the Certificate Administrator, if any, shall, based on the information set forth
in the Servicer's Section 3.10 Report, prepare and forward to each
Certificateholder, a statement (each a "Certificateholders' Report") setting
forth, to the extent applicable, the amount of the distribution payable to the
applicable Class that represents principal and the amount that represents
interest, and the applicable Class Principal Balance after giving effect to such
distribution.
In addition, not later than each Distribution Date, the Certificate
Administrator or Trustee, as applicable, shall forward to such
Certificateholder, the Trustee (if the Trustee has appointed a Certificate
Administrator) and the Depositor an additional report which sets forth with
respect to the Loans:
(i) The number and aggregate Principal Balance of the
Loans delinquent one, two and three months or more;
(ii) The (A) number and aggregate Principal Balance of
Loans with respect to which foreclosure proceedings have been
initiated, and (B) the number and aggregate book value of
Mortgaged Properties acquired through foreclosure, deed in lieu of
foreclosure or other exercise of rights respecting the Trustee's
security interest in the Loans;
(iii) The amount of Special Hazard Coverage available to
the Senior Certificates remaining as of the close of business on
the applicable Determination Date;
(iv) The amount of Bankruptcy Coverage available to the
Certificateholders remaining as of the close of business on the
applicable Determination Date;
(v) The amount of Fraud Coverage available to the
Certificateholders remaining as of the close of business on the
applicable Determination Date;
(vi) The amount of Realized Losses allocable to the
related Certificates on the related Distribution Date and the
cumulative amount of Realized Losses incurred allocated to such
Certificates since the Cut-Off Date;
(vii) The amount of interest accrued but not paid on the
each Class of Certificates entitled to interest since (a) the
prior Distribution Date and (b) the Cut-Off Date;
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(viii) The amount of funds advanced by the Servicer on the
related Withdrawal Date; and
(ix) The total amount of Payoffs and Curtailments
received during the related Prepayment Period.
Upon request by any Certificateholder, the Trustee or the Certificate
Administrator (if so appointed by the Trustee), as soon as reasonably
practicable, shall provide the requesting Certificateholder with such
information as is necessary and appropriate, in Trustee's or the Certificate
Administrator's sole discretion, for purposes of satisfying applicable reporting
requirements under Rule 144A of the Securities Act.
(b) Upon request to the Trustee or Certificate Administrator (if so
appointed by the Trustee) by any Certificateholder who is a Holder thereof at
the time of making such request (an "Eligible Certificateholder"), the Trustee
or the Certificate Administrator, if applicable, shall provide in electronic
format loan by loan data with respect to the payment experience of the Loans
containing at least the fields of information listed on Exhibit E hereto (based
on information provided by the Servicer). In addition, upon the written request
of any Eligible Certificateholder, the Trustee or the Certificate Administrator
shall provide similar loan by loan data with respect to any prior monthly
remittance report to the Certificateholders pursuant to this Agreement (as and
when such information becomes available). The expense of providing any tape or
disk pursuant to this subsection shall be an expense of the Eligible
Certificateholder. The Trustee or the Certificate Administrator shall include
in each monthly remittance report delivered pursuant to Section 4.2(a) a
statement that the monthly loan by loan information described in this subsection
is available upon request and at the expense of any Eligible Certificateholder
directed to the Trustee or the Certificate Administrator.
Section 4.3. ADVANCES BY THE SERVICER; DISTRIBUTION REPORTS TO THE
TRUSTEE. To the extent described below, the Servicer is obligated to advance
its own funds to the Certificate Account to cover any shortfall between (i)
payments scheduled to be received in respect of Loans serviced by such Servicer,
and (ii) the amounts actually deposited in the Certificate Account on account of
such payments. The Servicer's obligation to make any Advance or Advances
described in this Section 4.3 is effective only to the extent that such Advance
is, in the good faith judgment of the Servicer, reimbursable from Insurance
Proceeds or Liquidation Proceeds of the related Loans or recoverable as late
Monthly Payments with respect to the related Loans or otherwise.
Prior to the close of business on each Determination Date, the Servicer
shall determine whether or not it will make an Advance on the next Withdrawal
Date and shall furnish a statement to the Certificate Administrator, if any, the
Trustee, the Paying Agent, if any, and to any Certificateholder requesting the
same, setting forth the aggregate amount to be distributed on the next
succeeding Distribution Date on account of principal and interest in respect of
the Loans, stated separately. In the event that full scheduled amounts of
principal and interest in respect of the related Loans shall not have been
received by or on behalf of the Servicer prior to the Withdrawal Date preceding
such Distribution Date and the Servicer shall have determined that an Advance
shall be
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made in accordance with this Section 4.3, the Servicer shall so
specify and shall specify the aggregate amount of such Advance.
In the event that the Servicer shall be required to make an Advance, it
shall on the Withdrawal Date either (i) deposit in the Certificate Account an
amount equal to such Advance, (ii) direct the Trustee or the Certificate
Administrator (if so appointed by the Trustee) to make an appropriate entry in
the records of the Certificate Account that funds in such account being held for
future distribution or withdrawal have been, as permitted by this Section 4.3,
used by such Servicer to make such Advance, or (iii) make advances in the form
of any combination of (i) and (ii) aggregating the amount of such Advance. Any
funds being held for future distribution to Certificateholders and so used shall
be replaced by the related Servicer by deposit in the Certificate Account on any
future Withdrawal Date to the extent that funds in the Certificate Account on
the related Distribution Date with respect to the related Loans shall be less
than payments to Certificateholders required to be made on such date with
respect to such Loans. The Servicer is entitled to receive from the Custodial
Accounts for P&I established by the Servicer under its supervision amounts
received by the Servicer on particular Loans as late payments of principal and
interest or as Liquidation or Insurance Proceeds and respecting which the
Servicer has made an unreimbursed Advance of principal and interest. The
Servicer is also entitled to receive other amounts from the related Custodial
Accounts for P&I established by the Servicer under its supervision to reimburse
the Servicer for prior Nonrecoverable Advances.
In accordance with Section 3.3, Advances are reimbursable to the Servicer
from cash in the Custodial Account for P&I to the extent that the Servicer shall
determine that any such advances previously made are Nonrecoverable Advances
pursuant to Section 4.4.
In the event that the Trustee has appointed a Certificate Administrator,
prior to 5:00 P.M. New York City time on the Withdrawal Date, the Certificate
Administrator shall provide the Trustee with a statement regarding the amount of
principal and interest, the Residual Distribution Amount and the Excess
Liquidation Proceeds to be distributed to each Class of Certificates on such
Distribution Date (such amounts to be determined in accordance with the
definition of "Certificate Distribution Amount", Section 4.1 hereof and other
related definitions set forth in Article I hereof).
Section 4.4. NONRECOVERABLE ADVANCES. Any Advance previously made by
the Servicer with respect to a Loan that the Servicer shall determine in its
good faith judgment not to be ultimately recoverable from Insurance Proceeds or
Liquidation Proceeds or otherwise with respect to such Loan or recoverable as
late Monthly Payments with respect to such Loan shall be a Nonrecoverable
Advance. The determination by the Servicer that it has made a Nonrecoverable
Advance or that any advance would constitute a Nonrecoverable Advance, shall be
evidenced by an Officer's Certificate of the Servicer delivered to the Trustee
on the Determination Date and detailing the reasons for such determination.
Notwithstanding any other provision of this Agreement, any insurance policy
relating to the Loans, or any other agreement relating to the Loans to which the
Depositor or the Servicer is a party, (a) the Depositor and the Servicer shall
not be obligated to, and shall not, make any advance that, after reasonable
inquiry and in its sole discretion, the Depositor or the Servicer shall
determine would be a Nonrecoverable Advance, and (b) the
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Depositor and the Servicer shall be entitled to reimbursement for any
Advance as provided in Section 3.5 of this Agreement.
Section 4.5. FORECLOSURE REPORTS. Each year beginning in 1999 the
Servicer shall make any reports of foreclosures and abandonments of any
Mortgaged Property required by Section 6050J of the Code. In order to
facilitate this reporting process, the Servicer, on or before February 28th of
each year, commencing with 1999, shall provide to the Internal Revenue Service,
the Trustee and the Certificate Administrator, if any, reports relating to each
instance occurring during the previous calendar year in which the Servicer
(i) on behalf of the Trustee acquires an interest in a Mortgaged Property
through foreclosure or other comparable conversion in full or partial
satisfaction of a Loan, or (ii) knows or has reason to know that a Mortgaged
Property has been abandoned. The reports from the Servicer shall be in form and
substance sufficient to meet the reporting requirements imposed by such Section
6050J.
Section 4.6. ADJUSTMENT OF SERVICING FEES WITH RESPECT TO PAYOFFS. The
aggregate amount of the Servicing Fee subject to retention from deposit into or
withdrawal from the Certificate Account by the Servicer, in any month of
distribution shall be decreased by any Compensating Interest due and owing with
respect to any Loan with respect to which a Payoff has occurred in the related
Prepayment Period. The Servicer shall include the amount of any such
Compensating Interest with the deposits into the Certificate Account on the
related Withdrawal Date. Notwithstanding the foregoing, the amount by which the
Servicing Fee may be reduced with respect to the related Prepayment Period
pursuant to this Section 4.6 shall not exceed an amount greater than the amount
described in clause (i) of the definition of Compensating Interest for all Loans
as to which Payoffs have occurred and the rights of the Certificateholders to
such portion of the Servicing Fee shall not be cumulative.
Section 4.7. PROHIBITED TRANSACTIONS TAXES AND OTHER TAXES.
(a) In the event that any tax (including a tax on "prohibited
transactions" as defined in Section 860F(a)(2) of the Code and including
any and all interest, penalties, fines and additions to tax, as well as
any and all reasonable counsel fees and out-of-pocket expenses incurred
in contesting the imposition of such tax) is imposed on the Trust Fund
and is not otherwise paid pursuant to Section 4.7(b) hereof, the Servicer
shall pay such taxes when and as the same shall be due and payable (but
such obligation shall not prevent the Servicer, the Trustee, the
Certificate Administrator, if any, or any other appropriate Person from
contesting any such tax in appropriate proceedings and shall not prevent
the Servicer from withholding payment of such tax, if permitted by law,
pending the outcome of such proceedings); PROVIDED, that the Servicer
shall be entitled to be indemnified for any such taxes (excluding taxes
referred to in Section 4.7(b)) to the extent set forth in Section 6.3
hereof so long as the Servicer's failure to exercise reasonable care with
respect to the performance of its duties hereunder was not the primary
cause of the imposition of such taxes. If the Servicer is indemnified
for such taxes pursuant to this Section 4.7(a), such amount shall be
first charged against amounts otherwise distributable to the Holders of
Component R-1 of the Class R Certificate (or, if the tax relates to REMIC
II, Component R-2
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of the Class R Certificate) on a pro rata basis, then against amounts
otherwise distributable with respect to the REMIC I Regular Interests
(or, if the tax relates to REMIC II, to the Holders of the REMIC II
Certificates) on a pro rata basis. The Trustee is hereby authorized
to retain from amounts otherwise distributable to the
Certificateholders sufficient funds to reimburse the Servicer for the
payment of such tax for which the Servicer is entitled to
indemnification.
(b) The Servicer shall pay on written demand, and shall
indemnify and hold harmless the Trust Fund from and against, any and all
taxes imposed on the Trust Fund (including, for this purpose, any and all
interest, penalties, fines and additions to tax, as well as any and all
reasonable counsel fees and out-of-pocket expenses incurred in contesting
the imposition of such tax).
Section 4.8. TAX ADMINISTRATION.
(a) The Trustee is hereby appointed as attorney-in-fact and
agent for the initial Tax Matters Person; PROVIDED, that the Trustee may
appoint, and hereby does so appoint, the Certificate Administrator as
attorney-in-fact and agent for the Tax Matters Person. The Trustee may,
by written notice delivered to the Certificate Administrator, revoke the
appointment of the Certificate Administrator as attorney-in-fact and
agent for the Tax Matters Person, in which case the Trustee shall act in
such capacity.
(b) In order to enable the Trustee or the Certificate
Administrator, as applicable, to perform its duties as set forth in this
Section 4.8 and Section 3.1(b), the Servicer agrees to provide any tax
forms, instruments or other documents related thereto, as the Trustee or
the Certificate Administrator, as applicable, may reasonably request,
including, without limitation, any tax forms, instruments or other
documents prepared by the Servicer pursuant to this Section 4.8 In order
to enable the Trustee or the Certificate Administrator, as applicable, to
perform its duties as set forth in this Section 4.8 and Section 3.1(b),
the Servicer shall use its best efforts to cause to be delivered to the
Trustee or the Certificate Administrator, as applicable, within ten (10)
days after the Closing Date all information or data that the Trustee or
the Certificate Administrator, as applicable, 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. Thereafter, the Servicer shall use
its best efforts to provide to the Trustee or the Certificate
Administrator, as applicable, promptly upon request therefor, any such
additional information or data that the Trustee or the Certificate
Administrator, as applicable, may, from time to time, request in order to
enable the Trustee or the Certificate Administrator, as applicable, to
perform its duties as set forth in this Section 4.8 and Section 3.1(b).
Section 4.9. EQUAL STATUS OF SERVICING FEE. The right of the Servicer
to receive its Servicing Fee will be equal and not subordinate to the right of
the Certificateholders to receive principal and interest payments based on their
interests as provided herein. The Servicer's Servicing Fee may be collected
from Monthly Payments as received pursuant to Section 3.2 without deposit
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into the Certificate Account, whereas the Certificateholders'
distributions shall be made on a delayed basis as set forth in the
terms of the Certificates.
Section 4.10. APPOINTMENT OF PAYING AGENT AND CERTIFICATE ADMINISTRATOR.
The Trustee may appoint an Eligible Institution to act as a paying agent (the
"Paying Agent") or a certificate administrator (the "Certificate
Administrator"), as the case may be, in order to delegate to such Eligible
Institution any of its duties under this Agreement to administer the issuance,
transfer and exchange of the Certificates, administer payments to
Certificateholders or prepare information related to the Certificates; PROVIDED,
that the Trustee shall remain primarily responsible for any duties so delegated;
PROVIDED, FURTHER, that the Trustee shall receive no additional compensation in
connection with such appointment and delegation.
Initially, LaSalle National Bank will be the Certificate Administrator
and Paying Agent. If LaSalle National Bank ceases to serve as Certificate
Administrator or Paying Agent, the Trustee shall send written notice to all
Certificateholders (i) indicating that LaSalle National Bank is no longer in
such capacity and (ii) setting forth its replacement, if any, appointed pursuant
to this Section 4.10.
ARTICLE V
THE CERTIFICATES
Section 5.1. THE CERTIFICATES.
(a) The Certificates shall be substantially in the forms set
forth in Exhibits A and B attached hereto, and shall be executed by the
Trustee, authenticated by the Trustee (or any duly appointed
Authenticating Agent) and delivered to or upon the order of the Depositor
upon receipt by the Trustee of the documents specified in Section 2.1.
The Certificates shall be issuable in Authorized Denominations evidencing
Percentage Interests. Certificates shall be executed by manual or
facsimile signature on behalf of the Trustee by authorized officers of
the Trustee. Certificates bearing the manual or facsimile signatures of
individuals who were at the time of execution the proper officers of the
Trustee shall bind the Trustee, notwithstanding that such individuals or
any of them have ceased to hold such offices prior to the authentication
and delivery of such Certificates or did not hold such offices at the
date of such Certificates. No Certificate shall be entitled to any
benefit under this Agreement, or be valid for any purpose, unless there
appears on such Certificate a certificate of authentication substantially
in the form provided for herein executed by the Trustee or any
Authenticating Agent by manual signature, and such certificate upon any
Certificate shall be conclusive evidence, and the only evidence, that
such Certificate has been duly authenticated and delivered hereunder.
All Certificates, shall be dated the date of their authentication.
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(b) The following definitions apply for purposes of this
Section 5.1: "Disqualified Organization" means any Person which is not a
Permitted Transferee, but does not include any "Pass-Through Entity"
which owns or holds a Residual Certificate and of which a Disqualified
Organization, directly or indirectly, may be a stockholder, partner or
beneficiary; "Pass-Through Entity" means any regulated investment
company, real estate investment trust, common trust fund, partnership,
trust or estate, and any organization to which Section 1381 of the Code
applies; "Ownership Interest" means, with respect to any Residual
Certificate, any ownership or security interest in such Residual
Certificate, including any interest in a Residual Certificate as the
Holder thereof and any other interest therein whether direct or indirect,
legal or beneficial, as owner or as pledgee; "Transfer" means any direct
or indirect transfer or sale of, or directly or indirectly transferring
or selling any Ownership Interest in a Residual Certificate; and
"Transferee" means any Person who is acquiring by Transfer any Ownership
Interest in a Residual Certificate.
(c) Restrictions on Transfers of the Residual Certificate to
Disqualified Organizations are set forth in this Section 5.1(c).
(i) Each Person who has or who acquires any Ownership
Interest in a Residual Certificate shall be deemed by the
acceptance or acquisition of such Ownership Interest to have
agreed to be bound by the following provisions and to have
irrevocably authorized the Trustee, the Certificate Administrator
or the Paying Agent under clause (iii)(A) below to deliver
payments to a Person other than such Person and to negotiate the
terms of any mandatory sale under clause (iii)(B) below and to
execute all instruments of transfer and to do all other things
necessary in connection with any such sale. The rights of each
Person acquiring any Ownership Interest in a Residual Certificate
are expressly subject to the following provisions:
(A) Each Person holding or acquiring any
Ownership Interest in a Residual Certificate shall be a
Permitted Transferee and shall promptly notify the Trustee
or the Certificate Registrar if not the same Person as the
Trustee of any change or impending change in its status as
a Permitted Transferee.
(B) In connection with any proposed Transfer of
any Ownership Interest in a Residual Certificate to a U.S.
Person, the Trustee or the Certificate Registrar if not the
same Person as the Trustee shall require delivery to it,
and shall not register the Transfer of any Residual
Certificate until its receipt of (1) an affidavit and
agreement (a "Transferee Affidavit and Agreement") attached
hereto as Exhibit J from the proposed Transferee, in form
and substance satisfactory to the Depositor, representing
and warranting, among other things, that it is not a
Non-U.S. Person, that such transferee is a Permitted
Transferee, that it is not acquiring its Ownership Interest
in the Residual Certificate that is the subject of the
proposed Transfer as a nominee, trustee or agent for any
Person who is not a Permitted
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Transferee, that for so long as it retains its Ownership
Interest in a Residual Certificate, it will endeavor to
remain a Permitted Transferee, and that it has reviewed
the provisions of this Section 5.1(c) and agrees to be
bound by them, and (2) a certificate, attached hereto as
Exhibit I, from the Holder wishing to transfer the
Residual Certificate, in form and substance satisfactory
to the Depositor, representing and warranting, among
other things, that no purpose of the proposed Transfer
is to allow such Holder to impede the assessment or
collection of tax.
(C) Notwithstanding the delivery of a Transferee
Affidavit and Agreement by a proposed Transferee under
clause (B) above, if the Trustee or the Certificate
Registrar if not the same Person as the Trustee has actual
knowledge that the proposed Transferee is not a Permitted
Transferee, no Transfer of an Ownership Interest in a
Residual Certificate to such proposed Transferee shall be
effected.
(D) Each Person holding or acquiring any
Ownership Interest in a Residual Certificate agrees by
holding or acquiring such Ownership Interest (i) to require
a Transferee Affidavit and Agreement from any other Person
to whom such Person attempts to transfer its Ownership
Interest and to provide a certificate to the Trustee or the
Certificate Registrar if not the same Person as the Trustee
in the form attached hereto as Exhibit J; (ii) to obtain
the express written consent of the Depositor prior to any
transfer of such Ownership Interest, which consent may be
withheld in the Depositor's sole discretion; and (iii) to
provide a certificate to the Trustee or the Certificate
Registrar if not the same Person as the Trustee in the form
attached hereto as Exhibit I.
(ii) The Trustee or the Certificate Registrar if not the
same Person as the Trustee shall register the Transfer of any
Residual Certificate only if it shall have received the Transferee
Affidavit and Agreement, a certificate of the Holder requesting
such transfer in the form attached hereto as Exhibit J and all of
such other documents as shall have been reasonably required by the
Trustee or the Certificate Registrar if not the same Person as the
Trustee as a condition to such registration.
(iii) (A) If any "disqualified organization" (as defined
in Section 860E(e)(5) of the Code) shall become a Holder of a
Residual Certificate, then the last preceding Permitted Transferee
shall be restored, to the extent permitted by law, to all rights
and obligations as Holder thereof retroactive to the date of
registration of such Transfer of such Residual Certificate. If
any Non-U.S. Person shall become a Holder of a Residual
Certificate, then the last preceding Holder which is a U.S. Person
shall be restored, to the extent permitted by law, to all rights
and obligations as Holder thereof retroactive to the date of
registration of the Transfer to such Non-U.S. Person of such
Residual Certificate. If a transfer of a Residual Certificate is
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disregarded pursuant to the provisions of Treasury Regulations
Section 1.860E-1 or Section 1.860G-3, then the last preceding
Permitted Transferee shall be restored, to the extent permitted by
law, to all rights and obligations as Holder thereof retroactive
to the date of registration of such Transfer of such Residual
Certificate. The Trustee, the Certificate Administrator, the
Certificate Registrar and the Paying Agent shall be under no
liability to any Person for any registration of Transfer of a
Residual Certificate that is in fact not permitted by this Section
5.1(c) or for making any payments due on such Certificate to the
Holder thereof or for taking any other action with respect to such
Holder under the provisions of this Agreement.
(B) If any purported Transferee shall become a
Holder of the Residual Certificate in violation of the
restrictions in this Section 5.1(c) and to the extent that
the retroactive restoration of the rights of the Holder of
such Residual Certificate as described in clause (iii)(A)
above shall be invalid, illegal or unenforceable, then the
Depositor shall have the right, without notice to the
Holder or any prior Holder of such Residual Certificate, to
sell such Residual Certificate to a purchaser selected by
the Depositor on such terms as the Depositor may choose.
Such purported Transferee shall promptly endorse and
deliver the Residual Certificate in accordance with the
instructions of the Depositor. Such purchaser may be the
Depositor itself or any affiliate of the Depositor. The
proceeds of such sale, net of the commissions (which may
include commissions payable to the Depositor or its
affiliates), expenses and taxes due, if any, shall be
remitted by the Depositor to such purported Transferee.
The terms and conditions of any sale under this clause
(iii)(B) shall be determined in the sole discretion of the
Depositor, and the Depositor shall not be liable to any
Person having an Ownership Interest in the Residual
Certificate as a result of its exercise of such discretion.
(iv) The Depositor, on behalf of the Trustee, shall make
available, upon written request from the Trustee, or the
Certificate Administrator all information necessary to compute any
tax imposed (A) as a result of the Transfer of an Ownership
Interest in the Residual Certificate to any Person who is not a
Permitted Transferee, including the information regarding "excess
inclusions" of such Residual Certificate required to be provided
to the Internal Revenue Service and certain Persons as described
in Treasury Regulation Section 1.860D-1(b)(5), and (B) as a result
of any regulated investment company, real estate investment trust,
common trust fund, partnership, trust, estate or organizations
described in Section 1381 of the Code having as among its record
holders at any time any Person who is not a Permitted Transferee.
Reasonable compensation for providing such information may be
required by the Depositor from such Person.
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(v) The provisions of this Section 5.1 set forth prior
to this Section 5.1(c)(v) may be modified, added to or eliminated,
PROVIDED, that there shall have been delivered to the Trustee and
the Certificate Administrator the following:
(A) written notification from each Rating Agency
to the effect that the modification, addition to or
elimination of such provisions will not cause such Rating
Agency to downgrade its then-current Ratings of the
Certificates; and
(B) an Opinion of Counsel, in form and substance
satisfactory to the Depositor (as evidenced by a
certificate of the Depositor), to the effect that such
modification, addition to or absence of such provisions
will not cause the Trust Fund to cease to qualify as a
REMIC and will not create a risk that (1) the Trust Fund
may be subject to an entity-level tax caused by the
Transfer of any Residual Certificate to a Person which is
not a Permitted Transferee or (2) a Certificateholder or
another Person will be subject to a REMIC-related tax
caused by the Transfer of a Residual Certificate to a
Person which is not a Permitted Transferee.
(vi) The following legend shall appear on all Residual
Certificates:
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS
CERTIFICATE MAY BE MADE ONLY IF THE PROPOSED
TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE
DEPOSITOR, THE TRUSTEE AND THE CERTIFICATE REGISTRAR
THAT (1) SUCH TRANSFEREE IS NOT EITHER (A) THE
UNITED STATES, ANY STATE OR POLITICAL SUBDIVISION
THEREOF, ANY FOREIGN GOVERNMENT, ANY INTERNATIONAL
ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF
ANY OF THE FOREGOING, (B) ANY ORGANIZATION (OTHER
THAN A COOPERATIVE DESCRIBED IN SECTION 521 OF THE
CODE) WHICH IS EXEMPT FROM THE TAX IMPOSED BY
CHAPTER 1 OF THE CODE UNLESS SUCH ORGANIZATION IS
SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE
CODE, (C) ANY ORGANIZATION DESCRIBED IN SECTION
1381(a)(2)(C) OF THE CODE (ANY SUCH PERSON DESCRIBED
IN THE FOREGOING CLAUSES (A), (B), OR (C) BEING
HEREINAFTER REFERRED TO AS A "DISQUALIFIED
ORGANIZATION"), OR (D) AN AGENT OF A DISQUALIFIED
ORGANIZATION AND (2) NO PURPOSE OF SUCH TRANSFER IS
TO ENABLE THE TRANSFEROR TO IMPEDE THE ASSESSMENT OR
COLLECTION OF TAX. SUCH AFFIDAVIT SHALL INCLUDE
CERTAIN REPRESENTATIONS AS TO THE FINANCIAL
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CONDITION OF THE PROPOSED TRANSFEREE.
NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE
REGISTER OF ANY TRANSFER, SALE OR OTHER DISPOSITION
OF THIS CLASS R CERTIFICATE TO A DISQUALIFIED
ORGANIZATION OR AN AGENT OF A DISQUALIFIED
ORGANIZATION, SUCH REGISTRATION SHALL BE DEEMED TO
BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND SUCH
PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER
FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT NOT
LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS
CERTIFICATE. EACH HOLDER OF THE CLASS R CERTIFICATE
BY ACCEPTANCE OF THIS CERTIFICATE SHALL BE DEEMED TO
HAVE CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH.
(vii) The Holder of the Class R Certificate issued
hereunder, while not a Disqualified Organization, is the Tax
Matters Person.
(d) In the case of any Subordinate or Class R Certificate
presented for registration in the name of an employee benefit plan or
other plan or arrangement subject to the prohibited transaction
provisions of ERISA or Section 4975 of the Code (or comparable provisions
of any subsequent enactments) (a "Plan"), a trustee of any Plan, or any
other Person who is using the "plan assets" of any Plan to effect such
acquisition, the Trustee or the Certificate Registrar, if not the same
Person as the Trustee, shall require such transferee to provide an
Officer's Certificate signed by a Responsible Officer of such transferee
stating that the transferee is an insurance company using assets of a
"insurance company general account" (within the meaning of Department of
Labor Prohibited Transaction Class Exemption ("PTCE") 95-60) to effect
such purchase and satisfies all of the requirements for exemptive relief
under Sections I and III of PTCE 95-60, which Officer's Certificate shall
not be an expense of the Trustee, the Certificate Administrator, if any,
the Certificate Registrar or the Depositor.
So long as the Class M, Class B-1 and Class B-2 Certificates are
Book Entry Certificates, each Person who has or who acquires any Class M
or Class B Certificates shall be deemed by the acceptance or acquisition
of such Certificate to have represented that (a) such Person is not a
Plan, and such Person is not using "plan assets" of any such Plan to
effect such acquisition or (b) if the transferee is an insurance company
and the source of funds used to purchase such Certificate is an
"insurance company general account" (as such term is defined in PTCE
95-60) and the conditions set forth in Sections I and III of PTCE 95-60
have been satisfied.
(e) No transfer, sale, pledge or other disposition of a Junior
Subordinate Certificate shall be made unless such transfer, sale, pledge
or other disposition is made in accordance with this Section 5.1(e) or
Section 5.1(f). Each Person who, at any time, acquires
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any ownership interest in any Junior Subordinate Certificate shall be
deemed by the acceptance or acquisition of such ownership interest to
have agreed to be bound by the following provisions of this Section
5.1(e) and Section 5.1(f), as applicable. No transfer of a Junior
Subordinate Certificate shall be deemed to be made in accordance with
this Section 5.1(e) unless such transfer is made pursuant to an
effective registration statement under the Securities Act or unless the
Trustee or the Certificate Registrar, if not the same Person as the
Trustee, is provided with the certificates and an Opinion of Counsel,
if required, on which the Trustee and the Certificate Registrar may
conclusively rely, which establishes or establish to the Trustee's or
the Certificate Registrar's, as applicable, satisfaction that such
transfer is exempt from the registration requirements under the
Securities Act, as follows: In the event that a transfer is to be made
in reliance upon an exemption from the Securities Act, the Trustee or
the Certificate Registrar, if not the same Person as the Trustee, shall
require, in order to assure compliance with the Securities Act, that
the Certificateholder desiring to effect such transfer certify to the
Trustee and the Certificate Registrar in writing, in substantially the
form attached hereto as Exhibit F, the facts surrounding the transfer,
with such modifications to such Exhibit F as may be appropriate to
reflect the actual facts of the proposed transfer, and that the
Certificateholder's proposed transferee certify to the Trustee and the
Certificate Registrar in writing, in substantially the form attached
hereto as Exhibit G, the facts surrounding the transfer, with such
modifications to such Exhibit G as may be appropriate to reflect the
actual facts of the proposed transfer. If such certificate of the
proposed transferee does not contain substantially the substance of
Exhibit G, the Trustee or the Certificate Registrar, if not the same
Person as the Trustee, shall require an Opinion of Counsel satisfactory
to it that such transfer may be made without registration, which
Opinion of Counsel shall not be obtained at the expense of the Trustee,
the Certificate Administrator, the Certificate Registrar, the Trust
Fund or the Depositor. Such Opinion of Counsel shall allow for the
forwarding, and the Trustee shall forward, a copy thereof to the Rating
Agency. Notwithstanding the foregoing, any Class of Junior Subordinate
Certificate may be transferred, sold, pledged or otherwise disposed of
in accordance with the requirements set forth in Section 5.1(f).
(f) Transfers of the Junior Subordinate Certificates may be
made in accordance with this Section 5.1(f). To effectuate a Certificate
transfer in accordance with this Section 5.1(f), the proposed transferee
of such Certificate must provide the Trustee, the Certificate Registrar
and the Depositor with an investment letter substantially in the form of
Exhibit L attached hereto, which investment letter shall not be an
expense of the Trustee, the Certificate Administrator, the Certificate
Registrar or the Depositor, and which investment letter states that,
among other things, such transferee (i) is a "qualified institutional
buyer" as defined under Rule 144A, acting for its own account or the
accounts of other "qualified institutional buyers" as defined under Rule
144A, and (ii) is aware that the proposed transferor intends to rely on
the exemption from registration requirements under the Securities Act
provided by Rule 144A. Notwithstanding the foregoing, the proposed
transferee of such Certificate shall not be required to provide the
Trustee, the Certificate Registrar or the Depositor with Annex 1 or Annex
2 to the form of Exhibit L attached hereto if the Depositor so consents
prior to each such transfer. Such transfers shall be deemed to
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have complied with the requirements of this Section 5.1(f). The Holder
of a Certificate desiring to effect such transfer does hereby agree to
indemnify the Trustee, the Certificate Administrator, if any, the
Depositor, and the Certificate Registrar against any liability that may
result if transfer is not made in accordance with this Agreement.
(g) None of the Trustee, the Certificate Administrator, the
Certificate Registrar or the Paying Agent shall have any liability to the
Trust Fund arising from a registration or transfer of a Certificate in
reliance upon a certification, Officer's Certificate, affidavit, ruling
or Opinion of Counsel described in this Section 5.1.
Section 5.2. CERTIFICATES ISSUABLE IN CLASSES; DISTRIBUTIONS OF
PRINCIPAL AND INTEREST; AUTHORIZED DENOMINATIONS. The aggregate principal
amount of Certificates that may be authenticated and delivered under this
Agreement is limited to the aggregate Principal Balance of the Loans as of the
Cut-Off Date, as specified in the Preliminary Statement to this Agreement,
except for Certificates authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Certificates pursuant to
Section 5.3. Such aggregate principal amount shall be allocated among one or
more Classes having designations, types of interests, initial per annum
Remittance Rates, initial Class Principal Balances and last scheduled
Distribution Dates as specified in the Preliminary Statement to this Agreement.
The aggregate Percentage Interest of each Class of Certificates of which the
Class Principal Balance equals zero as of the Cut-Off Date that may be
authenticated and delivered under this Agreement is limited to 100%.
Certificates shall be issued in Authorized Denominations.
Section 5.3. REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES. The
Trustee shall cause to be maintained at one of its offices or at its designated
Certificate Registrar, a Certificate Register in which there shall be recorded
the name and address of each Certificateholder. Subject to such reasonable
rules and regulations as the Trustee may prescribe, the Certificate Register
shall be amended from time to time by the Trustee or its agent to reflect notice
of any changes received by the Trustee or its agent pursuant to Section 10.5.
The Trustee hereby appoints itself as the initial Certificate Registrar. The
Trustee may appoint an Eligible Institution to act as its agent in order to
delegate to such Eligible Institution its duties as Certificate Registrar under
this Agreement
Upon surrender for registration of transfer of any Certificate to the
Trustee at the office of First Trust of New York, National Association, 100 Wall
Street, Suite 1600, New York, NY 10005, Attention: Glenn Anderson, or such
other address or agency as may hereafter be provided to the Certificate
Administrator, if any, and the Servicer in writing by the Trustee, the Trustee
shall execute, and the Trustee or any Authenticating Agent shall authenticate
and deliver, in the name of the designated transferee or transferees, one or
more new Certificates of Authorized Denominations of like Percentage Interest.
At the option of the Certificateholders, Certificates may be exchanged for other
Certificates in Authorized Denominations of like Percentage Interest, upon
surrender of the Certificates to be exchanged at any such office or agency.
Whenever any Certificates are so surrendered for exchange, the Trustee shall
execute, and the Trustee, or any Authenticating Agent, shall authenticate and
deliver, the Certificates which the Certificateholder making the exchange is
entitled to receive. Every Certificate presented or surrendered for transfer
shall (if so required by
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the Trustee or any Authenticating Agent) be duly endorsed by, or be accompanied
by a written instrument of transfer in form satisfactory to the Trustee or any
Authenticating Agent and duly executed by, the Holder thereof or such Holder's
attorney duly authorized in writing.
A reasonable service charge may be made for any such exchange or transfer
of Certificates, and the Trustee or an Authenticating Agent may require payment
of a sum sufficient to cover any tax or governmental charge that may be imposed
in connection with any exchange or transfer of Certificates.
Upon the transfer of a Class Certificate each transferee that purchases a
Class A Certificate with the assets of one or more Plans shall be deemed to
represent that each such Plan qualifies as an "accredited investor" as defined
in Rule 501(a)(1) of Regulation D under the Securities act. If at any time the
Class A Certificates fail to receive a rating from any of S&P or Fitch that is
one of the three highest generic rating categories for that respective rating
agency, then such Class A Certificate shall not thereafter be eligible for
transfer to a Plan, and each transferee shall be deemed to represent that it is
not purchasing or holding its Class A Certificate with plan assets of a Plan.
All Certificates surrendered for exchange or transfer shall be cancelled
by the Trustee or any Authenticating Agent.
Section 5.4. MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES. If (i)
any mutilated Certificate is surrendered to the Trustee or any Authenticating
Agent, or (ii) the Trustee or any Authenticating Agent receives evidence to
their satisfaction of the destruction, loss or theft of any Certificate, and
there is delivered to the Trustee or any Authenticating Agent 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 or any Authenticating Agent that such
Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute and the Trustee or any Authenticating Agent shall authenticate and
deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Certificate, a new Certificate of like Percentage Interest. Upon the
issuance of any new Certificate under this Section 5.4, the Trustee or any
Authenticating Agent 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 or any
Authenticating Agent) connected therewith. Any replacement Certificate issued
pursuant to this Section 5.4 shall constitute complete and indefeasible evidence
of ownership in the Trust Fund, as if originally issued, whether or not the lost
or stolen Certificate shall be found at any time.
Section 5.5. PERSONS DEEMED OWNERS. The Depositor, the Certificate
Administrator, the Servicer, the Trustee and any agent of any of them may treat
the Person in whose name any Certificate is registered as the owner of such
Certificate for the purpose of receiving distributions pursuant to Section 4.1
and for all other purposes whatsoever, and neither the Depositor, the
Certificate Administrator, if any, the Servicer, the Trustee, the Certificate
Registrar nor any agent of the Depositor, the Certificate Administrator, if any,
the Servicer or the Trustee shall be affected by notice to the contrary.
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Section 5.6. TEMPORARY CERTIFICATES. Upon the initial issuance of the
Certificates, the Trustee may execute, and the Trustee or any Authenticating
Agent shall authenticate and deliver, temporary Certificates which are printed,
lithographed, typewritten or otherwise produced, in any Authorized Denomination,
of the tenor of the definitive Certificates in lieu of which they are issued and
with such variations in form from the forms of the Certificates set forth as
Exhibits A and B hereto as the Trustee's officers executing such Certificates
may determine, as evidenced by their execution of the Certificates.
Notwithstanding the foregoing, the Certificates may remain in the form set forth
in this Section.
If temporary Certificates are issued, the Trustee shall cause definitive
Certificates to be prepared within ten Business Days of the Closing Date or as
soon as practicable thereafter. After preparation of definitive Certificates,
the temporary Certificates shall be exchangeable for definitive Certificates
upon surrender of the temporary Certificates at the office or agency of the
Trustee to be maintained as provided in Section 5.10 hereof, without charge to
the Holder. Any tax or governmental charge that may be imposed in connection
with any such exchange shall be borne by the Depositor. Upon surrender for
cancellation of any one or more temporary Certificates, the Trustee shall
execute and the Trustee or any Authenticating Agent shall authenticate and
deliver in exchange therefor a like principal amount of definitive Certificates
of Authorized Denominations. Until so exchanged, the temporary Certificates
shall in all respects be entitled to the same benefits under this Agreement as
definitive Certificates.
Section 5.7. BOOK-ENTRY FOR BOOK-ENTRY CERTIFICATES. Notwithstanding
the foregoing, the Book-Entry Certificates, upon original issuance, shall be
issued in the form of one or more typewritten Certificates of Authorized
Denomination representing the Book-Entry Certificates, to be delivered to DTC,
the initial Clearing Agency, by, or on behalf of, the Depositor. The Book-Entry
Certificates shall initially be registered on the Certificate Register in the
name of Cede & Co., the nominee of DTC, as the initial Clearing Agency, and no
Beneficial Holder shall receive a definitive certificate representing such
Beneficial Holder's interest in any Class of Book-Entry Certificate, except as
provided above and in Section 5.9. Each Book-Entry Certificate shall bear the
following legend:
Unless this Certificate is presented by an authorized
representative of The Depository Trust Company, a New York
corporation ("DTC"), to the Trustee or its agent for registration
of transfer, exchange, or payment, and any Certificate issued is
registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment
is made to Cede & Co. or to such other entity as is requested by
an authorized representative of DTC), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has
an interest herein.
Unless and until definitive, fully registered Book-Entry Certificates (the
"Definitive Certificates") have been issued to the Beneficial Holders pursuant
to Section 5.9:
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(a) the provisions of this Section 5.7 shall be in full force
and effect with respect to the Book-Entry Certificates;
(b) the Certificate Administrator, if any, and the Trustee may
deal with the Clearing Agency for all purposes with respect to the
Book-Entry Certificates (including the making of distributions on the
Book-Entry Certificates) as the sole Certificateholder;
(c) to the extent that the provisions of this Section 5.7
conflict with any other provisions of this Agreement, the provisions of
this Section 5.7 shall control; and
(d) the rights of the Beneficial Holders shall be exercised
only through the Clearing Agency and the DTC Participants and shall be
limited to those established by law and agreements between such
Beneficial Holders and the Clearing Agency and/or the DTC Participants.
Pursuant to the Depositary Agreement, unless and until Definitive
Certificates are issued pursuant to Section 5.9, the initial Clearing
Agency will make book-entry transfers among the DTC Participants and
receive and transmit distributions of principal and interest on the
related Class of Book-Entry Certificates to such DTC Participants.
For purposes of any provision of this Agreement requiring or permitting
actions with the consent of, or at the direction of, Holders of Book-Entry
Certificates evidencing a specified Percentage Interest, such direction or
consent may be given by the Clearing Agency at the direction of Beneficial
Holders owning Book-Entry Certificates evidencing the requisite Percentage
Interest represented by the Book-Entry Certificates. The Clearing Agency may
take conflicting actions with respect to the Book-Entry Certificates to the
extent that such actions are taken on behalf of the Beneficial Holders.
Section 5.8. NOTICES TO CLEARING AGENCY. Whenever notice or other
communication to the Certificateholders is required under this Agreement, unless
and until Definitive Certificates shall have been issued to the related
Certificateholders pursuant to Section 5.9, the Trustee shall give all such
notices and communications specified herein to be given to Holders of the
Book-Entry Certificates to the Clearing Agency which shall give such notices and
communications to the related DTC Participants in accordance with its applicable
rules, regulations and procedures.
Section 5.9. DEFINITIVE CERTIFICATES. If (a) the Clearing Agency
notifies the Certificate Administrator, if any, or the Trustee that it is no
longer willing or able to discharge properly its responsibilities under the
Depositary Agreement with respect to the Book-Entry Certificates and the Trustee
or the Certificate Administrator is unable to locate a qualified successor, (b)
the Depositor, at its option, advises the Certificate Administrator, if any, or
the Trustee in writing that it elects to terminate the book-entry system with
respect to the Book-Entry Certificates through the Clearing Agency or (c) after
the occurrence of an Event of Default, Certificateholders holding Book-Entry
Certificates evidencing Percentage Interests aggregating not less than 66% of
the aggregate Class Principal Balance of such Certificates advise the
Certificate Administrator, if any, or the Trustee and the Clearing Agency
through DTC Participants in writing that the continuation of a book-entry system
with respect to the Book-Entry Certificates through the Clearing Agency is no
longer in the
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best interests of the Certificateholders with respect to such
Certificates, the Trustee shall notify or cause to be notified all
Certificateholders of Book-Entry Certificates of the occurrence of any
such event and of the availability of Definitive Certificates. Upon
surrender to the Trustee of the Book-Entry Certificates by the Clearing
Agency, accompanied by registration instructions from the Clearing
Agency for registration, the Trustee shall execute and the Trustee or
any Authenticating Agent shall authenticate and deliver the Definitive
Certificates. Neither the Depositor, the Certificate Administrator, if
any, the Authenticating Agent nor the Trustee shall be liable for any
delay in delivery of such instructions and may conclusively rely on,
and shall be protected in relying on, such instructions. Upon the
issuance of Definitive Certificates for all of the Certificates all
references herein to obligations imposed upon or to be performed by the
Clearing Agency shall be deemed to be imposed upon and performed by the
Trustee, the Certificate Administrator, if any, or to the extent
applicable with respect to such Definitive Certificates, and the
Trustee, the Certificate Administrator, the Certificate Registrar and
the Paying Agent shall recognize the Holders of Definitive Certificates
as Certificateholders hereunder.
Section 5.10. OFFICE FOR TRANSFER OF CERTIFICATES. The Trustee shall
maintain in New York, New York, an office or agency where Certificates may be
surrendered for registration of transfer or exchange. First Trust of New York,
National Association, 100 Wall Street, Suite 1600, New York, New York 10005,
Attention: Glenn Anderson, is initially designated for said purposes.
ARTICLE VI
THE DEPOSITOR AND THE SERVICER
Section 6.1. LIABILITY OF THE DEPOSITOR AND THE SERVICER. The Depositor
and the Servicer shall each be liable in accordance herewith only to the extent
of the obligations specifically imposed by this Agreement and undertaken
hereunder by the Depositor and the Servicer herein.
Section 6.2. MERGER OR CONSOLIDATION OF THE DEPOSITOR OR THE
SERVICER. Subject to the following paragraph, the Depositor and the Servicer
each will keep in full effect its existence, rights and franchises as
corporations, each under the laws of the jurisdiction of its incorporation, and
will obtain and preserve its qualification to do business as a foreign
corporation in each jurisdiction in which such qualification is or shall be
necessary to protect the validity and enforceability of this Agreement, the
Certificates or any of the Loans and to perform its respective duties under this
Agreement.
The Depositor or the Servicer may be merged or consolidated with or into
any Person, or transfer all or substantially all of its assets to any Person, in
which case any Person resulting from any merger or consolidation to which the
Depositor or Servicer shall be a party, or any Person succeeding to the business
of the Depositor or Servicer, shall be the successor of the Depositor or
Servicer hereunder, without the execution or filing of any paper or any further
act on the part of any of the parties hereto, anything herein to the contrary
notwithstanding.
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Section 6.3. LIMITATION ON LIABILITY OF THE SERVICER AND
OTHERS. Neither the Servicer nor any of the directors, officers,
employees or agents of the Servicer shall be under any liability to the
Trust Fund or 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 any director, officer, employee or agent of
the Servicer against any liability which would otherwise be imposed by
reason of willful misfeasance, bad faith or gross negligence in the
performance of duties or by reason of reckless disregard of obligations
and duties hereunder, nor shall this provision protect the Servicer
against any liability that would otherwise be imposed by reason of
negligence in the performance of duties hereunder. The Servicer and
any director, officer, employee or agent of the Servicer may rely in
good faith on any document of any kind prima facie properly executed
and submitted by any Person respecting any matters arising hereunder.
The Servicer and any director, officer, employee or agent of the
Servicer shall be indemnified by the Trust Fund and held harmless
against any loss, liability or expense incurred in connection with any
legal action relating to this Agreement or the Certificates, other than
any loss, liability or expense, in the case of the Servicer and any
director, officer, employee or agent of the Servicer, 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 or, in the case of the Servicer, as
Servicer, incurred by reason of negligence in the performance of any
duties hereunder. The Servicer shall not be under any obligation to
appear in, prosecute or defend any legal action which is not incidental
to its duties to service the Loans in accordance with this Agreement
and which in its opinion may involve it in any expense or liability;
PROVIDED, HOWEVER, that the Servicer may in its discretion undertake
any such action which it may deem necessary or desirable in respect of
this Agreement and the rights and duties of the parties hereto and the
interests of 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 Servicer shall be entitled to be reimbursed therefor out of the
Custodial Account for P&I as provided by Section 3.3.
Section 6.4. SERVICER NOT TO RESIGN. The Servicer shall not resign from
the obligations and duties hereby imposed on it, except upon determination that
its duties hereunder are no longer permissible under applicable law or are in
material conflict by reason of applicable law with any other activities carried
on by it, the other activities of the Servicer so causing such a conflict being
of a type and nature carried on by the Servicer at the date of this Agreement.
Any such determination permitting the resignation of the Servicer shall be
evidenced by an Opinion of Counsel to such effect delivered to the Trustee. The
Servicer shall notify the Rating Agency of any such resignation. No such
resignation shall become effective until a successor servicer shall have assumed
the Servicer's responsibilities and obligations in accordance with Section 7.5
hereof.
Notwithstanding the limitations stated above, the Servicer may transfer
its obligations, duties and rights hereunder without the consent of the
Certificateholders, PROVIDED, that (i) the Servicer obtains the prior written
consent of the Rating Agency, (ii) the transferee is a FNMA- or FHLMC-approved
servicer having a net worth of not less than $15,000,000, (iii) the successor
servicer assumes all of the Servicer's responsibilities and obligations (except
the repurchase obligations set forth in Sections 2.2 and 2.3 hereof, which shall
remain obligations of the Depositor) in accordance
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with Section 7.5 hereof, and (iv) the then-current rating of the Class
A Certificates will not be reduced as a result of such transfer, and
(v) has, in the reasonable opinion of the Trustee, the qualifications,
resources and experience to properly carry out, observe and perform the
duties, obligations and responsibilities of Servicer hereunder;
PROVIDED, that the foregoing clause (v) is intended solely for the
benefit of (and may be exercised or waived at the sole discretion of)
the Trustee, to enable the Trustee to assure itself that any successor
Servicer has such acceptable qualifications, resources and experience,
and such clause (v) is not intended to be for the benefit of, and shall
not be relied upon or enforced by, any Certificateholder, and PROVIDED,
FURTHER, that any consent to such transfer will not be unreasonably
withheld by the Trustee.
ARTICLE VII
DEFAULT
Section 7.1. EVENTS OF DEFAULT. In case one or more of the following
Events of Default by the Servicer shall occur and be continuing, that is to say:
(i) any failure by the Servicer to distribute or cause to be
distributed to the Trustee or its delegate on the Withdrawal Date any
payment required to be made to the Trustee under the terms of this
Agreement.
(ii) any failure on the part of the Servicer duly to observe or
perform in any material respect any other of the covenants or agreements
on the part of the Servicer in the Certificates or in this Agreement
which continues unremedied for a period of 60 days after the date on
which written notice of such failure, requiring the same to be remedied,
shall have been given to the Servicer by the Trustee, or to the Servicer
and the Trustee by the Holders of Certificates evidencing, in aggregate,
not less than 25% of the Trust Fund or 51% of the aggregate Percentage
Interests of any class of certificates;
(iii) a decree or order of a court or agency or supervisory
authority having jurisdiction in the premises for the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment of
debt, marshalling of assets and liabilities or similar proceedings, or
for the winding-up or liquidation of its affairs, shall have been entered
against the Servicer and such decree or order shall have remained in
force undischarged or unstayed for a period of 60 days;
(iv) the Servicer shall consent to the appointment of a
conservator or receiver or liquidator or liquidating committee in any
insolvency, readjustment of debt, marshalling of assets and liabilities,
voluntary liquidation or similar proceedings of or relating to the
Servicer or of or relating to all or substantially all of its property;
(v) the Servicer shall admit in writing its inability to pay
its debts generally as they become due, file a petition to take advantage
of any applicable insolvency or
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reorganization statute, make an assignment for the benefit of its
creditors or voluntarily suspend payment of its obligations; or
(vi) any failure of the Servicer to make any Advance required to
be made from its own funds pursuant to Section 4.3 which continues
unremedied for a period of one Business Day after the date upon which
such Advance was to have been made;
then, if an Event of Default described in clauses (i)-(v) of this Section 7.1
shall occur, and in each and every such case, subject to applicable law, so long
as an Event of Default shall not have been remedied, either the Trustee or the
Holders of Certificates evidencing, in aggregate, not less than 25% of the Trust
Fund or 51% of the aggregate Percentage Interests of any Class of Certificates
by notice in writing to the Servicer (and to the Trustee if given by the
Certificateholders) may terminate all of the rights and obligations of the
Servicer under this Agreement, but without prejudice to any rights it may have
to reimbursement of expenses, Advances and other advances of its own funds as
Servicer to the extent permitted by this Agreement, other than the Depositor's
(or its successors') obligation to repurchase any Loans pursuant to Section 2.2
or 2.3 shall survive any such termination. If an Event of Default described in
clause (vi) hereof shall occur, the Trustee shall, by notice in writing to the
Servicer, which shall be telecopied to the Servicer, immediately terminate all
of the rights and obligations of the Servicer, under this Agreement and in and
to the Loans and the proceeds thereof. On or after the receipt by the Servicer
of such written notice, all authority and power of the Servicer under this
Agreement, whether with respect to the Certificates or the Loans or otherwise,
shall pass to and be vested in the Trustee pursuant to and under this Section
7.1 (subject to the provisions of Section 7.5); and, without limitation, the
Trustee is hereby authorized and empowered to execute and deliver, on behalf of
the Servicer, as attorney-in-fact or otherwise, any and all documents and other
instruments, and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement or assignment of the Loans and related
documents or otherwise at the expense of the Servicer. The Servicer agrees to
cooperate with the Trustee in effecting the termination of the Servicer's
responsibilities and rights hereunder and shall promptly provide the Trustee all
documents and records whether in written or electronic form reasonably requested
by it to enable it to assume the Servicer's functions hereunder and shall
promptly also transfer to the Trustee of this Agreement all amounts which then
have been or should have been deposited in the Custodial Account for P&I by the
Servicer or which are thereafter received with respect to the Loans as well as
any escrowed funds held by it or in connection with its servicing activities
hereunder. The Servicer and the Trustee shall give the Rating Agency notice of
any Event of Default.
Section 7.2. OTHER REMEDIES OF TRUSTEE. During the continuance of any
Event of Default, so long as such Event of Default shall not have been remedied,
the Trustee, in addition to the rights specified in Section 7.1, shall have the
right, in its own name as trustee of an express trust, to take all actions now
or hereafter existing at law, in equity or by statute to enforce its rights and
remedies and to protect the interests, and enforce the rights and remedies, of
the Certificateholders (including the institution and prosecution of all
judicial, administrative and other proceedings and the filing of proofs of claim
and debt in connection therewith). Except as otherwise expressly provided in
this Agreement, no remedy provided for by this Agreement shall be exclusive of
any other remedy, and
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each and every remedy shall be cumulative and in addition to any other remedy
and no delay or omission to exercise any right or remedy shall impair any
such right or remedy or shall be deemed to be a waiver of any Event of
Default.
Section 7.3. DIRECTIONS BY CERTIFICATEHOLDERS AND DUTIES OF TRUSTEE
DURING EVENT OF DEFAULT. During the continuance of any Event of Default,
Holders of Certificates evidencing, in aggregate, not less than 25% of the Trust
Fund or 51% of the aggregate Percentage Interests of any Class of Certificates
may direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or power conferred upon
the Trustee under this Agreement; PROVIDED, HOWEVER, that the Trustee shall be
under no obligation to pursue any such remedy, or to exercise any of the trusts
or powers vested in it by this Agreement (including, without limitation, (i) the
conducting or defending of any administrative action or litigation hereunder or
in relation hereto and (ii) the terminating of the Servicer or any successor
servicer from its rights and duties as servicer hereunder) at the request, order
or direction of any of the Certificateholders, unless such Certificateholders
shall have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which may be incurred therein or thereby; and,
PROVIDED, FURTHER, that, subject to the provisions of Section 8.1, the Trustee
shall have the right to decline to follow any such direction if the Trustee, in
accordance with an Opinion of Counsel, determines that the action or proceeding
so directed may not lawfully be taken or if the Trustee in good faith determines
that the action or proceeding so directed would involve it in personal liability
or be unjustly prejudicial to the non-assenting Certificateholders or if the
Trustee has received contrary directions pursuant to this Section 7.3.
Section 7.4. ACTION UPON CERTAIN FAILURES OF SERVICER AND UPON EVENT OF
DEFAULT. In the event that the Trustee shall have knowledge of any failure of
the Servicer specified in Section 7.1(i) or (ii) which would become an Event of
Default upon the Servicer's failure to remedy the same after notice, the Trustee
shall give notice thereof to the Servicer. In the event that the Trustee shall
have knowledge of an Event of Default, the Trustee shall give prompt written
notice thereof to the Certificateholders and to the Rating Agency. For all
purposes of this Agreement, in the absence of actual knowledge by a Responsible
Officer of the Trustee, the Trustee shall not be deemed to have knowledge of any
failure of the Servicer as specified in Section 7.1(i) and (ii) or any Event of
Default unless notified thereof in writing by the Servicer or by a
Certificateholder.
Section 7.5. APPOINTMENT OF SUCCESSOR SERVICER.
(a) When the Servicer receives a notice of termination pursuant
to Section 7.1 or the Trustee receives the resignation of the Servicer
evidenced by an Opinion of Counsel pursuant to Section 6.4, the Trustee
shall become the successor in all respects to the Servicer in its
capacity as Servicer under this Agreement and the transactions set forth
or provided for herein, PROVIDED, HOWEVER, that the Trustee's obligation
to make any Advances shall be no greater than set forth in Section 4.3 of
this Agreement, and the Trustee shall have all the rights and powers and
be subject to all the responsibilities, duties and liabilities relating
thereto placed on the Servicer by the terms and provisions hereof (except
those contained in Sections 2.2 and 2.3) and in its capacity as such
successor shall have the same limitation
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of liability herein granted to the Servicer and PROVIDED, FURTHER,
that the Trustee shall not be required to make an Advance from its own
funds if such Advance would be prohibited by law. As compensation
therefor, the Trustee shall be entitled to receive monthly an amount
not to exceed the Servicing Fee as agreed by the Trustee and the
Servicer, together with such other servicing compensation in the form
of assumption fees, late charges, prepayment fees or otherwise as
provided in Section 3.9. If the agreed amount is less than the
Servicing Fee, the excess shall be paid to the Class R
Certificateholder. If the Trustee and the Servicer shall not agree on
the amount of such compensation, the Trustee shall solicit bids for a
successor servicer as described in Section 7.5(b), PROVIDED, HOWEVER,
if no successor servicer is obtained through the bidding process, the
Trustee may act as such, or may pursuant to Section 7.5(b) appoint a
successor servicer to act as such, for the Servicing Fee together with
such other servicing compensation as provided in Section 3.9. In no
event shall the Trustee's assumption of or succession to the
obligations of the Servicer make the Trustee liable for any actions or
omissions of the Servicer in its capacity as Servicer.
(b) Notwithstanding the above, the Trustee may and shall, if it
is unable (or unwilling due to disagreement on compensation as provided
in Section 7.5(a)) to act as Servicer, appoint, or petition a court of
competent jurisdiction to appoint, any established housing and home
finance institution, bank or mortgage servicing institution which is an
approved FNMA or FHLMC servicer having a net worth of not less than
$15,000,000 and meeting such other standards as are set forth in
Section 6.4 hereof for a successor to the Servicer hereunder in the
assumption of all or any part of the responsibilities, duties or
liabilities of the Servicer hereunder (except the repurchase obligations
set forth in Sections 2.2 and 2.3 hereof, which shall remain obligations
of the Depositor); PROVIDED, HOWEVER, that until such appointment and
assumption, the Trustee will continue to perform the servicing
obligations pursuant to this Agreement (and until such time shall be
entitled to receive the Servicing Fees pursuant to Section 3.9);
PROVIDED, FURTHER, that prior to the appointment of any successor
servicer, the Rating Agencies confirm that the appointment of such
successor servicer would not result in the downgrade of the Rating
assigned to any Class of Certificates. The compensation of any successor
servicer so appointed shall be equal to the Servicing Fees specified in
Section 3.9 together with such other compensation as is provided in said
Section 3.9. In the event the Trustee is required to solicit bids as
provided above, the Trustee shall solicit, by public announcement, bids
from housing and home finance institutions, banks and mortgage servicing
institutions acceptable to the Trustee and meeting the qualifications set
forth above in this Section 7.5(b) for the purchase of the servicing
functions. Such public announcement shall specify that the successor
servicer shall be entitled to the full amount of the Servicing Fee on the
aggregate unpaid principal balance of the Loans as servicing compensation
for servicing the Loans, together with the other servicing compensation
in the form of assumption fees, late payment charges, prepayment fees or
otherwise as provided in Section 3.9. Within 45 days after any such
public announcement, the Trustee shall negotiate and effect the sale,
transfer and assignment of the servicing rights and responsibilities
hereunder (except the repurchase obligations set forth in Section 2.2 and
2.3 hereof, which shall remain obligations of the Depositor) to the
qualified party submitting the highest qualifying bid. The Trustee shall
deduct all costs and
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expenses of any public announcement and of any sale, transfer and
assignment of the servicing rights and responsibilities hereunder from
any sum received by the Trustee from the successor to the Servicer in
respect of such sale, transfer and assignment. After such deductions,
the remainder of such sum shall be paid by the Trustee to the Class R
Certificateholder at the time of such sale, transfer and assignment to
the Servicer's successor.
(c) The Servicer agrees to cooperate with the Trustee and any
successor servicer in effecting the termination of the Servicer's
servicing responsibilities and rights hereunder and shall promptly
provide the Trustee or such successor servicer, as applicable, all
documents and records reasonably requested by it to enable it to assume
the Servicer's functions hereunder and shall promptly also transfer to
the Trustee or such successor servicer, as applicable, all amounts which
then have been or should have been deposited in the Custodial Account for
P&I by the Servicer or which are thereafter received with respect to the
Loans. Neither the Trustee nor any other successor servicer shall be
deemed to be in default hereunder by reason of any failure to make, or
any delay in making, any distribution hereunder or any portion thereof
caused by the failure of the Servicer to deliver, or any delay in
delivering, cash, documents or records to it.
Section 7.6. NOTIFICATION TO CERTIFICATEHOLDERS. Upon any termination
of the Servicer or appointment of a successor to the Servicer, in each case as
provided herein, the Trustee shall as soon as practicable give written notice
thereof to Certificateholders at their respective addresses appearing in the
Certificate Register and the Rating Agency.
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.1. DUTIES OF TRUSTEE. The Trustee, prior to the occurrence of
an Event of Default and after the curing of all Events of Default which may have
occurred, undertakes to perform such duties and only such duties as are
specifically set forth in this Agreement. In case an Event of Default has
occurred (which has not been cured), the Trustee, subject to the provisions of
Sections 7.1, 7.3, 7.4 and 7.5, shall exercise such of the rights and powers
vested in it by this Agreement, and use the same degree of care and skill in
their exercise as a prudent person would exercise or use under the circumstances
in the conduct of such person's own affairs. Any permissive right of the
Trustee enumerated in this Agreement shall not be construed as a duty.
Subject to Sections 8.2(i), 8.3 and 8.4, the Trustee, upon receipt of all
resolutions, certificates, statements, opinions, reports, documents, orders or
other instruments furnished to the Trustee which are specifically required to be
furnished pursuant to any provision of this Agreement, shall examine them to
determine whether they are in the form required by this Agreement; PROVIDED,
HOWEVER, that the Trustee shall not be responsible for the accuracy or content
of any resolution, certificate, statement, opinion, report, document, order or
other instrument furnished by any party hereunder. If any such instrument is
found not to conform to the requirements of this Agreement
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in a material manner, the Trustee shall take action as it deems appropriate
to have the instrument corrected, and if the instrument is not corrected to
the Trustee's reasonable satisfaction, the Trustee will provide notice
thereof to the Certificateholders and the Rating Agency.
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 or in the event the Trustee is acting as successor
servicer pursuant to Section 7.5, to the standard imposed on the Servicer
pursuant to Section 6.3 of this Agreement; PROVIDED, HOWEVER, that:
(i) Prior to the occurrence of an Event of Default and after
the curing of all such Events of Default which may have occurred, the
duties and obligations of the Trustee shall be determined solely by the
express provisions of this Agreement, the Trustee shall not be liable
except for the performance of such duties and obligations as are
specifically set forth in this Agreement, no implied covenants or
obligations shall be read into this Agreement against the Trustee and, in
the absence of bad faith on the part of the Trustee, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon any certificates or opinions
furnished to the Trustee and conforming to the requirements of this
Agreement;
(ii) The Trustee shall not be personally liable with respect to
any action taken, suffered or omitted to be taken by it in good faith in
accordance with this Agreement or at the direction of Certificateholders
holding Certificates which have an aggregate Principal Balance not less
than 25% of the aggregate Principal Balance of all Certificates relating
to the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising or omitting to exercise any trust
or power conferred upon the Trustee, under this Agreement;
(iii) The Trustee shall not be liable in its individual capacity
for any error of judgment made in good faith by any Responsible Officer,
unless it shall be proved that the Trustee or such Responsible Officer
was negligent in ascertaining the pertinent facts;
(iv) The Trustee shall not be liable for any act or omission of
the Depositor or the Servicer (except for its own acts or omissions as
Servicer hereunder) or for any but its own acts or omissions;
(v) The Trustee shall not be deemed to take notice or be deemed
to have knowledge of any matter, including without limitation any default
or Event of Default, unless written notice thereof, referring to the
Certificates, the Depositor, the Trust Fund or this Agreement is received
by a Responsible Officer of the Trustee at its Corporate Trust Office;
and
(vi) Subject to the other provisions of this Agreement and
without limiting the generality of this Section 8.1, the Trustee shall
have no duty (A) to see to any recording, filing, or depositing of this
Agreement or any agreement referred to herein or any financing
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statement or continuation statement evidencing a security interest, or
to see to the maintenance of any such recording or filing or
depositing or to any rerecording, refiling or redepositing of any
thereof, (B) to see to any insurance, (C) to see to the payment or
discharge of any tax, assessment, or other governmental charge or any
lien or encumbrance of any kind owing with respect to, assessed or
levied against, any part of the Trust Fund other than from funds
available in the Certificate Account, and (D) to confirm or verify the
contents of any reports or certificates of the Servicer delivered to
the Trustee pursuant to this Agreement believed by the Trustee to be
genuine and to have been signed or presented by the proper party or
parties.
None of the provisions contained in this Agreement shall require the
Trustee to expend or risk its own funds or otherwise incur financial liability
in the performance of any of its duties as Trustee hereunder or in the exercise
of any of its rights or powers if there is reasonable ground for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it, and none of the provisions contained in this
Agreement shall in any event require the Trustee to perform, or be responsible
for the manner of performance of, any of the obligations of the Servicer under
this Agreement except during such time, if any, as the Trustee shall be the
successor to, and be vested with the rights, duties, powers and privileges of,
the Servicer in accordance with the terms of this Agreement.
Section 8.2. CERTAIN MATTERS AFFECTING TRUSTEE. Except as otherwise
provided in Section 8.1:
(i) Before acting or refraining from acting the Trustee may
request or require an Officer's Certificate; the Trustee may rely and
shall be protected in acting or refraining from acting upon any
resolution, Officer's Certificate, opinion of counsel, certificate of
auditors or any other certificate, statement, instrument, opinion,
report, notice, request, consent, order, appraisal, bond or other paper
or document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(ii) The Trustee may consult with counsel, and any advice or
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 personally liable for any action
taken, suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon it
by this Agreement;
(iv) The right of the Trustee to perform any discretionary act
enumerated in this Agreement shall not be construed as a duty, and the
Trustee shall not be answerable for other than its negligence or willful
misconduct in the performance of such act;
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(v) The Trustee shall not be required to give any bond or
surety in respect of the execution of the Trust Fund created hereby or
the powers granted hereunder; and
(vi) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents, attorneys or custodians, and the Trustee shall not be
responsible for any misconduct or negligence on the part of any such
agent, attorney or custodian appointed by the Trustee with care. Any
such agents, attorneys or custodians shall be entitled to all indemnities
and protection afforded to the Trustee. Any designee of the Trustee
shall be considered its "agent" hereunder whether performing it as an
independent contractor or otherwise.
Section 8.3. TRUSTEE NOT REQUIRED TO MAKE INVESTIGATION. Prior to the
occurrence of an Event of Default hereunder and after the curing of all Events
of Default which may have occurred, the Trustee shall not be bound to ascertain
or inquire as to the performance or observance of any of the terms, conditions,
covenants or agreements herein or to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, consent, order, approval, bond, Mortgage, Mortgage Note
or other paper or document, unless requested in writing so to do by Holders of
Certificates having a Percentage Interest not less than 51% of the Trust Fund;
PROVIDED, HOWEVER, that if the payment within a reasonable time to the Trustee
of the costs, expenses or liabilities likely to be incurred by it in the making
of such investigation is, in the opinion of the Trustee, not reasonably assured
to the Trustee by the security afforded to it by the terms of this Agreement,
the Trustee may require reasonable indemnity against such expense or liability
as a condition to such proceeding. The reasonable expense of every such
examination shall be paid by the Depositor or, if paid by the Trustee, shall be
repaid by the Depositor upon demand.
Section 8.4. TRUSTEE NOT LIABLE FOR CERTIFICATES OR LOANS. The recitals
contained herein and in the Certificates (other than the certificate of
authentication on the Certificates) shall be taken as the statements of the
Depositor, and the Trustee assumes no responsibility for the correctness of the
same. The Trustee makes no representations or warranties as to the validity or
sufficiency of this Agreement or of the Certificates or of any Loan or related
document. The Trustee shall not be accountable for the use or application by
the Depositor of any of the Certificates or of the proceeds of such Certificates
or for the use or application of any funds paid to the Servicer in respect of
the Loans or deposited in or withdrawn from the Custodial Account for P&I by the
Servicer or for investment of any such amounts. The Trustee shall not be
responsible for the legality or validity of this Agreement or the validity,
priority, perfection or sufficiency of the security for the Certificates issued
or intended to be issued hereunder. The Trustee shall have no responsibility
for filing any financing or continuation statement in any public office at any
time or to otherwise perfect or maintain the perfection of any security interest
or lien granted to it hereunder or to record this Agreement.
Neither the Trustee nor any of the directors, officers, employees or
agents of the Trustee shall be under any liability to the Trust Fund or 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
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judgment while an Event of Default exists; PROVIDED, HOWEVER, that this
provision shall not protect the Trustee or any such person against any
liability which would otherwise be imposed by reason of willful misfeasance,
bad faith or negligence in the performance of duties. The Trustee and any
director, officer, employee or agent of the Trustee shall be indemnified by
the Depositor and held harmless against any loss, liability or expense,
including reasonable attorneys' fees, incurred in connection with or related
to the Trustee's performance of its powers and duties under this Agreement
(including, without limitation, performance under Section 8.1 hereof), or any
action relating to this Agreement or the Certificates, or the performance of
the Trustee's duties hereunder, other than any loss, liability or expense
incurred by any such Person by reason of willful misfeasance, bad faith or
negligence in the performance of duties. Any such losses, liabilities and
expenses resulting therefrom shall be losses, liabilities and expenses of the
Depositor. The indemnification provided hereunder shall survive termination
of this Agreement.
Section 8.5. TRUSTEE MAY OWN CERTIFICATES. The Trustee and any agent of
the Trustee in its individual or any other capacity may become the owner of or a
pledgee of the Certificates with the same rights it would have if it were not
Trustee or such agent, and may otherwise deal with the parties hereto.
Section 8.6. SERVICER TO PAY TRUSTEE'S FEES AND EXPENSES. The Servicer
covenants and agrees to pay to the Trustee monthly (or as otherwise agreed), and
the Trustee shall be entitled to receive, reasonable compensation (which shall
not be limited by any provision of law in regard to the compensation of a
trustee of an express trust) for all services rendered by it in the execution of
the trusts hereby created and in the exercise and performance of any of the
powers and duties hereunder of the Trustee, and the Servicer shall pay or
reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances, including reasonable attorneys' fees, incurred or
made by the Trustee in accordance with any of the provisions of this Agreement
(including the reasonable compensation and the expenses and disbursements of its
counsel and of all persons not regularly in its employ) except any such expense,
disbursement or advance as may arise from its negligence or bad faith. The Tax
Matters Person (or Person acting as its attorney-in-fact or agent) shall
indemnify the Trustee for any liability of or assessment against the Trustee
resulting from any error in any tax or tax information returns prepared or
caused to be prepared by such Person. In the event that (i) the Servicer does
not pay to the Trustee any compensation owed to the Trustee pursuant to this
Agreement or (ii) the Trustee is not reimbursed for any expense, disbursement or
advance incurred or made by the Trustee pursuant to this Agreement, the Trustee
shall be entitled to withdraw and retain such amount from the Certificate
Account. In the event the Trustee incurs expenses or renders services in any
proceedings which result from an Event of Default under Section 7.1, subsections
(iii), (iv) or (v) of this Agreement, or from any default which, with the
passage of time, would become an Event of Default, the expenses so incurred and
compensation for services so rendered are intended to constitute expenses of
administration under the United States Bankruptcy Code or equivalent law.
Section 8.7. ELIGIBILITY REQUIREMENTS FOR TRUSTEE. The Trustee
hereunder shall at all times be a corporation or association organized and doing
business under the laws of any state of the United States of America, authorized
under such laws to exercise corporate trust powers, having a
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combined capital and surplus of at least $50,000,000 and subject to
supervision or examination by federal or state authority. The Trustee shall
not control the Servicer nor be a parent of or a subsidiary of the Servicer.
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 8.7 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 8.7,
the Trustee shall resign immediately in the manner and with the effect
specified in Section 8.8.
Section 8.8. 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 Servicer. Such notice shall also be furnished to
the Rating Agency. Upon receiving such notice of resignation, the Servicer
shall promptly appoint a successor trustee by written instrument, in duplicate,
one copy of which instrument shall be delivered to the resigning Trustee and one
copy to the successor trustee. If no successor trustee shall have been so
appointed and have accepted appointment within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee at the expense of the
Servicer.
If at any time the Trustee shall cease to be eligible in accordance with
the provisions of Section 8.7 and shall fail to resign after written request for
the Trustee's resignation by the Servicer, or if at any time the Trustee shall
become incapable of acting, or shall be adjudged bankrupt or insolvent, or a
receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, then,
with or without cause, the Servicer may remove the Trustee and appoint a
successor trustee by written instrument, in duplicate, one copy of which
instrument shall be delivered to the Trustee so removed and one copy to the
successor trustee.
The Holders of Certificates having a Percentage Interest aggregating not
less than 51% of the aggregate Denomination of all Certificates 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 instrument or instruments shall be
delivered to the Servicer, one complete set to the Trustee so removed and one
complete set to the successor trustee so appointed.
Any resignation or removal of the Trustee and appointment of a successor
trustee pursuant to any of the provisions of this Section 8.8 shall become
effective only upon acceptance of appointment by the successor trustee as
provided in Section 8.9.
Section 8.9. SUCCESSOR TRUSTEE. Any successor trustee appointed as
provided in Section 8.8 shall execute, acknowledge and deliver to the Servicer
and to its predecessor trustee an instrument accepting such appointment
hereunder, and thereupon the resignation or removal of the predecessor trustee
shall become effective, and such successor trustee, without any further act,
deed or conveyance, shall become fully vested with all the rights, powers,
duties and obligations of its
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predecessor hereunder, with like effect as if originally named as trustee
herein. The predecessor trustee shall deliver or cause to be delivered to
the successor trustee all Mortgage Files and related documents and statements
held by it hereunder (other than any Mortgage Files at the time held by the
Custodian, if it shall agree to become the agent of any successor trustee
hereunder), and the Servicer 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
8.9 unless at the time of such acceptance such successor trustee shall be
eligible under the provisions of Section 8.7.
Upon acceptance of appointment by a successor trustee as provided in this
Section 8.9, the Servicer shall mail notice of the succession of such trustee
hereunder to all holders of Certificates at their addresses as shown in the
Certificate Register and to the Rating Agency. If the Servicer fails to mail
such notice within ten days after acceptance of appointment by the successor
trustee, the successor trustee shall cause such notice to be mailed at the
expense of the Servicer.
Section 8.10. MERGER OR CONSOLIDATION OF TRUSTEE. Any Person into which
the Trustee may be merged or converted or with which it may be consolidated, or
any Person resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any Person succeeding to all or substantially all
of the corporate trust business of the Trustee, shall be the successor of the
Trustee hereunder, PROVIDED, that such Person shall be eligible under the
provisions of Section 8.7, 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 8.11. APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.
Notwithstanding any other provisions hereof, at any time, for the purpose of
meeting any legal requirements of any jurisdiction in which any part of the
Trust Fund or property securing the same may at the time be located, the
Servicer and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee to act as co-trustee or co-trustees, jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of the Trust Fund, and
to vest in such Person or Persons, in such capacity, such title to the Trust
Fund, or any part thereof, and, subject to the other provisions of this
Section 8.11, such powers, duties, obligations, rights and trusts as the
Servicer and the Trustee may consider necessary or desirable. If the Servicer
shall not have joined in such appointment within 15 days after the receipt by it
of a request so to do, or in case an Event of Default shall have occurred and be
continuing, the Trustee alone shall have the power to make such appointment.
Each co-trustee or separate trustee hereunder shall not be required to meet the
terms of eligibility as a successor trustee under Section 8.7 hereunder but no
notice to holders of Certificates of the appointment of co-trustee(s) or
separate trustee(s) shall be required under Section 8.9 hereof.
In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 8.11, 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
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or co-trustee jointly, except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed (whether
as Trustee hereunder or as successor to the Servicer hereunder), the Trustee
shall be incompetent or unqualified to perform such act or acts, in which
event such rights, powers, duties and obligations (including the holding of
title to the Trust Fund or a portion thereof in any such jurisdiction) shall
be exercised and performed by such separate trustee or co-trustee at the
direction of the Trustee.
Any notice, request or other writing given to the Trustee shall be deemed
to have been given to each of the then separate trustees and co-trustees, as
effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article VIII. 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.
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. The Trustee shall not be responsible
for any action or inaction of any such separate trustee or co-trustee. If any
separate trustee or co-trustee shall die, become incapable of acting, resign or
be removed, all of its estates, properties, rights, remedies and trusts shall
vest in and be exercised by the Trustee, to the extent permitted by law, without
the appointment of a new or successor trustee.
The Trustee may appoint one or more Eligible Institutions to act as its
agent or agents to perform any or all of its duties and obligations under this
Agreement. Each such agent shall be subject to all of 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.
Section 8.12. APPOINTMENT OF CUSTODIANS. The Trustee may, with the
consent of the Servicer, appoint one or more Custodians, not affiliated with the
Depositor, to review, pursuant to Section 2.2 hereof, and hold all or a portion
of the Mortgage Files as agent for the Trustee PROVIDED, HOWEVER, that such
appointed Custodian may be LaSalle National Bank. Any Custodian appointed shall
be an institution subject to supervision by federal or state authority, shall
have combined capital and surplus of at least $50,000,000 and shall be qualified
to do business in the jurisdiction in which it holds any Mortgage File.
Section 8.13. AUTHENTICATING AGENT.
(a) The Trustee may appoint from time to time an authenticating
agent (the "Authenticating Agent") which shall be authorized to act on
behalf of the Trustee in authenticating Certificates. Wherever reference
is made in this Agreement to the
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authentication of Certificates by the Trustee or the Trustee's
certificate of authentication, such reference shall be deemed to include
authentication on behalf of the Trustee by the Authenticating Agent and
a certificate of authentication executed on behalf of the Trustee by the
Authenticating Agent. Any successor Authenticating Agent must be
acceptable to the Servicer and have a principal office and place of
business in New York, New York or Chicago, Illinois, have a combined
capital and surplus of at least $50,000,000, and be authorized to do a
trust business and subject to supervision or examination by federal or
state authorities.
(b) Any corporation into which the Authenticating Agent may be
merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion or consolidation to
which the Authenticating Agent shall be a party, or any corporation
succeeding to all or substantially all of the corporate agency business
of the Authenticating Agent, shall continue to be the Authenticating
Agent without the execution or filing of any paper or any further act on
the part of the Trustee or the Authenticating Agent.
(c) The Authenticating Agent may at any time resign by giving
at least 30 days' advance written notice of resignation to the Trustee
and to the Servicer. The Trustee may at any time terminate the agency of
the Authenticating Agent by giving written notice of termination to the
Authenticating Agent and to the Servicer. Upon receiving a notice of
resignation or upon such a termination, or in case at any time the
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section 8.13, the Trustee promptly shall appoint a
successor Authenticating Agent, shall give written notice of such
appointment to the Servicer and shall mail notice of such appointment to
all Certificateholders. Any successor Authenticating Agent upon
acceptance of its appointment hereunder shall become vested with all the
rights, powers, duties and responsibilities of its predecessor hereunder,
with like effect as if originally named as Authenticating Agent herein.
No successor Authenticating Agent shall be appointed unless eligible
under the provisions of this Section 8.13.
(d) The Authenticating Agent shall have no responsibility or
liability for any action taken by it as such at the direction of the
Trustee. Any reasonable compensation paid to the Authenticating Agent
shall be a reimbursable expense under Section 8.6.
Section 8.14. BLOOMBERG. As soon as practicable after the Closing Date,
the Trustee or the Certificate Administrator, if any, will arrange with
Bloomberg to have the Depositor set up on Bloomberg to provide the information
set forth on Exhibit Q (the "Data") with respect to the Loans on a monthly basis
in a format acceptable to Bloomberg and acceptable to the Underwriters. During
the term of this Agreement, the Trustee will provide updated Data to Bloomberg
on or before each Distribution Date.
Section 8.15. REPORTS TO SECURITIES AND EXCHANGE COMMISSION. Unless
otherwise directed by the Depositor in writing, the Certificate Administrator or
the Trustee, as applicable, shall prepare,
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sign and file with the Securities and Exchange Commission, on behalf of the
Depositor, (i) no later than ten days after each Distribution Date, the
Certificateholders' Report on the appropriate form and in the appropriate
medium authorized or prescribed therefor under the Exchange Act , (ii) no
later than March 15 of each calendar year, an annual report meeting the
requirements of the Exchange Act on the appropriate form and in the
appropriate medium authorized or prescribed therefor under the Exchange Act.
The Trustee or the Certificate Administrator, as applicable, shall promptly
forward copies of all filings made pursuant to this Section 8.15 to the
Depositor.
ARTICLE IX
TERMINATION
Section 9.1. TERMINATION UPON PURCHASE BY THE DEPOSITOR OR LIQUIDATION
OF ALL LOANS. The respective obligations and responsibilities of the Servicer
and the Trustee created hereby (other than the obligation to make payments to
Certificateholders as hereafter set forth in this Section 9.1 and obligations to
the Trustee in Sections 8.4 and 8.6) shall terminate upon the earlier of (i) the
later of the final payment or other liquidation (or any Advance with respect
thereto) of the last Loan remaining in the Trust Fund and the disposition of all
property acquired in respect of any Loan or (ii) the purchase by the Depositor
of all Loans at a price equal to the sum of (a) the principal balance of each
Loan plus accrued interest thereon at the applicable Pass-Through Rate to the
next scheduled Installment Due Date, less any Nonrecoverable Advances made with
respect to any such Loans and (b) the fair market value of all acquired property
in respect of Loans, less any Nonrecoverable Advances made with respect to any
such Loans, such fair market value to be determined by an appraiser selected by
the Trustee or (iii) the purchase by the Servicer, so long as the Servicer is
the Depositor, of all outstanding Certificates and delivery of such Certificates
to the Trustee; PROVIDED, HOWEVER, that in no event shall the trust created
hereby continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of Joseph P. Kennedy, the late ambassador of the
United States to the Court of St. James, living on the date hereof; and
PROVIDED, FURTHER, that a "plan of liquidation" of each of REMIC I and II in
accordance with Section 860F of the Code must be adopted in conjunction with any
termination effected pursuant to subclauses (i), (ii), or (iii) of this
Section 9.1.
The Depositor is hereby granted the right to purchase the Loans pursuant
to clause (ii) above, PROVIDED, HOWEVER, that such right shall be conditioned
upon the Principal Balances of such Loans, at the time of any such purchase,
aggregating an amount less than 10% of the aggregate Principal Balance of the
Loans on the Cut-off Date, after deduction of payments due on or before such
date.
Notice of any termination pursuant to clause (i) or (ii) above,
specifying the Distribution Date upon which all Certificateholders may surrender
their Certificates to the Trustee or its agent for payment and cancellation,
shall be given promptly by the Trustee or its agent (upon direction by the
Servicer no less than 10 days prior to the date such notice is to be mailed) by
letter to Certificateholders and the Rating Agency mailed by first class mail no
later than the 25th day of the month preceding the month of such final
distribution specifying (i) the Distribution Date upon which
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final payment on the Certificates will be made upon presentation and
surrender of Certificates at the office or agency of the Trustee or the
Certificate Registrar therein designated, (ii) the amount of any such final
payment and (iii) that the Record Date otherwise applicable to such
Distribution Date is not applicable, payments being made only upon
presentation and surrender of the Certificates at the office or agency of the
Trustee or the Certificate Registrar therein specified. The Trustee or its
agent shall give such notice to the Certificate Registrar and the Rating
Agency at the time such notice is given to the Certificateholders. Upon any
such termination, the duties of the Certificate Registrar shall also
terminate. In the event such notice is given in connection with the
Depositor's election to purchase, the Depositor shall deposit in the
Certificate Account on the related Withdrawal Date an amount equal to the
above-described purchase price and upon such deposit Certificateholders will
be entitled to the amount of such purchase price but not amounts in excess
thereof, all as provided herein. Upon presentation and surrender of the
Certificates pursuant to any termination under this Section 9.1, the Trustee
or Paying Agent shall cause to be distributed to Certificateholders an amount
equal to (a) the amount otherwise distributable on such Distribution Date, if
not in connection with a purchase; or (b) if the Depositor elected to so
purchase, the purchase price calculated as above provided. Upon any
termination pursuant to clause (iii) above, or upon certification to the
Trustee by a Servicing Officer following such final deposit, the Trustee and
any Custodians shall promptly release to the Servicer the Mortgage Files for
the remaining Loans, and the Trustee shall execute all assignments,
endorsements and other instruments necessary to effectuate such transfer.
In the event that all of the Certificateholders shall not surrender their
Certificates for cancellation within three months after the time specified in
the above-mentioned written notice, the Trustee or its agent shall give a second
written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within three months after the second notice all the Certificates
shall not have been surrendered for cancellation, the Trustee or its agent shall
take appropriate and reasonable steps as directed by the Servicer, 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 in
trust hereunder.
Section 9.2. TRUSTS IRREVOCABLE. Except as expressly provided herein,
all trusts created hereby are irrevocable.
Section 9.3. ADDITIONAL TERMINATION REQUIREMENTS.
(a) In the event the Depositor exercises its purchase option as
provided in Section 9.1, the Trust Fund shall be terminated in accordance
with the following additional requirements, unless the Trustee and the
Certificate Administrator have received an Opinion of Counsel to the
effect that the failure of the Trust Fund to comply with the requirements
of this Section 9.3 will not (i) result in the imposition of taxes on
"prohibited transactions" of REMIC I or REMIC II of the Trust Fund as
described in Section 860F(a)(2) of the Code, or (ii) cause either REMIC I
or REMIC II of the Trust Fund to fail to qualify as a REMIC at any time
that any Certificates are outstanding:
99
<PAGE>
(A) Within 90 days prior to the final Distribution Date
set forth in the notice given by the Depositor under Section 9.1,
the Tax Matters Person shall prepare the documents associated with
and shall adopt a plan of complete liquidation of each of REMIC I
and REMIC II of the Trust Fund; and
(B) At or after the time of adoption of such a plan of
complete liquidation and at or prior to the final Distribution
Date, the Servicer as agent of the Trustee shall sell all of the
assets of the Trust Fund to the Depositor for cash in accordance
with such plan of liquidation; PROVIDED, HOWEVER, that in the
event that a calendar quarter ends after the time of adoption of
such a plan of complete liquidation but prior to the final
Distribution Date, the Servicer shall not sell any of the assets
of the Trust Fund prior to the close of that calendar quarter.
(b) The Tax Matters Person hereby agrees to adopt such a plan
of complete liquidation and to take such other action in connection
therewith as may be reasonably requested by the Servicer.
ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.1. AMENDMENT. This Agreement may be amended from time to time
by the Depositor and the Trustee, without the consent of any of the
Certificateholders, (a) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other provision herein, or
to make any other provisions with respect to matters or questions arising under
this Agreement, or (b) to modify, eliminate or add to any provisions to such
extent as shall be necessary to maintain the qualification of the Trust Fund as
a REMIC at all times that any Class A or Subordinate Certificates are
outstanding, PROVIDED, that the Trustee has received an Opinion of Counsel to
the effect that such action is necessary or desirable to maintain such
qualification, PROVIDED, that such action under clauses (a) and (b) above shall
not, as evidenced by an Opinion of Counsel, adversely affect in any material
respect the interests of any Certificateholder.
This Agreement may also be amended from time to time by the Depositor and
the Trustee with the consent of the Holders of Certificates evidencing, in
aggregate, not less than 50% of the Trust Fund for the purpose of adding any
provisions or changing in any manner or eliminating any of the provisions of
this Agreement or of modifying in any manner the rights of the Holders of
Certificates; PROVIDED, HOWEVER, that no such amendment shall (a) reduce in any
manner the amount of, or delay the timing of, payments received on Loans which
are required to be distributed in respect of any Certificate without the consent
of the Holder of such Certificate; (b) adversely affect in any material respect
the interest of the Holders of the Class A Certificates in a manner other
than as described in (a) above without the consent of the Holders of Class A
Certificates aggregating not less than 66-22/3% of the aggregate Percentage
Interest evidenced by all Class A Certificates; (c) adversely affect in any
material respect the interest of the Holders of the Subordinate Certificates
in a manner other than as described in (a) above without the consent of the
Holders of Class A Certificates aggregating not less than 66-2/3% of the
aggregate Percentage Interest evidenced by all Class A Certificates; (c)
adversely affect in any material respect the interest of the Holders of the
Subordinate Certificates
100
<PAGE>
in a manner other than as described in clause (a) above without the consent
of the Holders of Subordinate Certificates aggregating not less than 66-2/3%
of the aggregate Percentage Interest evidenced by all Subordinate
Certificates; (d) adversely affect in any material respect the interest of
the Class R Certificateholder without the consent of the Holders of the Class
R Certificate; (e) change in any material respect the rights and obligations
of the Servicer or successor Servicer under this Agreement without the prior
written consent of such party; or (f) reduce the aforesaid percentage of the
Certificates the Holders of which are required to consent to any such
amendments without the consent of the Holders of all Certificates then
outstanding; PROVIDED, that for the purposes of this Agreement, the Holder of
the Class R Certificate shall have no right to vote at all times that any
Class A or Subordinate Certificates are outstanding if such amendment relates
to the modification, elimination or addition of any provision necessary to
maintain the qualification of the Trust Fund as a REMIC.
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 to the effect that such amendment will not cause
either REMIC I or REMIC II of the Trust Fund to fail to qualify as a REMIC at
any time that any REMIC I Regular Interests or REMIC II Certificates are
outstanding.
As soon as practicable after the execution of any such amendment, the
Trustee shall furnish written notification of the substance of such amendment to
each Certificateholder and the Rating Agency.
It shall not be necessary for the consent of the Certificateholders under
this Section 10.1 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.
Prior to the execution of any amendment to this Agreement, the Trustee
shall be entitled to receive and rely upon an opinion of counsel stating that
the execution of such amendment is authorized or permitted by this Agreement.
The Trustee may, but shall not be obligated to, enter into any such amendment
which affects the Trustee's own rights, duties or immunities under this
Agreement.
Section 10.2. 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 for real property records in all
the counties or other comparable jurisdictions in which any or all of the
properties subject to the Mortgages are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected by the
Servicer at its expense, but only after the Depositor has delivered to the
Trustee an Opinion of Counsel to the effect that such recordation materially and
beneficially affects the interests of the Certificateholders.
101
<PAGE>
For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
Section 10.3. LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS. The death or
incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust Fund, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or take any action or proceeding
in any court for a partition or winding up of the Trust Fund, nor otherwise
affect the rights, obligations and liabilities of the parties hereto or any of
them.
Except as otherwise expressly provided herein no Certificateholder,
solely by virtue of its status as a Certificateholder, shall have any right to
vote or in any manner otherwise control the operation and management of the
Trust 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
person by reason of any action taken by the parties to this Agreement pursuant
to any provision hereof.
No Certificateholder, solely by virtue of its status as
Certificateholder, shall have any right by virtue or by availing of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
holder previously shall have given to the Trustee a written notice of default
and of the continuance thereof, as hereinbefore provided, and unless all of the
Holders of Certificates evidencing, in aggregate, not less than 25% of the Trust
Fund shall have made written request upon the Trustee to institute such action,
suit or proceeding in its own name as Trustee hereunder and shall have offered
to the Trustee such reasonable indemnity as it may require against the costs,
expenses and liabilities to be incurred therein or thereby, and the Trustee, for
60 days after its receipt of such notice, request and offer of indemnity, shall
have neglected or refused to institute any such action, suit or proceeding; it
being understood and intended, and being expressly covenanted by each
Certificateholder with every other Certificateholder and the Trustee, that no
one or more holders of Certificates shall have any right in any manner whatever
by virtue or by availing of any provision of this Agreement to affect, disturb
or prejudice the rights of the Holders of any other of such Certificates, or to
obtain or seek to obtain priority over or preference to any other such Holder,
or to enforce any right under this Agreement, except in the manner herein
provided and for the benefit of all Certificateholders. For the protection and
enforcement of the provisions of this Section 10.3, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
Section 10.4. GOVERNING LAW; JURISDICTION. THIS AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD
TO CONFLICTS OF LAWS PRINCIPLES), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF
THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
102
<PAGE>
Section 10.5. NOTICES. All demands, notices and communications hereunder
shall be in writing and shall be deemed to have been duly given if personally
delivered at or mailed by certified or registered mail, return receipt requested
(a) in the case of the Depositor, to ABN AMRO Mortgage Corporation, 181 West
Madison Street, Suite 3250, Chicago, Illinois 60602, Attention: Maria Fregosi -
Director - ABN AMRO Mortgage Operations, or such other address as may hereafter
be furnished to the Servicer and the Trustee in writing by the Depositor, (b) in
the case of the Servicer, to LaSalle Home Mortgage Corporation, 4242 North
Harlem Avenue, Norridge, Illinois 60634, Attention: Servicer, or such other
address as may hereafter be furnished to the Depositor and the Trustee in
writing by the Servicer, (c) in the case of the Trustee, to the Corporate Trust
Office, or such other address as may hereafter be furnished to the Depositor and
the Servicer in writing by the Trustee, in each case Attention: Corporate Trust
Department, (d) in the case of S&P, to Standard & Poor's Rating Services, 26
Broadway, 10th Floor, New York, New York 10004-1064, Attention: Residential
Mortgage Surveillance Group, or such other address as may hereinafter be
furnished to the Depositor in writing by S&P and (e) in the case of Fitch, to
Fitch IBCA, Inc., One State Street Plaza, 32nd Floor, New York, New York 10004,
Attention: George Massim, Residential Mortgage, or such other address as may
hereinafter be furnished to the Depositor in writing by Fitch. Any notice
required or permitted to be mailed to a Certificateholder shall be given by
first class mail, postage prepaid, at the address of such Holder as shown in the
Certificate Register. Any notice mailed or transmitted within the time
prescribed in this Agreement shall be conclusively presumed to have been duly
given, whether or not the addressee receives such notice; PROVIDED, that any
demand, notice or communication to or upon the Depositor, the Servicer or the
Trustee shall not be effective until received.
Section 10.6. 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.
103
<PAGE>
IN WITNESS WHEREOF, the Depositor, the Servicer 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.
ABN AMRO MORTGAGE CORPORATION, as
Depositor
By
-------------------------------
Its Vice President
CHASE BANK OF TEXAS, NATIONAL
ASSOCIATION, as Trustee
By
-------------------------------
Its
-------------------------------
LASALLE HOME MORTGAGE CORPORATION,
as Servicer
By
-------------------------------
Its
-------------------------------
Pooling and Servicing Agreement
<PAGE>
STATE OF )
----------- : ss.:
COUNTY OF )
-----------
On the ____ day of ____________, 1998 before me,______________________,
personally appeared Stewart W. Fleming, a Vice President of ABN AMRO Mortgage
Corporation, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the person whose name is subscribed to the
within instrument and acknowledged to me that he executed the same in his
authorized capacity, and that by his signature on the instrument the person,
or the entity upon behalf of which the person acted, executed the instrument.
WITNESS my hand and official seal
Signature (Seal)
-------------------------------
<PAGE>
STATE OF )
----------- : ss.:
COUNTY OF )
-----------
On the ____ day of ____________, 1998 before me,______________________,
personally appeared ________________________, known to me to be ________________
of ______________________________________, one of the corporations that executed
the within instrument and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such corporation
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
------------------------------
Notary Public
[NOTARIAL SEAL]
<PAGE>
STATE OF )
----------- : ss.:
COUNTY OF )
-----------
On the ____ day of ____________, 1998 before me,______________________,
personally appeared ________________________, known to me to be ________________
of ______________________________________, one of the corporations that executed
the within instrument and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such corporation
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
---------------------------------
Notary Public
[NOTARIAL SEAL]
<PAGE>
EXHIBIT A
FORMS OF CERTIFICATES
A-1
<PAGE>
Exhibit A-1
CUSIP __________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-1
Evidencing a Percentage Interest in certain distributions with respect to a
pool of conventional one-to four-family mortgage loans formed and
administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real
estate mortgage investment conduit," as those terms are defined in Sections
860G and 860D, respectively, of the Internal Revenue Code of 1986, as
amended. The issue date (the "Issue Date") of this Certificate is October
27, 1998. The rate at which interest is payable as of the Issue Date with
respect to this Certificate is 5.90% per annum.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
Series 1998-4 Portion of the Class A-1 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class A-1 Remittance Rate: 5.90% $___________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class A-1 Principal Balance as of the Cut-Off Date:
$____________________
________________
Registered Owner Certificate No.__
A-1-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998 ] with original issued
discount ("OID") of $_________________ per $1,000 of original certificate
[notional] principal balance, an initial class coupon rate of ____% per
annum, an annualized monthly compounded yield to maturity of ___%, an
adjusted issue price as a percentage of original certificate [notional]
principal balance of ___% and OID allocable to the initial short accrual
period of $___________ per $1,000 of original certificate [notional]
principal balance. The prepayment assumption used by the issuer in pricing
this certificate is ___% [PSA, CPR]. The yield to maturity was based upon
fractional monthly compounding taking into account the initial short accrual
period.]
A-1-2
<PAGE>
Exhibit A-2
CUSIP____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-2
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is October 27, 1998. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 5.60% per annum.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
Series 1998-4 Portion of the Class A-2 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class A-2 Remittance Rate: 5.60% $_________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class A-2 Principal Balance as of the Cut-Off Date:
$____________________
____________________
Registered Owner Certificate No.__
A-2-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998] with original issued discount
("OID") of $_________________ per $1,000 of original certificate [notional]
principal balance, an initial class coupon rate of ____% per annum, an
annualized monthly compounded yield to maturity of ___%, an adjusted issue price
as a percentage of original certificate [notional] principal balance of ___% and
OID allocable to the initial short accrual period of $___________ per $1,000 of
original certificate [notional] principal balance. The prepayment assumption
used by the issuer in pricing this certificate is ___% [PSA, CPR]. The yield to
maturity was based upon fractional monthly compounding taking into account the
initial short accrual period.]
A-2-2
<PAGE>
Exhibit A-3
CUSIP____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-3
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is October 27, 1998. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.00% per annum.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
Series 1998-4 Portion of the Class A-3 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class A-3 Remittance Rate: 6.00% $_________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class A-3 Principal Balance as of the Cut-Off Date:
$____________________
____________________
Registered Owner Certificate No.__
A-3-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998] with original issued discount
("OID") of $_________________ per $1,000 of original certificate [notional]
principal balance, an initial class coupon rate of ____% per annum, an
annualized monthly compounded yield to maturity of ___%, an adjusted issue price
as a percentage of original certificate [notional] principal balance of ___% and
OID allocable to the initial short accrual period of $___________ per $1,000 of
original certificate [notional] principal balance. The prepayment assumption
used by the issuer in pricing this certificate is ___% [PSA, CPR]. The yield to
maturity was based upon fractional monthly compounding taking into account the
initial short accrual period.]
A-3-2
<PAGE>
Exhibit A-4
CUSIP____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-4
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is October 27, 1998. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.50% per annum.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
Series 1998-4 Portion of the Class A-4 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class A-4 Remittance Rate: 6.50% $_________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class A-4 Principal Balance as of the Cut-Off Date:
$____________________
____________________
Registered Owner Certificate No.__
A-4-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998] with original issued discount
("OID") of $_________________ per $1,000 of original certificate [notional]
principal balance, an initial class coupon rate of ____% per annum, an
annualized monthly compounded yield to maturity of ___%, an adjusted issue price
as a percentage of original certificate [notional] principal balance of ___% and
OID allocable to the initial short accrual period of $___________ per $1,000 of
original certificate [notional] principal balance. The prepayment assumption
used by the issuer in pricing this certificate is ___% [PSA, CPR]. The yield to
maturity was based upon fractional monthly compounding taking into account the
initial short accrual period.]
A-4-2
<PAGE>
Exhibit A-5
CUSIP____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-5
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is October 27, 1998. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.75% per annum.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
Series 1998-4 Portion of the Class A-5 Notional
Amount as of the Cut-Off Date
evidenced by this Certificate:
Class A-5 Remittance Rate: 6.75% applied $________________________________
to the Class A-5 Notional Amount
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class A-5 Notional Amount as of the Cut-Off Date:
$____________________
____________________
Registered Owner Certificate No.__
A-5-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998] with original issued discount
("OID") of $_________________ per $1,000 of original certificate [notional]
principal balance, an initial class coupon rate of ____% per annum, an
annualized monthly compounded yield to maturity of ___%, an adjusted issue price
as a percentage of original certificate [notional] principal balance of ___% and
OID allocable to the initial short accrual period of $___________ per $1,000 of
original certificate [notional] principal balance. The prepayment assumption
used by the issuer in pricing this certificate is ___% [PSA, CPR]. The yield to
maturity was based upon fractional monthly compounding taking into account the
initial short accrual period.]
A-5-2
<PAGE>
Exhibit A-6
CUSIP____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-6
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is October 27, 1998. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.75% per annum.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
Series 1998-4 Portion of the Class A-6 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class A-6 Remittance Rate: 6.75% $_________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class A-6 Principal Balance as of the Cut-Off Date:
$____________________
____________________
Registered Owner Certificate No.__
A-6-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998] with original issued discount
("OID") of $_________________ per $1,000 of original certificate [notional]
principal balance, an initial class coupon rate of ____% per annum, an
annualized monthly compounded yield to maturity of ___%, an adjusted issue price
as a percentage of original certificate [notional] principal balance of ___% and
OID allocable to the initial short accrual period of $___________ per $1,000 of
original certificate [notional] principal balance. The prepayment assumption
used by the issuer in pricing this certificate is ___% [PSA, CPR]. The yield to
maturity was based upon fractional monthly compounding taking into account the
initial short accrual period.]
A-6-2
<PAGE>
Exhibit A-7
CUSIP____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-7
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is October 27, 1998. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.62% per annum.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
Series 1998-4 Portion of the Class A-7 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class A-7 Remittance Rate: 6.62% $_________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class A-7 Principal Balance as of the Cut-Off Date:
$____________________
____________________
Registered Owner Certificate No.__
A-7-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998 ] with original issued
discount ("OID") of $_________________ per $1,000 of original certificate
[notional] principal balance, an initial class coupon rate of ____% per annum,
an annualized monthly compounded yield to maturity of ___%, an adjusted issue
price as a percentage of original certificate [notional] principal balance of
___% and OID allocable to the initial short accrual period of $___________ per
$1,000 of original certificate [notional] principal balance. The prepayment
assumption used by the issuer in pricing this certificate is ___% [PSA, CPR].
The yield to maturity was based upon fractional monthly compounding taking into
account the initial short accrual period.]
A-7-2
<PAGE>
Exhibit A-8
CUSIP____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-8
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is October 27, 1998. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 8.00% per annum.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
Series 1998-4 Portion of the Class A-8 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class A-8 Remittance Rate: 8.00% $_________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class A-8 Principal Balance as of the Cut-Off Date:
$____________________
____________________
Registered Owner Certificate No.__
A-8-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998 ] with original issued
discount ("OID") of $_________________ per $1,000 of original certificate
[notional] principal balance, an initial class coupon rate of ____% per annum,
an annualized monthly compounded yield to maturity of ___%, an adjusted issue
price as a percentage of original certificate [notional] principal balance of
___% and OID allocable to the initial short accrual period of $___________ per
$1,000 of original certificate [notional] principal balance. The prepayment
assumption used by the issuer in pricing this certificate is ___% [PSA, CPR].
The yield to maturity was based upon fractional monthly compounding taking into
account the initial short accrual period.]
A-8-2
<PAGE>
Exhibit A-9
CUSIP____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-9
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is October 27, 1998. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.75% per annum.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
Series 1998-4 Portion of the Class A-9 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class A-9 Remittance Rate: 6.75% $_________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class A-9 Principal Balance as of the Cut-Off Date:
$____________________
____________________
Registered Owner Certificate No.__
A-9-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998 ] with original issued
discount ("OID") of $_________________ per $1,000 of original certificate
[notional] principal balance, an initial class coupon rate of ____% per annum,
an annualized monthly compounded yield to maturity of ___%, an adjusted issue
price as a percentage of original certificate [notional] principal balance of
___% and OID allocable to the initial short accrual period of $___________ per
$1,000 of original certificate [notional] principal balance. The prepayment
assumption used by the issuer in pricing this certificate is ___% [PSA, CPR].
The yield to maturity was based upon fractional monthly compounding taking into
account the initial short accrual period.]
A-9-2
<PAGE>
Exhibit A-10
CUSIP_____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-10
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is October 27, 1998. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.75% per annum.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
Series 1998-4 Portion of the Class A-10 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class A-10 Remittance Rate: 6.75% $__________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class A-10 Principal Balance as of the Cut-Off Date:
$____________________
____________________
Registered Owner Certificate No.__
A-10-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998 ] with original issued
discount ("OID") of $_________________ per $1,000 of original certificate
[notional] principal balance, an initial class coupon rate of ____% per annum,
an annualized monthly compounded yield to maturity of ___%, an adjusted issue
price as a percentage of original certificate [notional] principal balance of
___% and OID allocable to the initial short accrual period of $___________ per
$1,000 of original certificate [notional] principal balance. The prepayment
assumption used by the issuer in pricing this certificate is ___% [PSA, CPR].
The yield to maturity was based upon fractional monthly compounding taking into
account the initial short accrual period.]
A-10-2
<PAGE>
Exhibit A-11
CUSIP____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-11
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is October 27, 1998. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.75% per annum.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
Series 1998-4 Portion of the Class A-11 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class A-11 Remittance Rate: 6.75% $__________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class A-11 Principal Balance as of the Cut-Off Date:
$____________________
____________________
Registered Owner Certificate No.__
A-11-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998 ] with original issued
discount ("OID") of $_________________ per $1,000 of original certificate
[notional] principal balance, an initial class coupon rate of ____% per annum,
an annualized monthly compounded yield to maturity of ___%, an adjusted issue
price as a percentage of original certificate [notional] principal balance of
___% and OID allocable to the initial short accrual period of $___________ per
$1,000 of original certificate [notional] principal balance. The prepayment
assumption used by the issuer in pricing this certificate is ___% [PSA, CPR].
The yield to maturity was based upon fractional monthly compounding taking into
account the initial short accrual period.]
A-11-2
<PAGE>
Exhibit A-12
CUSIP____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-12
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is October 27, 1998. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.75% per annum.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
Series 1998-4 Portion of the Class A-12 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class A-12 Remittance Rate: 6.75% $__________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class A-12 Principal Balance as of the Cut-Off Date:
$____________________
______________________
Registered Owner Certificate No.__
A-12-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998 ] with original issued
discount ("OID") of $_________________ per $1,000 of original certificate
[notional] principal balance, an initial class coupon rate of ____% per annum,
an annualized monthly compounded yield to maturity of ___%, an adjusted issue
price as a percentage of original certificate [notional] principal balance of
___% and OID allocable to the initial short accrual period of $___________ per
$1,000 of original certificate [notional] principal balance. The prepayment
assumption used by the issuer in pricing this certificate is ___% [PSA, CPR].
The yield to maturity was based upon fractional monthly compounding taking into
account the initial short accrual period.]
A-12-2
<PAGE>
Exhibit A-13
CUSIP____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-13
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is October 27, 1998. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.35% per annum.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
Series 1998-4 Portion of the Class A-13 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class A-13 Remittance Rate: 6.35% $__________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class A-13 Principal Balance as of the Cut-Off Date:
$____________________
______________________
Registered Owner Certificate No.__
A-13-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998 ] with original issued
discount ("OID") of $_________________ per $1,000 of original certificate
[notional] principal balance, an initial class coupon rate of ____% per annum,
an annualized monthly compounded yield to maturity of ___%, an adjusted issue
price as a percentage of original certificate [notional] principal balance of
___% and OID allocable to the initial short accrual period of $___________ per
$1,000 of original certificate [notional] principal balance. The prepayment
assumption used by the issuer in pricing this certificate is ___% [PSA, CPR].
The yield to maturity was based upon fractional monthly compounding taking into
account the initial short accrual period.]
A-13-2
<PAGE>
Exhibit A-14
CUSIP____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-14
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is October 27, 1998. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 8.00% per annum.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
Series 1998-4 Portion of the Class A-14 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class A-14 Remittance Rate: 8.00% $__________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class A-14 Principal Balance as of the Cut-Off Date:
$____________________
____________________
Registered Owner Certificate No.__
A-14-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998 ] with original issued
discount ("OID") of $_________________ per $1,000 of original certificate
[notional] principal balance, an initial class coupon rate of ____% per annum,
an annualized monthly compounded yield to maturity of ___%, an adjusted issue
price as a percentage of original certificate [notional] principal balance of
___% and OID allocable to the initial short accrual period of $___________ per
$1,000 of original certificate [notional] principal balance. The prepayment
assumption used by the issuer in pricing this certificate is ___% [PSA, CPR].
The yield to maturity was based upon fractional monthly compounding taking into
account the initial short accrual period.]
A-14-2
<PAGE>
Exhibit A-15
CUSIP____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-15
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is October 27, 1998. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.75% per annum.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
Series 1998-4 Portion of the Class A-15 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class A-15 Remittance Rate: 6.75% $__________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class A-15 Principal Balance as of the Cut-Off Date:
$____________________
____________________
Registered Owner Certificate No.__
A-15-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998 ] with original issued
discount ("OID") of $_________________ per $1,000 of original certificate
[notional] principal balance, an initial class coupon rate of ____% per annum,
an annualized monthly compounded yield to maturity of ___%, an adjusted issue
price as a percentage of original certificate [notional] principal balance of
___% and OID allocable to the initial short accrual period of $___________ per
$1,000 of original certificate [notional] principal balance. The prepayment
assumption used by the issuer in pricing this certificate is ___% [PSA, CPR].
The yield to maturity was based upon fractional monthly compounding taking into
account the initial short accrual period.]
A-15-2
<PAGE>
Exhibit A-16
CUSIP____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-16
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is October 27, 1998. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.75% per annum.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
Series 1998-4 Portion of the Class A-16 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class A-16 Remittance Rate: 6.75% $__________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class A-16 Principal Balance as of the Cut-Off Date:
$____________________
____________________
Registered Owner Certificate No.__
A-16-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998 ] with original issued
discount ("OID") of $_________________ per $1,000 of original certificate
[notional] principal balance, an initial class coupon rate of ____% per annum,
an annualized monthly compounded yield to maturity of ___%, an adjusted issue
price as a percentage of original certificate [notional] principal balance of
___% and OID allocable to the initial short accrual period of $___________ per
$1,000 of original certificate [notional] principal balance. The prepayment
assumption used by the issuer in pricing this certificate is ___% [PSA, CPR].
The yield to maturity was based upon fractional monthly compounding taking into
account the initial short accrual period.]
A-16-2
<PAGE>
Exhibit A-17
CUSIP_____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-X
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is October 27, 1998. The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is 6.75% per annum.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]||
Series 1998-4 Portion of the Class A-X
Notional Amount as of the Cut-
Off Date evidenced by this
Certificate:
Class A-X Remittance Rate: 6.75% applied to
the Class A-X Notional Amount $_____________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class A-X Notional Amount as of the Cut-Off Date:
$_______________________
|| ________________
Registered Owner Certificate No.__
A-17-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998] with original issued discount
("OID") of $_________________ per $1,000 of original certificate [notional]
principal balance, an initial class coupon rate of ____% per annum, an
annualized monthly compounded yield to maturity of ___%, an adjusted issue price
as a percentage of original certificate [notional] principal balance of ___% and
OID allocable to the initial short accrual period of $___________ per $1,000 of
original certificate [notional] principal balance. The prepayment assumption
used by the issuer in pricing this certificate is ___% [PSA, CPR]. The yield to
maturity was based upon fractional monthly compounding taking into account the
initial short accrual period.]
A-17-2
<PAGE>
Exhibit A-18
CUSIP____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class A-P
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is October 27, 1998. Interest is
not payable with respect to this Certificate.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
Series 1998-4 Portion of the Class A-P Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class A-P Remittance Rate: 0.00% $_________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class A-P Principal Balance as of the Cut-Off Date:
$____________________
________________
Registered Owner Certificate No.___
A-18-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998] with original issued
discount ("OID") of $_________________ per $1,000 of original certificate
[notional]principal balance, an initial class coupon rate of ____% per annum,
an annualized monthly compounded yield to maturity of ___%, an adjusted issue
price as a percentage of original certificate [notional] principal balance of
___% and OID allocable to the initial short accrual period of $___________
per $1,000 of original certificate [notional] principal balance. The
prepayment assumption used by the issuer in pricing this certificate is ___%
[PSA, CPR]. The yield to maturity was based upon fractional monthly
compounding taking into account the initial short accrual period.]
A-18-2
<PAGE>
Exhibit A-19
CUSIP_______________
MORTGAGE PASS-THROUGH CERTIFICATE
Class M
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended (the
"Code"). The issue date (the "Issue Date") of this Certificate is October 27,
1998.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
IN THE CASE OF ANY CLASS M CERTIFICATE PRESENTED FOR REGISTRATION IN THE
NAME OF AN EMPLOYEE BENEFIT OR OTHER PLAN SUBJECT TO THE PROHIBITED
TRANSACTION PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE CODE (OR COMPARABLE
PROVISIONS OF ANY SUBSEQUENT ENACTMENTS) (A "PLAN"), A TRUSTEE OF ANY
SUCH PLAN, OR ANY OTHER PERSON WHO IS USING "PLAN ASSETS" OF ANY SUCH
PLAN TO EFFECT SUCH ACQUISITION, THE TRUSTEE OR CERTIFICATE REGISTRAR
SHALL REQUIRE SUCH TRANSFEREE TO PROVIDE AN OFFICER'S CERTIFICATE SIGNED
BY A RESPONSIBLE OFFICER OF SUCH TRANSFEREE STATING THAT THE TRANSFEREE
IS AN INSURANCE COMPANY USING ASSETS OF AN "INSURANCE COMPANY GENERAL
ACCOUNT" (WITHIN THE MEANING OF DEPARTMENT OF LABOR PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60) TO EFFECT SUCH PURCHASE AND
SATISFIES ALL OF THE REQUIREMENTS FOR EXEMPTIVE RELIEF UNDER SECTIONS I
AND III OF PTCE 95-60, WHICH OFFICER'S CERTIFICATE SHALL NOT BE AN
EXPENSE OF THE TRUSTEE, THE CERTIFICATE ADMINISTRATOR, IF ANY, OR THE
DEPOSITOR.
The Class M Certificates will be subordinate in right of payment to and provide
credit support to certain Classes of Certificates, as described in the Pooling
Agreement.
Series 1998-4 Portion of the Class M Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class M Remittance Rate: 6.75% $_______________________________
A-19-1
<PAGE>
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class M Principal Balance as of the Cut-Off Date:
$____________________
________________
Registered Owner Certificate No.____
A-19-2
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998] with original issued
discount ("OID") of $_________________ per $1,000 of original certificate
[notional] principal balance, an initial class coupon rate of ____% per annum,
an annualized monthly compounded yield to maturity of ___%, an adjusted issue
price as a percentage of original certificate [notional] principal balance of
___% and OID allocable to the initial short accrual period of $___________
per $1,000 of original certificate [notional] principal balance. The
prepayment assumption used by the issuer in pricing this certificate is ___%
[PSA, CPR]. The yield to maturity was based upon fractional monthly
compounding taking into account the initial short accrual period.]
A-19-3
<PAGE>
Exhibit A-20
CUSIP _____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class B-1
Evidencing a Percentage Interest in certain distributions with respect to a
pool of conventional one- to four-family mortgage loans formed and
administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real
estate mortgage investment conduit," as those terms are defined in Sections
860G and 860D, respectively, of the Internal Revenue Code of 1986, as amended
(the "Code"). The issue date (the "Issue Date") of this Certificate is
October 27, 1998.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
IN THE CASE OF ANY CLASS B-1 CERTIFICATE PRESENTED FOR REGISTRATION IN
THE NAME OF AN EMPLOYEE BENEFIT OR OTHER PLAN SUBJECT TO THE PROHIBITED
TRANSACTION PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE CODE (OR COMPARABLE
PROVISIONS OF ANY SUBSEQUENT ENACTMENTS) (A "PLAN"), A TRUSTEE OF ANY
SUCH PLAN, OR ANY OTHER PERSON WHO IS USING "PLAN ASSETS" OF ANY SUCH
PLAN TO EFFECT SUCH ACQUISITION, THE TRUSTEE OR CERTIFICATE REGISTRAR
SHALL REQUIRE SUCH TRANSFEREE TO PROVIDE AN OFFICER'S CERTIFICATE SIGNED
BY A RESPONSIBLE OFFICER OF SUCH TRANSFEREE STATING THAT THE TRANSFEREE
IS AN INSURANCE COMPANY USING ASSETS OF AN "INSURANCE COMPANY GENERAL
ACCOUNT" (WITHIN THE MEANING OF DEPARTMENT OF LABOR PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60) TO EFFECT SUCH PURCHASE AND
SATISFIES ALL OF THE REQUIREMENTS FOR EXEMPTIVE RELIEF UNDER SECTIONS I
AND III OF PTCE 95-60, WHICH OFFICER'S CERTIFICATE SHALL NOT BE AN
EXPENSE OF THE TRUSTEE, THE CERTIFICATE ADMINISTRATOR, IF ANY, OR THE
DEPOSITOR.
The Class B-1 Certificates will be subordinate in right of payment to and
provide credit support to certain Classes of Certificates, as described in
the Pooling Agreement.
Series 1998-4 Portion of the Class B-1 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class B-1 Remittance Rate: 6.75% $_________________________________
A-20-1
<PAGE>
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class B-1 Principal Balance as of the Cut-Off Date:
$____________________
________________
Registered Owner Certificate No.____
A-20-2
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998] with original issued
discount ("OID") of $_________________ per $1,000 of original certificate
[notional] principal balance, an initial class coupon rate of ____% per annum,
an annualized monthly compounded yield to maturity of ___%, an adjusted issue
price as a percentage of original certificate [notional] principal balance of
___% and OID allocable to the initial short accrual period of $___________
per $1,000 of original certificate [notional] principal balance. The
prepayment assumption used by the issuer in pricing this certificate is ___%
[PSA, CPR]. The yield to maturity was based upon fractional monthly
compounding taking into account the initial short accrual period.]
A-20-3
<PAGE>
Exhibit A-21
CUSIP ____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class B-2
Evidencing a Percentage Interest in certain distributions with respect to a
pool of conventional one- to four-family mortgage loans formed and
administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real
estate mortgage investment conduit," as those terms are defined in Sections
860G and 860D, respectively, of the Internal Revenue Code of 1986, as amended
(the "Code"). The issue date (the "Issue Date") of this Certificate is
October 27, 1998.
[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
IN THE CASE OF ANY CLASS B-2 CERTIFICATE PRESENTED FOR REGISTRATION IN
THE NAME OF AN EMPLOYEE BENEFIT OR OTHER PLAN SUBJECT TO THE PROHIBITED
TRANSACTION PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE CODE (OR COMPARABLE
PROVISIONS OF ANY SUBSEQUENT ENACTMENTS) (A "PLAN"), A TRUSTEE OF ANY
SUCH PLAN, OR ANY OTHER PERSON WHO IS USING "PLAN ASSETS" OF ANY SUCH
PLAN TO EFFECT SUCH ACQUISITION, THE TRUSTEE OR CERTIFICATE REGISTRAR
SHALL REQUIRE SUCH TRANSFEREE TO PROVIDE AN OFFICER'S CERTIFICATE SIGNED
BY A RESPONSIBLE OFFICER OF SUCH TRANSFEREE STATING THAT THE TRANSFEREE
IS AN INSURANCE COMPANY USING ASSETS OF AN "INSURANCE COMPANY GENERAL
ACCOUNT" (WITHIN THE MEANING OF DEPARTMENT OF LABOR PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60) TO EFFECT SUCH PURCHASE AND
SATISFIES ALL OF THE REQUIREMENTS FOR EXEMPTIVE RELIEF UNDER SECTIONS I
AND III OF PTCE 95-60, WHICH OFFICER'S CERTIFICATE SHALL NOT BE AN
EXPENSE OF THE TRUSTEE, THE CERTIFICATE ADMINISTRATOR, IF ANY, OR THE
DEPOSITOR.
The Class B-2 Certificates will be subordinate in right of payment to and
provide credit support to certain Classes of Certificates, as described in the
Pooling Agreement.
Series 1998-4 Portion of the Class B-2 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class B-2 Remittance Rate: 6.75% $ ________________________________
A-21-1
<PAGE>
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class B-2 Principal Balance as of the Cut-Off Date:
$____________________
________________
Registered Owner Certificate No. _____
A-21-2
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998] with original issued
discount ("OID") of $_________________ per $1,000 of original certificate
[notional]principal balance, an initial class coupon rate of ____% per annum,
an annualized monthly compounded yield to maturity of ___%, an adjusted issue
price as a percentage of original certificate [notional] principal balance of
___% and OID allocable to the initial short accrual period of $___________
per $1,000 of original certificate [notional] principal balance. The
prepayment assumption used by the issuer in pricing this certificate is ___%
[PSA, CPR]. The yield to maturity was based upon fractional monthly
compounding taking into account the initial short accrual period.]
A-21-3
<PAGE>
Exhibit A-22
CUSIP _____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class B-3
Evidencing a Percentage Interest in certain distributions with respect to a
pool of conventional one- to four-family mortgage loans formed and
administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real
estate mortgage investment conduit," as those terms are defined in Sections
860G and 860D, respectively, of the Internal Revenue Code of 1986, as amended
(the "Code"). The issue date (the "Issue Date") of this Certificate is
October 27, 1998.
IN THE CASE OF ANY CLASS B-3 CERTIFICATE PRESENTED FOR REGISTRATION IN
THE NAME OF AN EMPLOYEE BENEFIT OR OTHER PLAN SUBJECT TO THE PROHIBITED
TRANSACTION PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE CODE (OR COMPARABLE
PROVISIONS OF ANY SUBSEQUENT ENACTMENTS) (A "PLAN"), A TRUSTEE OF ANY
SUCH PLAN, OR ANY OTHER PERSON WHO IS USING "PLAN ASSETS" OF ANY SUCH
PLAN TO EFFECT SUCH ACQUISITION, THE TRUSTEE OR CERTIFICATE REGISTRAR
SHALL REQUIRE SUCH TRANSFEREE TO PROVIDE AN OFFICER'S CERTIFICATE SIGNED
BY A RESPONSIBLE OFFICER OF SUCH TRANSFEREE STATING THAT THE TRANSFEREE
IS AN INSURANCE COMPANY USING ASSETS OF AN "INSURANCE COMPANY GENERAL
ACCOUNT" (WITHIN THE MEANING OF DEPARTMENT OF LABOR PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60) TO EFFECT SUCH PURCHASE AND
SATISFIES ALL OF THE REQUIREMENTS FOR EXEMPTIVE RELIEF UNDER SECTIONS I
AND III OF PTCE 95-60, WHICH OFFICER'S CERTIFICATE SHALL NOT BE AN
EXPENSE OF THE TRUSTEE, THE CERTIFICATE ADMINISTRATOR, IF ANY, OR THE
DEPOSITOR.
The Class B-3 Certificates will be subordinate in right of payment to and
provide credit support to certain Classes of Certificates, as described in the
Pooling Agreement.
Series 1998-4 Portion of the Class B-3 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class B-3 Remittance Rate: 6.75% $__________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
Last Scheduled Distribution Date: November 25, 2028
Class B-3 Principal Balance as of the Cut-Off Date:
$____________________
________________
Registered Owner Certificate No. _____
A-22-1
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998] with original issued
discount ("OID") of $_________________ per $1,000 of original certificate
[notional]principal balance, an initial class coupon rate of ____% per annum,
an annualized monthly compounded yield to maturity of ___%, an adjusted issue
price as a percentage of original certificate [notional] principal balance of
___% and OID allocable to the initial short accrual period of $___________
per $1,000 of original certificate [notional] principal balance. The
prepayment assumption used by the issuer in pricing this certificate is ___%
[PSA, CPR]. The yield to maturity was based upon fractional monthly
compounding taking into account the initial short accrual period.]
A-22-2
<PAGE>
Exhibit A-23
CUSIP ____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class B-4
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended (the
"Code"). The issue date (the "Issue Date") of this Certificate is October 27,
1998.
IN THE CASE OF ANY CLASS B-4 CERTIFICATE PRESENTED FOR REGISTRATION IN
THE NAME OF AN EMPLOYEE BENEFIT OR OTHER PLAN SUBJECT TO THE PROHIBITED
TRANSACTION PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE CODE (OR COMPARABLE
PROVISIONS OF ANY SUBSEQUENT ENACTMENTS) (A "PLAN"), A TRUSTEE OF ANY
SUCH PLAN, OR ANY OTHER PERSON WHO IS USING "PLAN ASSETS" OF ANY SUCH
PLAN TO EFFECT SUCH ACQUISITION, THE TRUSTEE OR CERTIFICATE REGISTRAR
SHALL REQUIRE SUCH TRANSFEREE TO PROVIDE AN OFFICER'S CERTIFICATE SIGNED
BY A RESPONSIBLE OFFICER OF SUCH TRANSFEREE STATING THAT THE TRANSFEREE
IS AN INSURANCE COMPANY USING ASSETS OF AN "INSURANCE COMPANY GENERAL
ACCOUNT" (WITHIN THE MEANING OF DEPARTMENT OF LABOR PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60) TO EFFECT SUCH PURCHASE AND
SATISFIES ALL OF THE REQUIREMENTS FOR EXEMPTIVE RELIEF UNDER SECTIONS I
AND III OF PTCE 95-60, WHICH OFFICER'S CERTIFICATE SHALL NOT BE AN
EXPENSE OF THE TRUSTEE, THE CERTIFICATE ADMINISTRATOR, IF ANY, OR THE
DEPOSITOR.
The Class B-4 Certificates will be subordinate in right of payment to and
provide credit support to certain Classes of Certificates, as described in the
Pooling Agreement.
Series 1998-4 Portion of the Class B-4 Principal Balance
as of the Cut-Off Date evidenced by this
Certificate:
Class B-4 Remittance Rate: 6.75% $__________________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
A-23-1
<PAGE>
Last Scheduled Distribution Date: November 25, 2028
Class B-4 Principal Balance as of the Cut-Off Date:
$____________________
________________
Registered Owner Certificate No._____
A-23-2
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998] with original issued
discount ("OID") of $_________________ per $1,000 of original certificate
[notional]principal balance, an initial class coupon rate of ____% per annum,
an annualized monthly compounded yield to maturity of ___%, an adjusted issue
price as a percentage of original certificate [notional] principal balance of
___% and OID allocable to the initial short accrual period of $___________
per $1,000 of original certificate [notional] principal balance. The
prepayment assumption used by the issuer in pricing this certificate is ___%
[PSA, CPR]. The yield to maturity was based upon fractional monthly
compounding taking into account the initial short accrual period.]
A-23-3
<PAGE>
Exhibit A-24
CUSIP ____________
MORTGAGE PASS-THROUGH CERTIFICATE
Class B-5
Evidencing a Percentage Interest in certain distributions with respect to a
pool of conventional one- to four-family mortgage loans formed and
administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended (the
"Code"). The issue date (the "Issue Date") of this Certificate is October 27,
1998.
IN THE CASE OF ANY CLASS B-5 CERTIFICATE PRESENTED FOR REGISTRATION IN
THE NAME OF AN EMPLOYEE BENEFIT OR OTHER PLAN SUBJECT TO THE PROHIBITED
TRANSACTION PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE CODE (OR COMPARABLE
PROVISIONS OF ANY SUBSEQUENT ENACTMENTS) (A "PLAN"), A TRUSTEE OF ANY
SUCH PLAN, OR ANY OTHER PERSON WHO IS USING "PLAN ASSETS" OF ANY SUCH
PLAN TO EFFECT SUCH ACQUISITION, THE TRUSTEE OR CERTIFICATE REGISTRAR
SHALL REQUIRE SUCH TRANSFEREE TO PROVIDE AN OFFICER'S CERTIFICATE SIGNED
BY A RESPONSIBLE OFFICER OF SUCH TRANSFEREE STATING THAT THE TRANSFEREE
IS AN INSURANCE COMPANY USING ASSETS OF AN "INSURANCE COMPANY GENERAL
ACCOUNT" (WITHIN THE MEANING OF DEPARTMENT OF LABOR PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60) TO EFFECT SUCH PURCHASE AND
SATISFIES ALL OF THE REQUIREMENTS FOR EXEMPTIVE RELIEF UNDER SECTIONS I
AND III OF PTCE 95-60, WHICH OFFICER'S CERTIFICATE SHALL NOT BE AN
EXPENSE OF THE TRUSTEE, THE CERTIFICATE ADMINISTRATOR, IF ANY, OR THE
DEPOSITOR.
The Class B-5 Certificates will be subordinate in right of payment to and
provide credit support to certain Classes of Certificates, as described in the
Pooling Agreement.
Series 1998-4 Portion of the Class B-5 Principal
Balance as of the Cut-Off Date
evidenced by this Certificate:
Class B-5 Remittance Rate: 6.75% $_________________________________
Cut-Off Date: October 1, 1998
First Distribution Date: November 25, 1998
A-24-1
<PAGE>
Last Scheduled Distribution Date: November 25, 2028
Class B-5 Principal Balance as of the Cut-Off Date:
$____________________
________________
Registered Owner Certificate No._____
A-24-2
<PAGE>
[OID LEGEND
This certificate was issued on [October 27, 1998] with original issued
discount ("OID") of $_________________ per $1,000 of original certificate
[notional]principal balance, an initial class coupon rate of ____% per annum,
an annualized monthly compounded yield to maturity of ___%, an adjusted issue
price as a percentage of original certificate [notional] principal balance of
___% and OID allocable to the initial short accrual period of $___________
per $1,000 of original certificate [notional] principal balance. The
prepayment assumption used by the issuer in pricing this certificate is ___%
[PSA, CPR]. The yield to maturity was based upon fractional monthly
compounding taking into account the initial short accrual period.]
A-24-3
<PAGE>
EXHIBIT B
FORM OF RESIDUAL CERTIFICATE
CUSIP [__________]
MORTGAGE PASS-THROUGH CERTIFICATE
Class R
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE DEPOSITOR AND
THE CERTIFICATE REGISTRAR THAT (1) SUCH TRANSFEREE IS NOT EITHER (A) THE UNITED
STATES, ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY FOREIGN GOVERNMENT, ANY
INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE
FOREGOING, (B) ANY ORGANIZATION (OTHER THAN A COOPERATIVE DESCRIBED IN SECTION
521 OF THE CODE) WHICH IS EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE
UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE
CODE, (C) ANY ORGANIZATION DESCRIBED IN SECTION 1381(a)(2)(C) OF THE CODE (ANY
SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A), (B), OR (C) BEING
HEREINAFTER REFERRED TO AS A "DISQUALIFIED ORGANIZATION"), OR (D) AN AGENT OF A
DISQUALIFIED ORGANIZATION AND (2) NO PURPOSE OF SUCH TRANSFER IS TO ENABLE THE
TRANSFER TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX. SUCH AFFIDAVIT SHALL
INCLUDE CERTAIN REPRESENTATIONS AS TO THE FINANCIAL CONDITION OF THE PROPOSED
TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE REGISTER OF ANY
TRANSFER, SALE OR OTHER DISPOSITION OF THIS CLASS R CERTIFICATE TO A
DISQUALIFIED ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH
REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND
SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE
HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS
CERTIFICATE. EACH HOLDER OF A CLASS R CERTIFICATE BY ACCEPTANCE OF THIS
CERTIFICATE SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS
PARAGRAPH.
IN THE CASE OF ANY CLASS R CERTIFICATE PRESENTED FOR REGISTRATION IN THE NAME OF
AN EMPLOYEE BENEFIT OR OTHER PLAN SUBJECT TO THE FIDUCIARY RESPONSIBILITY
PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED
("ERISA"), OR SECTION 4975 OF THE CODE (OR COMPARABLE PROVISIONS OF ANY
SUBSEQUENT ENACTMENTS) (A "PLAN"), OR A TRUSTEE OF ANY SUCH PLAN, OR ANY OTHER
PERSON WHO IS USING "PLAN ASSETS" OF ANY SUCH PLAN TO EFFECT SUCH ACQUISITION,
THE TRUSTEE OR CERTIFICATE REGISTRAR SHALL REQUIRE SUCH TRANSFEREE TO PROVIDE AN
OFFICER'S CERTIFICATE SIGNED BY A RESPONSIBLE OFFICER OF SUCH TRANSFEREE STATING
THAT THE TRANSFEREE IS AN INSURANCE COMPANY USING ASSETS OF AN "INSURANCE
COMPANY GENERAL ACCOUNT" (WITHIN THE MEANING OF DEPARTMENT OF LABOR PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60) TO EFFECT SUCH PURCHASE AND
SATISFIES ALL OF THE REQUIREMENTS FOR EXEMPTIVE RELIEF UNDER SECTIONS I AND III
OF PTCE 95-60, WHICH OFFICER'S CERTIFICATE SHALL NOT BE AN EXPENSE OF THE
TRUSTEE, THE CERTIFICATE ADMINISTRATOR, IF ANY, OR THE DEPOSITOR.
B-1
<PAGE>
Solely for U.S. federal income tax purposes, this Certificate represents
"residual interests" in "real estate mortgage investment conduits," as those
terms are defined in Sections 860G and 860D, respectively, of the Internal
Revenue Code of 1986, as amended.
||
Series 1998-4 Percentage Interest evidenced by
this Class R Certificate in the
distributions to be made with
respect to the Class R Certificate:
____%
Class R Remittance Rate: 6.75%.
Additionally, the Class R Certificates
are entitled to Excess Liquidation
Proceeds and the Residual Distribution
Amount as defined in the Pooling
Agreement.
Cut-Off Date: October 1, 1998
First Distribution Date: November 25,
1998
Last Scheduled Distribution Date:
November 25, 2028
Class R Principal Balance as of the
Cut-Off Date:
$____________________
||
____________________
Registered Owner Certificate No.___
B-2
<PAGE>
EXHIBIT C
[RESERVED]
C-1
<PAGE>
EXHIBIT D
SCHEDULE OF MORTGAGE LOANS
A copy of the Mortgage may be obtained by contacting the Registrant.
D-1
<PAGE>
EXHIBIT E
FIELDS OF MORTGAGE LOAN INFORMATION
Deal Name
Distribution Date
Loan Number
City
State
Zip Code
Property Type (SFR, CONDO, etc.)
Occupancy Status (Owner, Investor, etc.)
Loan Purpose (Purchase, Refi, etc.)
Loan Type
Loan Status (Current, Foreclosure, REO, Bankruptcy)
Original Term of Loan
Amortization Term
First Payment of Loan
Maturity Date
Appraisal Value
Original LTV
Original Principal Balance
Previous Month's Balance
Current Principal Balance
Prepay Date
Prepay Status (Loan has been prepaid, liquidated or repurchased by the Servicer)
Original Scheduled P & I
Current Scheduled P & I
Scheduled Interest Amount
Scheduled Principal Amount
Curtailment
Note Rate
Paid to Date
Payment Date
E-1
<PAGE>
EXHIBIT F
FORM OF TRANSFEROR CERTIFICATE FOR
PRIVATELY OFFERED CERTIFICATES
[Date]
Chase Bank of Texas, National Association, as Trustee
600 Travis
Houston, Texas 77002
Attn: Corporate Trust Group
[LASALLE NATIONAL BANK, AS CERTIFICATE REGISTRAR
135 SOUTH LASALLE STREET, SUITE 1625
CHICAGO, ILLINOIS 60674-4107
ATTN: ABN AMRO SERIES 1998-4]
Re: Purchase of ABN AMRO Mortgage Corporation Mortgage Pass-Through
Certificates Series 1998-4, Class [B-3] [B-4] [B-5] (the
"Certificates")
Ladies and Gentlemen:
In connection with our disposition of the above Certificates we
certify that (a) we understand the Certificates have not been registered
under the Securities Act of 1933, as amended (the "Act") and are being
disposed by us in a transaction that is exempt from the registration
requirements of the Act, and (b) we have not offered or sold any certificates
to, or solicited offers to buy any Certificates from, any person, or
otherwise approached or negotiated with any person with respect thereto, or
taken any other action which would result in a violation of Section 5 of the
Act.
Very truly yours,
[Name of Transferor]
By:
-------------------------------
Authorized Officer
F-1
<PAGE>
EXHIBIT G
FORM OF TRANSFEREE'S CERTIFICATE FOR
PRIVATELY OFFERED CERTIFICATES
[Date]
Chase Bank of Texas, National Association
600 Travis
Houston, Texas 77002
Attn: Corporate Trust Group
AMN AMRO Mortgage Corporation
181 West Madison, 32nd Floor
Chicago, IL 60602
[LASALLE NATIONAL BANK, AS CERTIFICATE REGISTRAR
135 SOUTH LASALLE STREET, SUITE 1625
CHICAGO, ILLINOIS 60674-4107
ATTN: ABN AMRO SERIES 1998-4]
The undersigned (the "Purchaser") proposes to purchase [Class B-3] [Class
B-4] [Class B-5] Certificates evidencing an undivided interest in ABN AMRO
Mortgage Corporation Mortgage Pass-Through Certificates, Series 1998-4 (the
"Purchased Certificates") in the principal amount of $____________. In doing
so, the Purchaser hereby acknowledges and agrees as follows:
Section 1. Definitions. Each capitalized term used herein and not
otherwise defined herein shall have the meaning ascribed to it in the Pooling
and Servicing Agreement, dated as of October 1, 1998, between ABN AMRO Mortgage
Corporation ("AMAC"), LaSalle Home Mortgage Corporation, as servicer (the
"Servicer") and Chase Bank of Texas, National Association, as trustee (the
"Trustee"), of the ABN AMRO Mortgage Corporation Mortgage Pass-Through
Certificates, Series 1998-4.
Section 2. Representations and Warranties of the Purchaser. In
connection with the proposed transfer, the Purchaser represents and warrants to
AMAC, the Servicer, the Certificate Registrar and the Trustee that:
(a) The Purchaser is duly organized, validly existing and in good
standing under the laws of the jurisdiction in which the Purchaser is organized,
is authorized to invest in the Purchased Certificates, and to enter into this
Agreement, and duly executed and delivered this Agreement;
(b) The Purchaser is acquiring the Purchased Certificates for its own
account as principal and not with a view to the distribution thereof, in whole
or in part;
G-1
<PAGE>
(c) The Purchaser is an "accredited investor" as such term is
defined in paragraph (a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) of Section 501
of Regulation D under the Securities Act of 1933, as amended (the "Act"), has
knowledge of financial and business matters and is capable of evaluating the
merits and risks of an investment in the Purchased Certificates; the
Purchaser has sought such accounting, legal and tax advice as it has
considered necessary to make an informed investment decision; and the
Purchaser is able to bear the economic risk of an investment in the Purchased
Certificates and can afford a complete loss of such investment;
(d) The Purchaser is not affiliated with the Trustee;
(e) The Purchaser confirms that AMAC has made available to the
Purchaser the opportunity to ask questions of, and receive answers from AMAC
concerning the Trust, the purchase by the Purchaser of the Purchased
Certificates and all matters relating thereto that AMAC possesses or can
acquire without unreasonable effort or expense;
(f) If applicable, the Purchaser has complied, and will continue to
comply, with the guidelines established by Thrift Bulletin 12 issued December
13, 1988, by the Office of Regulatory Activities of the Federal Home Loan
Bank System; and
(g) The Purchaser will provide the Trustee and the Servicer with
affidavits substantially in the form of Exhibit A attached hereto.
Section 3. Transfer of Purchased Certificates.
(a) The Purchaser understands that the Purchased Certificates have
not been registered under the Act, or any state securities laws and that no
transfer may be made unless the Purchased Certificates are registered under
the Act and under applicable state law or unless an exemption from
registration is available. The Purchaser further understands that neither
AMAC nor the Trust is under any obligation to register the Purchased
Certificates or make an exemption available. In the event that such a
transfer is to be made within two years from the Closing Date without
registration under the Act or applicable state securities laws, (i) the
Trustee or the Certificate Registrar shall require, in order to assure
compliance with such laws, that the Certificateholder's prospective
transferees each certify to AMAC, the Certificate Registrar and the Trustee
as to the factual basis for the registration or qualification exemption
relied upon, and (ii) the Trustee, the Certificate Registrar or AMAC may
require an Opinion of Counsel that such transfer may be made pursuant to an
exemption from the Act and state securities laws, which Opinion of Counsel
shall not be an expense of the Trustee, the Certificate Registrar or AMAC.
Any such Certificateholder desiring to effect such transfer shall, and does
hereby agree to, indemnify the Trustee and AMAC against any liability that
may result if the Transfer is not so exempt or is not made in accordance with
such federal and state laws.
(b) No transfer of a Purchased Certificate shall be made unless the
transferee provides AMAC, the Certificate Registrar and the Trustee with (i)
a Transferee's Agreement, substantially in the form of this Agreement, and
(ii) an affidavit substantially in the form of Exhibit A hereto that the
proposed transferee (x) is not an employee benefit plan or other plan or
arrangement subject to the prohibited transaction provisions of ERISA or
Section 4975 of the
G-2
<PAGE>
Internal Revenue Code of 1986, as amended, or comparable provisions of any
subsequent enactments (a "Plan"), a trustee of any Plan, or any other Person
who is using the "plan assets" of any Plan to effect such acquisition or (y)
is an insurance company, the source of funds to be used by it to purchase the
Purchased Certificates is an "insurance company general account" (within the
meaning of Department of Labor Prohibited Transaction Class Exemption
("PTCE") 95-60), and the purchase is being made in reliance upon the
availability of the exemptive relief afforded under Sections I and III of
PTCE 95-60.
(c) The Purchaser acknowledges that its Purchased Certificates bear
a legend setting forth the applicable restrictions on transfer.
IN WITNESS WHEREOF, the undersigned has caused this Agreement to be
validly executed by its duly authorized representative as of the day and the
year first above written.
[Purchaser]
By:
--------------------------------
Its:
G-3
<PAGE>
Exhibit A to Form of Transferee Agreement (Exhibit G)
BENEFIT PLAN AFFIDAVIT
RE: ABN AMRO MORTGAGE CORPORATION
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 1998-4
(THE "TRUST") [CLASS B-3] [CLASS B-4] [CLASS B-5] CERTIFICATES
(THE "PURCHASED CERTIFICATES")
Under penalties of perjury, I, __________________________, declare that,
to the best of my knowledge and belief, the following representations are true,
correct and complete; and
1. That I am the ____________________ of _____________________ (the
"Purchaser"), whose taxpayer identification number is __________, and on behalf
of which I have the authority to make this affidavit.
2. That the Purchaser is acquiring a Purchased Certificate
representing an interest in Trust.
3. That the Purchaser (i) is not an employee benefit plan or other
plan or arrangement subject to the prohibited transaction provisions of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA") or Section
4975 of the Internal Revenue Code of 1986, as amended (the "Code"), or
comparable provisions of any subsequent enactments (a "Plan"), a trustee of any
Plan, or any other Person who is using the "plan assets" of any Plan to effect
such acquisition, or (ii) has provided an Officer's Certificate signed by a
Responsible Officer of the Purchaser satisfactory to ABN AMRO Mortgage
Corporation (the "Depositor"), the Certificate Registrar, and the Trustee of the
Trust stating that the Purchaser is an insurance company using assets of a
"insurance company general account" (within the meaning of Department of Labor
Prohibited Transaction Class Exemption ("PTCE") 95-60) to effect such purchase
and satisfies all of the requirements for exemptive relief under Sections I and
III of PTCE 95-60, which Officer's Certificate shall not be an expense of the
Depositor or the Trustee.
IN WITNESS WHEREOF, the Purchaser has caused this instrument to be duly
executed on its behalf, by its duly authorized officer this ___ day of
___________, 199_.
[Purchaser]
By:
---------------------------------
Its:
G-4
<PAGE>
Personally appeared before me ________________________ , known or proved
to me to be the same person who executed the foregoing instrument and to be a
__________________________ of the Purchaser, and acknowledged to me that (s)he
executed the same as his/her free act and deed and as the free act and deed of
the Purchaser.
SUBSCRIBED and SWORN to before me this day of _____________, 19__.
-------------------------------------
Notary Public
G-5
<PAGE>
EXHIBIT H
[RESERVED]
H-1
<PAGE>
EXHIBIT I
FORM OF TRANSFEROR CERTIFICATE
[Date]
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION, AS TRUSTEE
600 TRAVIS
HOUSTON, TEXAS 77002
ATTN: CORPORATE TRUST GROUP
[LASALLE NATIONAL BANK, AS CERTIFICATE REGISTRAR
135 SOUTH LASALLE STREET, SUITE 1625
CHICAGO, ILLINOIS 60674-4107
ATTN: ABN AMRO SERIES 1998-4]
RE: ABN AMRO MORTGAGE CORPORATION MORTGAGE PASS-THROUGH
CERTIFICATES, SERIES 1998-4 CLASS R
This letter is delivered to you in connection with the sale by __________
_____________________ (the "Seller") to _________________________ (the
"Purchaser") of $________________ initial Certificate Principal Balance of
Mortgage Pass-Through Certificates, Series 1998-4, Class R (the "Certificate"),
pursuant to Section 5.1 of the Pooling and Servicing Agreement (the "Pooling and
Servicing Agreement"), dated as of October 1, 1998 among ABN AMRO Mortgage
Corporation, as depositor (the "Company"), LaSalle Home Mortgage Corporation, as
servicer (the "Servicer"), and Chase Bank of Texas, National Association, as
trustee (the "Trustee"). All terms used herein and not otherwise defined shall
have the meanings set forth in the Pooling and Servicing Agreement. The Seller
hereby certifies, represents and warrants to, and covenants with the Depositor,
the Servicer, the Certificate Registrar and the Trustee that:
1. No purpose of the Seller relating to the sale of the Certificate
by the Seller to the Purchaser is or will be to enable the Seller to impede the
assessment or collection of tax.
2. The Seller understands that the Purchaser has delivered to the
Trustee, the Servicer, the Certificate Registrar and the Depositor a transferee
affidavit and agreement in the form attached to the Pooling and Servicing
Agreement as Exhibit J. The Seller does not know or believe that any
representation contained therein is false.
3. The Seller has no actual knowledge that the Proposed Transferee is
not a Permitted Transferee.
4. The Seller has no actual knowledge that the Purchaser would be
unwilling or unable to pay taxes due on its share of the taxable income
attributable to the Certificates.
I-1
<PAGE>
5. The Seller has conducted a reasonable investigation of the
financial condition of the Purchaser and, as a result of the investigation ,
found that the Purchaser has historically paid its debts as they came due, and
found no significant evidence to indicate that the Purchaser will not continue
to pay its debts as they come due in the future.
6. The Purchaser has represented to the Seller that, if the
Certificates constitute a noneconomic residual interest, it (i) understands that
as holder of a noneconomic residual interest it may incur tax liabilities in
excess of any cash flows generated by the interest, and (ii) intends to pay
taxes associated with its holding of the Certificates as they become due.
Very truly yours,
[Seller]
By:
--------------------------------
Name:
---------------------------
Title:
---------------------------
I-2
<PAGE>
EXHIBIT J
FORM OF TRANSFEREE AFFIDAVIT AND AGREEMENT
STATE OF )
) ss:
COUNTY OF )
[NAME OF OFFICER], being first duly sworn, deposes and says:
1. That he is [Title of Officer] of [Name of Owner] (record or
beneficial owner of the Class R Certificate (the "Owner")), a [savings
institution] [corporation] duly organized and existing under the laws of [the
State of ______________________ ] [the United States], on behalf of which he
makes this affidavit and agreement.
2. That the Owner (i) is not and will not be a "disqualified
organization" as of the [date of transfer] within the meaning of Section 860E(e)
(5) of the Internal Revenue Code of 1986, as amended (the "Code") and will
endeavor to remain other than a disqualified organization for so long as it
retains its ownership interest in the Class R Certificate, and (ii) is acquiring
the Class R Certificate for its own account or for the account of another Owner
from which it has received an affidavit and agreement in substantially the same
form as this affidavit and agreement. (For this purpose, a "disqualified
organization" means the United States, any state or political subdivision
thereof, or any agency or instrumentality of any of the foregoing (other than an
instrumentality all of the activities of which are subject to tax and, except
for the Federal Home Loan Mortgage Corporation, a majority of whose board of
directors is not selected by any such governmental entity, or any foreign
government or international organization, or any agency or instrumentality of
such foreign government or organization, any rural electric or telephone
cooperative, or any organization (other than certain farmers' cooperatives) that
is generally exempt from federal income tax unless such organization is subject
to the tax on unrelated business taxable income).
3. That the Owner is aware (i) of the tax that would be imposed on
transfers of the Class R Certificate; (ii) that such tax would be on the
transferor, or, if such transfer is through an agent (which person includes a
broker, nominee or middleman) for a disqualified organization, on the agent;
(iii) that the person otherwise liable for the tax shall be relieved of
liability for the tax if the transferee furnished to such person an affidavit
that the transferee is not a disqualified organization and, at the time of
transfer, such person does not have actual knowledge that the affidavit is
false; and (iv) that the Class R Certificate may represent "noneconomic residual
interests" within the meaning of Treasury regulations promulgated pursuant to
the Code and that the transferor of a noneconomic residual interest will remain
liable for any taxes due with respect to the income on such residual interest,
if a significant purpose of the transfer was to enable the transferor to impede
the assessment or collection of tax.
4. That the Owner is aware of the tax imposed on a "pass-through
entity" holding the Class R Certificate if at any time during the taxable year
of the pass-through entity a disqualified
J-1
<PAGE>
organization is the record holder of an interest in such entity. (For this
purpose, a "pass-through entity" includes a regulated investment company, a
real estate investment trust or common trust fund, a partnership, trust or
estate, and certain cooperatives.)
5. That the Owner is aware that the Trustee and the Certificate
Registrar will not register the transfer of the Class R Certificate unless
the transferee, or other transferee's agent, delivers to each of them an
affidavit and agreement, among other things, in substantially the same form
as this affidavit and agreement. The Owner expressly agrees that it will not
consummate any such transfer if it knows or believes that any of the
representations contained in such affidavit and agreement are false.
6. That the Owner has reviewed the restrictions set forth on the
face of the Class R Certificate and the provisions of Section 5.1 of the
Pooling and Servicing Agreement under which the Class R Certificate was
issued. The Owner expressly agrees to be bound by and to comply with such
restrictions and provisions.
7. That the Owner consents to any additional restrictions or
arrangements that shall be deemed necessary upon advice of counsel to
constitute a reasonable arrangement to ensure that the Class R Certificate
will only be owned, directly or indirectly, by an Owner that is not a
disqualified organization.
8. The Owner's Taxpayer Identification Number is ________________.
9. That no purpose of the Owner relating to the purchase of the
Class R Certificate by the Owner is or will be to enable the transferor to
impede the assessment or collection of tax.
10. That the Owner has no present knowledge or expectation that it
will be unable to pay any United States taxes owed by it so long as any of
the Certificates remain outstanding.
11. That the Owner has no present knowledge or expectation that it
will become insolvent or subject to a bankruptcy proceeding for so long as
any of the Certificates remain outstanding.
12. That the purpose of the Owner relating to any sale of the Class
R Certificate by the Owner will be to impede the assessment or collection of
tax.
13. The Owner is a citizen or resident of the United States, a
corporation, partnership or other entity created or organized in, or under
the laws of, the United States or any political subdivision thereof, or an
estate or trust whose income from sources without the United States is
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.
14. The Owner hereby agrees to cooperate with the Depositor and to
take any action required of it by the Code or Treasury regulations thereunder
(whether now or hereafter promulgated) in order to create or maintain the
REMIC status of the REMIC I or the REMIC II.
J-2
<PAGE>
15. The Owner hereby agrees that it will not take any action that
could endanger the REMIC status of the REMIC I or the REMIC II, as
applicable, or result in the imposition of tax on the REMIC I or the REMIC II
unless counsel for, or acceptable to, the Depositor has provided an opinion
that such action will not result in the loss of such REMIC status or the
imposition of such tax, as applicable.
16. The Owner as transferee of the Class R Certificate has
represented to their transferor that, if the Class R Certificate represents
noneconomic residual interests, the Owner (i) understands that as holder of a
noneconomic residual interest it may incur tax liabilities in excess of any
cash flows generated by the interest, and (ii) intends to pay taxes
associated with its holding of the Class R Certificate as they become due.
IN WITNESS WHEREOF, the Owner has caused this instrument to be
executed on its behalf, pursuant to the authority of its Board of Directors,
by its [Title of Officer] and its corporate seal to be hereunto attached,
attested by its [Assistant] Secretary, this ______ day of ________________,
19__.
[Name of Owner]
By:
--------------------------------
[Name of Officer]
[Title of Officer]
[Corporate Seal]
ATTEST:
[Assistant] Secretary
J-3
<PAGE>
Personally appeared before me the above-named [Name of Officer], known
or proved tome to be the same person who executed the foregoing instrument
and to be the [Title of Officer] of the Owner, and Acknowledged to me that he
executed the same as his free act and deed and free act and deed of the Owner.
Subscribed and sworn before me this ____ day of _________________, 19__.
NOTARY PUBLIC
COUNTY OF
STATE OF
My Commission expires the ___ day
of______________________ , 19__
J-4
<PAGE>
EXHIBIT K
FORM OF ADDITIONAL MATTER INCORPORATED
INTO THE FORM OF THE CERTIFICATES
This Certificate does not represent an obligation of or interest in
ABN AMRO Mortgage Corporation or any of its affiliates. Neither this
Certificate nor the underlying Loans are guaranteed by any agency or
instrumentality of the United States.
This certifies that the above-named Registered Owner is the registered
owner of certain interests in a trust fund (the "Certificate Trust Fund")
whose assets consist of, among other things, of a pool (the "Mortgage Pool")
of conventional one- to four-family mortgage loans (the "Loans"), formed by
ABN AMRO Mortgage Corporation (the "Depositor"). The Loans were originated
or acquired by various financial institutions and subsequently acquired by
the Depositor. The Mortgage Pool was created pursuant to a Pooling and
Servicing Agreement, dated as of the Cut-Off Date stated above (the "Pooling
Agreement"), between the Depositor, LaSalle Home Mortgage Corporation, as
Servicer (the "Servicer"), and Chase Bank of Texas, National Association, as
Trustee (the "Trustee"), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Pooling
Agreement. Nothing herein shall be deemed inconsistent with such meanings,
and in the event of any conflict between the Pooling Agreement and the terms
of this Certificate, the Pooling Agreement shall control. This Certificate
is issued under and is subject to the terms, provisions and conditions of the
Pooling Agreement, to which Pooling Agreement the Holder of this Certificate,
by virtue of the acceptance hereof, assents and by which such Holder is bound.
Distributions will be made, pursuant to the Pooling Agreement, on the
25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day
of the month immediately preceding the month of such distribution (the
"Record Date"), to the extent of such Certificateholder's Percentage Interest
represented by this Certificate in the portion of the Certificate
Distribution Amount for such Distribution Date then distributable on the
Certificates of this Class, as specified in Section 4.1 of the Pooling
Agreement.
Distributions on this Certificate will be made by the Trustee or its
Paying Agent by wire transfer or by other means of payment acceptable to each
Certificateholder of record on the immediately preceding Record Date.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee or its Paying Agent of the pendency of
such distribution and only upon presentation and surrender of this
Certificate to the Certificate Registrar.
Reference is hereby made to the further provisions of this Certificate
set forth below, which further provisions shall for all purposes have the
same effect as if set forth at this place.
K-1
<PAGE>
Unless the certificate of authentication hereon has been executed by
or on behalf of the Trustee, by manual signature, this Certificate shall not
be entitled to any benefit under the Pooling Agreement or be valid for any
purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
CHASE BANK OF TEXAS, NATIONAL
ASSOCIATION, as Trustee
--------------------------------------
By:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Pooling Agreement.
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION,
as Trustee
By:
----------------------------------
Dated:
-------------------------------
K-2
<PAGE>
ABN AMRO MORTGAGE CORPORATION
MORTGAGE PASS-THROUGH CERTIFICATE
This Certificate is one of a duly authorized issue of Certificates
designated as Mortgage Pass-Through Certificates of the Series and Class
specified hereon (herein called the "Certificates") and representing certain
interests in the Certificate Trust Fund.
The Certificates do not represent an obligation of, or an interest in,
the Depositor or any of its affiliates and are not insured or guaranteed by
any governmental agency. The Certificates are limited in right of payment to
certain collections and recoveries respecting the Loans, all as more
specifically set forth herein and in the Pooling Agreement. To the extent
described in the Pooling Agreement, the Servicer is obligated to advance its
own funds to cover certain shortfalls with respect to payments on the Loans.
In the event Servicer funds are advanced with respect to any Loan, such
advance is reimbursable to the Servicer from the related recoveries on such
Loan or from other cash deposited in the Custodial Account for P & I to the
extent that such advance is not otherwise recoverable.
As provided in the Pooling Agreement, withdrawals from the Custodial
Account for P&I may be made by the Servicer from time to time for purposes
other than distributions to Certificateholders, such purposes including
reimbursement to the Servicer of advances made, or certain expenses incurred,
by it.
The Pooling Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor and the Servicer, and the rights of the
Certificateholders under the Pooling Agreement at any time by the Depositor
and the Trustee, with the consent of the Holders of the Certificates
aggregating not less than 66-2/3% of the aggregate Percentage Interest
evidenced by all of the Certificates of the Trust Fund. For the purposes of
such provision and except as provided below, voting rights related to 100% of
the Aggregate Certificate Principal Balance of any Class will be allocated
pro rata (by Certificate Principal Balance) among the Certificates of such
Class. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange hereof or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Pooling Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders
of any of the Certificates.
As provided in the Pooling Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is
registrable in the Certificate Register upon surrender of this Certificate
for registration of transfer at the offices of the Certificate Registrar or
the office maintained by the Trustee in the City and State of New York, duly
endorsed by, or accompanied by an assignment in the form below or other
written instrument of transfer in form satisfactory to the Trustee or any
Authenticating Agent duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new
Certificates of Authorized Denominations evidencing the same Percentage
Interest set forth hereinabove will be issued to the designated transferee or
transferees.
K-3
<PAGE>
No transfer of a Certificate will be made unless such transfer is
exempt from or is made in accordance with the registration requirements of
the Securities Act of 1933, as amended (the "Securities Act") and any
applicable state securities laws. No transfer, sale, pledge or other
disposition of a Junior Subordinate Certificate shall be made unless such
transfer, sale, pledge or other disposition is made in accordance with
Section 5.1(e) or Section 5.1(f) of the Pooling Agreement. Each Person who,
at any time, acquires any ownership interest in any Junior Subordinate
Certificate shall be deemed by the acceptance or acquisition of such
ownership interest to have agreed to be bound by the provisions of such
Section 5.1(e) and Section 5.1(f), as applicable. No transfer of a Junior
Subordinate Certificate shall be deemed to be made in accordance with such
Section 5.1(e) unless such transfer is made pursuant to an effective
registration statement under the Securities Act or unless the Trustee and the
Certificate Registrar are provided with the certificates and an Opinion of
Counsel, if required, on which the Trustee and the Certificate Registrar may
conclusively rely, which establishes or establish to the Trustee's and the
Certificate Registrar's satisfaction that such transfer is exempt from the
registration requirements under the Securities Act, as follows: In the event
that a transfer is to be made in reliance upon an exemption from the
Securities Act, the Trustee and the Certificate Registrar shall require, in
order to assure compliance with the Securities Act, that the
Certificateholder desiring to effect such transfer certify to the Trustee and
the Certificate Registrar in writing, in substantially the form attached as
Exhibit F to the Pooling Agreement, the facts surrounding the transfer, with
such modifications to such Exhibit F as may be appropriate to reflect the
actual facts of the proposed transfer, and that the Certificateholder's
proposed transferee certify to the Trustee and the Certificate Registrar in
writing, in substantially the form attached as Exhibit G to the Pooling
Agreement, the facts surrounding the transfer, with such modifications to
such Exhibit G as may be appropriate to reflect the actual facts of the
proposed transfer. If such certificate of the proposed transferee does not
contain substantially the substance of Exhibit G, the Trustee and the
Certificate Registrar shall require an Opinion of Counsel satisfactory to it
that such transfer may be made without registration, which Opinion of Counsel
shall not be obtained at the expense of the Trustee, the Certificate
Registrar, the Trust Fund or the Depositor.
Transfers of the Junior Subordinate Certificates may also be made in
accordance with Section 5.1(f) of the Pooling Agreement. To effectuate a
Certificate transfer in accordance with such Section 5.1(f), the proposed
transferee of such Certificate must provide the Trustee, the Certificate
Registrar and the Depositor with an investment letter substantially in the
form of Exhibit L attached to the Pooling Agreement, which investment letter
shall not be an expense of the Trustee, the Certificate Registrar or the
Depositor, and which investment letter states that, among other things, such
transferee (i) is a "qualified institutional buyer" as defined under Rule
144A, acting for its own account or the accounts of other "qualified
institutional buyers" as defined under Rule 144A, and (ii) is aware that the
proposed transferor intends to rely on the exemption from registration
requirements under the Securities Act provided by Rule 144A. Notwithstanding
the foregoing, the proposed transferee of such Certificate shall not be
required to provide the Trustee, the Certificate Registrar or the Depositor
with Annex 1 or Annex 2 to the form of such Exhibit L if the Depositor so
consents prior to each such transfer. Such transfers shall be deemed to have
complied with the requirements of Section 5.1(f) of the Pooling Agreement.
The Holder of a Certificate desiring to effect such transfer does hereby
agree to indemnify the Trustee, and the Certificate Registrar, the Depositor,
and the Certificate Registrar against any liability that may result if
transfer is not made in accordance with the Pooling Agreement.
K-4
<PAGE>
The Certificates are issuable only as registered Certificates without
coupons in Authorized Denominations specified in the Pooling Agreement. As
provided in the Pooling Agreement and subject to certain limitations therein
set forth, Certificates are exchangeable for new Certificates of Authorized
Denominations evidencing the same aggregate interest in the portion of the
Available Distribution Amount distributable on this Class of Certificate, as
requested by the Holder surrendering the same.
A reasonable service charge may be made for any such registration of
transfer or exchange, and the Trustee or the Certificate Registrar may
require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.
The Depositor, the Certificate Registrar, the Certificate
Administrator, the Servicer, the Trustee and any agent of any of them may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and neither the Depositor, the Certificate
Registrar, the Certificate Administrator, the Servicer, the Trustee nor any
such agent shall be affected by notice to the contrary.
The respective obligations and responsibilities of the Servicer and
the Trustee created under the Pooling Agreement (other than the obligation to
make payments to Certificateholders as set forth therein) shall terminate
upon the earlier of (i) the later of the final payment or other liquidation
(or any Advance with respect thereto) of the last Loan remaining in the Trust
Fund and the disposition of all property acquired in respect of any Loan or
(ii) the purchase by the Class R Certificateholder of all Loans at a price
established pursuant to the Pooling Agreement; PROVIDED, HOWEVER, that in no
event shall the trust created hereby continue beyond 21 years from the death
of the survivor of certain persons identified in the Pooling Agreement.
K-5
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sell(s) and assign(s) and
transfer(s) unto ___________________________________________________________
____________________________________________________________________________
(Please print or typewrite name and address, including postal zip code of
assignee. Please interest social security or other identifying number of
assignee.)
the within Mortgage Pass-Through Certificate and hereby irrevocably constitute
and appoints _________________________________________________________________
__________________________________________________________________ Attorney to
transfer said Certificate on the Certificate Register, with full power of
substitution in the premises.
Dated:
------------------ -------------------------------------------
Signature Guaranteed
--------------------------------------------
NOTICE:
The signature to this assignment must
correspond with the name as written upon the
face of the within instrument in every
particular, without alteration or enlargement
or any change whatever.
K-6
<PAGE>
EXHIBIT L
FORM OF RULE 144A INVESTMENT REPRESENTATION
Description of Rule 144A Securities, including numbers:
_______________________________________
_______________________________________
_______________________________________
_______________________________________
The undersigned seller, as registered holder (the "Seller"), intends to
transfer the Rule 144A Securities described above to the undersigned buyer
(the "Buyer").
1. In connection with such transfer and in accordance with the
agreements pursuant to which the Rule 144A Securities were issued, the Seller
hereby certifies the following facts: Neither the Seller nor anyone acting
on its behalf has offered, transferred, pledged, sold or otherwise disposed
of the Rule 144A Securities, any interest in the Rule 144A Securities or any
other similar security to, or solicited any offer to buy or accept a
transfer, pledge or other disposition of the Rule 144A Securities, any
interest in the Rule 144A Securities or any other similar security from, or
otherwise approached or negotiated with respect to the Rule 144A Securities,
any interest in the Rule 144A Securities or any other similar security with,
any person in any manner, or made any general solicitation by means of
general advertising or in any other manner, or taken any other action, that
would constitute a distribution of the Rule 144A Securities under the
Securities Act of 1933, as amended (the "1993 Act"), or that would render the
disposition of the Rule 144A Securities in violation of Section 5 of the 1933
Act or require registration pursuant thereto, and that the Seller has not
offered the Rule 144A Securities to any person other than the Buyer or
another "qualified institutional buyer" as defined in Rule 144A under the
1933 Act.
2. The Buyer warrants and represents to, and covenants with, the
Seller, the Trustee, the Certificate Registrar and the Servicer (as defined
in the Pooling and Servicing Agreement (the "Agreement") dated as of October
1, 1998 between ABN AMRO Mortgage Corporation, as Depositor, LaSalle Home
Mortgage Corporation, as Servicer, and Chase Bank of Texas, National
Association, as Trustee) pursuant to Section 5.1(f) of the Agreement, as
follows:
(a) The Buyer understands that the Rule 144A Securities have
not been registered under the 1933 Act or the securities laws of any state.
(b) The Buyer considers itself a substantial, sophisticated
institutional investor having such knowledge and experience in financial and
business matters that it is capable of evaluating the merits and risks of
investment in the Rule 144A Securities.
(c) The Buyer has received and reviewed the Private
Placement Memorandum dated as of October 27, 1998 relating to the Rule 144A
Securities and has been furnished with all information regarding the Rule
144A Securities that it has requested from the Seller, the Trustee, the
Depositor or the Servicer.
L-1
<PAGE>
(d) Neither the Buyer nor anyone acting on its behalf has
offered, transferred, pledged, sold or otherwise disposed of the Rule 144A
Securities, any interest in the Rule 144A Securities or any other similar
security to, or solicited any offer to buy or accept a transfer, pledge or
other disposition of the Rule 144A Securities, any interest in the Rule 144A
Securities or any other similar security from, or otherwise approached or
negotiated with respect to the Rule 144A Securities, any interest in the Rule
144A Securities or any other similar security with, any person in any manner,
or made any general solicitation by means of general advertising or in any
other manner, or taken any other action, that would constitute a distribution
of the Rule 144A Securities under the 1933 Act or that would render the
disposition of the Rule 144A Securities a violation of Section 5 of the 1933
Act or require registration pursuant thereto, nor will it act, nor has it
authorized or will it authorize any person to act, in such manner with
respect to the Rule 144A Securities.
(e) The Buyer is a "qualified institutional buyer" as that
term is defined in Rule 144A under the 1933 Act and has (1) completed either
of the forms of certification to that effect attached hereto as Annex 1 or
Annex 2, or (2) obtained the waiver of the Depositor with respect to Annex 1
and Annex 2 pursuant to Section 5.1(f) of the Agreement. The Buyer is aware
that the sale to it is being made in reliance on Rule 144A. The Buyer is
acquiring the Rule 144A Securities for its own account or the accounts of
other qualified institutional buyers, understands that such Rule 144A
Securities may be resold, pledged or transferred only (i) to a person
reasonably believed to be a qualified institutional buyer that purchases for
its own account or for the account of a qualified institutional buyer to whom
notice is given that the resale, pledge or transfer is being made in reliance
on Rule 144A, or (ii) pursuant to another exemption from registration under
the 1933 Act.
(f) The Buyer is not affiliated with (i) the Trustee or (ii)
any Rating Agency that rated the Rule 144A Securities.
(g) If applicable, the Buyer has complied, and will continue
to comply, with the guidelines established by Thrift Bulletin 12 issued
December 13, 1988, by the Office of Regulatory Activities of the Federal Home
Loan Bank System.
[Required only in the case of a transfer of a Class B-1, Class B-2,
Class B-3, Class B-4, or Class B-5 Certificate] [3. The Buyer warrants and
represents to, and covenants with, the Seller, the Servicer, the Certificate
Registrar and the Depositor that (1) the Buyer is not an employee benefit plan
(within the meaning of Section 3(3) of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA")), subject to the prohibited transaction
provisions of ERISA ("Plan"), or a plan (within the meaning of Section
4975(e)(1) of the Internal Revenue Code of 1986 ("Code")) subject to Section
4975 of the Code (also a "Plan"), and the Buyer is not directly or indirectly
purchasing the Rule 144A Securities on behalf of, as investment manager of, as
named fiduciary of, as trustee of, or with "plan assets" of any Plan, or (2)
The Buyer has provided the Seller, the Servicer, the Certificate Registrar and
the Depositor with an Officer's Certificate signed by a Responsible Officer
of the Buyer stating that the Buyer is an insurance company using assets of a
"insurance company general account" (within the meaning of Department of
Labor Prohibited Transaction Class Exemption ("PTCE") 95-60) to effect such
purchase and satisfies all of the requirements for exemptive relief under
Sections I and III of PTCE 95-60, which Officer's Certificate shall not be an
expense of the Servicer or the Depositor.]
L-2
<PAGE>
3. This document may be executed in one or more counterparts and
by the different parties hereto on separate counterparts, each of which, when
so executed, shall be deemed to be an original; such counterparts, together,
shall constitute one and the same document.
IN WITNESS WHEREOF, each of the parties has executed this document as
of the date set forth below.
- ------------------------------------ ------------------------------------
Print Name of Seller Print Name of Seller
By: By:
--------------------------------- --------------------------------
Name: Name:
----------------------- ------------------------
Title: Title:
----------------------- ----------------------
Taxpayer Identification: Taxpayer Identification:
----------- -----------
No.: No.:
------------------------------- -------------------------------
Date: Date:
------------------------------- ------------------------------
L-3
<PAGE>
Annex 1 to Exhibit L
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Buyers Other Than Registered Investment Companies]
The undersigned hereby certifies as follows in connection with the
Rule 144A Investment Representation to which this Certification is attached:
1. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
Buyer.
2. In connection with purchases by the Buyer, the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under
the Securities Act of 1933 ("Rule 144A") because (i) the Buyer owned and/or
invested on a discretionary basis $___________(1) in securities (except for
the excluded securities referred to below) as of the end of the Buyer's most
recent fiscal year (such amount being calculated in accordance with Rule
144A) and (ii) the Buyer satisfies the criteria in the category marked below.
____ CORPORATION, ETC. The Buyer is a corporation (other than a bank,
savings and loan association or similar institution),
Massachusetts or similar business trust, partnership, or
charitable organization described in Section 501(c)(3) of the
Internal Revenue Code.
____ BANK. The Buyer (a) is a national bank or banking institution
organized under the laws of any State, territory or the District
of Columbia, the business of which is substantially confined to
banking and is supervised by the State or territorial banking
commission or similar official or is a foreign bank or equivalent
institution, and (b) has an audited net worth of at least
$25,000,000 as demonstrated in its latest annual financial
statements, A COPY OF WHICH IS ATTACHED HERETO.
____ SAVINGS AND LOAN. The Buyer (a) is a savings and loan
association, building and loan association, cooperative bank,
homestead association or similar institution, which is supervised
and examined by a State or Federal authority having supervision
over any such institutions or is a foreign savings and loan
association or equivalent institution and (b) has an audited net
worth of at least $25,000,000 as demonstrated in its latest
annual financial statements.
____ BROKER-DEALER. The Buyer is a dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934.
- --------------
(1) Buyer must own and/or invest on a discretionary basis at least
$100,000,000 in securities unless Buyer is a dealer, and, in that case, Buyer
must own and/or invest on a discretionary basis at least $10,000,000 in
securities.
L-1-1
<PAGE>
____ INSURANCE COMPANY. The Buyer is an insurance company whose
primary and predominant business activity is the writing of
insurance or the reinsuring of risks underwritten by insurance
companies and which is subject to supervision by the insurance
commissioner or a similar official or agency of a State or
territory or the District of Columbia.
____ STATE OR LOCAL PLAN. The Buyer is a plan established and
maintained by a State, its political subdivisions, or any agency
or instrumentality of the State or its political subdivisions, for
the benefit of its employees.
____ ERISA PLAN. The Buyer is an employee benefit plan within the
meaning of Section 3(3) of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA") and is subject to the fiduciary
responsibility provisions of ERISA.
____ INVESTMENT ADVISER. The Buyer is an investment adviser registered
under the Investment Advisers Act of 1940.
____ SBIC. The Buyer is a Small Business Investment Company licensed
by the U.S. Small Business Administration under Section 301(c) or
(d) of the Small Business Investment Act of 1958.
____ BUSINESS DEVELOPMENT COMPANY. The Buyer is a business development
company as defined in Section 202(a)(22) of the Investment
Advisers Act of 1940.
____ TRUST FUND. The Buyer is a trust fund whose trustee is a bank or
trust company and whose participants are exclusively (a) plans
established and maintained by a State, its political subdivisions,
or any agency or instrumentality of the State or its political
subdivisions, for the benefit of its employees, or (b) employee
benefit plans within the meaning of Title I of the Employee
Retirement Income Security Act of 1974, but is not a trust fund
that includes as participants individual retirement accounts or
H.R. 10 plans.
3. The term "SECURITIES" as used herein DOES NOT INCLUDE (i)
securities of issuers that are affiliated with the Buyer, (ii) securities
that are part of an unsold allotment to or subscription by the Buyer, if the
Buyer is a dealer, (iii) bank deposit notes and certificates of deposit, (iv)
loan participations, (v) repurchase agreements, (vi) securities owned but
subject to a repurchase agreement and (vii) currency, interest rate and
commodity swaps.
4. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Buyer, the Buyer used
the cost of such securities to the Buyer and did not include any of the
securities referred to in the preceding paragraph. Further, in determining
such aggregate amount, the Buyer may have included securities owned by
subsidiaries of the Buyer, but only if such subsidiaries are consolidated
with the Buyer in its financial statements prepared in accordance with
generally accepted accounting principles and if the investments of such
subsidiaries are managed under the Buyer's direction. However, such
securities were not included
L-1-2
<PAGE>
if the Buyer is a majority-owned, consolidated subsidiary of another
enterprise and the Buyer is not itself a reporting company under the
Securities Exchange Act of 1934.
5. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the
Certificates are relying and will continue to rely on the statements made
herein because one or more sales to the Buyer may be in reliance on Rule 144A.
Will the Buyer be purchasing the Rule 144A
---- ---- Securities only for the Buyer's own account?
Yes No
6. If the answer to the foregoing question is "no", the Buyer
agrees that, in connection with any purchase of securities sold to the Buyer
for the account of a third party (including any separate account) in reliance
on Rule 144A, the Buyer will only purchase for the account of a third party
that at the time is a "qualified institutional buyer" within the meaning of
Rule 144A. In addition, the Buyer agrees that the Buyer will not purchase
securities for a third party unless the Buyer has obtained a current
representation letter from such third party or taken other appropriate steps
contemplated by Rule 144A to conclude that such third party independently
meets the definition of "qualified institutional buyer" set forth in Rule
144A.
7. The Buyer will notify each of the parties to which this
certification is made of any changes in the information and conclusions
herein. Until such notice is given, the Buyer's purchase of Rule 144A
Securities will constitute a reaffirmation of this certification as of the
date of such purchase.
---------------------------------------
Print Name of Buyer
By:
-----------------------------------
Name:
Title:
Date:
---------------------------------
L-1-3
<PAGE>
ANNEX 2 TO EXHIBIT L
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Buyers That Are Registered Investment Companies]
The undersigned hereby certifies as follows in connection with the
Rule 144A Investment Representation to which this Certification is attached:
1. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the Buyer or, if the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under
the Securities Act of 1933 ("Rule 144A") because Buyer is a part of a Family
of Investment Companies (as defined below), is such an officer the Adviser.
2. In connection with purchases by Buyer, the Buyer is a
"qualified institutional buyer" as defined in SEC Rule 144A because (i) the
Buyer is an investment company registered under the Investment Company Act of
1940, and (ii) as marked below, the Buyer alone, or the Buyer's Family of
Investment Companies, owned at least $100,000,000 in securities (other than
the excluded securities referred to below) as of the end of the Buyer's most
recent fiscal year. For purposes of determining the amount of securities
owned by the Buyer or the Buyer's Family of Investment Companies, the cost of
such securities was used.
____ The Buyer owned $___________ in securities (other than the
excluded securities referred to below) as of the end of the
Buyer's most recent fiscal year (such amount being calculated in
accordance with Rule 144A).
____ The Buyer is part of a Family of Investment Companies which owned
in the aggregate $____________ in securities (other than the
excluded securities referred to below) as of the end of the
Buyer's most recent fiscal year (such amount being calculated in
accordance with Rule 144A).
3. The term "FAMILY OF INVESTMENT COMPANIES" as used herein means
two or more registered investment companies (or series thereof) that have the
same investment adviser or investment advisers that are affiliated (by virtue
of being majority owned subsidiaries of the same parent or because one
investment adviser is a majority owned subsidiary of the other).
4. The term "SECURITIES" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer or are part of the
Buyer's Family of Investment Companies, (ii) bank deposit notes and
certificates of deposit, (iii) loan participations, (iv) repurchase
agreements, (v) securities owned but subject to a repurchase agreement and
(vi) currency, interest rate and commodity swaps.
5. The Buyer is familiar with Rule 144A and understands that each
of the parties to which this certification is made are relying and will
continue to rely on the statements made herein because one or more sales to
the Buyer will be in reliance on Rule 144A. In addition, the Buyer will only
purchase for the Buyer's own account.
L-2-1
<PAGE>
6. The undersigned will notify each of the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice, the Buyer's purchase of Rule 144A Securities will constitute
a reaffirmation of this certification by the undersigned as of the date of such
purchase.
---------------------------------------
Print Name of Buyer
By:
-----------------------------------
Name:
Title:
Date:
---------------------------------
IF AN ADVISER
----------------------------------------
Print Name of Buyer
By:
-----------------------------------
Name:
Title:
Date:
---------------------------------
(SEAL)
L-2-2
<PAGE>
EXHIBIT M
[RESERVED]
M-1
<PAGE>
EXHIBIT N
[RESERVED]
N-1
<PAGE>
EXHIBIT O
PLANNED PRINCIPAL BALANCES
<TABLE>
<CAPTION>
Distribution Dates Class A-1 Class A-2 Class A-3 Class A-4
- ------------------ --------- --------- --------- ---------
<S> <C> <C> <C> <C>
Initial Balance. . . . . . . . . . . . . $16,413,000.00 $25,740,000.00 $44,700,000.00 $2,112,000.00
November 25, 1998. . . . . . . . . . . . 16,413,000.00 25,740,000.00 44,700,000.00 2,112,000.00
December 25, 1998. . . . . . . . . . . . 16,413,000.00 25,740,000.00 44,700,000.00 2,112,000.00
January 25, 1999 . . . . . . . . . . . . 16,413,000.00 25,740,000.00 44,700,000.00 2,112,000.00
February 25, 1999. . . . . . . . . . . . 16,413,000.00 25,740,000.00 44,700,000.00 2,112,000.00
March 25, 1999 . . . . . . . . . . . . . 16,413,000.00 25,740,000.00 44,700,000.00 2,112,000.00
April 25, 1999 . . . . . . . . . . . . . 16,413,000.00 25,740,000.00 44,700,000.00 2,112,000.00
May 25, 1999 . . . . . . . . . . . . . . 16,413,000.00 25,740,000.00 44,700,000.00 2,112,000.00
June 25, 1999. . . . . . . . . . . . . . 16,413,000.00 25,740,000.00 44,700,000.00 2,112,000.00
July 25, 1999. . . . . . . . . . . . . . 16,413,000.00 25,740,000.00 44,700,000.00 2,112,000.00
August 25, 1999. . . . . . . . . . . . . 16,413,000.00 25,740,000.00 44,700,000.00 2,112,000.00
September 25, 1999 . . . . . . . . . . . 16,413,000.00 25,740,000.00 44,700,000.00 2,112,000.00
October 25, 1999 . . . . . . . . . . . . 16,179,411.10 25,373,669.75 44,500,041.18 2,112,000.00
November 25, 1999. . . . . . . . . . . . 15,933,419.89 24,987,889.35 44,289,465.63 2,112,000.00
December 25, 1999. . . . . . . . . . . . 15,675,126.44 24,582,815.74 44,068,359.02 2,112,000.00
January 25, 2000 . . . . . . . . . . . . 15,404,637.20 24,158,615.83 43,836,812.45 2,112,000.00
February 25, 2000. . . . . . . . . . . . 15,122,064.93 23,715,466.48 43,594,922.46 2,112,000.00
March 25, 2000 . . . . . . . . . . . . . 14,827,528.62 23,253,554.30 43,342,790.91 2,112,000.00
April 25, 2000 . . . . . . . . . . . . . 14,521,153.45 22,773,075.59 43,080,524.95 2,112,000.00
May 25, 2000 . . . . . . . . . . . . . . 14,203,070.64 22,274,236.17 42,808,236.91 2,112,000.00
June 25, 2000. . . . . . . . . . . . . . 13,873,417.43 21,757,251.24 42,526,044.28 2,112,000.00
July 25, 2000. . . . . . . . . . . . . . 13,532,336.94 21,222,345.26 42,234,069.58 2,112,000.00
August 25, 2000. . . . . . . . . . . . . 13,179,978.08 20,669,751.77 41,932,440.26 2,112,000.00
September 25, 2000 . . . . . . . . . . . 12,816,506.56 20,099,730.63 41,621,298.19 2,112,000.00
October 25, 2000 . . . . . . . . . . . . 12,442,111.25 19,512,578.06 41,300,805.04 2,112,000.00
November 25, 2000. . . . . . . . . . . . 12,056,977.24 18,908,584.30 40,971,199.25 2,112,000.00
December 25, 2000. . . . . . . . . . . . 11,661,303.93 18,288,062.10 40,632,411.52 2,112,000.00
January 25, 2001 . . . . . . . . . . . . 11,255,464.71 17,651,597.00 40,285,001.47 2,112,000.00
February 25, 2001. . . . . . . . . . . . 10,840,311.06 17,000,524.39 39,929,618.01 2,112,000.00
March 25, 2001 . . . . . . . . . . . . . 10,422,385.63 16,345,104.87 39,571,861.82 2,112,000.00
April 25, 2001 . . . . . . . . . . . . . 10,006,574.82 15,693,001.64 39,215,915.81 2,112,000.00
May 25, 2001 . . . . . . . . . . . . . . 9,592,877.15 15,044,212.38 38,861,778.71 2,112,000.00
June 25, 2001. . . . . . . . . . . . . . 9,181,281.88 14,398,720.26 38,509,441.32 2,112,000.00
July 25, 2001. . . . . . . . . . . . . . 8,771,778.36 13,756,508.56 38,158,894.53 2,112,000.00
August 25, 2001. . . . . . . . . . . . . 8,364,355.96 13,117,560.62 37,810,129.24 2,112,000.00
September 25, 2001 . . . . . . . . . . . 7,959,004.13 12,481,859.89 37,463,136.42 2,112,000.00
October 25, 2001 . . . . . . . . . . . . 7,555,712.37 11,849,389.89 37,117,907.07 2,112,000.00
November 25, 2001. . . . . . . . . . . . 7,154,470.22 11,220,134.25 36,774,432.25 2,112,000.00
December 25, 2001. . . . . . . . . . . . 6,755,267.29 10,594,076.65 36,432,703.07 2,112,000.00
January 25, 2002 . . . . . . . . . . . . 6,358,093.25 9,971,200.90 36,092,710.67 2,112,000.00
February 25, 2002. . . . . . . . . . . . 5,962,937.82 9,351,490.85 35,754,446.25 2,112,000.00
March 25, 2002 . . . . . . . . . . . . . 5,569,790.75 8,734,930.48 35,417,901.06 2,112,000.00
April 25, 2002 . . . . . . . . . . . . . 5,178,641.88 8,121,503.81 35,083,066.38 2,112,000.00
May 25, 2002 . . . . . . . . . . . . . . 4,789,481.09 7,511,194.98 34,749,933.54 2,112,000.00
June 25, 2002. . . . . . . . . . . . . . 4,402,298.30 6,903,988.19 34,418,493.94 2,112,000.00
July 25, 2002. . . . . . . . . . . . . . 4,017,083.49 6,299,867.73 34,088,738.99 2,112,000.00
August 25, 2002. . . . . . . . . . . . . 3,633,826.72 5,698,817.99 33,760,660.17 2,112,000.00
September 25, 2002 . . . . . . . . . . . 3,252,518.05 5,100,823.41 33,434,248.99 2,112,000.00
October 25, 2002 . . . . . . . . . . . . 2,873,147.64 4,505,868.54 33,109,497.01 2,112,000.00
November 25, 2002. . . . . . . . . . . . 2,495,705.68 3,913,937.99 32,786,395.84 2,112,000.00
December 25, 2002. . . . . . . . . . . . 2,120,182.42 3,325,016.47 32,464,937.12 2,112,000.00
January 25, 2003 . . . . . . . . . . . . 1,746,568.14 2,739,088.76 32,145,112.55 2,112,000.00
February 25, 2003. . . . . . . . . . . . 1,374,853.20 2,156,139.73 31,826,913.87 2,112,000.00
O-1
<PAGE>
<CAPTION>
Distribution Dates Class A-1 Class A-2 Class A-3 Class A-4
- ------------------ --------- --------- --------- ---------
<S> <C> <C> <C> <C>
March 25, 2003 . . . . . . . . . . . . . 1,005,027.99 1,576,154.30 31,510,332.86 2,112,000.00
April 25, 2003 . . . . . . . . . . . . . 637,082.97 999,117.51 31,195,361.35 2,112,000.00
May 25, 2003 . . . . . . . . . . . . . . 271,008.64 425,014.46 30,881,991.19 2,112,000.00
June 25, 2003. . . . . . . . . . . . . . 0.00 0.00 30,330,840.15 2,112,000.00
July 25, 2003. . . . . . . . . . . . . . 0.00 0.00 29,090,007.25 2,112,000.00
August 25, 2003. . . . . . . . . . . . . 0.00 0.00 27,855,483.56 2,112,000.00
September 25, 2003 . . . . . . . . . . . 0.00 0.00 26,627,237.23 2,112,000.00
October 25, 2003 . . . . . . . . . . . . 0.00 0.00 25,405,236.58 2,112,000.00
November 25, 2003. . . . . . . . . . . . 0.00 0.00 24,366,746.71 2,112,000.00
December 25, 2003. . . . . . . . . . . . 0.00 0.00 23,334,447.59 2,112,000.00
January 25, 2004 . . . . . . . . . . . . 0.00 0.00 22,308,309.16 2,112,000.00
February 25, 2004. . . . . . . . . . . . 0.00 0.00 21,288,301.53 2,112,000.00
March 25, 2004 . . . . . . . . . . . . . 0.00 0.00 20,274,394.97 2,112,000.00
April 25, 2004 . . . . . . . . . . . . . 0.00 0.00 19,266,559.90 2,112,000.00
May 25, 2004 . . . . . . . . . . . . . . 0.00 0.00 18,264,766.94 2,112,000.00
June 25, 2004. . . . . . . . . . . . . . 0.00 0.00 17,268,986.84 2,112,000.00
July 25, 2004. . . . . . . . . . . . . . 0.00 0.00 16,279,190.55 2,112,000.00
August 25, 2004. . . . . . . . . . . . . 0.00 0.00 15,295,349.15 2,112,000.00
September 25, 2004 . . . . . . . . . . . 0.00 0.00 14,317,433.90 2,112,000.00
October 25, 2004 . . . . . . . . . . . . 0.00 0.00 13,345,416.21 2,112,000.00
November 25, 2004. . . . . . . . . . . . 0.00 0.00 12,467,405.99 2,112,000.00
December 25, 2004. . . . . . . . . . . . 0.00 0.00 11,619,160.00 2,112,000.00
January 25, 2005 . . . . . . . . . . . . 0.00 0.00 10,794,264.99 2,112,000.00
February 25, 2005. . . . . . . . . . . . 0.00 0.00 9,989,097.99 2,112,000.00
March 25, 2005 . . . . . . . . . . . . . 0.00 0.00 9,203,194.97 2,112,000.00
April 25, 2005 . . . . . . . . . . . . . 0.00 0.00 8,436,102.69 2,112,000.00
May 25, 2005 . . . . . . . . . . . . . . 0.00 0.00 7,687,378.46 2,112,000.00
June 25, 2005. . . . . . . . . . . . . . 0.00 0.00 6,956,589.86 2,112,000.00
July 25, 2005. . . . . . . . . . . . . . 0.00 0.00 6,243,314.58 2,112,000.00
August 25, 2005. . . . . . . . . . . . . 0.00 0.00 5,547,140.10 2,112,000.00
September 25, 2005 . . . . . . . . . . . 0.00 0.00 4,867,663.52 2,112,000.00
October 25, 2005 . . . . . . . . . . . . 0.00 0.00 4,204,491.31 2,112,000.00
November 25, 2005. . . . . . . . . . . . 0.00 0.00 3,772,989.86 2,112,000.00
December 25, 2005. . . . . . . . . . . . 0.00 0.00 3,351,851.48 2,112,000.00
January 25, 2006 . . . . . . . . . . . . 0.00 0.00 2,940,831.74 2,112,000.00
February 25, 2006. . . . . . . . . . . . 0.00 0.00 2,539,691.89 2,112,000.00
March 25, 2006 . . . . . . . . . . . . . 0.00 0.00 2,148,198.76 2,112,000.00
April 25, 2006 . . . . . . . . . . . . . 0.00 0.00 1,766,124.60 2,112,000.00
May 25, 2006 . . . . . . . . . . . . . . 0.00 0.00 1,393,246.98 2,112,000.00
June 25, 2006. . . . . . . . . . . . . . 0.00 0.00 1,029,348.64 2,112,000.00
July 25, 2006. . . . . . . . . . . . . . 0.00 0.00 674,217.43 2,112,000.00
August 25, 2006. . . . . . . . . . . . . 0.00 0.00 327,646.09 2,112,000.00
September 25, 2006 . . . . . . . . . . . 0.00 0.00 0.00 2,101,432.25
October 25, 2006 . . . . . . . . . . . . 0.00 0.00 0.00 1,771,378.24
November 25, 2006. . . . . . . . . . . . 0.00 0.00 0.00 1,610,334.62
December 25, 2006. . . . . . . . . . . . 0.00 0.00 0.00 1,453,180.11
January 25, 2007 . . . . . . . . . . . . 0.00 0.00 0.00 1,299,822.63
February 25, 2007. . . . . . . . . . . . 0.00 0.00 0.00 1,150,172.28
March 25, 2007 . . . . . . . . . . . . . 0.00 0.00 0.00 1,004,141.23
April 25, 2007 . . . . . . . . . . . . . 0.00 0.00 0.00 861,643.72
May 25, 2007 . . . . . . . . . . . . . . 0.00 0.00 0.00 722,595.97
June 25, 2007. . . . . . . . . . . . . . 0.00 0.00 0.00 586,916.20
July 25, 2007. . . . . . . . . . . . . . 0.00 0.00 0.00 454,524.50
August 25, 2007. . . . . . . . . . . . . 0.00 0.00 0.00 325,342.86
September 25, 2007 . . . . . . . . . . . 0.00 0.00 0.00 199,295.07
October 25, 2007 . . . . . . . . . . . . 0.00 0.00 0.00 76,306.73
November 25, 2007. . . . . . . . . . . . 0.00 0.00 0.00 69,043.93
December 25, 2007. . . . . . . . . . . . 0.00 0.00 0.00 61,953.70
January 25, 2008 . . . . . . . . . . . . 0.00 0.00 0.00 55,032.00
February 25, 2008. . . . . . . . . . . . 0.00 0.00 0.00 48,274.88
O-2
<PAGE>
<CAPTION>
Distribution Dates Class A-1 Class A-2 Class A-3 Class A-4
- ------------------ --------- --------- --------- ---------
<S> <C> <C> <C> <C>
March 25, 2008 . . . . . . . . . . . . . 0.00 0.00 0.00 41,678.50
April 25, 2008 . . . . . . . . . . . . . 0.00 0.00 0.00 35,239.07
May 25, 2008 . . . . . . . . . . . . . . 0.00 0.00 0.00 28,952.93
June 25, 2008. . . . . . . . . . . . . . 0.00 0.00 0.00 22,816.48
July 25, 2008. . . . . . . . . . . . . . 0.00 0.00 0.00 16,826.20
August 25, 2008. . . . . . . . . . . . . 0.00 0.00 0.00 10,978.67
September 25, 2008 . . . . . . . . . . . 0.00 0.00 0.00 5,270.54
October 25, 2008 and thereafter. . . . . 0.00 0.00 0.00 0.00
</TABLE>
O-3
<PAGE>
EXHIBIT P-1
FIRST TARGETED PRINCIPAL BALANCES
<TABLE>
<CAPTION>
Distribution Dates Class A-6 Class A-7 Class A-8
- ------------------ --------- --------- ---------
<S> <C> <C> <C>
Initial Balance. . . . . . . . . . . . . $43,144,000.00 $51,500,000.00 $5,356,000.00
November 25, 1998. . . . . . . . . . . . 42,944,762.22 51,262,174.44 5,331,266.14
December 25, 1998. . . . . . . . . . . . 42,721,183.70 50,995,293.91 5,303,510.57
January 25, 1999 . . . . . . . . . . . . 42,473,344.23 50,699,453.64 5,272,743.18
February 25, 1999. . . . . . . . . . . . 42,201,307.48 50,374,729.63 5,238,971.88
March 25, 1999 . . . . . . . . . . . . . 41,905,152.53 50,021,216.28 5,202,206.49
April 25, 1999 . . . . . . . . . . . . . 41,584,973.88 49,639,026.40 5,162,458.75
May 25, 1999 . . . . . . . . . . . . . . 41,240,881.40 49,228,291.12 5,119,742.28
June 25, 1999. . . . . . . . . . . . . . 40,873,000.25 48,789,159.86 5,074,072.63
July 25, 1999. . . . . . . . . . . . . . 40,481,470.88 48,321,800.26 5,025,467.23
August 25, 1999. . . . . . . . . . . . . 40,066,448.89 47,826,398.06 4,973,945.40
September 25, 1999 . . . . . . . . . . . 39,628,104.94 47,303,156.97 4,919,528.33
October 25, 1999 . . . . . . . . . . . . 39,511,724.00 47,164,235.72 4,905,080.52
November 25, 1999. . . . . . . . . . . . 39,390,730.05 47,019,808.03 4,890,060.03
December 25, 1999. . . . . . . . . . . . 39,265,190.36 46,869,954.19 4,874,475.24
January 25, 2000 . . . . . . . . . . . . 39,135,177.26 46,714,760.55 4,858,335.10
February 25, 2000. . . . . . . . . . . . 39,000,768.10 46,554,319.43 4,841,649.22
March 25, 2000 . . . . . . . . . . . . . 38,862,045.10 46,388,728.97 4,824,427.81
April 25, 2000 . . . . . . . . . . . . . 38,719,095.30 46,218,093.09 4,806,681.68
May 25, 2000 . . . . . . . . . . . . . . 38,572,010.44 46,042,521.27 4,788,422.21
June 25, 2000. . . . . . . . . . . . . . 38,420,886.84 45,862,128.51 4,769,661.37
July 25, 2000. . . . . . . . . . . . . . 38,265,825.31 45,677,035.13 4,750,411.65
August 25, 2000. . . . . . . . . . . . . 38,106,930.98 45,487,366.63 4,730,686.13
September 25, 2000 . . . . . . . . . . . 37,944,317.24 45,293,258.34 4,710,498.87
October 25, 2000 . . . . . . . . . . . . 37,778,107.82 45,094,857.98 4,689,865.23
November 25, 2000. . . . . . . . . . . . 37,608,426.83 44,892,313.68 4,668,800.62
December 25, 2000. . . . . . . . . . . . 37,435,405.26 44,685,781.82 4,647,321.31
January 25, 2001 . . . . . . . . . . . . 37,259,238.31 44,475,495.39 4,625,451.52
February 25, 2001. . . . . . . . . . . . 37,080,293.60 44,261,893.21 4,603,236.89
March 25, 2001 . . . . . . . . . . . . . 36,900,983.37 44,047,854.71 4,580,976.89
April 25, 2001 . . . . . . . . . . . . . 36,723,082.75 43,835,498.84 4,558,891.88
May 25, 2001 . . . . . . . . . . . . . . 36,546,577.94 43,624,809.11 4,536,980.15
June 25, 2001. . . . . . . . . . . . . . 36,371,451.84 43,415,765.11 4,515,239.57
July 25, 2001. . . . . . . . . . . . . . 36,197,687.44 43,208,346.55 4,493,668.04
August 25, 2001. . . . . . . . . . . . . 36,025,267.88 43,002,533.28 4,472,263.46
September 25, 2001 . . . . . . . . . . . 35,854,176.37 42,798,305.28 4,451,023.75
October 25, 2001 . . . . . . . . . . . . 35,684,396.23 42,595,642.64 4,429,946.83
November 25, 2001. . . . . . . . . . . . 35,515,910.92 42,394,525.60 4,409,030.66
December 25, 2001. . . . . . . . . . . . 35,348,703.98 42,194,934.52 4,388,273.19
January 25, 2002 . . . . . . . . . . . . 35,182,759.04 41,996,849.86 4,367,672.39
February 25, 2002. . . . . . . . . . . . 35,018,059.86 41,800,252.24 4,347,226.23
March 25, 2002 . . . . . . . . . . . . . 34,854,590.29 41,605,122.38 4,326,932.73
April 25, 2002 . . . . . . . . . . . . . 34,692,334.28 41,411,441.12 4,306,789.88
May 25, 2002 . . . . . . . . . . . . . . 34,531,275.89 41,219,189.43 4,286,795.70
June 25, 2002. . . . . . . . . . . . . . 34,371,399.28 41,028,348.39 4,266,948.23
July 25, 2002. . . . . . . . . . . . . . 34,212,688.69 40,838,899.21 4,247,245.52
August 25, 2002. . . . . . . . . . . . . 34,055,128.47 40,650,823.20 4,227,685.61
P-1-1
<PAGE>
<CAPTION>
Distribution Dates Class A-6 Class A-7 Class A-8
- ------------------ --------- --------- ---------
<S> <C> <C> <C>
September 25, 2002 . . . . . . . . . . . 33,898,703.07 40,464,101.80 4,208,266.59
October 25, 2002 . . . . . . . . . . . . 33,743,397.04 40,278,716.56 4,188,986.52
November 25, 2002. . . . . . . . . . . . 33,589,195.00 40,094,649.14 4,169,843.51
December 25, 2002. . . . . . . . . . . . 33,436,081.70 39,911,881.32 4,150,835.66
January 25, 2003 . . . . . . . . . . . . 33,284,041.97 39,730,394.99 4,131,961.08
February 25, 2003. . . . . . . . . . . . 33,133,060.71 39,550,172.14 4,113,217.90
March 25, 2003 . . . . . . . . . . . . . 32,983,122.95 39,371,194.88 4,094,604.27
April 25, 2003 . . . . . . . . . . . . . 32,834,213.78 39,193,445.43 4,076,118.32
May 25, 2003 . . . . . . . . . . . . . . 32,686,318.39 39,016,906.11 4,057,758.24
June 25, 2003. . . . . . . . . . . . . . 32,539,422.08 38,841,559.36 4,039,522.17
July 25, 2003. . . . . . . . . . . . . . 32,393,510.20 38,667,387.70 4,021,408.32
August 25, 2003. . . . . . . . . . . . . 32,248,568.22 38,494,373.80 4,003,414.88
September 25, 2003 . . . . . . . . . . . 32,104,581.67 38,322,500.38 3,985,540.04
October 25, 2003 . . . . . . . . . . . . 31,961,536.20 38,151,750.29 3,967,782.03
November 25, 2003. . . . . . . . . . . . 31,831,320.22 37,996,314.47 3,951,616.70
December 25, 2003. . . . . . . . . . . . 31,701,946.68 37,841,884.25 3,935,555.96
January 25, 2004 . . . . . . . . . . . . 31,573,401.46 37,688,442.78 3,919,598.05
February 25, 2004. . . . . . . . . . . . 31,445,670.53 37,535,973.31 3,903,741.22
March 25, 2004 . . . . . . . . . . . . . 31,318,739.95 37,384,459.19 3,887,983.76
April 25, 2004 . . . . . . . . . . . . . 31,192,595.82 37,233,883.85 3,872,323.92
May 25, 2004 . . . . . . . . . . . . . . 31,067,224.37 37,084,230.83 3,856,760.01
June 25, 2004. . . . . . . . . . . . . . 30,942,611.87 36,935,483.75 3,841,290.31
July 25, 2004. . . . . . . . . . . . . . 30,818,744.69 36,787,626.35 3,825,913.14
August 25, 2004. . . . . . . . . . . . . 30,695,609.27 36,640,642.44 3,810,626.81
September 25, 2004 . . . . . . . . . . . 30,573,192.12 36,494,515.91 3,795,429.65
October 25, 2004 . . . . . . . . . . . . 30,451,479.86 36,349,230.77 3,780,320.00
November 25, 2004. . . . . . . . . . . . 30,310,984.76 36,181,525.02 3,762,878.60
December 25, 2004. . . . . . . . . . . . 30,160,713.63 36,002,149.82 3,744,223.58
January 25, 2005 . . . . . . . . . . . . 30,003,408.26 35,814,378.02 3,724,695.31
February 25, 2005. . . . . . . . . . . . 29,840,606.76 35,620,045.62 3,704,484.74
March 25, 2005 . . . . . . . . . . . . . 29,672,484.47 35,419,361.91 3,683,613.64
April 25, 2005 . . . . . . . . . . . . . 29,499,212.22 35,212,530.81 3,662,103.20
May 25, 2005 . . . . . . . . . . . . . . 29,320,956.42 34,999,750.97 3,639,974.10
June 25, 2005. . . . . . . . . . . . . . 29,137,879.19 34,781,215.88 3,617,246.45
July 25, 2005. . . . . . . . . . . . . . 28,950,138.41 34,557,114.04 3,593,939.86
August 25, 2005. . . . . . . . . . . . . 28,757,887.88 34,327,629.01 3,570,073.42
September 25, 2005 . . . . . . . . . . . 28,561,277.39 34,092,939.59 3,545,665.72
October 25, 2005 . . . . . . . . . . . . 28,360,452.79 33,853,219.89 3,520,734.87
November 25, 2005. . . . . . . . . . . . 28,097,852.26 33,539,759.67 3,488,135.01
December 25, 2005. . . . . . . . . . . . 27,833,222.91 33,223,877.71 3,455,283.28
January 25, 2006 . . . . . . . . . . . . 27,566,647.87 32,905,673.22 3,422,190.01
February 25, 2006. . . . . . . . . . . . 27,298,207.92 32,585,242.63 3,388,865.23
March 25, 2006 . . . . . . . . . . . . . 27,027,981.57 32,262,679.65 3,355,318.68
April 25, 2006 . . . . . . . . . . . . . 26,756,045.10 31,938,075.34 3,321,559.84
May 25, 2006 . . . . . . . . . . . . . . 26,482,472.60 31,611,518.15 3,287,597.89
June 25, 2006. . . . . . . . . . . . . . 26,207,336.07 31,283,094.00 3,253,441.78
July 25, 2006. . . . . . . . . . . . . . 25,930,705.40 30,952,886.33 3,219,100.18
August 25, 2006. . . . . . . . . . . . . 25,652,648.49 30,620,976.20 3,184,581.52
September 25, 2006 . . . . . . . . . . . 25,373,231.25 30,287,442.27 3,149,894.00
October 25, 2006 . . . . . . . . . . . . 25,092,517.68 29,952,360.94 3,115,045.54
November 25, 2006. . . . . . . . . . . . 24,774,251.32 29,572,453.71 3,075,535.19
December 25, 2006. . . . . . . . . . . . 24,456,084.31 29,192,665.07 3,036,037.17
January 25, 2007 . . . . . . . . . . . . 24,138,037.92 28,813,020.42 2,996,554.12
February 25, 2007. . . . . . . . . . . . 23,820,132.63 28,433,544.19 2,957,088.60
P-1-2
<PAGE>
<CAPTION>
Distribution Dates Class A-6 Class A-7 Class A-8
- ------------------ --------- --------- ---------
<S> <C> <C> <C>
March 25, 2007 . . . . . . . . . . . . . 23,502,388.07 28,054,259.81 3,917,643.02
April 25, 2007 . . . . . . . . . . . . . 23,184,823.08 27,675,189.80 2,878,219.74
May 25, 2007 . . . . . . . . . . . . . . 22,867,455.75 27,296,355.72 2,838,820.99
June 25, 2007. . . . . . . . . . . . . . 22,550,303.39 26,917,778.24 2,799,448.94
July 25, 2007. . . . . . . . . . . . . . 22,233,382.58 26,539,477.17 2,760,105.63
August 25, 2007. . . . . . . . . . . . . 21,916,709.18 26,161,471.42 2,720,793.03
September 25, 2007 . . . . . . . . . . . 21,600,298.37 25,783,779.11 2,681,513.03
October 25, 2007 . . . . . . . . . . . . 21,284,164.50 25,406,417.50 2,642,267.42
November 25, 2007. . . . . . . . . . . . 20,950,231.10 25,007,808.77 2,600,812.11
December 25, 2007. . . . . . . . . . . . 20,617,324.18 24,610,425.44 2,559,484.25
January 25, 2008 . . . . . . . . . . . . 20,285,432.22 24,214,253.65 2,518,282.38
February 25, 2008. . . . . . . . . . . . 19,954,543.62 23,819,279.53 2,477,205.07
March 25, 2008 . . . . . . . . . . . . . 19,624,646.77 23,425,489.26 2,436,250.88
April 25, 2008 . . . . . . . . . . . . . 19,295,730.11 23,032,869.01 2,395,418.38
May 25, 2008 . . . . . . . . . . . . . . 18,967,782.05 22,641,404.96 2,354,706.12
June 25, 2008. . . . . . . . . . . . . . 18,640,791.05 22,251,083.33 2,314,112.67
July 25, 2008. . . . . . . . . . . . . . 18,314,745.56 21,861,890.33 2,273,636.59
August 25, 2008. . . . . . . . . . . . . 17,989,634.05 21,473,812.20 2,233,276.47
September 25, 2008 . . . . . . . . . . . 17,665,444.99 21,086,835.18 2,193,030.86
October 25, 2008 . . . . . . . . . . . . 17,342,036.84 20,700,790.31 2,152,882.19
November 25, 2008. . . . . . . . . . . . 17,017,311.58 20,313,173.24 2,112,570.02
December 25, 2008. . . . . . . . . . . . 16,693,530.32 19,926,683.00 2,072,375.03
January 25, 2009 . . . . . . . . . . . . 16,370,680.28 19,541,304.34 2,032,295.65
February 25, 2009. . . . . . . . . . . . 16,048,748.74 19,157,022.07 1,992,330.29
March 25, 2009 . . . . . . . . . . . . . 15,727,723.00 18,773,821.03 1,952,477.39
April 25, 2009 . . . . . . . . . . . . . 15,407,590.43 18,391,686.15 1,912,735.36
May 25, 2009 . . . . . . . . . . . . . . 15,088,338.43 18,010,602.38 1,873,102.65
June 25, 2009. . . . . . . . . . . . . . 14,769,954.44 17,630,554.74 1,833,577.69
July 25, 2009. . . . . . . . . . . . . . 14,452,425.95 17,251,528.29 1,794,158.94
August 25, 2009. . . . . . . . . . . . . 14,135,740.50 16,873,508.15 1,754,844.85
September 25, 2009 . . . . . . . . . . . 13,819,885.65 16,496,479.49 1,715,633.87
October 25, 2009 . . . . . . . . . . . . 13,504,849.03 16,120,427.52 1,676,524.46
November 25, 2009. . . . . . . . . . . . 13,190,618.28 15,745,337.50 1,637,515.10
December 25, 2009. . . . . . . . . . . . 12,877,181.10 15,371,194.76 1,598,604.25
January 25, 2010 . . . . . . . . . . . . 12,564,525.22 14,997,984.63 1,559,790.40
February 25, 2010. . . . . . . . . . . . 12,252,638.43 14,625,692.55 1,521,072.03
March 25, 2010 . . . . . . . . . . . . . 11,941,508.54 14,254,303.96 1,482,447.61
April 25, 2010 . . . . . . . . . . . . . 11,631,123.39 13,883,804.35 1,443,915.65
May 25, 2010 . . . . . . . . . . . . . . 11,321,470.88 13,514,179.27 1,405,474.64
June 25, 2010. . . . . . . . . . . . . . 11,012,538.94 13,145,414.32 1,367,123.09
July 25, 2010. . . . . . . . . . . . . . 10,704,315.53 12,777,495.12 1,328,859.49
August 25, 2010. . . . . . . . . . . . . 10,396,788.64 12,410,407.36 1,290,682.37
September 25, 2010 . . . . . . . . . . . 10,089,946.33 12,044,136.75 1,252,590.22
October 25, 2010 . . . . . . . . . . . . 9,783,776.66 11,678,669.06 1,214,581.58
November 25, 2010. . . . . . . . . . . . 9,478,267.73 11,313,990.09 1,176,654.97
December 25, 2010. . . . . . . . . . . . 9,173,407.70 10,950,085.68 1,138,808.91
January 25, 2011 . . . . . . . . . . . . 8,869,184.75 10,586,941.74 1,101,041.94
February 25, 2011. . . . . . . . . . . . 8,565,587.07 10,224,544.18 1,063,352.60
March 25, 2011 . . . . . . . . . . . . . 8,262,602.92 9,862,878.97 1,025,739.41
April 25, 2011 . . . . . . . . . . . . . 7,960,220.57 9,501,932.12 988,200.94
May 25, 2011 . . . . . . . . . . . . . . 7,658,428.33 9,141,689.67 950,735.73
June 25, 2011. . . . . . . . . . . . . . 7,357,214.55 8,782,137.71 913,342.32
July 25, 2011. . . . . . . . . . . . . . 7,056,567.59 8,423,262.35 876,019.28
August 25, 2011. . . . . . . . . . . . . 6,756,475.86 8,065,049.76 838,765.18
P-1-3
<PAGE>
<CAPTION>
Distribution Dates Class A-6 Class A-7 Class A-8
- ------------------ --------- --------- ---------
<S> <C> <C> <C>
September 25, 2011 . . . . . . . . . . . 6,456,927.80 7,707,486.13 801,578.56
October 25, 2011 . . . . . . . . . . . . 6,157,911.87 7,350,557.70 764,458.00
November 25, 2011. . . . . . . . . . . . 5,859,416.56 6,994,250.72 727,402.07
December 25, 2011. . . . . . . . . . . . 5,561,430.40 6,638,551.49 690,409.36
January 25, 2012 . . . . . . . . . . . . 5,263,941.94 6,283,446.37 653,478.42
February 25, 2012. . . . . . . . . . . . 4,966,939.76 5,928,921.70 616,607.86
March 25, 2012 . . . . . . . . . . . . . 4,670,412.47 5,574,963.89 579,796.24
April 25, 2012 . . . . . . . . . . . . . 4,374,348.71 5,221,559.39 543,042.18
May 25, 2012 . . . . . . . . . . . . . . 4,078,737.13 4,868,694.66 506,344.24
June 25, 2012. . . . . . . . . . . . . . 3,783,566.44 4,516,356.20 469,701.04
July 25, 2012. . . . . . . . . . . . . . 3,488,825.34 4,164,530.53 433,111.18
August 25, 2012. . . . . . . . . . . . . 3,194,502.58 2,813,204.22 396,573.24
September 25, 2012 . . . . . . . . . . . 2,900,586.92 2,462,363.86 360,085.84
October 25, 2012 . . . . . . . . . . . . 2,607,067.16 3,111,996.08 323,647.59
November 25, 2012. . . . . . . . . . . . 2,313,932.11 2,762,087.52 287,257.10
December 25, 2012. . . . . . . . . . . . 2,021,170.62 2,412,624.86 250,912.99
January 25, 2013 . . . . . . . . . . . . 1,728,771.54 2,063,594.81 214,613.86
February 25, 2013. . . . . . . . . . . . 1,436,723.77 1,714,984.10 178,358.35
March 25, 2013 . . . . . . . . . . . . . 1,145,016.21 1,366,779.50 142,145.07
April 25, 2013 . . . . . . . . . . . . . 853,637.80 1,018,967.80 105,972.65
May 25, 2013 . . . . . . . . . . . . . . 562,577.49 671,535.80 69,839.72
June 25, 2013. . . . . . . . . . . . . . 271,824.25 324,470.36 33,744.92
July 25, 2013 and thereafter . . . . . . 0.00 0.00 0.00
</TABLE>
P-1-4
<PAGE>
EXHIBIT P-2
SECOND TARGETED PRINCIPAL BALANCES
<TABLE>
<CAPTION>
Distribution Dates Class A-6 Class A-7 Class A-8
- ------------------ --------- --------- ---------
<S> <C> <C> <C>
Initial Balance. . . . . . . . . . . . . $43,144,000.00 $51,500,000.00 $5,356,000.00
November 25, 1998. . . . . . . . . . . . 42,944,762.22 51,262,174.44 5,331,266.14
December 25, 1998. . . . . . . . . . . . 42,721,183.70 50,995,293.91 5,303,510.57
January 25, 1999 . . . . . . . . . . . . 42,473,344.23 50,699,453.64 5,272,743.18
February 25, 1999. . . . . . . . . . . . 42,201,307.48 50,374,729.63 5,238,971.88
March 25, 1999 . . . . . . . . . . . . . 41,905,152.53 50,021,216.28 5,202,206.49
April 25, 1999 . . . . . . . . . . . . . 41,584,973.88 49,639,026.40 5,162,458.75
May 25, 1999 . . . . . . . . . . . . . . 41,240,881.40 49,228,291.12 5,119,742.28
June 25, 1999. . . . . . . . . . . . . . 40,873,000.25 48,789,159.86 5,074,072.63
July 25, 1999. . . . . . . . . . . . . . 40,481,470.88 48,321,800.26 5,025,467.23
August 25, 1999. . . . . . . . . . . . . 40,066,448.89 47,826,398.06 4,973,945.40
September 25, 1999 . . . . . . . . . . . 39,628,104.94 47,303,156.97 4,919,528.33
October 25, 1999 . . . . . . . . . . . . 39,511,724.00 47,164,235.72 4,905,080.52
November 25, 1999. . . . . . . . . . . . 39,390,730.05 47,019,808.03 4,890,060.03
December 25, 1999. . . . . . . . . . . . 39,265,190.36 46,869,954.19 4,874,475.24
January 25, 2000 . . . . . . . . . . . . 39,135,177.26 46,714,760.55 4,858,335.10
February 25, 2000. . . . . . . . . . . . 39,000,768.10 46,554,319.43 4,841,649.22
March 25, 2000 . . . . . . . . . . . . . 38,862,045.10 46,388,728.97 4,824,427.81
April 25, 2000 . . . . . . . . . . . . . 38,719,095.30 46,218,093.09 4,806,681.68
May 25, 2000 . . . . . . . . . . . . . . 38,572,010.44 46,042,521.27 4,788,422.21
June 25, 2000. . . . . . . . . . . . . . 38,420,886.84 45,862,128.51 4,769,661.37
July 25, 2000. . . . . . . . . . . . . . 37,849,086.19 45,179,583.23 4,698,676.66
August 25, 2000. . . . . . . . . . . . . 37,137,711.24 44,330,431.32 4,610,364.86
September 25, 2000 . . . . . . . . . . . 36,407,007.17 43,458,206.68 4,519,653.49
October 25, 2000 . . . . . . . . . . . . 35,658,282.31 42,564,471.05 4,426,704.99
November 25, 2000. . . . . . . . . . . . 34,892,855.06 41,650,798.15 4,331,683.01
December 25, 2000. . . . . . . . . . . . 34,112,097.11 40,718,825.35 4,234,757.84
January 25, 2001 . . . . . . . . . . . . 33,317,821.00 39,770,716.24 4,136,154.49
February 25, 2001. . . . . . . . . . . . 32,513,003.02 38,810,023.54 4,036,242.45
March 25, 2001 . . . . . . . . . . . . . 31,714,467.51 37,856,830.08 3,937,110.33
April 25, 2001 . . . . . . . . . . . . . 30,934,341.03 36,925,611.04 3,840,263.55
May 25, 2001 . . . . . . . . . . . . . . 30,172,333.12 36,016,019.74 3,745,666.05
June 25, 2001. . . . . . . . . . . . . . 29,428,134.64 35,127,687.14 3,653,279.46
July 25, 2001. . . . . . . . . . . . . . 28,701,441.22 34,260,249.93 3,563,065.99
August 25, 2001. . . . . . . . . . . . . 27,991,953.26 33,413,350.48 3,474,988.45
September 25, 2001 . . . . . . . . . . . 27,299,375.82 32,586,636.72 3,389,010.22
October 25, 2001 . . . . . . . . . . . . 26,623,418.55 31,779,762.08 3,305,095.26
November 25, 2001. . . . . . . . . . . . 25,963,795.63 30,992,385.38 3,223,208.08
December 25, 2001. . . . . . . . . . . . 25,320,225.72 30,224,170.79 3,143,313.76
January 25, 2002 . . . . . . . . . . . . 24,692,431.84 29,474,787.69 3,065,377.92
February 25, 2002. . . . . . . . . . . . 24,080,141.37 28,743,910.64 2,989,366.71
March 25, 2002 . . . . . . . . . . . . . 23,483,085.92 28,031,219.29 2,915,246.81
April 25, 2002 . . . . . . . . . . . . . 22,901,001.30 27,336,398.28 2,842,985.42
May 25, 2002 . . . . . . . . . . . . . . 22,333,627.46 26,659,137.18 2,772,550.27
June 25, 2002. . . . . . . . . . . . . . 21,780,708.41 25,999,130.43 2,703,909.56
July 25, 2002. . . . . . . . . . . . . . 21,241,992.17 25,356,077.25 2,637,032.03
August 25, 2002. . . . . . . . . . . . . 20,717,230.70 24,729,681.55 2,571,886.88
September 25, 2002 . . . . . . . . . . . 20,206,179.83 24,119,651.89 2,508,443.80
P-2-1
<PAGE>
<CAPTION>
Distribution Dates Class A-6 Class A-7 Class A-8
- ------------------ --------- --------- ---------
<S> <C> <C> <C>
October 25, 2002 . . . . . . . . . . . . 19,708,599.25 23,525,701.40 2,446,672.95
November 25, 2002. . . . . . . . . . . . 19,224,252.38 22,947,547.69 2,386,544.96
December 25, 2002. . . . . . . . . . . . 18,752,906.37 22,384,912.81 2,328,030.93
January 25, 2003 . . . . . . . . . . . . 18,294,332.02 21,837,523.16 2,271,102.41
February 25, 2003. . . . . . . . . . . . 17,848,303.73 21,305,109.45 2,215,731.38
March 25, 2003 . . . . . . . . . . . . . 17,414,599.43 20,787,406.60 2,161,890.29
April 25, 2003 . . . . . . . . . . . . . 16,993,000.54 20,284,153.71 2,109,551.99
May 25, 2003 . . . . . . . . . . . . . . 16,583,291.92 19,795,093.96 2,058,689.77
June 25, 2003. . . . . . . . . . . . . . 16,185,261.81 19,319,974.58 2,009,277.36
July 25, 2003. . . . . . . . . . . . . . 15,798,701.78 18,858,546.77 1,961,288.86
August 25, 2003. . . . . . . . . . . . . 15,423,406.69 18,410,565.65 1,914,698.83
September 25, 2003 . . . . . . . . . . . 15,059,174.61 17,975,790.21 1,869,482.18
October 25, 2003 . . . . . . . . . . . . 14,705,806.81 17,553,983.18 1,825,614.25
November 25, 2003. . . . . . . . . . . . 14,450,378.94 17,249,084.82 1,793,904.82
December 25, 2003. . . . . . . . . . . . 14,204,692.22 16,955,814.23 1,763,404.68
January 25, 2004 . . . . . . . . . . . . 13,968,559.68 16,673,948.26 1,734,090.62
February 25, 2004. . . . . . . . . . . . 13,741,797.38 16,403,267.31 1,705,939.80
March 25, 2004 . . . . . . . . . . . . . 13,524,224.26 16,143,555.29 1,678,929.75
April 25, 2004 . . . . . . . . . . . . . 13,315,662.18 15,894,599.54 1,653,038.35
May 25, 2004 . . . . . . . . . . . . . . 13,115,935.82 15,656,190.78 1,628,243.84
June 25, 2004. . . . . . . . . . . . . . 12,924,872.67 15,428,123.08 1,604,524.80
July 25, 2004. . . . . . . . . . . . . . 12,742,302.94 15,210,193.80 1,581,860.16
August 25, 2004. . . . . . . . . . . . . 12,568,059.58 15,002,203.51 1,560,229.17
September 25, 2004 . . . . . . . . . . . 12,401,978.20 14,803,955.99 1,539,611.42
October 25, 2004 . . . . . . . . . . . . 12,243,897.03 14,615,258.14 1,519,986.85
November 25, 2004. . . . . . . . . . . . 12,097,076.09 14,440,001.35 1,501,760.14
December 25, 2004. . . . . . . . . . . . 11,947,076.80 14,260,950.66 1,483,138.87
January 25, 2005 . . . . . . . . . . . . 11,796,504.00 14,081,215.37 1,464,446.40
February 25, 2005. . . . . . . . . . . . 11,646,761.14 13,902,470.76 1,445,856.96
March 25, 2005 . . . . . . . . . . . . . 11,497,891.29 13,724,768.25 1,427,375.90
April 25, 2005 . . . . . . . . . . . . . 11,349,935.27 13,548,156.56 1,409,008.28
May 25, 2005 . . . . . . . . . . . . . . 11,202,931.77 13,372,681.86 1,390,758.91
June 25, 2005. . . . . . . . . . . . . . 11,056,917.36 13,198,387.82 1,372,632.33
July 25, 2005. . . . . . . . . . . . . . 10,911,926.63 13,025,315.72 1,354,632.84
August 25, 2005. . . . . . . . . . . . . 10,767,992.19 12,853,504.49 1,336,764.47
September 25, 2005 . . . . . . . . . . . 10,625,144.74 12,682,990.78 1,319,031.04
October 25, 2005 . . . . . . . . . . . . 10,483,413.21 12,513,809.11 1,301,436.15
November 25, 2005. . . . . . . . . . . . 10,325,629.12 12,325,465.87 1,281,848.45
December 25, 2005. . . . . . . . . . . . 10,169,900.42 12,139,576.11 1,262,515.92
January 25, 2006 . . . . . . . . . . . . 10,016,213.86 11,956,124.00 1,243,436.90
February 25, 2006. . . . . . . . . . . . 9,864,555.65 11,775,093.09 1,224,609.68
March 25, 2006 . . . . . . . . . . . . . 9,714,911.50 11,596,466.30 1,206,032.50
April 25, 2006 . . . . . . . . . . . . . 9,567,266.62 11,420,226.01 1,187,703.50
May 25, 2006 . . . . . . . . . . . . . . 9,421,605.77 11,246,354.01 1,169,620.82
June 25, 2006. . . . . . . . . . . . . . 9,277,913.31 11,074,831.62 1,151,782.49
July 25, 2006. . . . . . . . . . . . . . 9,136,173.12 10,905,639.62 1,134,186.52
August 25, 2006. . . . . . . . . . . . . 8,996,368.76 10,738,758.36 1,116,830.87
September 25, 2006 . . . . . . . . . . . 8,858,483.38 10,574,167.76 1,099,713.45
October 25, 2006 . . . . . . . . . . . . 8,722,499.81 10,411,847.31 1,082,832.12
November 25, 2006. . . . . . . . . . . . 8,585,831.80 10,248,709.85 1,065,865.82
December 25, 2006. . . . . . . . . . . . 8,451,102.51 10,087,886.59 1,049,140.21
January 25, 2007 . . . . . . . . . . . . 8,318,280.79 9,929,340.37 1,032,651.40
February 25, 2007. . . . . . . . . . . . 8,187,335.80 9,773,034.34 1,016,395.57
March 25, 2007 . . . . . . . . . . . . . 8,058,236.95 9,618,932.02 1,000,368.93
P-2-2
<PAGE>
<CAPTION>
Distribution Dates Class A-6 Class A-7 Class A-8
- ------------------ --------- --------- ---------
<S> <C> <C> <C>
April 25, 2007 . . . . . . . . . . . . . 7,930,953.95 9,466,997.22 984,567.71
May 25, 2007 . . . . . . . . . . . . . . 7,805,456.77 9,317,194.13 968,988.19
June 25, 2007. . . . . . . . . . . . . . 7,681,715.68 9,169,487.24 953,626.67
July 25, 2007. . . . . . . . . . . . . . 7,559,701.21 9,023,841.38 938,479.50
August 25, 2007. . . . . . . . . . . . . 7,439,384.20 8,880,221.74 923,543.06
September 25, 2007 . . . . . . . . . . . 7,320,735.75 8,738,593.81 908,813.76
October 25, 2007 . . . . . . . . . . . . 7,203,727.25 8,598,923.45 894,288.04
November 25, 2007. . . . . . . . . . . . 7,096,494.08 8,470,921.69 880,975.86
December 25, 2007. . . . . . . . . . . . 6,990,309.51 8,344,171.61 867,793.85
January 25, 2008 . . . . . . . . . . . . 6,885,154.51 8,218,650.51 854,739.65
February 25, 2008. . . . . . . . . . . . 6,781,010.30 8,094,335.96 841,810.94
March 25, 2008 . . . . . . . . . . . . . 6,677,858.37 7,971,205.87 829,005.41
April 25, 2008 . . . . . . . . . . . . . 6,575,680.46 7,849,238.45 816,320.80
May 25, 2008 . . . . . . . . . . . . . . 6,474,458.52 7,728,412.15 803,754.86
June 25, 2008. . . . . . . . . . . . . . 6,374,174.80 7,608,705.78 791,305.40
July 25, 2008. . . . . . . . . . . . . . 6,274,811.74 7,490,098.38 778,970.23
August 25, 2008. . . . . . . . . . . . . 6,176,352.04 7,372,569.30 766,747.21
September 25, 2008 . . . . . . . . . . . 6,078,778.62 7,256,098.15 754,634.21
October 25, 2008 . . . . . . . . . . . . 5,981,944.57 7,140,509.58 742,613.00
November 25, 2008. . . . . . . . . . . . 5,883,746.77 7,023,293.13 730,422.49
December 25, 2008. . . . . . . . . . . . 5,786,441.38 6,907,141.93 718,342.76
January 25, 2009 . . . . . . . . . . . . 5,690,010.92 6,792,035.11 706,371.65
February 25, 2009. . . . . . . . . . . . 5,594,438.13 6,677,952.06 694,507.01
March 25, 2009 . . . . . . . . . . . . . 5,499,706.01 6,564,872.50 682,746.74
April 25, 2009 . . . . . . . . . . . . . 5,405,797.77 6,452,776.40 671,088.75
May 25, 2009 . . . . . . . . . . . . . . 5,312,696.90 6,341,644.03 659,530.98
June 25, 2009. . . . . . . . . . . . . . 5,220,387.08 6,231,455.93 648,071.42
July 25, 2009. . . . . . . . . . . . . . 5,128,852.24 6,122,192.89 636,708.06
August 25, 2009. . . . . . . . . . . . . 5,038,076.52 6,013,836.01 625,438.94
September 25, 2009 . . . . . . . . . . . 4,948,044.29 5,906,366.61 614,262.13
October 25, 2009 . . . . . . . . . . . . 4,858,740.15 5,799,766.31 603,175.70
November 25, 2009. . . . . . . . . . . . 4,770,148.88 5,694,016.95 592,177.76
December 25, 2009. . . . . . . . . . . . 4,682,255.49 5,589,100.64 581,266.47
January 25, 2010 . . . . . . . . . . . . 4,595,045.21 5,484,999.73 570,439.97
February 25, 2010. . . . . . . . . . . . 4,508,503.45 5,381,696.82 559,696.47
March 25, 2010 . . . . . . . . . . . . . 4,422,615.83 5,279,174.74 549,034.17
April 25, 2010 . . . . . . . . . . . . . 4,337,368.16 5,177,416.56 538,451.32
May 25, 2010 . . . . . . . . . . . . . . 4,252,746.46 5,076,405.58 527,946.18
June 25, 2010. . . . . . . . . . . . . . 4,168,736.93 4,976,125.34 517,517.04
July 25, 2010. . . . . . . . . . . . . . 4,085,325.96 4,876,559.59 507,162.20
August 25, 2010. . . . . . . . . . . . . 4,002,500.12 4,777,692.30 496,880.00
September 25, 2010 . . . . . . . . . . . 3,920,246.19 4,679,507.66 486,668.80
October 25, 2010 . . . . . . . . . . . . 3,838,551.08 4,581,990.09 476,526.97
November 25, 2010. . . . . . . . . . . . 3,757,401.92 4,485,124.21 466,452.92
December 25, 2010. . . . . . . . . . . . 3,676,785.99 4,388,894.82 456,445.06
January 25, 2011 . . . . . . . . . . . . 3,596,690.75 4,293,286.98 446,501.85
February 25, 2011. . . . . . . . . . . . 3,517,103.83 4,198,285.91 436,621.73
March 25, 2011 . . . . . . . . . . . . . 3,438,013.02 4,103,877.02 426,803.21
April 25, 2011 . . . . . . . . . . . . . 3,359,406.27 4,010,045.96 417,044.78
May 25, 2011 . . . . . . . . . . . . . . 3,281,271.70 3,916,778.52 407,344.97
June 25, 2011. . . . . . . . . . . . . . 3,203,597.59 3,824,060.72 397,702.31
July 25, 2011. . . . . . . . . . . . . . 3,126,372.35 3,731,878.74 388,115.39
August 25, 2011. . . . . . . . . . . . . 2,984,413.66 3,562,425.91 370,492.29
September 25, 2011 . . . . . . . . . . . 2,778,822.97 3,317,017.04 344,969.77
P-2-3
<PAGE>
<CAPTION>
Distribution Dates Class A-6 Class A-7 Class A-8
- ------------------ --------- --------- ---------
<S> <C> <C> <C>
October 25, 2011 . . . . . . . . . . . . 2,575,737.92 3,074,599.08 319,758.30
November 25, 2011. . . . . . . . . . . . 2,375,114.89 2,835,119.99 294,852.48
December 25, 2011. . . . . . . . . . . . 2,176,910.90 2,598,528.45 270,246.96
January 25, 2012 . . . . . . . . . . . . 1,981,083.63 2,364,773.94 245,936.49
February 25, 2012. . . . . . . . . . . . 1,787,591.34 2,133,806.65 221,915.89
March 25, 2012 . . . . . . . . . . . . . 1,596,392.96 1,905,577.54 198,180.06
April 25, 2012 . . . . . . . . . . . . . 1,407,447.96 1,680,038.24 174,723.98
May 25, 2012 . . . . . . . . . . . . . . 1,220,716.45 1,457,141.13 151,542.68
June 25, 2012. . . . . . . . . . . . . . 1,036,159.11 1,236,839.29 128,631.29
July 25, 2012. . . . . . . . . . . . . . 853,737.21 1,019,086.47 105,984.99
August 25, 2012. . . . . . . . . . . . . 673,412.57 803,837.09 83,599.06
September 25, 2012 . . . . . . . . . . . 495,147.58 591,046.28 61,468.81
October 25, 2012 . . . . . . . . . . . . 318,905.18 380,669.77 39,589.66
November 25, 2012. . . . . . . . . . . . 144,648.85 172,664.00 17,957.06
December 25, 2012 and thereafter . . . . 0.00 0.00 0.00
</TABLE>
P-2-4
<PAGE>
EXHIBIT Q
BLOOMBERG DATA
<TABLE>
<S> <C>
Loan Number
Property Type
Owner Occupied
Loan Purpose
Loan Type
Current Interest Rate
Original Balance
Current Balance
First Payment Date
Maturity Date
Current PNI
Servicing Fee
Loan Term
Foreclosure/REO
Loan to Value Ratio
State Code
Interest Paid to Date
Zip Code
PIF Data
Amortized Remaining Term
</TABLE>
Q-1
<PAGE>
EXHIBIT R
FORM OF SPECIAL SERVICING AND COLLATERAL FUND AGREEMENT
This SPECIAL SERVICING AND COLLATERAL FUND AGREEMENT (the
"Agreement") is made and entered into as of [DATE], between LaSalle Home
Mortgage Corporation (the "Depositor") and ______________________________
(the "Purchaser").
PRELIMINARY STATEMENT
_________________________ (the "Owner") is the holder of the
entire interest in ABN AMRO Mortgage Corporation Multi-Class Mortgage
Pass-Through Certificates, Series 1998-4 (the "Certificates"). The
Certificates were issued pursuant to a Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement") among ABN AMRO Mortgage Corporation, as
depositor, as servicer thereunder (the "Servicer") and Chase Bank of Texas,
National Association, as trustee (the "Trustee").
The Owner intends to resell all of the Certificates directly to
the Purchaser on or promptly after the date hereof.
In connection with such sale, the parties hereto have agreed
that the Depositor, as Servicer, will engage in certain special servicing
procedures relating to foreclosures for benefit of the Purchaser, and that
the Purchaser will deposit funds in a collateral fund to cover any losses
attributable to such procedures as well as all advances and costs in
connection therewith, as set forth herein.
In consideration of the mutual agreements herein contained, the
receipt and sufficiency of which are hereby acknowledged, the Depositor and
the Purchaser agree to the following:
ARTICLE I.
DEFINITIONS
Section 1.01. DEFINED TERMS.
Whenever used in this Agreement, the following words and
phrases, unless the context otherwise requires, shall have the following
meanings:
BUSINESS DAY: Any day other than (i) a Saturday or a Sunday or
(ii) a day on which banking institutions in the State of New York are
required or authorized by law or executive order to be closed.
COLLATERAL FUND: The fund established and maintained pursuant
to Section 3.01 hereof.
COLLATERAL FUND PERMITTED INVESTMENTS: Either: (i)
obligations of, or obligations fully guaranteed as to principal and interest
by, the United States, or any agency or instrumentality thereof, provided
such obligations are backed by the full faith and credit of the United
States, (ii) a money market fund rated in the highest rating category by a
nationally recognized rating agency selected by the Depositor, (iii) cash,
(iv) mortgage pass-through certificates issued or guaranteed by GNMA, FNMA or
FHLMC, (v) commercial paper (including both non-interest bearing discount
obligations and interest bearing obligations payable on demand or on a
specified date), the issuer of which may be an affiliate of the Depositor,
having at the time of such investment a rating of at least A-1 by Standard
and Poor's Corporation ("S&P") or at least P-1 by Moody's Investors Service,
Inc. ("Moody's") and (vi) demand and time deposits in, certificates of
deposit of, any depository institution or trust company (which may be an
affiliate of the Depositor) incorporated under the laws of the United States
of America or any state thereof and subject to supervision and examination by
federal and/or state banking authorities, so long as at the time of such
investment either (x) the long-term debt obligations of such depository
institution or trust company have a rating of at least Aa2 by Moody's or AA
by S&P or (y) the certificate of deposit or other unsecured short-term debt
obligations of such depository institution or trust company have a rating of
at least P-1 by Moody's or A-1 by S&P and, for each of the preceding clauses
(i), (iv), (v) and (vi), the maturity thereof shall be not later than the
earlier to occur of (A) 30 days from the date of the related investment and
(B) the next succeeding Distribution Date.
R-1
<PAGE>
COMMENCEMENT OF FORECLOSURE: The first official action
required under local law in order to commence foreclosure proceedings or to
schedule a trustee's sale under a deed of trust, including (i) in the case of
a mortgage, any filing or service of process necessary to commence an action
to foreclose, or (ii) in the case of a deed of trust, the posting,
publishing, filing or delivery of a notice of sale, but not including in
either case (x) any notice of default, notice of intent to foreclose or sell
or any other action prerequisite to the actions specified in (i) or (ii)
above and upon the consent of the Purchaser which will be deemed given unless
expressly withheld within two Business Days of notification, (y) the
acceptance of a deed-in-lieu of foreclosure (whether in connection with a
sale of the related property or otherwise) or (z) initiation and completion
of a short pay-off.
CURRENT APPRAISAL: With respect to any Loan as to which the
Purchaser has made an Election to Delay Foreclosure, an appraisal of the
related Mortgaged Property obtained by the Purchaser at its expense from an
appraiser (which shall not be an affiliate of the Purchaser) acceptable to
the Depositor as nearly contemporaneously as practicable to the time of the
Purchaser's election, prepared based on the Depositor's customary
requirements for such appraisals.
ELECTION TO DELAY FORECLOSURE: Any election by the Purchaser
to delay the Commencement of Foreclosure, made in accordance with Section
2.02(b).
ELECTION TO FORECLOSE: Any election by the Purchaser to
proceed with the commencement of Foreclosure, made in accordance with Section
2.03(a).
REQUIRED COLLATERAL FUND BALANCE: As of any date of
determination, an amount equal to the aggregate of all amounts previously
required to be deposited in the Collateral Fund pursuant to Section 2.02(d)
(after adjustment for all withdrawals and deposits pursuant to Section
2.02(e)) and Section 2.03(b) (after adjustment for all withdrawals and
deposits pursuant to Section 2.03(c)) and Section 3.02 to be reduced by all
withdrawals therefrom pursuant to Section 2.02(g) and Section 2.03(d).
Section 1.02. DEFINITIONS INCORPORATED BY REFERENCE.
All capitalized terms not otherwise defined in this Agreement
shall have the meanings assigned in the Pooling and Servicing Agreement.
ARTICLE II.
SPECIAL SERVICING PROCEDURES
Section 2.01. REPORTS AND NOTICES.
(a) In connection with the performance of its duties
under the Pooling and Servicing Agreement relating to the realization upon
defaulted Loans, the Depositor, as Servicer, shall provide to the Purchaser
the following notices and reports:
(b) Within five Business Days after each Distribution
Date (or included in or with the monthly statement to Certificateholders
pursuant to the Pooling and Servicing Agreement), the Depositor shall provide
to the Purchaser a report indicating for the Trust the number of Loans that
are (A) thirty days, (B) sixty days, (C) ninety days or more delinquent or
(D) in foreclosure, and indicating for each such Loan the outstanding
principal balance.
(c) Prior to the Commencement of Foreclosure in
connection with any Loan, the Depositor shall provide the Purchaser with a
notice (sent by telecopier) of such proposed and imminent foreclosure,
stating the loan number and the aggregate amount owing under the Loan.
(d) If requested by the Purchaser, the Depositor
shall make its servicing personnel available (during their normal business
hours) to respond to reasonable inquiries by the Purchaser in connection with
any Loan identified in a report under subsection (a)(i)(B), (a)(i)(C),
(a)(i)(D) or (a)(ii) which has been given to the Purchaser; provided, that
(1) the Depositor shall only be required to provide information that is
readily accessible to its servicing personnel and is non-confidential and (2)
the Depositor shall not be required to provide any written information under
this subsection.
(e) In addition to the foregoing, the Depositor shall
provide to the Purchaser such information as the Purchaser may reasonably
request concerning each Loan that is at least sixty days delinquent and each
Loan which has become real estate owned, through the final liquidation
thereof; provided that the Depositor shall only be required to provide
information that is readily accessible to its servicing personnel and is
non-confidential.
R-2
<PAGE>
(f) With respect to all Loans which are serviced at
any time by the Depositor through a Subservicer, the Depositor shall be
entitled to rely for all purposes hereunder, including for purposes of
fulfilling its reporting obligations under this Section 2.01 on the accuracy
and completeness of any information provided to it by the applicable
Subservicer.
Section 2.02. PURCHASER'S ELECTION TO DELAY FORECLOSURE
PROCEEDINGS.
(a) The Purchaser directs the Depositor that in the
event that the Depositor does not receive written notice of the Purchaser's
election pursuant to subsection (b) below within 24 hours (exclusive of any
intervening non-Business Days) of transmission of the notice provided by the
Depositor under Section 2.01(a)(ii), subject to extension as set forth in
Section 2.02(b), the Depositor shall proceed with the Commencement of
Foreclosure in respect of such Loan in accordance with its normal foreclosure
policies without further notice to the Purchaser. Any foreclosure that has
been initiated may be discontinued (i) without notice to the Purchaser, if
the Loan has been brought current or if a refinancing or prepayment occurs
with respect to the Loan (including by means of a short payoff approved by
the Depositor) (ii) with notice to the Purchaser if the Depositor has reached
the terms of a forbearance agreement with the borrower. In such latter case
the Depositor may complete such forbearance agreement unless instructed
otherwise by the Purchaser within one Business Day of notification.
(b) In connection with any Loan with respect to which
a notice under Section 2.01(a)(ii) has been given to the Purchaser, the
Purchaser may elect, for reasonable cause as determined by the Purchaser, to
instruct the Depositor to delay the Commencement of Foreclosure until such
term as the Purchaser determines that the Depositor may proceed with the
Commencement of Foreclosure. Such election must be evidenced by written
notice received within 24 hours (exclusive of any intervening non-Business
Days) of transmission of the notice provided by the Depositor under Section
2.01(a)(ii). Such 24 hour period shall be extended for no longer than an
additional four Business Days after the receipt of the information if the
Purchaser requests additional information related to such foreclosure;
provided, however that the Purchaser will have at least one Business Day to
respond to any requested additional information. Any such additional
information shall (i) not be confidential in nature and (ii) be obtainable by
the Depositor from existing reports, certificates or statements or otherwise
be readily accessible to its servicing personnel. The Purchaser agrees that
it has no right to deal with the mortgagor. If the Depositor's normal
foreclosure policy includes acceptance of a deed-in-lieu of foreclosure or
short payoff, the Purchaser will be notified and given one Business Day to
respond.
(c) With respect to any Loan as to which the
Purchaser has made an Election to Delay Foreclosure, the Purchaser shall
obtain a Current Appraisal as soon as practicable, and shall provide the
Depositor with a copy of such Current Appraisal.
(d) Within two Business Days of making any Election
to Delay Foreclosure, the Purchaser shall remit by wire transfer to the
Depositor, for deposit in the Collateral Fund, an amount, as calculated by
the Depositor, equal to the sum of (i) 125% of the greater of the outstanding
Principal Balance of the Loan and the value shown in the Current Appraisal
referred to in subsection (c) above (or, if such Current Appraisal has not
yet been obtained, the Depositor's estimate thereof, in which case the
required deposit under this subsection shall be adjusted upon obtaining of
such Current Appraisal), and (ii) three months' interest on the Loan at the
applicable Mortgage Rate. If any Election to Delay Foreclosure extends for a
period in excess of three months (such excess period being referred to herein
as the "Excess Period"), the Purchaser shall remit by wire transfer in
advance to the Depositor for deposit in the Collateral Fund the amount, as
calculated by the Depositor, equal to interest on the Loan at the applicable
Mortgage Rate for the Excess Period. The terms of this Agreement shall no
longer apply to the servicing of any Loan upon the failure of the Purchaser
to deposit the above amounts relating to the Loan within two Business Days of
the Election to Delay Foreclosure.
(e) With respect to any Loan as to which the
Purchaser has made an Election to Delay Foreclosure, the Depositor may
withdraw from the Collateral Fund from time to time amounts necessary to
reimburse the Depositor for all Advances and Liquidation Expenses thereafter
made by the Depositor as Servicer in accordance with the Pooling and
Servicing Agreement. To the extent that the amount of any such Liquidation
Expense is determined by the Depositor based on estimated costs, and the
actual costs are subsequently determined to be higher, the Depositor may
withdraw the additional amount from the Collateral Fund. In the event that
the Loan is brought current by the Mortgagor and the foreclosure action is
discontinued, the amounts so withdrawn from the Collateral Fund shall be
redeposited therein as and to the extent that reimbursement therefor from
amounts paid by the Mortgagor is not prohibited pursuant to the Pooling and
Servicing Agreement. Except as provided in the preceding sentence, amounts
withdrawn from the Collateral Fund to cover Advances and Liquidation Expenses
shall not be redeposited therein or otherwise reimbursed to the Purchaser.
If and when any such Loan is brought current by the Mortgagor, all amounts
remaining in the Collateral Fund in respect of such (after adjustment for all
withdrawals and deposits pursuant to this subsection) shall be released to
the Purchaser.
R-3
<PAGE>
(f) With respect to any Loan as to which the
Purchaser has made an Election to Delay Foreclosure, the Depositor shall
continue to service the Loan in accordance with its customary procedures
(other than the delay in Commencement of Foreclosure as provided herein). If
and when the Purchaser shall notify the Depositor that it believes that it is
appropriate to do so, the Depositor shall proceed with the Commencement of
Foreclosure. In any event, if the Loan is not brought current by the
mortgagor by the time the loan becomes 6 months delinquent, the Purchaser's
election shall no longer be effective and at the Purchaser's option, either
(i) the Purchaser shall purchase the Loan from the Trust Fund at a purchase
price equal to the fair market value as shown on the Current Appraisal, to be
paid by (x) applying any balance in the Collateral Fund to such purchase
price, and (y) to the extent of any deficiency, by wire transfer of
immediately available funds to the Depositor or Trustee; or (ii) the
Depositor shall proceed with the Commencement of Foreclosure.
(g) Upon the occurrence of a liquidation with respect
to any Loan as to which the Purchaser made an Election to Delay Foreclosure
and as to which the Depositor proceeded with the Commencement of Foreclosure
in accordance with subsection (f) above, the Depositor shall calculate the
amount, if any, by which the value shown on the Current Appraisal obtained
under subsection (c) exceeds the actual sales price obtained for the related
Mortgaged Property (net of Liquidation Expenses and accrued interest related
to the extended foreclosure period), and the Depositor shall withdraw the
amount of such excess from the Collateral Fund, shall remit the same to the
Trust Fund and in its capacity as Servicer shall apply such amount as
additional Liquidation Proceeds pursuant to the Pooling and Servicing
Agreement. After making such withdrawal, all amounts remaining in the
Collateral Fund in respect of such Loan (after adjustment for all withdrawals
and deposits pursuant to subsection (e)) shall be released to the Purchaser.
Section 2.03. PURCHASER'S ELECTION TO COMMENCE FORECLOSURE
PROCEEDINGS.
(a) In connection with any Loan identified in a
report under Section 2.01(a)(i)(B), the Purchaser may elect, for reasonable
cause as determined by the Purchaser, to instruct the Depositor to proceed
with the Commencement of Foreclosure as soon as practicable. Such election
must be evidenced by written notice received by the Depositor by 5:00 p.m.,
New York City time, on the third Business Day following the delivery of such
report under Section 2.01(a)(i).
(b) Within two Business Days of making any Election
to Foreclose, the Purchaser shall remit to the Depositor, for deposit in the
Collateral Fund, an amount, as calculated by the Depositor, equal to 125% of
the current Principal Balance of the Loan and three months' interest on the
Loan at the applicable Mortgage Rate. If and when any such Loan is brought
current by the Mortgagor, all amounts in the Collateral Fund in respect of
such Loan shall be released to the Purchaser. The terms of this Agreement
shall no longer apply to the servicing of any Loan upon the failure of the
Purchaser to deposit the above amounts relating to the Loans within two
Business Days at the Election to Foreclose.
(c) With respect to any Loan as to which the
Purchaser has made an Election to Foreclose, the Depositor shall continue to
service the Loan in accordance with its customary procedures (other than to
proceed with the Commencement of Foreclosure as provided herein). In
connection therewith, the Depositor shall have the same rights to make
withdrawals for Advances and Liquidation Expenses from the Collateral Fund as
are provided under Section 2.02(e), and the Depositor shall make
reimbursements thereto to the limited extent provided under such subsection.
The Depositor shall not be required to proceed with the Commencement of
Foreclosure if (i) the same is stayed as a result of the Mortgagor's
bankruptcy or is otherwise barred by applicable law, or to the extent that
all legal conditions precedent thereto have not yet been complied with or
(ii) the Depositor believes there is a breach of representation or warranties
by the Depositor, which may result in a repurchase or substitution of such
Loan, or (iii) the Depositor reasonably believes the Mortgaged Property may
be contaminated with or affected by hazardous wastes or hazardous substances
(and the Depositor supplies the Purchaser with information supporting such
belief). The Depositor will repurchase or substitute a Loan pursuant to the
preceding clause (ii) within the time period specified in the Pooling and
Servicing Agreement. Any foreclosure that has been initiated may be
discontinued (i) without notice to the Purchaser if the Loan has been brought
current or if a refinancing or prepayment occurs with respect to the Loan
(including by means of a short payoff approved by the Depositor), or (ii)
with notice to the Purchaser if the Depositor has reached the terms of a
forbearance agreement unless instructed otherwise by the Purchaser within two
Business Days of notification.
(d) Upon the occurrence of a liquidation with respect
to any Loan as to which the Purchaser made an Election to Foreclose and as to
which the Depositor proceeded with the Commencement of Foreclosure in
accordance with subsection (c) above, the Depositor shall calculate the
amount, if any, by which the Principal Balance of the Loan at the time of
liquidation (plus all unreimbursed Advances and Liquidation Expenses in
connection therewith other than those paid from the Collateral Fund) exceeds
the actual sales price obtained for the related Mortgaged Property, and the
Depositor shall withdraw the amount of such excess from the Collateral Fund,
shall remit the same to the Trust Fund and in its capacity as Servicer shall
apply such amount as additional Liquidation
R-4
<PAGE>
Proceeds pursuant to the Pooling and Servicing Agreement. After making such
withdrawal, all amounts remaining in the Collateral Fund (after adjustment
for all withdrawals and deposits pursuant to subsection (c)) in respect of
such Loan shall be released to the Purchaser.
Section 2.04. TERMINATION.
(a) With respect to all Loans included in the Trust
Fund, the Purchaser's rights to make any Election to Delay Foreclosure or any
Election to Foreclose and the Depositor's obligations under Section 2.01
shall terminate (i) at such time as the Certificate Principal Balance of the
Certificates has been reduced to zero, (ii) if the greater of (x) 43% (or
such lower or higher percentages that represents the Depositor's actual
historical loss experience with respect to the Loans in the related pool) of
the aggregate principal balance of all Loans that are in foreclosure or are
more than 90 days delinquent on a contractual basis and REO properties or if
the aggregate amount that the Depositor estimates will be required to be
withdrawn from the Collateral Fund with respect to Loans as to which the
Purchaser has made an Election to Delay Foreclosure or an Election to
Foreclose exceeds (z) the Outstanding Certificate Principal Balance of the
Certificates, or (iii) upon any transfer by the Purchaser of any interest
(other than the minority interest therein, but only if the transferee
provides written acknowledgment to the Depositor of the Purchaser's right
hereunder and that such transferee will have no rights hereunder) in the
Certificates (whether or not such transfer is registered under the Pooling
and Servicing Agreement), including any such transfer in connection with a
termination of the Trust Fund. Except as set forth above, this Agreement and
the respective rights, obligations and responsibilities of the Purchaser and
the Depositor hereunder shall terminate upon the later to occur of (i) the
final liquidation of the last Loan as to which the Purchaser made any
Election to Delay Foreclosure or any Election to Foreclose and the withdrawal
of all remaining amounts in the Collateral Fund as provided herein and (ii)
ten (10) Business Day's notice.
(b) Purchaser's rights pursuant to Section 2.02 or
2.03 of this Agreement shall terminate with respect to a Loan as to which the
Purchaser has exercised its rights under Section 2.02 or 2.03 hereof, upon
Purchaser's failure to deposit any amounts required pursuant to Section
2.02(d) or 2.03(b).
(c) Neither the Servicer nor any of its directors,
officers, employees or agents shall be under any liability 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 Servicer or any such Person against any
liability which would otherwise be imposed by reason of willful misfeasance,
bad faith or gross negligence in the performance of duties or by reason of
reckless disregard of obligations and duties hereunder. The Servicer and any
director, officer, employee or agent thereof may rely in good faith on any
document of any kind prima facie properly executed and submitted by an Person
respecting any matters arising hereunder.
ARTICLE III.
COLLATERAL FUND; SECURITY INTEREST
Section 3.01. COLLATERAL FUND.
Upon receipt from the Purchaser of the initial amount required
to be deposited in the Collateral Fund pursuant to Article 11, the Depositor
shall establish and maintain with itself as a segregated account on its books
and records an account (the "Collateral Fund"), entitled "LaSalle Home
Mortgage Corporation, as Servicer, for the benefit of registered holders of
ABN AMRO Mortgage Corporation Multi-Class Mortgage Pass-Through Certificates,
Series 1998-3." Amounts in the Collateral Fund shall continue to be the
property of the Purchaser, subject to the first priority security interest
granted hereunder for the benefit of the Certificateholders, until withdrawn
from the Collateral Fund pursuant to Section 2.02 or 2.03 hereof.
Upon the termination of this Agreement and the liquidation of
all Loans as to which the Purchaser has made any Election to Delay
Foreclosure or any Election to Foreclose pursuant to Section 2.04 hereof, the
Depositor shall distribute to the Purchaser all amounts remaining in the
Collateral Fund together with any investment earnings thereon.
In no event shall the Purchaser (i) take or cause the Trustee
or the Depositor to take any action that could cause any REMIC established
under the Trust Agreement to fail to qualify as a REMIC or cause the
imposition on any such REMIC of any "prohibited transaction" or "prohibited
contribution" taxes or (ii) cause the Trustee or the Depositor to fail to
take any action necessary to maintain the status of any such REMIC as a REMIC.
R-5
<PAGE>
Section 3.02. COLLATERAL FUND PERMITTED INVESTMENTS.
The Depositor shall, at the written direction of the Purchaser
invest the funds in the Collateral Fund in Collateral Fund Permitted
Investments. Such direction shall not be changed more frequently than
quarterly. In the absence of any direction, the Depositor shall select such
investments in accordance with the definition of Collateral Fund Permitted
Investments in its discretion.
All income and gain realized from any investment as well as any
interest earned on deposits in the Collateral Fund (net of any losses on such
investments) and any payments of principal made in respect of any Collateral
Fund Permitted Investment shall be deposited in the Collateral Fund upon
receipt. All costs and realized losses associated with the purchase and sale
of Collateral Fund Permitted Investments shall be borne by the Purchaser and
the amount of net realized losses shall be deposited by the Purchaser in the
Collateral Fund. The Depositor shall periodically (but not more frequently
than monthly) distribute to the Purchaser upon request an amount of cash, to
the extent cash is available therefor in the Collateral Fund, equal to the
amount by which the balance of the Collateral Fund, after giving effect to
all other distributions to be made from the Collateral Fund on such date,
exceeds the Required Collateral Fund Balance. Any amounts so distributed
shall be released from the lien and security interest of this Agreement.
Section 3.03. GRANT OF SECURITY INTEREST.
The Purchaser grants to the Depositor and the Trustee for the
benefit of the Certificateholders a security interest in and lien on all of
the Purchaser's right, title and interest, whether now owned or hereafter
acquired, in and to: (1) the Collateral Fund, (2) all amounts deposited in
the Collateral Fund and Collateral Fund Permitted Investments in which such
amounts are invested (and the distributions and proceeds of such investments)
and (3) all cash and non-cash proceeds of any of the foregoing, including
proceeds of the voluntary or involuntary conversion thereof (all of the
foregoing collectively, the "Collateral").
The Purchaser acknowledges the lien on and security interest in
the Collateral for the benefit of the Certificateholders. The Purchaser
shall take all actions requested by the Depositor or the Trustee as may be
reasonably necessary to perfect the security interest created under this
Agreement in the Collateral and cause it to be prior to all other security
interests and liens, including the execution and delivery to the Depositor
for filing of appropriate financing statements in accordance with applicable
law. The Depositor shall file appropriate continuation statements, or
appoint an agent on its behalf to file such statements, in accordance with
applicable law.
Section 3.04. COLLATERAL SHORTFALLS.
In the event that amounts on deposit in the Collateral Fund at
any time are insufficient to cover any withdrawals therefrom that the
Depositor or the Trustee is then entitled to make hereunder, the Purchaser
shall be obligated to pay such amounts to the Depositor or the Trustee
immediately upon demand. Such obligation shall constitute a general corporate
obligation of the Purchaser.
ARTICLE IV.
MISCELLANEOUS PROVISIONS
Section 4.01. AMENDMENT.
This Agreement may be amended from time to time by the
Depositor and the Purchaser by written agreement signed by the Depositor and
the Purchaser.
Section 4.02. COUNTERPARTS.
This Agreement may be executed simultaneously in any number of
counterparts, each of which counterparts shall be deemed to be an original,
and such counterparts shall constitute but one and the same instrument.
Section 4.03. GOVERNING LAW.
This Agreement shall be construed in accordance with the laws
of the State of New York and the obligations, rights and remedies of the
parties hereunder shall be determined in accordance with such laws.
R-6
<PAGE>
Section 4.04. NOTICES.
All demands, notices and direction hereunder shall be in
writing or by telecopy and shall be deemed effective upon receipt to:
(a) in the case of the Depositor,
LaSalle Home Mortgage Corporation
4242 North Harlem Avenue
Norridge, Illinois 60634
Attn:______________________________
Phone:_____________________________
or such other address as may hereafter be furnished in writing by the
Depositor, or
R-7
<PAGE>
(b) in the case of the Purchaser, with respect to
notices pursuant to Section 2.01,
[Purchaser]
[Address]
Attn:____________________________________
Phone:___________________________________
Fax:_____________________________________
with respect to all other notices pursuant to this
Agreement,
________________________________________
[Address]
Attn:____________________________________
Phone:___________________________________
Fax:_____________________________________
or such other address as may hereafter be furnished in writing by the Purchaser.
Section 4.05. SEVERABILITY OF PROVISIONS.
If any one or more of the covenants, agreements, provisions or
terms of this Agreement shall be for any reason whatsoever, including
regulatory, 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.
Section 4.06. SUCCESSORS AND ASSIGNS.
The provisions of this Agreement shall be binding upon and
inure to the benefit of the respective successors and assigns of the parties
hereto, and all such provisions shall inure to the benefit of the
Certificateholders; provided, however, that the rights under this Agreement
cannot be assigned by the Purchaser without the consent of the Depositor.
Section 4.07. ARTICLE AND SECTION HEADINGS.
The article and section headings herein are for convenience of
reference only, and shall not limit or otherwise affect the meaning hereof.
Section 4.08. CONFIDENTIALITY.
The Purchaser agrees that all information supplied by or on
behalf of the Depositor pursuant to Sections 2.01 or 2.02, including
individual account information, is the property of the Depositor and the
Purchaser agrees to hold such information confidential and not to disclose
such information.
R-8
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IN WITNESS WHEREOF, the Depositor and the Purchaser have caused
their names to be signed hereto by their respective officers thereunto duly
authorized, all as of the day and year first above written.
LASALLE HOME MORTGAGE CORPORATION
By:
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Name:
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Title:
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By:
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Name:
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Title:
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R-9
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MORTGAGE LOAN PURCHASE AGREEMENT
Mortgage Loan Purchase Agreement (the "AGREEMENT"), dated as of
October 27, 1998, between Standard Federal Bank (the "SELLER") and ABN AMRO
Mortgage Corporation (the "PURCHASER").
Subject to the terms and conditions of this Agreement, the Seller
agrees to sell and the Purchaser agrees to purchase certain mortgage loans
(the "MORTGAGE LOANS") as described herein and as identified on the Mortgage
Loan Schedule defined in SECTION 2 hereof. The Mortgage Loans will be
purchased on a servicing retained basis.
Now, therefore, in consideration of the premises and the mutual
agreements set forth herein, the parties agree as follows:
SECTION 1. PURCHASE AND SALE OF THE MORTGAGE LOANS.
(a) Pursuant to the terms hereof and upon satisfaction of the
conditions set forth herein, the Seller agrees to sell and the Purchaser
agrees to purchase, Mortgage Loans having the general characteristics set
forth in this Agreement and specifically identified on the Mortgage Loan
Schedule, for the Purchase Price set forth below in SECTION 3(a) hereof and
having an aggregate principal balance on and as of the date of such Mortgage
Loan Schedule (the "CUT-OFF DATE") of approximately $360,000,000 after
deduction of principal payments due on or before the Cut-Off Date (which
amount may vary plus or minus 5% thereof), or such other aggregate principal
balance as agreed by the Purchaser and the Seller as evidenced by the actual
aggregate principal balance of the Mortgage Loans accepted by the Purchaser
on the Closing Date (as defined below).
(b) Subject to mutual agreement between the Purchaser and the Seller,
the closing for the purchase and sale of the Mortgage Loans shall take place
on October 27, 1998 (the "Closing Date") at the office of Purchaser's counsel
in Chicago, Illinois or such other place as the parties shall agree.
SECTION 2. MORTGAGE LOAN SCHEDULE. Attached to this Agreement as
Schedule 1 is a listing of the Mortgage Loans evidenced by promissory notes,
mortgage notes or other evidence of indebtedness (the "MORTGAGE NOTES")
evidencing the indebtedness of an obligor (the "MORTGAGOR") under the
mortgages, deeds of trust or other instruments securing a Mortgage Loan (the
"MORTGAGES") to be purchased by and delivered to the Purchaser on the Closing
Date (as such may be amended prior to the Closing Date by mutual agreement of
the parties) (the "MORTGAGE LOAN SCHEDULE"). The "Mortgage Loan Schedule" as
of the Closing Date shall refer to the Mortgage Loan Schedule as delivered on
the Cut-off Date related to such Mortgage Loans to be purchased by or on
behalf of the Purchaser pursuant to the terms of this Agreement. The
<PAGE>
Mortgage Loan Schedule shall contain as to each Mortgage Loan listed thereon,
at a minimum, the Mortgage Loan information indicated on SCHEDULE 2 hereto.
SECTION 3. PURCHASE PRICE.
(a) In exchange for the Mortgage Loans, on the Closing Date, the
Purchaser shall transfer to the Seller by wire transfer in immediately
available funds the purchase price (the "PURCHASE PRICE") which is equal to
the principal balance thereof as of the Cut-Off Date plus any accrued and
unpaid interest thereon to such Cut-Off Date.
(b) The Purchaser shall be entitled to all scheduled payments of
principal and interest due with respect to the Mortgage Loans after the
Cut-Off Date, and all other recoveries of principal and interest collected
after the Cut-Off Date (other than in respect of principal and interest on
the Mortgage Loans due on or before the Cut-Off Date). The Seller shall be
entitled to all scheduled payments of principal and interest due with respect
to the Mortgage Loans on or before the Cut-Off Date, and all other recoveries
of principal and interest collected on or before the Cut-Off Date (other than
in respect of principal and interest on the Mortgage Loans due after the
Cut-Off Date). The Principal Balance of each Mortgage Loan as of the Cut-Off
Date is determined after deduction of payments of principal due on or before
the Cut-Off Date whether or not collected. Therefore, payments of scheduled
principal and interest prepaid for a date due following the Cut-Off Date
shall not be deducted from the Principal Balance as of the Cut-Off Date but
such prepaid amounts shall belong to and be promptly remitted to the
Purchaser.
SECTION 4. EXAMINATION OF MORTGAGE FILES.
Prior to the Closing Date, the Seller will have made files for each
Mortgage Loan, that consist at least of the documents listed on SCHEDULE 3
attached hereto (with respect to each Mortgage Loan, a "Mortgage File", and
collectively, the "MORTGAGE FILES"), available to the Purchaser or its
agents, for examination at the Seller's offices or such other location as
shall otherwise be agreed upon by the Purchaser and the Seller. The
Purchaser may purchase all or part of the Mortgage Loans with or without
conducting any partial or complete examination. The fact that the Purchaser
or its agents have conducted or have failed to conduct any partial or
complete examination of the Mortgage Files shall not affect the Purchaser's
rights under this Agreement, including, but not limited to, the rights to
demand repurchase, substitution or other relief as provided in this Agreement.
SECTION 5. TRANSFER OF MORTGAGE LOANS; POSSESSION OF MORTGAGE FILES.
(a) On the Closing Date, subject to the satisfaction of the terms and
conditions hereof the Seller shall sell, transfer, assign, set over and
otherwise convey to the Purchaser, without recourse, but subject to the terms
of this Agreement, all right, title and interest of the Seller in and to the
Mortgage Loans and all proceeds thereof, wherever located, including without
limitation, all amounts in respect of principal and interest received or
receivable with respect to Mortgage Loan payments due after the Cut-Off Date
(and including scheduled payments of
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principal and interest due after the Cut-Off Date but received by the Seller
on or before the Cut-Off Date, but not including payments of principal and
interest due on the Mortgage Loans on or before the Cut-Off Date), together
with the proceeds of any related mortgage insurance policies. Such transfer
shall be made directly to the Purchaser in accordance with the letter
delivered to the Seller by the Purchaser attached hereto as EXHIBIT A (the
"INSTRUCTION LETTER"). The Seller's records will accurately reflect the sale
of each Mortgage Loan to the Purchaser.
(b) The ownership of each Mortgage Loan and the related Mortgage Note,
the Mortgage and the contents of the related Mortgage File shall be, upon
satisfaction of SUBSECTION 5(a) hereof, vested in the Purchaser and the
ownership of all records and documents with respect to such Mortgage Loan
prepared by or which come into the possession of the Seller shall immediately
vest in the Purchaser and shall be retained and maintained by the Seller at
the will and for the benefit of the Purchaser in a custodial capacity only.
The Seller shall deliver to the Purchaser or its agent in accordance with the
instructions set forth in EXHIBIT A, simultaneously with the execution and
delivery of this Agreement or prior to the Closing Date, all of the documents
pertaining to each Mortgage Loan.
(c) The transfer of the Mortgage Loans as described herein shall be
absolute and is intended by the parties to be a sale. In the event that a
court deems the conveyance set forth herein not to constitute a sale, the
Seller shall have granted to the Purchaser and the Trustee a first priority
security interest in the Mortgage Loans and in the proceeds thereof of any
kind or nature whatsoever, and in the proceeds of any related insurance
policies, subject to the satisfaction or waiver of the conditions set forth
in SECTION 11 hereof, and shall take, or shall cause to have been taken, all
steps necessary prior to the Closing Date to perfect such security interest
in the Purchaser.
SECTION 6. BOOKS AND RECORDS.
On the Closing Date, following the sale of the Mortgage Loans to the
Purchaser, title to each Mortgage and the related Mortgage Note shall be
transferred to the Purchaser or its assignee in accordance with this
Agreement. All rights arising out of the Mortgage Loans after the Cut-Off
Date including, but not limited to, any and all funds received on or in
connection with a Mortgage Loan and due after the Cut-Off Date shall be
received and held by the Seller in a custodial capacity for the benefit of
the Purchaser or its assignee as the owner of the Mortgage Loans in
accordance herewith and shall be delivered or caused to be delivered by the
Seller to the Purchaser or its assignee on or immediately following the
Closing Date. Any funds received by the Seller, the Purchaser or LaSalle
Home Mortgage Corporation after the Cut-Off Date but due prior to the Cut-Off
Date shall remain the property of the Seller and shall be promptly remitted
to the Seller.
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SECTION 7. FURTHER ACTIONS; FINANCING STATEMENTS.
(a) In furtherance of the provisions of Section 5(c) hereof, the Seller
agrees to take or cause to be taken such further actions to execute, deliver
and file or cause to be executed, delivered and filed, such further documents
and instruments (including, without limitation, any UCC financing statements)
as may be necessary, or as the Purchaser may reasonably request, in order to
perfect and maintain the security interest created pursuant to said section
and to otherwise fully effectuate the purposes, terms and conditions of this
Agreement, and the Purchaser shall cooperate in any such action.
(b) The Seller shall: (i) promptly execute, deliver, and file any
financing statements, amendments, continuation statements, assignments,
certificates and other documents with respect to such security interest as
may be necessary to enable the Purchaser to perfect or to maintain the
perfection of such security interest, each in form and substance satisfactory
to the Purchaser; and the Seller hereby grants to the Purchaser, subject to
the satisfaction or waiver of the conditions set forth in SECTION 11 hereof,
the right, at the Purchaser's option, to file any or all such financing
statements, amendments, continuation statements, assignments, certificates
and other documents pursuant to the UCC and otherwise without its signature
and hereby irrevocably appoints the Purchaser, subject to the satisfaction or
waiver of the conditions set forth in SECTION 11 hereof, as its
attorney-in-fact to execute, deliver and file any such financing statements,
amendments, continuation statements, assignments, certificates and other
documents in the Seller's name and to perform all other acts which the
Purchaser deems appropriate to perfect or to maintain the perfection of the
security interest; and (ii) notify the Purchaser within five (5) days after
the occurrence of any of the following: (A) any change in the Seller's
corporate name or any trade name; (B) any change in the Seller's location of
its chief executive office or principal place of business; and (C) any merger
or consolidation or other change in Seller's identity or material change in
its corporate structure.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF SELLER.
(a) The Seller hereby represents and warrants to the Purchaser as of the
Closing Date (or such other date as is specified in the related representation
or warranty) as follows:
(i) The Seller has been duly created and is validly existing as a
Federal Savings Bank under the laws of the United States;
(ii) The execution and delivery of this Agreement by the Seller and
its performance of and compliance with the terms of this Agreement will not
violate the Seller's charter or by-laws or will not conflict with or result
in a breach of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
material agreement or instrument to which the Seller is a party or by which
the Seller or to which any of the property or assets of the Seller is
subject;
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(iii) This Agreement, assuming due authorization, execution and
delivery by the Purchaser, constitutes a valid and legally binding
obligation of the Seller, enforceable against the Seller in accordance with
its terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other similar laws of general applicability relating to
or affecting creditors' rights and to general equity principles, regardless
of whether such enforcement is considered in a proceeding in equity or at
law;
(iv) The Seller is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal,
state, municipal or governmental agency, which default might have
consequences that would materially and adversely affect the condition
(financial or other) or operations of the Seller or its properties or might
have consequences that would affect its performance hereunder;
(v) No litigation is pending or, to the best of the Seller's
knowledge, threatened against the Seller which would prohibit its entering
into this Agreement or performing its obligations under this Agreement;
(vi) The Seller is an approved conventional seller/servicer for
FNMA or FHLMC in good standing;
(vii) The consummation of the transactions contemplated by this
Agreement are in the ordinary course of business of the Seller, and the
transfer, assignment and conveyance of the Mortgage Notes and the Mortgages
by the Seller pursuant to this Agreement is not subject to the bulk
transfer or any similar statutory provisions in effect in the State of
Michigan;
(viii) With respect to each Mortgage Loan:
(a) that the information set forth in the Mortgage Loan
Schedule appearing as an exhibit to this Agreement is true and correct
in all material respects at the date or dates respecting which such
information is furnished as specified therein;
(b) the Seller is the sole owner and holder of each
Mortgage Loan free and clear of all liens, pledges, charges or
security interests of any nature and has full right and authority,
subject to no interest or participation of, or agreement with, any
other party, to sell and assign the same;
(c) no payment of principal of or interest on or in respect
of any Mortgage Loan is 30 days or more past due from the Due Date of
such payment;
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(d) to the best of the Seller's knowledge, as of the date
of the transfer of the Mortgage Loans to the Purchaser, there is no
valid offset, defense or counterclaim to any Mortgage Note or
Mortgage;
(e) there is no proceeding pending, or to the best of the
Seller's knowledge, threatened for the total or partial condemnation
of any of the real property, together with any improvements thereto,
securing the indebtedness of the Mortgagor under the related Mortgage
Loan (the "Mortgaged Property") and the Mortgaged Property is free of
material damage and is in good repair and neither the Mortgaged
Property nor any improvement located on or being part of the Mortgaged
Property is in violation of any applicable zoning law or regulation;
(f) that each Mortgage Loan complies in all material
respects with applicable state or federal laws, regulations and other
requirements, pertaining to usury, equal credit opportunity and
disclosure laws, and each Mortgage Loan was not usurious at the time
of origination;
(g) to the best of the Seller's knowledge, all taxes,
governmental assessments and insurance premiums previously due and
owing, and which may become a lien against the Mortgaged Property,
with respect to the Mortgaged Property have been paid;
(h) that each Mortgage Note and the related Mortgage are
genuine and each is the legal, valid and binding obligation of the
maker thereof, enforceable in accordance with its terms except as such
enforcement may be limited by bankruptcy, insolvency, reorganization
or other similar laws affecting the enforcement of creditors' rights
generally and by general equity principles (regardless of whether such
enforcement is considered in a proceeding in equity or at law); all
parties to the Mortgage Note and the Mortgage had legal capacity to
execute the Mortgage Note and the Mortgage; and each Mortgage Note and
Mortgage have been duly and properly executed by the Mortgagor;
(i) that each Mortgage is a valid and enforceable first
lien on the property securing the related Mortgage Note, and that each
Mortgage Loan is covered by an ALTA mortgagee title insurance policy
or other form of policy or insurance generally acceptable to FNMA or
FHLMC, issued by, and is a valid and binding obligation of, a title
insurer acceptable to FNMA or FHLMC insuring the originator, its
successor and assigns, as to the lien of the Mortgage in the original
principal amount of the Mortgage Loan subject only to (a) the lien of
current real property taxes and assessments not yet due and payable,
(b) covenants, conditions and restrictions, rights of way, easements
and other matters of public record as of the date of recording of such
Mortgage acceptable to mortgage lending institutions in the area in
which the Mortgaged Property is located or specifically referred to in
the appraisal performed in connection with
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the origination of the related Mortgage Loan and (c) such other
matters to which like properties are commonly subject which do not
individually, or in the aggregate, materially interfere with the
benefits of the security intended to be provided by the Mortgage;
(j) neither the Seller nor any prior holder of any Mortgage
has, except as the Mortgage File may reflect, modified the Mortgage in
any material respect; satisfied, cancelled or subordinated such
Mortgage in whole or in part; released such Mortgaged Property in
whole or in part from the lien of the Mortgage; or executed any
instrument of release, cancellation, modification or satisfaction;
(k) that each Mortgaged Property consists of a fee simple
estate, a leasehold estate or condominium form of ownership in real
property;
(l) the condominium projects that include the condominiums
that are the subject of any condominium loan are generally acceptable
to FNMA or FHLMC;
(m) no foreclosure action is threatened or has been
commenced (except for the filing of any notice of default) with
respect to the Mortgage Loan; and except for payment delinquencies not
in excess of 30 days, to the best of the Seller's knowledge, there is
no default, breach, violation or event of acceleration existing under
the Mortgage or the related Mortgage Note and no event which, with the
passage of time or with notice and the expiration of any grace or cure
period, would constitute a default, breach, violation or event of
acceleration; and the Seller has not waived any default, breach,
violation or event of acceleration;
(n) Each Mortgage Loan was originated on FNMA or FHLMC
uniform instruments for the state in which the mortgaged property is
located;
(o) that based upon a representation by each Mortgagor at
the time of origination or assumption of the applicable Mortgage Loan,
100% of the Mortgage Loans measured by Principal Balance were to be
secured by owner-occupied residences and no more than 0% of the
Mortgage Loans measured by Principal Balance secured by non-owner-
occupied residences;
(p) that an appraisal of each Mortgaged Property was
conducted at the time of origination of the related Mortgage Loan, and
that each such appraisal was conducted in accordance with FNMA or
FHLMC criteria, on FNMA or FHLMC forms and comparables on at least
three properties were obtained;
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(q) that no Mortgage Loan had a Loan-to-Value Ratio at
origination in excess of 95%;
(r) the Mortgage Loans were not selected in a manner to
adversely affect the interests of the Purchaser and the Seller knows
of no conditions which reasonably would cause it to expect any
Mortgage Loan to become delinquent or otherwise lose value;
(s) each Mortgage Loan was either (A) originated directly
by or closed in the name of either: (i) a savings and loan
association, savings bank, commercial bank, credit union, insurance
company, or similar institution which is supervised and examined by a
federal or state authority or (ii) a mortgagee approved by the
Secretary of Housing and Urban Development pursuant to Sections 203
and 211 of the National Housing Act or (B) originated or underwritten
by an entity employing underwriting standards consistent with the
underwriting standards of an institution as described in subclause
(A)(i) or (A)(ii) above; and
(t) each Mortgage Loan is a "qualified mortgage" within the
meaning of Section 860G of the Internal Revenue Code of 1986.
It is understood and agreed that the representations and
warranties set forth in this SECTION 8 shall survive the sale of the
Mortgage Loans to the Purchaser and shall inure to the benefit of the
Purchaser, notwithstanding any restrictive or qualified endorsement on
any Mortgage Note or assignment of Mortgage or the examination of any
Mortgage File.
Upon discovery by either the Seller, the Purchaser or its
designees of a breach of any of the foregoing representations or
warranties of the Seller which materially and adversely affects (1)
the value of any of the Mortgage Loans actually delivered or (2) the
interests of the Purchaser therein, the party discovering such breach
shall give prompt written notice to the other. Within 90 (ninety)
days of its discovery or its receipt of notice of any such breach of a
representation or warranty, the Seller shall, with respect to the
Mortgage Loan(s) to which such breach relates, (i) cure such breach in
all material respects (except for a breach of that portion of the
representation and warranty relating to any casualty from the presence
of hazardous waste or hazardous substances), (ii) repurchase such
Mortgage Loan or Mortgage Loans (or any property acquired in respect
thereof) from the Purchaser at the Purchase Price, as adjusted for the
then current principal balance or (iii) within the 90 (ninety)-day
period following the Closing Date substitute another mortgage loan for
such Mortgage Loan. Such substitute mortgage loan shall on the date
of substitution, (i) have a principal balance not in excess of the
principal balance of the defective Mortgage Loan,
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(ii) be accruing interest at a rate of interest at least equal to that of
the defected Mortgage Loan, (iii) have a remaining term to stated maturity
not greater than, and not more than two years less than, that of the
Mortgage Loan so substituted, (iv) have an original loan-to-value ratio not
higher than that of the Mortgage Loan so substituted and a current loan-to-
value ratio not higher than that of the Mortgage Loan so substituted, and
(v) comply with all the representations and warranties relating to Mortgage
Loans set forth herein, as of the date of substitution (such mortgage loan
being referred to herein as a "QUALIFYING SUBSTITUTE MORTGAGE LOAN").
Except as set forth in SECTION 13 hereof, it is understood and agreed that
the obligations of the Seller set forth in this SECTION 8 to cure,
substitute for or repurchase a defective Mortgage Loan constitute the sole
remedies of the Purchaser respecting a breach of the foregoing
representations and warranties.
The Purchaser, upon receipt by it of the full amount of the
Purchase Price as adjusted for the then current principal balance for
a Mortgage Loan that is repurchased, or upon receipt of the Mortgage
File for a Qualifying Substitute Mortgage Loan for a Mortgage Loan
that is substituted or repurchased, shall release or cause to be
released and reassign to the Seller the related Mortgage File for the
Mortgage Loan that is substituted and shall execute and deliver such
instruments of transfer or assignment, in each case without recourse,
representation, or warranty, as shall be necessary to vest in the
Seller or its designee or assignee title to any such substituted
Mortgage Loan released pursuant hereto, free and clear of all security
interests, liens and other encumbrances created by this Agreement,
which instruments shall be prepared by the Seller at its expense and
shall be reasonably acceptable to the Purchaser, and the Purchaser
shall have no further responsibility with respect to the Mortgage File
relating to such Mortgage Loan that is substituted.
Any cause of action against the Seller or relating to or arising
out of the breach of any representations and warranties made in this
SECTION 8 shall accrue as to any Mortgage Loan upon (i) discovery of
such breach by the Purchaser or notice thereof by the Seller to the
Purchaser, (ii) failure by the Seller to cure such breach, repurchase
such Mortgage Loan or substitute a Qualifying Substitute Mortgage Loan
as specified above, and (iii) demand upon the Seller by the Purchaser
for all amounts payable in respect of such Mortgage Loan.
SECTION 9. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF PURCHASER.
(a) The Purchaser hereby represents and warrants to the Seller, as of the
date hereof (or such other date as is specified in the related representation or
warranty) as follows:
(i) The Purchaser is a corporation duly formed and validly
existing under the laws of the State of Delaware;
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(ii) The execution and delivery of this Agreement by the Purchaser
and its performance of and compliance with the terms of this Agreement will
not violate the Purchaser's corporate charter or by-laws or will not
conflict with or result in a breach of any of the terms or provisions of,
or constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other material agreement or instrument to which the Purchaser
is a party or by which the Purchaser or to which any property or assets of
the Purchaser is subject;
(iii) This Agreement, assuming due authorization, execution and
delivery by the Seller, constitutes a valid and legally binding obligation
of the Purchaser, enforceable against the Purchaser in accordance with its
terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other similar laws of general applicability relating to
or affecting creditors' rights and to general equity principles, regardless
of whether such enforcement is considered in a proceeding in equity or at
law;
(iv) The Purchaser is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal,
state, municipal or governmental agency, which the Purchaser default might
have consequences that would materially and adversely affect the condition
(financial or other) or operations of the Purchaser or its properties or
might have consequences that would affect its performance hereunder; and
(v) No litigation is pending or, to the best of the Purchaser's
knowledge, threatened against the Purchaser which would prohibit its
entering into this Agreement or performing its obligations under this
Agreement;
SECTION 10. PURCHASER'S CONDITIONS TO CLOSING. The obligations of the
Purchaser under this Agreement shall be subject to the satisfaction, on or prior
to the Closing Date, of the following conditions:
(a) The obligations of the Seller required to be performed by it on or
prior to the Closing Date pursuant to the terms of this Agreement shall have
been duly performed and complied with and all of the representations and
warranties of the Seller under this Agreement shall be true and correct as of
the date hereof and as of the Closing Date, and no event shall have occurred
which, with notice or the passage of time, or both, would constitute a default
under this Agreement, and the Purchaser shall have received a certificate to
that effect signed by an Authorized Officer (as defined below) of the Seller.
(b) The Purchaser or the Purchaser's document custodian shall have
received, or the Purchaser's attorney shall have received in escrow, all of the
following closing documents, in such forms as are agreed upon and acceptable to
the Purchaser, duly executed by all signatories other than the Purchaser, as
required pursuant to the respective terms thereof:
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(i) An assignment or assignments of the Mortgage Loans to the
Purchaser substantially in the form attached hereto as EXHIBIT B with such
changes as are required to adapt the assignment to the proper form in the
jurisdiction where the related Mortgage Property is located, and each
original Mortgage Note, duly endorsed originally or by facsimile, without
recourse, to the Purchaser, in each case in accordance with the
instructions set forth in EXHIBIT A attached hereto, which assignment or
assignments and Mortgage Note shall be delivered to and held by the
Purchaser or its agent on behalf of the Purchaser;
(ii) The Mortgage Loan Schedule prepared by Purchaser dated as of
the related Closing Date and attached hereto;
(iii) A certificate signed by an officer, which officer may be
either a senior vice president, a vice president, an assistant vice
president or assistant secretary (an "AUTHORIZED OFFICER"), dated as of the
Closing Date, substantially in the form attached hereto as EXHIBIT C to the
parties hereto, and attached thereto copies of the charter and by-laws and
a Good Standing Certificate or a memorandum setting forth the verbal
assurances from the appropriate regulatory authorities with respect to the
Seller will be immediately forthcoming; and
(iv) An opinion of Seller's counsel in substantially the form
attached hereto as EXHIBIT D.
(v) A security release certification, in a form acceptable to the
Purchaser, executed by the appropriate mortgagee or secured party, if any
of the Mortgage Loans have at any time been subject to any security
interest, pledge or hypothecation for the benefit of such person.
(c) The Seller will furnish to the Purchaser such other certificates of
its officers or others and such other documents to evidence fulfillment of the
conditions set forth in this Agreement as the Purchaser and its attorney may
reasonably request.
SECTION 11. SELLER'S CONDITIONS TO CLOSING. The obligations of the
Seller under this Agreement shall be subject to the satisfaction, on or prior to
the Closing Date, of the following conditions:
(a) The obligations of the Purchaser required to be performed by it on or
prior to the Closing Date pursuant to the terms of this Agreement shall have
been duly performed and complied with and all of the representations and
warranties of the Purchaser under this Agreement shall be true and correct as of
the date hereof and as of the Closing Date, and no event shall have occurred
which, with notice or the passage of time, or both, would constitute a default
under this Agreement, and the Seller shall have received a certificate to that
effect signed by an Authorized Officer of the Purchaser.
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(b) The Seller shall have received, or the Seller's attorney shall have
received in escrow, all of the following closing documents, in such forms as are
agreed upon and acceptable to the Seller, duly executed by all signatories other
than the Seller as required pursuant to the respective terms thereof:
(i) A certificate signed by an Authorized Officer dated as of the
Closing Date, in the form acceptable to the parties hereto, and attached
thereto the resolutions of the Purchaser authorizing the transactions
contemplated by this Agreement, together with copies of the Articles of
Association and by-laws as of a recent date with respect to the Purchaser;
(c) The Purchaser will furnish to the Seller such other certificates of
its officers or others and such other documents to evidence fulfillment of the
conditions set forth in this Agreement as the Seller and its attorney may
reasonably request.
SECTION 12. INDEMNIFICATION.
(a) The Seller agrees to indemnify and hold harmless the Purchaser against
any and all losses, claims, expenses, damages or liabilities to which Purchaser
may become subject, insofar as such losses, claims, expenses, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
representation or warranty made by the Seller in Section 8 hereof on which
Purchaser has relied, being, or alleged to be, materially untrue or incorrect.
This indemnity will be in addition to any liability which the Seller may
otherwise have.
(b) The Purchaser agrees to indemnify and hold harmless the Seller solely
in its capacity as seller of the Mortgage Loans against any and all losses,
claims, expenses, damages or liabilities to which the Seller may become subject,
insofar as such losses, claims, expenses, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any representation or warranty
made by the Purchaser in SECTION 9 hereof on which the Seller has relied, being,
or alleged to be, materially untrue or incorrect (notwithstanding the
Purchaser's lack of knowledge with respect to the substance of any
representation or warranty to which SECTION 9 applies which is made to the best
of the Purchaser's knowledge). This indemnity will be in addition to any
liability which the Purchaser may otherwise have.
(c) Promptly after receipt by either the Purchasers or the Seller of
notice of the commencement of any action or proceeding in any way relating to or
arising from this Agreement, such party will notify the other party of the
commencement thereof; but the omission so to notify the party from whom
indemnification is sought (the "Indemnifying Party") will not relieve the
Indemnifying Party from any liability which it may have to the party seeking
indemnification (the "Indemnified Party") except to the extent that the
Indemnifying Party is adversely affected by the lack of notice. In case any
such action is brought against the Indemnified Party, and it notifies the
Indemnifying Party of the commencement thereof, the Indemnifying Party will be
entitled to participate in the defense (with the consent of the
-12-
<PAGE>
Indemnified Party which shall not be unreasonably withheld) of such action at
the Indemnifying Party's expense.
SECTION 13. NOTICES. All demands, notices and communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed, by
registered or certified mail, return receipt requested, or, if by other means,
when received by the other party. Notices to the Seller shall be directed to
InterFirst, 777 East Eisenhower Parkway, Ann Arbor, Michigan 48108, Attention:
Steve Kapp - Vice President with a copy to Standard Federal Bank, 2600 West Big
Beaver Road, Troy, Michigan 48084, Attention: Karen Severn Jackson - Vice
President; and notices to the Purchaser shall be directed to ABN AMRO Mortgage
Corporation, 181 West Madison Street, Suite 3250, Chicago, Illinois 60602,
Attention: Maria Fregosi - Director - ABN AMRO Mortgage Operations; or such
other addresses as may hereafter be furnished to the other party by like notice.
SECTION 14. TERMINATION. This Agreement may be terminated (i) by the
mutual consent of the parties hereto, or (ii) by the Purchaser if the conditions
to the Purchaser's obligations to closing set forth under SECTION 10 hereof are
not fulfilled as and when required to be fulfilled or (iii) by the Seller if the
Purchaser's obligations under SECTION 11 hereof are not fulfilled as and when
required. In the event of a termination pursuant to SECTION 14(ii), the Seller
agrees that it will pay the out-of-pocket fees and expenses of the Purchaser in
connection with the transactions contemplated by this Agreement and in the event
of a termination pursuant to SECTION 14(iii), the Purchaser agrees that it will
pay the out-of-pocket fees and expenses of the Seller in connection with the
transactions contemplated by this Agreement.
SECTION 15. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. All representations, warranties and agreements contained in this
Agreement, or in certificates of officers of the Seller and the Purchaser
submitted pursuant hereto, shall remain operative and in full force and effect
and shall survive transfer and sale of the Mortgage Loans to the Purchaser.
SECTION 16. SEVERABILITY. If any provision of this Agreement shall be
prohibited or invalid under applicable law, the Agreement shall be ineffective
only to such extent, without invalidating the remainder of this Agreement.
SECTION 17. COUNTERPARTS. This Agreement may be executed in any number
of counterparts, each of which shall be an original, but both of which together
shall constitute one and the same agreement.
SECTION 18. GOVERNING LAW. This Agreement shall be deemed to have been
made in the State of New York and shall be interpreted in accordance with the
laws of such state without regard to the principles of conflicts of law of such
state.
SECTION 19. FURTHER ASSURANCES. The Seller and the Purchaser agree to
execute and deliver such instruments and take such actions as the other party
may, from time to time,
-13-
<PAGE>
reasonably request in order to effectuate the purpose and to carry out the
terms of this Agreement.
SECTION 20. SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and inure to the benefit of and be enforceable by the Seller and the
Purchaser and their permitted successors and assigns. The Seller acknowledges
and agrees that the Purchaser may assign its rights under this Agreement. Any
person into which the Seller may be merged or consolidated (or any person
resulting from any merger or consolidation involving the Seller), or any person
succeeding to the business of the Seller shall be considered the "successor" of
the Seller hereunder. Except as provided in the two preceding sentences, this
Agreement cannot be assigned, pledged or hypothecated by any party hereto
without the written consent of the other party to this Agreement.
Notwithstanding anything to the contrary in this SECTION 20, the parties hereto
agree that the Purchaser has the right to assign its rights and interest in, to
and under SECTION 8 hereof.
SECTION 21. AMENDMENTS. No term or provision of this Agreement may be
waived or modified unless such waiver or modification is in writing and signed
by a duly authorized officer of the party against whom such waiver or
modification is sought to be enforced.
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<PAGE>
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their names to
be signed hereto by their respective duly authorized officers as of the date
first above written.
Standard Federal Bank,
as Seller
By: /s/
----------------------------------------
Name: Stewart W. Fleming
Title: Senior Vice President
<PAGE>
ABN AMRO Mortgage Corporation,
as Purchaser
By: /s/
----------------------------------------
Name: Stewart W. Fleming
Title: Vice President
<PAGE>
SCHEDULE 1
MORTGAGE LOAN SCHEDULE
----------------------
A copy of the Mortgage Loan schedule may be obtained by contacting the
Registrant.
<PAGE>
SCHEDULE 2
MORTGAGE LOAN SCHEDULE INFORMATION
----------------------------------
Each Mortgage Loan shall be identified by at least the following details,
among others, relating to each Mortgage Loan:
(i) the loan number of the Mortgage Loan and name of the related
Mortgagor;
(ii) the street address of the Mortgaged Property;
(iii) the mortgage interest rate as of the Cut-Off Date;
(iv) the original term and maturity date of the related Mortgage
Note;
(v) the original principal balance;
(vi) the first payment date;
(vii) the monthly payment in effect as of the Cut-Off Date;
(viii) the date of the last paid installment of interest;
(ix) the unpaid principal balance as of the close of business on the
Cut-Off Date;
(x) the loan-to-value ratio at origination and as of the Cut-Off Date;
(xi) the type of property;
(xii) the nature of occupancy at origination;
(xiii) the county in which Mortgaged Property is located, if
available;
(xiv) the Mortgage Loan Group; and
(xv) the Closing Date.
<PAGE>
SCHEDULE 3
MORTGAGE FILE INFORMATION
-------------------------
Each Mortgage File shall include at least the following
documents, among others, with respect to each Mortgage Loan transferred and
assigned from the Seller to the Purchaser, or its agent:
(i) the original Mortgage Note bearing all intervening endorsements
endorsed, "Pay to the order of Chase Bank of Texas, National
Association for the benefit of the Certificateholders of ABN AMRO
Mortgage Corporation Series 1998-4 Attn: Corporate Trust
Department, 600 Travis Street, Houston, TX 77002, without recourse"
and signed in the name of the Seller by an Authorized Officer
showing an unbroken chain of title from the originator thereof to
the person endorsing;
(ii) (a) the original Mortgage with evidence of recording thereon, and
if the Mortgage was executed pursuant to a power of attorney, a
certified true copy of the power of attorney certified by the
recorder's office, with evidence of recording thereon, or certified
by a title insurance company or escrow company to be a true copy
thereof; PROVIDED that if such original Mortgage or power of
attorney cannot be delivered with evidence of recording thereon on
or prior to the Closing Date because of a delay caused by the
public recording office where such original Mortgage has been
delivered for recordation or because such original Mortgage has
been lost, the Seller shall deliver or cause to be delivered to the
Purchaser a true and correct copy of such Mortgage, together with
(1) in the case of a delay caused by the public recording office, a
certificate signed by an Authorized Officer of the Seller stating
that such original Mortgage has been dispatched to the appropriate
public recording official for recordation or (2) in the case of an
original Mortgage that has been lost, a certificate by the
appropriate county recording office where such Mortgage is recorded
or from a title insurance company or escrow company indicating that
such original was lost and the copy of the original mortgage is a
true and correct copy;
(b) the original assignment to "Chase Bank of Texas, National
Association, as Trustee," which assignment shall be in form and
substance acceptable for recording, or a copy certified by the
Seller as a true and correct copy of the original assignment which
has been sent for recordation. Subject to the foregoing, such
assignments may, if permitted by law, be by blanket assignments for
Mortgage Loans covering Mortgaged Properties situated within the
same county. If the assignment
<PAGE>
is in blanket form, a copy of the assignment shall be included in
the related individual Mortgage File;
(iii) the originals of any and all instruments that modify the terms and
conditions of the Mortgage Note, including but not limited to
modification, consolidation, extension and assumption agreements
including any adjustable rate mortgage (ARM) rider, if any;
(iv) the originals of all required intervening assignments, if any with
evidence of recording thereon, and if such assignment was executed
pursuant to a power of attorney, a certified true copy of the power
of attorney certified by the recorder's office, with evidence of
recording thereon, or certified by a title insurance company or
escrow company to be a true copy thereof; PROVIDED that if such
original assignment or power of attorney cannot be delivered with
evidence of recording thereon on or prior to the Closing Date
because of a delay caused by the public recording office where such
original assignment has been delivered for recordation or because
such original assignment has been lost, the Seller shall deliver or
cause to be delivered to the Purchaser a true and correct copy of
such assignment, together with (a) in the case of a delay caused by
the public recording office, a certificate signed by an Authorized
Officer of the Seller stating that such original assignment has
been dispatched to the appropriate public recording official for
recordation or (b) in the case of an original assignment that has
been lost, a certificate by the appropriate county recording office
where such assignment is recorded or from a title insurance company
or escrow company indicating that such original was lost and the
copy of the original assignment is a true and correct copy;
(v) the original mortgage policy of title insurance (including, if
applicable, the endorsement relating to the negative amortization
of the Mortgage Loans) or in the event such original title policy
is unavailable, any one of an original title binder, an original
preliminary title report or an original title commitment or a copy
thereof certified by the title company with the original policy of
title insurance to follow within 180 days of the Closing Date;
(vi) the mortgage insurance certificate;
(vii) hazard insurance certificates and copies of the Hazard Insurance
Policy and, if applicable, flood insurance policy; and
(viii) any and all other documents, opinions and certificates executed
and/or delivered by the related Mortgagor and/or its counsel in
connection with
-2-
<PAGE>
the origination of such Mortgage Loan which may include Truth-in-
Lending Statement and other legal statements, Appraisal and Survey.
-3-
<PAGE>
EXHIBIT A
---------
INSTRUCTION LETTER
ABN AMRO Mortgage Corporation
181 West Madison Street, Suite 3250
Chicago, Illinois 60602
________ __, 1998
Standard Federal Bank
2600 West Big Beaver Road
Troy, Michigan 48084
Dear Ladies and Gentlemen:
Pursuant to the Mortgage Loan Purchase Agreement dated as of October 27,
1998 (the "PURCHASE AGREEMENT") between you and us, we have agreed to
purchase from you certain Mortgage Loans. All capitalized terms used herein
and not otherwise defined shall have the meanings set forth in the Purchase
Agreement.
In order to facilitate these transactions, and for the purpose of
convenience only, we hereby authorize and direct you to:
<TABLE>
<CAPTION>
Action Due Date
<S> <C>
1. Endorse mortgage notes to: one week prior to funding
"Pay to the order of
Chase Bank of Texas, National Association
for the benefit of the Certificateholders
of ABN AMRO Mortgage Corporation
Series 1998-4, Attn: Corporate Trust
Department, 600 Travis Street,
Houston, TX 77002,
without recourse"
2. Assign mortgages to be recorded one week prior to funding
to Chase Bank of Texas, National Association
for the benefit of the Certificateholders
of ABN AMRO Mortgage Corporation
Series 1998-4:
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
3. Deliver to the Purchaser or its agent all two business days after
Mortgage Loan documents pertaining to each funding
loan
4. Deliver to the Purchaser's servicer all one week prior to Servicing
Mortgage Loan servicing documents pertaining transfer date
to each loan
5. Provide lost mortgage note affidavits, one week prior to funding
certified copies of all missing mortgages,
and certified recorded copies of missing
intervening assignments
6. Mortgage Loan Schedule generated by Purchaser one day prior to funding
and agreed to by Seller
</TABLE>
Sincerely,
ABN AMRO Mortgage Corporation
By:____________________________________________
Name:__________________________________________
Title:_________________________________________
-2-
<PAGE>
EXHIBIT B
---------
FORM OF ASSIGNMENT
------------------
Standard Federal Bank, a federal savings bank (the "SELLER"), in
exchange for $__________ in hand paid and other good and valuable
consideration, hereby grants, bargains, sells, assigns, transfers, conveys,
and sets over to ABN AMRO Mortgage Corporation, a Delaware corporation (the
"PURCHASER"), all of the Seller's right, title, and interest in, to, and
under the mortgage loans listed on SCHEDULE 1 attached hereto, the mortgage
notes evidencing or relating to such mortgage loans, all mortgages, trust
deeds, title insurance policies, property insurance policies, chattel paper,
loan guaranties, loan accounts, surveys, instruments, certificates, and other
documents whatsoever evidencing or relating to such mortgage notes and
mortgage loans, and all books, ledgers, books of account, records, writings,
data bases, information, and computer software (and all documentation
therefor or relating thereto, and all licenses relating to or covering such
computer software and/or documentation), and all other property, rights,
title, and interests whatsoever relating to, used, or useful in connection
with, or evidencing, embodying, incorporating, or referring to, any of the
foregoing (the "MORTGAGES"). The Seller warrants to the Purchaser that the
Seller is the owner of the Mortgages, subject to no liens, claims, or
encumbrances.
<PAGE>
Dated: _____________, 1998 Standard Federal Bank
By:_____________________________________
Name:________________________________
Title:_______________________________
-2-
<PAGE>
ACKNOWLEDGED ON __________ __, 1998
ABN AMRO Mortgage Corporation
By:_______________________________________
Name:__________________________________
Title:_________________________________
-3-
<PAGE>
STATE OF ____________ )
)
COUNTY OF ___________ )
I, ______________, a Notary Public in and for the said County and State,
do hereby certify that ____________, personally known to me to be the same
person whose name is subscribed to the foregoing instrument as
_______________ of __________________, appeared before me this day in person
and, being first sworn, acknowledged that he signed and delivered the said
instrument as his own free and voluntary act, and as the free and voluntary
act of said corporation as the ___________ of ____________, a ____________,
for the uses and purposes therein set forth and that he was duly authorized
to execute the said instrument by the __________________ of said
_________________.
Given under my hand and seal, this ____ day of ____________, 1998.
__________________________________
Notary Public
My commission expires:____________
<PAGE>
EXHIBIT C
---------
FORM OF OFFICER'S CERTIFICATE
-----------------------------
Standard Federal Bank
I, ____________________, do hereby certify pursuant to Section 10(a) and
(b)(iii) of the Purchase Agreement (as hereinafter defined) that I am the
duly elected ____________________ of Standard Federal Bank ("Standard
Federal"), a federal savings bank, and further certify as follows:
1. Attached hereto as EXHIBIT "A" is a true and correct copy of the
charter of Standard Federal. There has been no amendment or other document
filed affecting the charter as of the date of this certification of Standard
Federal, and no such amendment has been authorized.
2. Attached hereto as EXHIBIT "B" is a true and correct copy of the
by-laws of Standard Federal as in full force and effect as of the date of
this certification.
3. No proceedings looking toward merger, consolidation, liquidation,
or dissolution of Standard Federal are pending or contemplated.
4. Each person who, as an officer or representative of Standard
Federal, signed, or will sign (a) the Purchase Agreement, and (b) any other
document delivered pursuant thereto or on the date hereof in connection with
the Mortgage Loan Purchase Agreement, dated as of October 27, 1998, between
Standard Federal, as seller, and ABN AMRO Mortgage Corporation, as Purchaser
(the "PURCHASE AGREEMENT") was, at the respective times of such signing and
delivery, and is as of the date hereof duly elected or appointed, qualified
and acting as such officer or representative, and the signatures of such
persons appearing on such documents are their genuine signatures.
5. Attached hereto as EXHIBIT "C" is a true, complete and correct copy
of the Resolutions of Standard Federal's Board of Directors, which were duly
adopted as of _____ __, 1998, and such Resolutions have not been amended,
altered or repealed, and remain in full force and effect without modification
on the date hereof.
6. Attached hereto as EXHIBIT "D" is a Good Standing Certificate
issued by the Office of Thrift Supervision as of __________, 199_. A current
Good Standing Certificate has been requested from the Office of Thrift
Supervision and will be supplied when it is received.
7. Standard Federal has performed all obligations and satisfied all
conditions on its part to be performed or satisfied under the Purchase
Agreement on or prior to the Closing Date and all of the representations and
warranties of the Seller under the Purchase Agreement are true and correct as
of the date hereof and as of the Closing Date, and no event has occurred
which,
<PAGE>
with notice or passage of time, or both, would constitute a default under the
Purchase Agreement.
All capitalized terms used herein and not otherwise defined shall have the
meanings set forth in the Purchase Agreement.
IN WITNESS WHEREOF, I have hereunto signed my name.
Date: __________ __, 199_
Standard Federal Bank
By:_________________________________
Name:_______________________________
Title:______________________________
-2-
<PAGE>
I, ____________________, [ASSISTANT SECRETARY] of Standard Federal Bank,
a federal savings bank, hereby certify that ____________________ is the duly
elected, qualified and acting ____________________ of Standard Federal Bank
and that the signature appearing on the preceding page is his genuine
signature.
IN WITNESS WHEREOF, I have hereunto signed my name.
Date: __________ __, 199_
Standard Federal Bank
By:_________________________________
Name:_______________________________
Title:______________________________
-3-
<PAGE>
[OPINION TO BE REVISED IN ACCORDANCE WITH
GENERAL COUNSEL'S FORM OF OPINION LETTER]
EXHIBIT D
---------
[OPINION OF SELLER'S IN-HOUSE COUNSEL
PURSUANT TO SECTION 10(b)(iv)]
-----------------
__________ __, 1998
ABN AMRO Mortgage Corporation
181 West Madison Street, Suite 3250
Chicago, Illinois 60602
Re: ABN AMRO MORTGAGE CORPORATION PURCHASE OF MORTGAGE LOANS
--------------------------------------------------------
Ladies and Gentlemen:
As General Counsel to Standard Federal Bank, a federal savings bank
("SELLER"), I and attorneys working under my supervision have acted as
counsel to Seller in connection with the sale of Mortgage Loans by Seller to
ABN AMRO Mortgage Corporation (the "PURCHASER") pursuant to a Mortgage Loan
Purchase Agreement, dated as of October 27, 1998 (the "PURCHASE AGREEMENT"),
between the Purchaser and Seller. This opinion is being delivered to the
Purchaser pursuant to SECTION 10(b)(iv) of the Purchase Agreement. All
capitalized terms not otherwise defined herein have the meanings given them
in the Purchase Agreement.
In rendering the opinions set forth below, we have examined and relied
upon originals or copies, certified or otherwise identified to our
satisfaction, of the charter and by-laws of Seller, the Purchase Agreement
and such corporate records, agreements or other instruments of Seller, and
such certificates, records and other documents, agreements and instruments,
including, among other things, certain documents delivered on the Closing
Date, as we have deemed necessary and proper as the basis for our opinions.
In connection with such examination, we have assumed the genuineness of all
signatures, the authenticity of all documents, agreements and instruments
submitted to us as originals, the conformity to original documents,
agreements and instruments of all documents, agreements and instruments
submitted to us as copies or specimens, the authenticity of the originals of
such documents, agreements and instruments submitted to us as copies or
specimens, the conformity to executed original documents of all documents
submitted to us in draft and the accuracy of the matters set forth in the
documents we reviewed. We have also assumed that all documents, agreements
and instruments have been
<PAGE>
ABN AMRO Mortgage Corporation
_____________ ___, 199_
Page 2
duly authorized, executed and delivered by all parties thereto. As to any
facts material to such opinions that we did not independently establish or
verify, we have relied upon statements and representations of officers and
other representatives of Seller as we have deemed necessary and proper as the
basis for our opinions, including, among other things, the representations
and warranties of Seller in the Purchase Agreement.
Based upon the foregoing, I am of the opinion that:
1. Seller is a federal savings bank, duly organized, validly existing
and in good standing under the laws of the United States and either is not
required to be qualified to do business under the laws of any states where
such qualification is necessary to transact the business contemplated by the
Purchase Agreement, or is qualified to do business under the laws of any
states where such qualification is necessary to transact the business
contemplated by the Purchase Agreement, or is qualified to do business under
the laws of any states where such qualification is necessary to transact the
business contemplated by the Purchase Agreement, and Seller is duly
authorized and has full corporate power and authority to transact the
business contemplated by the Purchase Agreement.
2. The Purchase Agreement has been duly authorized, executed and
delivered by Seller and is a legal, valid and binding obligation of and is
enforceable against Seller in accordance with its terms, except that the
enforceability thereof may be subject to (A) bankruptcy, insolvency,
receivership, conservatorship, reorganization, moratorium or other laws, now
or hereafter in effect, relating to creditors' rights generally or the right
of creditors of federal savings banks, (B) general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity or at
law) and (C) limitations of public policy under applicable securities laws as
to rights of indemnity and contribution under the Purchase Agreement.
3. No consent, approval, authorization or order of any court or
supervisory, regulatory, administrative or governmental agency or body is
required for the execution, delivery and performance by Seller of or
compliance by Seller with the Purchase Agreement, the sale of the Mortgage
Loans or the consummation of the transactions contemplated by the Purchase
Agreement.
4. Neither the execution and delivery by Seller of the Purchase
Agreement, nor the consummation by Seller of the transactions contemplated
therein, nor the compliance by Seller with the provisions thereof, will
conflict with or result in a breach of any of the terms, conditions or
provisions of Seller's charter or by-laws or board or shareholder's
resolutions, or any agreement or instrument to which Seller is now a party or
by which it is bound, or constitute a
<PAGE>
ABN AMRO Mortgage Corporation
_____________ ___, 199_
Page 3
default or result in an acceleration under any of the foregoing, or result in
the violation of any law, rule, regulation, order, judgment or decree to
which Seller or its property is subject, which, in any of the above cases,
would materially and adversely affect Seller's ability to perform its
obligations under the Purchase Agreement.
5. There is not an action, suit, proceeding or investigation pending,
or, to the best of my knowledge, threatened against Seller which, either in
any one instance or in the aggregate, would draw into question the validity
of the Purchase Agreement or the Mortgage Loans or of any action taken or to
be taken in connection with the obligations of Seller contemplated therein,
or which would be likely to materially impair the ability of Seller to
perform under the terms of the Purchase Agreement.
The Opinions expressed herein are limited to matters of federal and
Michigan law and do not purport to cover any matters as to which laws of any
other jurisdiction are applicable. Except as expressly provided herein, this
opinion is being furnished to you solely for your benefit in connection with
the purchase of the Mortgage Loans, and it is not to be used, circulated,
quoted or otherwise referred to for any purpose without my express written
consent.
Sincerely,
Standard Federal Bank
By: ____________________
Title: General Counsel
