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pdfGINNIE MAE MULTICLASS SECURITIES PROGRAM
Government National Mortgage Association
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MULTICLASS SECURITIES GUIDE
Part I:
Ginnie Mae Multiclass Securities Transactions:
Guidelines And Selected Transaction Documents
January 1, 2014
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
MULTICLASS SECURITIES GUIDE
(January 1, 2014 Edition)
Page
PART I: GINNIE MAE MULTICLASS SECURITIES TRANSACTIONS:
GUIDELINES AND SELECTED TRANSACTION DOCUMENTS
A.
INTRODUCTION TO THE GINNIE MAE MULTICLASS SECURITIES PROGRAM .......................... I-1
B. TRA
NSACTION GUIDELINES FOR THE GINNIE MAE MULTICLASS SECURITIES PROGRAM
1. Gene
ral Overview .......................................................................................................................... I-2
2. Transaction
3.
Ginnie Mae Multiclass Securities Program Conventions ............................................................... I-4
4.
Ginnie Mae Multiclass Securities Transaction Participants ...........................................................I-5
5. Trust
6.
C.
Information Web-Based Application - e-Access ........................................................I-3
Counsel’s Responsibilities .................................................................................................... I-6
Post-Closing Matters with respect to Ginnie Mae Multiclass Securities Transactions .................. I-7
GINNIE MAE REMIC AND MX TRANSACTION DOCUMENTS
1.
Form of Transaction Initiation Letter (with attached Financial Advisor Checklist for
Sponsor) for REMIC and MX Transactions .................................................................................. I-8
2.
Sponsor Agreement for REMIC and MX Transactions
a.
Form of Sponsor Agreement for REMIC and MX Transactions ..................................... I-9
b.
Standard Sponsor Provisions for REMIC and MX Transactions (including Supplemental
Statement and Sponsor Certification) ............................................................................ I-10
3. Base
Offering Circular for Single Family REMIC and MX Transactions ................................... I-11
4.
Form of Offering Circular Supplement for Single Family REMIC and MX Transactions .......... I-12
5.
Form of Transfer Affidavit for REMIC Transactions .................................................................. I-13
6.
Form of Guaranty Agreement for Single Family REMIC and MX Transactions ........................ I-14
7.
Accountants’ Agreed-Upon Procedures Reports for Single Family REMIC and MX
Transactions
a.
Form of Accountants’ Agreed-Upon Procedures Report for Single Family REMIC and
MX transactions concerning the Offering Circular........................................................ I-15
(i)
b.
8.
E. GLO
Accountants’ Agreed-Upon Procedures Report for Single Family REMIC and MX
Transactions as of Closing Date .................................................................................... I-16
Form of Closing Flow of Funds Instruction Letter for REMIC and MX Transactions ................ I-17
SSARY ................................................................................................................... ............................ I-18
PART II: GINNIE MAE MULTICLASS SECURITIES TRANSACTIONS:
ADDITIONAL SELECTED TRANSACTION DOCUMENTS
A. INTR
ODUCTION ............................................................................................................... ........................ II-1
B.
CLOSING CHECKLIST AND TABLE OF CONTENTS FOR REMIC TRANSACTIONS .................... II-2
C.
TRUST AGREEMENTS FOR REMIC TRANSACTIONS
1.
Form of Trust Agreement for REMIC Trusts (including Form of Waiver Agreement)................ II-3
2. REMIC
3.
Form of MX Trust Agreement ................................................................................................. ..... II-5
4. MX
D.
E.
Standard Trust Provisions............................................................................................ .... II-4
Standard Trust Provisions ...................................................................................................... II-6
TRANSFER OF GINNIE MAE CERTIFICATES AND CREATION OF REMIC SECURITIES
1.
Forms of Trustee’s Receipt and Safekeeping Agreement for REMIC Transactions .....................II-7
2.
Form of Issuance Statement for REMIC and MX Transactions ................................................... II-8
LEGAL OPINIONS for REMIC and MX Transactions
1.
Form of Transaction Opinion of Trust Counsel for REMIC and MX Transactions...................... II-9
2.
Form of Opinion of Sponsor for REMIC and MX Transactions .................................................II-10
3.
Form of Tax Opinions of Trust Counsel for REMIC and MX Transactions
a. Single
b.
Double REMIC: One Residual Security ....................................................................... II-12
c.
Double REMIC: Two Residual Securities .................................................................... II-13
d. MX
F.
REMIC .............................................................................................................. II-11
(Grantor) Trust ...................................................................................................... II-14
4.
Form of Opinion of Trustee’s Counsel for REMIC and MX Transactions ................................. II-15
5.
Opinion of HUD General Counsel ............................................................................................. . II-16
GINNIE MAE REMIC TRUST ADMINISTRATION AND TAX REPORTING ................................... II-17
(ii)
PART III: GINNIE MAE PLATINUM SECURITIES TRANSACTIONS
PART IV: GINNIE MAE MULTIFAMILY TRANSACTIONS:
MULTIFAMILY TRANSACTION DOCUMENTS*
A.
GENERAL OVERVIEW: MULTIFAMILY TRANSACTIONS ............................................................. IV-1
B.
GINNIE MAE MULTIFAMILY TRANSACTION DOCUMENTS ........................................................ IV-2
1.
Form of Offering Circular Supplement for Multifamily Transactions ........................................ IV-3
2.
Multifamily Base Offering Circular ......................................................................................... ... IV-4
3.
Form of Guaranty Agreement for Multifamily Transactions ...................................................... IV-5
4.
Accountants’ Agreed-Upon Procedures Reports for Multifamily Transactions
a.
Form of Accountants’ Agreed-Upon Procedures Report concerning the Offering
Circular for Multifamily Transactions .......................................................................... IV-6
b.
Agreed-Upon Procedures Report as of Closing Date for Multifamily Transactions .... IV-7
* For multifamily transactions, additional transaction documents found in Parts I and II of the Multiclass
Securities Guide must be delivered, including the Transaction Initiation Letter, Sponsor Agreement, Transfer
Affidavit, Closing Flow of Funds Instruction Letter, Supplemental Statement, if applicable, REMIC Trust
Agreement, MX Trust Agreement, if applicable, Trustee’s Receipt and Safekeeping Agreement and the Issuance
Statement. In addition, opinions of counsel found in Part II of the Multiclass Securities Guide must be delivered,
including the Transaction Opinion, Sponsor Opinion, relevant Tax Opinions, Trustee’s Opinion and Opinion of
HUD General Counsel.
PART V: GINNIE MAE MULTICLASS SECURITIES TRANSACTIONS:
CALLABLE SECURITIES
A.
GENERAL OVERVIEW: CALLABLE TRANSACTIONS .....................................................................V-1
B.
GINNIE MAE CALLABLE TRANSACTION DOCUMENTS
1.
Form of Offering Circular for Callable Securities ........................................................................ V-2
2.
Form of Trust Agreement for Callable Trusts ............................................................................... V-3
3.
Standard Trust Provisions for Callable Trusts .............................................................................. V-4
4.
Form of Sponsor Agreement for Callable Trusts .......................................................................... V-5
5.
Standard Sponsor Provisions for Callable Trusts .......................................................................... V-6
6.
Form of Ginnie Mae Callable Securities Guaranty Agreement .................................................... V-7
7.
Form of Transaction Initiation Letter for Callable Securities ....................................................... V-8
(iii)
8.
Form of Accountant’s Agreed-Upon Procedures Report Concerning the Offering Circular
for Callable Securities ................................................................................................................... V-9
9.
Forms of Trustee’s Receipt and Safekeeping Agreement for Callable Securities .......................V-10
10.
Form of Issuance Statement for Callable Securities ................................................................... V-11
11.
Form of Transaction Opinion of Trust Counsel for Callable Securities ......................................V-12
12.
Form of Tax Opinion of Trust Counsel for Callable Securities .................................................. V-13
13.
Form of Opinion of Sponsor for Callable Securities ...................................................................V-14
14.
Form of Opinion of Trustee’s Counsel for Callable Securities ................................................... V-15
15.
Form of Accountants’ Agreed-Upon Procedures Report as of the Closing Date for
Callable Securities............................................................................................................ ........... V-16
16.
Form of Closing Flow of Funds Instruction Letter for Callable Securities .................................V-17
17.
Form of Closing Checklist and Table of Contents for Callable Securities ..................................V-18
PART VI: GINNIE MAE MULTICLASS SECURITIES TRANSACTIONS:
STRIPPED MORTGAGE-BACKED SECURITIES (“SMBS”)
A.
GENERAL OVERVIEW: SMBS TRANSACTIONS ............................................................................. VI-1
B.
GINNIE MAE SMBS TRANSACTION DOCUMENTS
1.
Pricing Checklist for SMBS Transactions .................................................................................. VI-2
2.
Standard Sponsor Provisions for SMBS Transactions ................................................................ VI-3
3.
Form of Sponsor Agreement for SMBS Transactions ................................................................ VI-4
4. Base
Offering Circular for SMBS Transactions.......................................................................... VI-5
5.
Form of Offering Circular Supplement for SMBS Transactions ................................................ VI-6
6.
Form of Accountants’ Agreed-Upon Procedures Report concerning the Offering Circular
for SMBS Transactions ............................................................................................................................
I-7 V
7.
Form of Guaranty Agreement for SMBS Transactions ............................................................... VI-8
8.
Form of Issuance Statement for SMBS Transactions.................................................................. VI-9
9.
Forms of Trustee’s Receipt and Safekeeping Agreement for SMBS Transactions ...................VI-10
10.
Form of Closing Flow of Funds Letter for SMBS Transactions ............................................... VI-11
11.
Form of Trust Agreement for SMBS Transactions ................................................................... VI-12
12.
Standard Trust Provisions for Ginnie Mae SMBS Trusts ......................................................... VI-13
(iv)
13.
Form of Transaction Opinion of Trust Counsel for SMBS Transactions ..................................VI-14
14.
Form of Opinion of Sponsor for SMBS Transactions ............................................................... VI-15
15.
Form of Tax Opinion of Trust Counsel for SMBS Transactions .............................................. VI-16
16.
Form of Opinion of Trustee’s Counsel for SMBS Transactions ............................................... VI-17
17.
Form of Accountants’ Agreed-Upon Procedures Report as of Closing Date for SMBS
Transactions .............................................................................................................................. VI-18
PART VII: GINNIE MAE HREMIC TRANSACTIONS:
HREMIC TRANSACTION DOCUMENTS
A.
GENERAL OVERVIEW: HREMIC TRANSACTIONS ....................................................................... VII-1
B.
GINNIE MAE HREMIC TRANSACTION DOCUMENTS
1.
Form of Offering Circular Supplement for HREMIC Transactions.......................................... VII -2
2.
Accountants’ Agreed-Upon Procedures Reports for HREMIC Transactions
a.
Form of Accountants’ Agreed-Upon Procedures Report concerning the
Offering Circular for HREMIC Transactions ............................................................. VII -3
b.
Agreed-Upon Procedures Report as of Closing Date for HREMIC Transactions ...... VII -4
* For HREMIC transactions, additional transaction documents found in Parts I and II of the Multiclass
Securities Guide must be delivered, including the Transaction Initiation Letter, Sponsor Agreement, Transfer
Affidavit, Closing Flow of Funds Instruction Letter, Sponsor Certification, Supplemental Statement, if applicable,
REMIC Trust Agreement, MX Trust Agreement, if applicable, Trustee’s Receipt and Safekeeping Agreement and
the Issuance Statement. In addition, opinions of counsel found in Part II of the Multiclass Securities Guide must be
delivered, including the Transaction Opinion, Sponsor Opinion, relevant Tax Opinions, Trustee’s Opinion and
Opinion of HUD General Counsel.
(v)
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
INTRODUCTION TO THE GINNIE MAE MULTICLASS SECURITIES PROGRAM
________________
REQUIREMENTS FOR PARTICIPATION
I-1-0
CONTENTS
Page
I. PARTICIPATION
REQUIREMENTS ...............................................................................1
II. ELIGIBLE
PARTICIPANTS ..............................................................................................2
III. REMOVAL
..........................................................................................................................4
IV. PARTICIP ATION BY MINORITY AND/OR WOMEN-OWNED
BUSINESSES, MINORITY AND/OR WOMEN-OWNED LAW FIRMS AND
SERVICE-DISABLED VETERAN-OWNED SMALL BUSINESSES .............................5
I-1-i
I. PARTICIPATION REQUIREMENTS
A Participant in the Ginnie Mae Multiclass Securities Program must comply with the
following requirements:
A.
Certification. A Participant must complete the certification and agreement set out
as Attachment 1 and provide the items described in the list included in Attachment 1.
B.
Compliance with Ginnie Mae Multiclass Securities Guide. By completing a
Ginnie Mae Multiclass Securities Program transaction, a Participant is deemed to have
represented and warranted to Ginnie Mae that it has complied with, and that it agrees to comply
with, the Ginnie Mae Multiclass Securities Guide (the “Guide”) in effect as of the date that the
Ginnie Mae Guaranty is placed on the securities.
C.
Material changes in status. A Participant must report material adverse changes in
status, including voluntary and non-voluntary terminations, defaults, fines and findings of
material non-conformance with rules and policies of state and federal agencies and federal
government sponsored enterprises.
D.
Integrity. A Participant must conduct its business operations in accordance with
industry practices, ethics and standards, and maintain its books and records in an appropriate
manner, as determined by Ginnie Mae.
I-1-1
II. ELIGIBLE PARTICIPANTS
A.
Participants - REMIC, MX, Callable and SMBS Trusts, as applicable
A Participant generally must meet the following requirements:
1.
Sponsor. A Sponsor must:
a.
Apply and be approved;
b.
Demonstrate to Ginnie Mae’s satisfaction its capacity to
accumulate the eligible assets needed for a proposed structured securities issuance;
c.
Have at least $250 million in shareholders’ equity or partners’
capital, evidenced by the Sponsor’s most recent audited financial statements, which must have
been issued within the preceding 12 months;
d.
Be in good standing with and have been responsible for at least one
structured securities transaction with Fannie Mae, the entity formally known as the Federal
National Mortgage Association, or Freddie Mac, the entity formally known as the Federal Home
Loan Mortgage Corporation, or have demonstrated to Ginnie Mae’s satisfaction its capability to
do so;
e.
Represent the structural integrity of the proposed issuance under
all cash flow scenarios and demonstrate to Ginnie Mae’s satisfaction its ability to indemnify
Ginnie Mae for a breach of this representation; and
f.
Strive to comply and cause the Participants that it selects to strive
to comply with Ginnie Mae’s participation requirements and with Ginnie Mae’s policies
regarding participation by minority and/or women-owned businesses.
2.
Trustee. A Trustee is selected by the Sponsor from the list of eligible
trustees. At present the following entities are eligible to serve as Trustee:
I-1-2
BNY Mellon
U.S. Bank Trust National Association
Wells Fargo Bank, N.A.
3.
Co-Sponsor. A Co-Sponsor must submit an application and a certification
as to its status as a minority and/or women-owned business.
4.
Trust Counsel.
a.
Trust Counsel is selected by the Sponsor and must:
(i)
provide opinions acceptable to Ginnie Mae and upon which
Ginnie Mae may rely; and
(ii)
strive to comply with Ginnie Mae’s policies regarding
participation by minority and/or women-owned law firms.
5.
Accountants.
a.
Accountants are selected by the Sponsor and must:
(i)
provide agreed-upon procedures reports acceptable to
Ginnie Mae and upon which Ginnie Mae may rely; and
(ii)
strive to comply with Ginnie Mae’s policies regarding
participation by minority and/or women-owned businesses.
B.
Participant - Ginnie Mae Platinum Securities.
A Depositor must certify that:
1.
it is an institutional “accredited investor” within the meaning of Rule
501(a)(1), (2), (3) or (7) of Regulation D of the Securities Act of 1933, as amended;
2.
it has authority to deliver, and will deliver, the assets to the trustee and that
the assets are free of all liens and encumbrances; and
3.
the information set forth by the Depositor regarding the assets is true and
correct.
I-1-3
III. REMOVAL
A.
Basis for Removal from Participation.
Participants may be removed from the Ginnie Mae Multiclass Securities Program
for any of the following reasons:
1.
failure to meet any provision for eligibility;
2.
non-compliance with any provision of the Guide;
3.
inability to certify appropriately as described herein;
4.
failure of the Participant to conduct its business operations in accordance
with industry practices, ethics and standards, as determined by Ginnie Mae, or a failure to
maintain its books and records in an appropriate manner; and
5.
any other reason Ginnie Mae determines is necessary to protect the safety
and soundness of the Ginnie Mae Multiclass Securities Program.
B.
Removal Procedure.
Participants may be suspended from participation in the Ginnie Mae Multiclass
Securities Program upon written notice from Ginnie Mae, which shall include the reasons for the
suspension. The Participant shall have the opportunity to submit a written presentation to the
President of Ginnie Mae in support of its reinstatement. A determination by the President of
Ginnie Mae shall exhaust the Participant’s administrative remedies.
If a Participant is suspended from the Ginnie Mae Multiclass Securities Program,
Ginnie Mae shall have no obligation to complete a pending transaction involving the Participant.
C.
Reapplication.
After a Participant has been removed, the Participant may reapply for
participation in the Ginnie Mae Multiclass Securities Program. Approval of the reapplication is
at the sole discretion of Ginnie Mae.
I-1-4
IV. PARTICIPATION BY MINORITY AND/OR WOMEN-OWNED
BUSINESSES, MINORITY AND/OR WOMEN-OWNED LAW FIRMS AND
SERVICE-DISABLED VETERAN-OWNED SMALL BUSINESSES
A.
Goals - Multiclass Securities.
Pursuant to Executive Order 12138 of May 18, 1979, 3 CFR 1979 Comp., p. 393,
as amended, and Executive Order 12432 of July 14, 1983, 3 CFR 1983 Comp., p. 198, Ginnie
Mae anticipates meaningful participation by MWOBs, MWOLFs and Service-Disabled VOSBs
(each as defined below) in the Ginnie Mae Multiclass Securities Program. A minority and/or
woman-owned business (an “MWOB”) or a minority and/or woman-owned law firm (an
“MWOLF”) is a business concern that is Owned and Controlled by one or more members of a
minority group (i.e., African American, Asian American, Hispanic American or Native
American), or by one or more women, in each case who are either citizens or permanent
residents of the United States. “Owned” means a business which is more than 50 percent
Unconditionally Owned by one or more members of a minority group or by one or more women.
“Unconditionally Owned” means ownership that is not subject to conditions precedent,
conditions subsequent, executory agreements, voting trusts, shareholder agreements, or other
similar arrangements that serve to allow the primary benefits of program participation to accrue
to entities or individuals other than those upon whom MWOB eligibility for this program is
based. “Controlled” means a business whose Management and Daily Business Operations are
controlled by the minority group member(s) or woman (women) upon whom eligibility is based.
“Management and Daily Business Operations” means the minority group member(s) or woman
(women) upon whom eligibility is based must hold the position of Chairman of the Board,
President, or Chief Executive Officer, and have direct full-time responsibility for the day-to-day
management of the business. A “Service-Disabled VOSB” means a small business which is not
I-1-5
less than 51 percent owned (or, if a publicly-owned small business, not less than 51 percent of
the stock of which is owned) by, and is managed on a daily basis by, one or more serviceconnected disabled veterans. A “veteran” means a person who served in the active military,
naval or air service of the United States for at least 24 months and who was discharged or
released under conditions other than dishonorable. “Service connected” means, with respect to a
disability, that such disability was incurred or aggravated in the line of duty while in active
military, naval or air service. A “small business” means a firm that is organized for profit, has a
place of business in the United States, is not dominant in its field, and meets size standards and
other criteria established (and published) by the Small Business Administration.
B.
Alliance Initiative.
Ginnie Mae has established the Alliance Initiative to promote the involvement of
Co-Sponsors that are MWOBs or Service-Disabled VOSBs and in furtherance of its goals that
Co-Sponsors either sell or underwrite a portion of the securities in a transaction and that CoSponsors become Sponsors of a transaction.
Sponsors are requested to establish goals for Co-Sponsor participation by
determining the amount of securities they anticipate offering to Co-Sponsors to sell or
underwrite. Sponsors are requested to inform Ginnie Mae of the amount of securities offered for
sale or sold by Co-Sponsors.
Co-Sponsors, when requested, will identify the Sponsors with whom they have
worked and provide a description of the securities that they were offered to sell or underwrite.
As part of its Alliance Initiative, Ginnie Mae will have an outreach component
that will include one or more of the following: 1) a published directory of approved MWOB and
Service-Disabled VOSB Co-Sponsors; 2) annual conventions, seminars or professional meetings,
I-1-6
which will be comprised of, in part, Sponsors and Co-Sponsors; 3) wider dissemination of
information on the Multiclass Securities Program and MWOB and Service-Disabled VOSB
participation in that Program; and 4) periodic visits to the Sponsors’ and Co-Sponsors’ offices.
Ginnie Mae will recognize those Sponsors that have met or exceeded their goals for Co-Sponsor
participation.
1.
MWOBs and Service-Disabled VOSBs as Co-Sponsors
Ginnie Mae considers meaningful participation for MWOB and Service-
Disabled VOSB Co-Sponsors to be the use of one of the following two options. Sponsors may
increase the level of participation by Co-Sponsors.
(a)
Best Efforts Option Under the Best Efforts Option, the Sponsor will strive to have the
Co-Sponsor sell at least 10 percent of the transaction, computed on the basis of the original
principal balance, for a 24-hour period, prior to the Sponsor’s or other’s marketing of the
allocated percentage of the transaction.
(b)
Underwriting Option Under the Underwriting Option, the Sponsor will strive to have the
Co-Sponsor acquire, at the option of the Co-Sponsor, at least 10 percent of the transaction, at
prices negotiated between the Sponsor and the Co-Sponsor. In addition to the sales price, and in
lieu of a schedule of discounts, the Sponsor pays the Co-Sponsor an amount equal to 1/8th of 1
percent of the principal amount purchased.
2.
MWOBs and Service-Disabled VOSBs
Ginnie Mae encourages MWOBs and Service-Disabled VOSBs to become
Sponsors, either individually or as joint venturers, by providing a 30 percent reduction in the
I-1-7
Ginnie Mae guaranty fee for transactions closed and securities sold solely by MWOB or ServiceDisabled VOSB Sponsors and their Co-Sponsors.
C.
MWOLFs
Trust Counsel will strive to have MWOLFs complete at least 10 percent of the
billing for the work completed for each transaction.
Please contact Ginnie Mae for more information.
D.
Applicability.
The requirements described in this section are not applicable to the Ginnie Mae
Platinum Certificates that Ginnie Mae guarantees.
I-1-8
Attachment 1
LIST OF REQUIRED ITEMS FOR PARTICIPANT APPROVAL IN THE
GINNIE MAE MULTICLASS SECURITIES PROGRAM
1. Signed Participant Certification and Agreement (attached)
2. Staff biographies of key individuals that will be involved in the Multiclass Securities
Program
3. List of deals showing multiclass/collateralized mortgage obligation experience as lead or
co-lead manager (for Sponsors only)
4. Audited financial statements for the most recent two years showing a minimum net worth
of $250 million based on the most recent audited financial statements (for Sponsors only)
5. List of deals showing multiclass/collateralized mortgage obligation experience (for all
other prospective Participants)
6. List of any adverse actions by state and federal agencies and government sponsored
enterprises (if applicable)
7. Provide evidence of minority and/or woman-owned business (“MWOB”), minority
and/or woman-owned law firm ( “MWOLF”), or service-disabled veteran-owned small
business status (“Service-Disabled VOSB”) (if applicable)
8. Provide the Participant’s Company Legal Name, Company Address, Contact Name,
Contact Phone Number, Contact Email Address
I-1-9
GINNIE MAE MULTICLASS SECURITIES PROGRAM
PARTICIPANT CERTIFICATION AND AGREEMENT
Please select Participant role:
Sponsor
Co-Sponsor
Trust Counsel
Co-Trust Counsel
Accountant
The undersigned declares to the Government National Mortgage Association (“Ginnie Mae”)
that the following representations are true, correct and complete.
1.
Neither the undersigned, any affiliate of the undersigned that will be a party to the Ginnie
Mae Multiclass Securities Program agreements (together with the undersigned, a “Participant”),
nor any officer, partner, or professional employed by a Participant and who will work on the
Ginnie Mae Multiclass Securities Program (each an “Individual”) has been convicted of, or
found liable in a civil action for, fraud, forgery, bribery, falsification or destruction of records,
making false statements or any other offense indicating a lack of business integrity that seriously
and directly affects the present responsibility of the Individual.
2.
Neither a Participant nor any Individual is currently suspended or debarred by any state
or federal government agency.
3. ______________________________
(Participant’s Company Legal Name) is permitted
under applicable law or regulation to perform the services or act in the capacity for which it is
applying to participate in the Multiclass Securities Program.
4. ______________________________
(Participant’s Company Legal Name) confirms that
it possesses the knowledge of and the necessary capabilities to participate in the Multiclass
Securities Program in the capacity for which it is applying.
5.
Each Participant has disclosed all adverse actions by state and federal agencies and
government sponsored enterprises, including without limitation voluntary and non-voluntary
terminations, defaults, fines and agency findings of material non-compliance or nonconformance with agency rules and policies indicating a lack of business integrity that seriously
and directly affects the present responsibility of the Participant.
6.
Each Participant agrees to report an event that would require a change in this
Certification and Agreement and/or a change in control within 30 days of its occurrence. In a
merger, acquisition, division, issuance of securities, sale or other business combination where the
control of an original Participant has changed materially, the surviving party shall demonstrate to
Ginnie Mae’s satisfaction its qualification to act as a Participant and its ability and agreement to
assume all previously incurred obligations and liabilities of the original Participant to Ginnie
Mae.
I-1-10
7.
The staff biographies, list of CMO/multiclass deals, list of adverse actions (if applicable),
proof of MWOB, MWOLF or Service-Disabled VOSB (if applicable) and audited financial
statements (if applicable) provided to Ginnie Mae are true and accurate.
8.
I am a duly authorized officer, partner or other duly authorized signatory of
______________________________ (Participant’s Company Legal Name) on behalf of which I
have the authority to execute this Certification and Agreement.
*************************
______________________________ (Participant’s Company Legal Name) has caused this
instrument to be duly executed on its behalf, by its duly authorized officer this _______ day of
________________ 20___.
(Signing Participant’s Name)
By: _________________________________ (Executor Signature)
Print Name:
Its: ________________________________ (Title of Executor)
I-1-11
TRANSACTION GUIDELINES FOR
THE GINNIE MAE MULTICLASS SECURITIES PROGRAM
GENERAL OVERVIEW
The following description is intended to provide Participants with a general overview of
the operation and timing requirements of a typical Ginnie Mae Multiclass Securities offering of
REMIC and MX Securities. Participants should refer to Part IV of the Ginnie Mae Multiclass
Securities Guide (the “Guide”) for additional information specific to Ginnie Mae Multifamily
transactions. Participants should refer to Part V and Part VI of the Guide for modifications of the
following transaction guidelines for issuances of Ginnie Mae Callable Securities and SMBS
Securities, respectively. Participants should refer to Part III of the Guide for all information
relating to the issuance of Ginnie Mae Platinum Securities. Unless otherwise indicated,
definitions of capitalized terms are found in the glossary to the Guide currently in effect.
Key Monthly Transaction Dates
Key monthly transaction dates for the Ginnie Mae Multiclass Securities Program (not including
securities issued pursuant to the Ginnie Mae Platinum Guide) are available two months prior to
the month in which the transaction closes on Ginnie Mae’s website at www.ginniemae.gov.
Such dates include the Final Structure Date, the Print Date, the Pool Information Date, the Pool
Wire Date and the Closing Date.
Initiating a Transaction
A Sponsor interested in sponsoring a Ginnie Mae Multiclass Securities offering initially
should contact Ginnie Mae by telephone at the following office:
Ginnie Mae
Senior Vice President
Capital Markets Division
550 12th Street, SW, Third Floor
Washington, DC 20024
Telephone: (202) 475-4926
Facsimile: (202) 485-0220
In the initial telephone inquiry, the potential Sponsor should be prepared to provide
Ginnie Mae with information and to respond to Ginnie Mae’s inquiries regarding the proposed
transaction. Following the initial telephone inquiry with the potential Sponsor, Ginnie Mae may
confer with the Financial Advisor and the Legal Advisor regarding the terms of the proposed
transaction and Ginnie Mae will consider whether the proposed transaction complies with the
provisions of the Guide. If a Sponsor intends to propose a structure for which the Sponsor is
uncertain as to its compliance with the Guide, the Sponsor should inquire with Ginnie Mae at
least one month prior to the Final Structure Date of the month when the Sponsor expects to close
such transaction. Ginnie Mae reserves the right to disapprove a proposed transaction if Ginnie
Mae, in its sole and absolute discretion, considers such proposed transaction to be noncompliant
with the Guide. If Ginnie Mae determines that the proposed transaction complies with the
I-2-1
provisions of the Guide, Ginnie Mae will open and designate a transaction number for the
proposed transaction.
No later than the Final Structure Date, the Financial Advisor will contact the Sponsor
regarding the final deal structure. At a minimum, the potential Sponsor will be expected to
provide the Financial Advisor with the information requested in the Ginnie Mae Financial
Advisor Pricing Checklist for Sponsor (the “Checklist”), a copy of which is attached to the Form
of Transaction Initiation Letter in the Guide. In addition, the potential Sponsor may be required
to provide a written description of the preliminary Securities Structure (including a description of
the type(s) of Trust Assets to be included in the related Trust, and an affirmation that any
Underlying Certificate included in such Trust will evidence, directly or indirectly, Ginnie Mae
Certificates) and a list of proposed Participants in the transaction to the Financial Advisor, the
Legal Advisor and Ginnie Mae.
The Sponsor is solely responsible for paying (a) the fees and expenses of Trust Counsel
and the Accountants and (b) the costs of composing and printing the applicable offering
document. Ginnie Mae expects the Sponsor to pay these fees and expenses on or before the
Closing Date unless the Sponsor has made other arrangements satisfactory to the payee.
Transaction Initiation Letter
After Ginnie Mae designates a transaction number for the proposed transaction and the
Financial Advisor sends the Checklist, Ginnie Mae will execute and deliver to the Sponsor a
Transaction Initiation Letter (in the form provided in the Guide). An authorized officer of the
Sponsor will execute the Transaction Initiation Letter and attach (a) the proposed Securities
Structure, (b) a Trust Asset list that describes the type(s) of Trust Assets to be included in the
related Trust and affirm that any Underlying Certificates or Underlying SMBS Securities, as
applicable, included in the Trust will evidence, indirectly or directly, Ginnie Mae Certificates, (c)
in the case of Underlying Certificates evidencing interests in Freddie Mac or Fannie Mae
Certificates, a reference sheet or terms sheet (as applicable) from the related Underlying
Certificate Disclosure Document and (d) a Checklist completed by the Financial Advisor based
on the Sponsor’s responses and return it to Ginnie Mae by facsimile within two days. Upon
receipt of the fully-executed Transaction Initiation Letter, Ginnie Mae will provide a copy of the
letter to the Financial Advisor.
Announcement on e-Access
The Financial Advisor will post an Announcement on e-Access within two Business
Days after the Final Structure Date. As soon as possible thereafter, the Sponsor will provide the
Trust Counsel with the information necessary to create a working group list for the transaction,
and the Trust Counsel will distribute the working group list.
Final Securities Structure
No later than the Final Structure Date for the transaction, the Sponsor will provide a copy
of the Securities Structure (including but not limited to paydown rules, accrual rules, Structuring
Ranges and notional rules), and furnish copies of the Underlying Certificate Disclosure
Documents for any Underlying Certificates (that evidence interests in Freddie Mac or Fannie
I-2-2
Mae Securities) to be included in the Trust, to the Accountants, Trust Counsel, the Financial
Advisor, the Legal Advisor and Ginnie Mae. In addition, the Sponsor will provide the Scheduled
Principal Balances, if any, to the Financial Advisor and the Accountants.
Offering Document
After the Securities Structure for a transaction is final, the applicable offering document
is drafted. Sponsors can contact the Legal Advisor for an electronic form of such offering
document, a copy of which is included in the Guide. The Accountants will provide a draft of the
terms regarding the Securities Structure to be included in the Terms Sheet, in the offering
document and, if applicable, in the Schedules. The Sponsor will request and obtain CUSIP
Numbers issued by Standard and Poor’s CUSIP Bureau and will forward them to Trust Counsel,
the Financial Advisor and the Legal Advisor. The Sponsor will also prepare and finalize an OID
prices letter, as required by the Sponsor Agreement. The Financial Advisor will submit
information to the printer with respect to each security including the Final Distribution Date,
decrement tables, weighted average life tables, and if applicable, Scheduled Principal Balance
tables, Effective Ranges, Effective Rates, information regarding any Accretion Directed Classes
and yield tables. Trust Counsel will submit to the printer the tabular information regarding any
Underlying Certificates, Underlying Callable Class Securities and Underlying SMBS Securities,
as applicable, to be included as an exhibit to the offering document. Trust Counsel will draft the
offering document unless otherwise determined by Ginnie Mae in its sole and absolute
discretion. Throughout the drafting process, Trust Counsel will collect comments from the
parties with respect to the offering document and will maintain a “master.” The Legal Advisor is
responsible for making any changes to the Base Offering Circulars at the request of Ginnie Mae.
Before the final offering document is printed, the Accountants must provide an agreedupon procedures report (in the form provided in the Guide). The Accountants will circulate
drafts of this letter for comments. In addition, Ginnie Mae will receive written advice from the
Financial Advisor.
As a condition to the printing of the applicable offering document, Ginnie Mae and the
Sponsor will execute a Sponsor Agreement (in the form provided in the Guide), which
incorporates by reference the Standard Sponsor Provisions. In the Sponsor Agreement, the
Sponsor agrees, among other things, to establish the related Trust and to transfer the Trust Assets
to the Trust in consideration of the Ginnie Mae Securities. The Sponsor also agrees to pay the
Ginnie Mae Guaranty Fee and any applicable Ginnie Mae MX Combination Fee on the Closing
Date. By execution of the Sponsor Agreement, Ginnie Mae agrees to guarantee the Ginnie Mae
Securities issued by the related Trust or Trusts.
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Trust Counsel will create and distribute a draft of the Sponsor Agreement several days
before the offering document is printed. Trust Counsel will collect the Sponsor’s signature on
the Sponsor Agreement and hold that signature in escrow pending final approval of the
applicable offering document by Trust Counsel and the Sponsor. The Legal Advisor will obtain
Ginnie Mae’s signature on the Sponsor Agreement and will hold it in escrow pending receipt of a
final accountant’s agreed-upon procedures report concerning the offering document, written
advice to Ginnie Mae from the Financial Advisor and final agreement to the offering document
by the Legal Advisor, the Financial Advisor and Ginnie Mae. After these conditions are met and
Trust Counsel has submitted the Sponsor’s signature to Ginnie Mae and the Legal Advisor, the
Legal Advisor will transmit Ginnie Mae’s signature to Trust Counsel. Trust Counsel may then
notify the printer to print the final offering document.
Once the offering document is printed, the printer will send electronically the entire
offering document to the Information Agent for posting on e-Access. Additionally, the Financial
Advisor will post second announcements on e-Access for deals that have been modified since
originally structured.
Drafting and Review of Closing Documents
As soon as possible after the Print Date, the applicable transaction parties will prepare
and distribute drafts of the following closing documents (the “Closing Documents”) for which
they are responsible, each marked against the forms of such documents in the Guide. All
Closing Documents should be drafted in compliance with the forms of such documents in the
Guide. The Closing Documents should be distributed to the Sponsor, Ginnie Mae, HUD OGC,
the Legal Advisor, Trust Counsel, the Trustee, Trustee’s counsel, the Accountants and the
Financial Advisor for comment.
Trust Counsel will prepare and distribute drafts of the Trust Agreement(s), the Trustee’s
Receipt and Safekeeping Agreement, the Closing Flow of Funds Instruction Letter, the Issuance
Statement, the form of Security for Certificated Securities, the Transaction Opinion, the REMIC
tax opinion and, if applicable, the MX tax opinion. Trust Counsel will distribute drafts of the
Certificated Securities and the Issuance Statement no later than the Pool Wire Date. In addition,
Trust Counsel will prepare a Transfer Affidavit (using the form attached as an exhibit to the
Standard Trust Provisions) and arrange for its execution by the initial purchaser of each Residual
Security and for delivery of the executed document no later than pre-closing. Trust Counsel will
prepare and distribute the Trustee’s Receipt and Safekeeping Agreement (using the applicable
form included in the Guide), dated as of the Pool Wire Date, at least one Business Day before the
Pool Wire Date. Trust Counsel will follow-up with all interested parties to assure that the
transfer of the Trust Assets can take place on the Pool Wire Date.
The Sponsor, or the Trust Counsel on its behalf, will prepare and distribute drafts of the
Sponsor’s opinion, if applicable. Trustee’s counsel will prepare and distribute drafts of its
opinion. The Accountants will prepare and distribute drafts of their closing agreed-upon
procedures report. The Legal Advisor will prepare and distribute a draft of the Guaranty
Agreement to Trust Counsel and Ginnie Mae. The Financial Advisor will prepare and distribute
drafts of its written advice to Ginnie Mae and the Legal Advisor.
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When the Trust Assets include HECM MBS, the Sponsor, or the Trust Counsel on its
behalf, will prepare and distribute drafts of the Sponsor Certification. In the Sponsor
Certification the Sponsor certifies that (i) the fair market value of each Participation in the pool
of Participations underlying any HECM MBS contributed to any Trust REMIC is equal to or
greater than the outstanding principal amount of such Participation and (ii) the aggregate issue
price of the Regular Securities issued by such Trust REMIC is equal to or greater than the
aggregate principal balance of the HECM MBS contributed to any such Trust REMIC.
Pool Information Date
On the Pool Information Date, the Sponsor will finalize the pool or pools of Trust Assets
to be transferred to the Trust and will provide a list electronically of the final Trust Assets to the
Trustee and the Accountants. In addition, the Sponsor should transmit to the Accountants, Trust
Counsel, the Legal Advisor and the Financial Advisor a copy of their analysis of the Weighted
Average Life calculations of each Class at pricing versus at closing. The Accountants will
analyze the Trust Assets and compare their characteristics to the characteristics assumed in the
offering document, confirming the listed data and recomputing the Sponsor’s Weighted Average
Life calculations.
In addition, no later than the Pool Information Date, the Sponsor will deliver or cause to
be delivered to the Information Agent, one copy of the Underlying Certificate Disclosure
Document for each Underlying Certificate that evidences an interest in Freddie Mac or Fannie
Mae Securities included in the Trust.
Pool Wire Date
On the Pool Wire Date, the Sponsor will transfer the Trust Assets to the Trustee Limited
Purpose Account at the Book-Entry Depository or Trust Asset Depository Account, as
applicable. If the Trust Assets delivered by a Sponsor on the Pool Wire Date are subject to a
repurchase agreement or other lending arrangement between the Sponsor and a repo or other
lender (as used in the Ginnie Mae Multiclass Securities Guide, the term repo lender includes a
repo lender or any other lender having a lien on the Trust Assets and any intermediary bank
acting on behalf of such lender), the Sponsor is reminded to communicate with the repo lender
well in advance of the Pool Wire Date to assure expeditious transfer of the Trust Assets. In
connection with the transfer of Trust Assets to the Trustee, the Trustee will execute the Trustee’s
Receipt and Safekeeping Agreement prepared and distributed by Trust Counsel, dated as of the
Pool Wire Date. The Accountants will provide a list of the Trust Assets to the Trustee for
comparison to the Trust Assets delivered by the Sponsor. The Trustee will attach to the
Trustee’s Receipt and Safekeeping Agreement the list of Trust Assets obtained from the
Accountants. If the Trustee discovers any errors on the schedule, the Trustee may correct the
errors by hand as long as the Trustee transmits the corrections to the Sponsor, the Accountants
and the Financial Advisor.
The Sponsor will provide registration instructions for the Certificated Securities to Trust
Counsel and Trustee no later than the Pool Wire Date. The Trust Counsel will use these
instructions to create the Securities, and the Trustee will use the instructions for purposes of
making the first distribution.
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Pre-closing
Pre-closing will occur on the Business Day before the Closing Date. Ginnie Mae expects
all issues to be resolved and all Closing Documents to be final by the close of business on the
day of the pre-closing. All Closing Documents will be executed and delivered to Trust Counsel
by pre-closing and Trust Counsel will distribute electronic copies of final, fully executed
versions of the Closing Documents and of the Sponsor Agreement to Ginnie Mae and the Legal
Advisor. All opinions are to be dated the Closing Date.
A Supplemental Statement and a letter to Ginnie Mae confirming the related investor’s
decision regarding the affected securities, in substantially the forms attached as Exhibits 3 and 4
to the Standard Sponsor Provisions, will be required if the actual characteristics of the Trust
Assets are such that there is a material change in the investment characteristics of any Class as
described in the applicable offering document or there is a 10% or greater change in the
projected Weighted Average Life (“WAL”) of any Class at the pricing prepayment speed or for a
short-duration bond (a bond with a WAL of two years or less), if there is a difference of three
months or more in the WAL. Trust Counsel is responsible for drafting and distributing to the
transaction parties a Supplemental Statement as soon as possible upon discovery of the change or
variance necessitating the Supplemental Statement. The Financial Advisor will post the final
agreed upon Supplemental Statement on Ginnie Mae’s Internet website as soon as possible after
it is finalized.
The Trustee will follow applicable guidelines to issue the Book-Entry Securities. The
Sponsor and Trustee will confer and agree on the method of delivery for the Certificated
Securities. Trust Counsel will print each Certificated Security on safety paper.
The Closing Flow of Funds Instruction Letter prepared by Trust Counsel will be signed
by the Sponsor and delivered to the Trustee.
The Legal Advisor will provide the final Guaranty Agreement for Ginnie Mae’s
signature. After receiving advice from the Legal Advisor and Financial Advisor, Ginnie Mae
will execute the Guaranty Agreement and deliver it in escrow to Trust Counsel.
Closing
On the Closing Date, the Sponsor will establish the Trust and transfer the Trust Assets to
the Trust pursuant to the applicable Trust Agreement. The Trustee will submit the Ginnie Mae
Guaranty Fee and any applicable Ginnie Mae MX Combination Fee to Ginnie Mae. To submit
payments directly to Ginnie Mae’s Office of Finance, the Trustee must access the pay.gov
website and follow the online instructions. For additional assistance, please contact Ginnie
Mae’s Treasurer Division by phone at 202-401-2064 x4968/4936 or by fax at 202-485-0222.
Pay.gov allows Trustees to make payments via Automated Clearing House (ACH) or credit card
via the internet. The pay.gov site is available 24 hours a day, 7 days a week (holidays included)
for Trustees to submit payments; however, ACH payment processing follows the Federal
Reserve holiday schedule.
The Trustee will issue the Book-Entry Securities from the Trustee Issuer Account at the
Book-Entry Depository (where the Book-Entry Depository will have posted the Book-Entry
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Securities pending settlement) to the Security Account designated by the Sponsor or its repo
lender (if applicable) maintained at the Book-Entry Depository. In addition, the Trustee will
authenticate and deliver all Certificated Securities at the closing pursuant to instructions provided
by the Sponsor or its repo lender (if applicable).
All transactions will be deemed to have taken place simultaneously, and no delivery or
payment made at the closing will be considered to have been finally made until all action taken
at the closing is completed.
The Accountants will e-mail the Final Data Statement to the Information Agent to be
posted on e-Access on or about the Closing Date. The Financial Advisor will post on e-Access
the REMIC Relay File.
Post-Closing
Within thirty days of the Closing Date, Trust Counsel will provide a CD with an
electronic copy of each of the Closing Documents to each transaction participant as set forth on
page I-6-8. Upon request, Trust Counsel will distribute originals of the Closing Documents to
Ginnie Mae.
Procedures applicable to certain requests for amendment of the Trust Agreement and MX
Trust Agreement, if any, are set out in the Guide in the document entitled “Ginnie Mae
Multiclass Securities Program — Post-Closing Matters with respect to Ginnie Mae Multiclass
Securities Transactions.”
I-2-7
TRANSACTION INFORMATION WEB-BASED APPLICATION e-ACCESS
Ginnie Mae has designed Multiclass Securities e-Access (“e-Access”), a web-based
application located on Ginnie Mae’s website to simplify and support the process of reverse
engineering and monitoring multiclass securities issued under the Ginnie Mae Multiclass
Securities Program. e-Access will provide any dealer, investor or data disclosure vendor
electronic access to structuring information, factors and other data for all Securities.
A.
Information to be Posted on e-Access
1. Announce
ment
When Ginnie Mae approves the initiation of a transaction and the Financial
Advisor sends the pricing checklist, an Announcement will be posted on e-Access
within two Business Days after the Final Structure Date. This Announcement
will include information such as the name of the Sponsor and Co-Sponsor, their
respective contacts and telephone numbers, the pricing date of the transaction, the
transaction designation, the anticipated Closing Date and the general
characteristics of the anticipated Trust Assets (such as whether they are Ginnie
Mae I MBS Certificates, fixed-rate Ginnie Mae II MBS Certificates, adjustablerate Ginnie Mae II MBS Certificates, Underlying SMBS Securities, HECM MBS,
Eligible REMIC Certificates or Ginnie Mae Platinum Certificates and, if Ginnie
Mae Platinum Certificates, whether they are backed by Ginnie Mae I MBS
Certificates or fixed-rate Ginnie Mae II MBS Certificates), the aggregate principal
balance of the Trust Assets and their Certificate Rates.
2. Offe
ring Document
The offering document will be posted in electronic form on e-Access within one
Business Day of the applicable Print Date. Additionally, the Financial Advisor
will post second announcements on e-Access for deals that have been modified
since originally structured.
3.
REMIC Relay File
A REMIC Relay File on each Ginnie Mae Multiclass Securities transaction will
be posted on e-Access by the Closing Date for such transaction.
The REMIC Relay File contains transaction-specific information, collateralspecific information, and Class-specific information. The REMIC Relay File
contains all information necessary to reverse-engineer a transaction, including
Scheduled Principal Balances, if applicable, in one standardized file format.
4. Settle
ment Information
Settlement information will be posted on e-Access when a transaction closes.
I-3-1
A set of one required file and two optional files comprise the settlement
information:
-
Final Data Statement
Supplemental Statement, if applicable
The Final Data Statement contains the characteristics of each of the actual
Trust Assets (including whether such Trust Assets constitute Trust MBS,
Underlying Callable Securities, Underlying SMBS Securities or
Underlying Certificates). With respect to Trust MBS, these characteristics
include the type of Mortgage Loans underlying the Trust MBS, as well as
the Certificate Rates, Weighted Average Coupon, Weighted Average
Remaining Term to Maturity and Weighted Average Loan Age. If a Trust
MBS is backed by adjustable rate Mortgage Loans, the characteristics will
also include the initial Certificate Rate, the name of the index, the
Certificate Margin, the Periodic Rate Cap, the Maximum Rate, the
Minimum Rate, the next Certificate Rate Adjustment Date and the next
Certificate Payment Adjustment Date. With respect to Underlying
Certificates, these characteristics include the pool number and suffix for
an Underlying Certificate, the Issue Date, Certificate Rate, Maturity Date,
initial (original) principal balance and remaining (current) principal
balance of an Underlying Certificate. With respect to Underlying Callable
Securities, these characteristics include the pool number, type and suffix
for the Underlying Callable Securities, Certificate Rate, Maturity Date, the
Weighted Average Remaining Term to Maturity, the Weighted Average
Coupon and the Weighted Average Loan Age. With respect to Underlying
SMBS Securities, the characteristics include the class designation, the
Interest Rate, the Interest Type and in the case of the underlying Mortgage
Loans, the Weighted Average Coupon, the Weighted Average Remaining
Term to Maturity and the Weighted Average Loan Age.
When (a) the size of a transaction is increased, (b) the projected Weighted
Average Life or other investment characteristic of any Class (based on the
actual Trust Assets delivered on the Closing Date) differs materially from
that set forth in the offering document, (c) the Securities Structure
otherwise is modified after the offering document is printed or (d) any
errors that are material to investors are discovered, a Supplemental
Statement containing updated information for the transaction will be
posted on e-Access.
5. Monthly
Information
The Trustee will prepare the Monthly Information containing the monthly Class
Factors and Interest Rates and the Information Agent will post such information
in a Monthly Tranche Factor File on e-Access. Additionally, the Trustee will
prepare, and the Information Agent will post, the Calculated Certificate Factors in
a Calculated Certificate Factor file if the Trustee has to compute the monthly
I-3-2
Certificate Factor for any “missing” Ginnie Mae Certificate pools. A Series
Factor file, which has information about the Series as a whole, such as the current
aggregate principal balance of the Trust Assets, will also be prepared by the
Trustee and posted by the Information Agent on e-Access.
6.
Determination of Characteristics
In the absence of published information on the Ginnie Mae Weighted Average
Tape based on actual Mortgage Loan characteristics:
B.
The current Weighted Average Coupon posted on e-Access for Mortgage
Loans backing a Ginnie Mae II Certificate is computed using the
methodology relating to generic pools set forth in the Securities Industry
and Financial Market Association’s Standard Formulas for the Analysis of
Mortgaged Backed Securities and Other Related Securities—Chapter SF,
Section C.
The current Weighted Average Remaining Term to Maturity for a Ginnie
Mae Certificate is computed using the methodology relating to generic
pools set forth in Securities Industry and Financial Market Association’s
Standard Formulas for the Analysis of Mortgage Backed Securities and
Other Related Securities—Chapter SF, Section C.
The current Weighted Average Loan Age for a Ginnie Mae Certificate is
computed using the methodology relating to generic pools set forth in the
Securities Industry and Financial Market Association’s Standard Formulas
for the Analysis of Mortgaged Backed Securities and Other Related
Securities—Chapter SF, Section C.
Source of Information to be Posted and Responsibility for Posting
The following chart shows the source of information to be posted on e-Access, the person
responsible for posting the applicable information and the time frame for posting such
information:
I-3-3
Type of Information
Alert Inform
Created By
ation Agent
Posted By
Time Frame
Information
Agent
Whenever new files are
posted
Advisor
Financial Advisor
2 Business Days after
pricing date
REMIC Relay File
Financial Advisor
Financial Advisor
By Closing Date
Scheduled Principal
Balances
Sponsor Inform
Offering Circular
Supplement or Offering
Circular, as applicable
Trust Counsel
Information
Agent
Within one Business
Day after the Print Date
Supplemental
Statement, if any
Trust Counsel
Financial Advisor
As required and as
finalized
Final Data Statement
Accountant
Accountants
Closing Date
Other Closing
Schedules,
if any
Sponsor/Trust
Counsel
Financial Advisor
Closing Date
Series Factors
Trustee
Information
Agent
Monthly on the
Business Day before
the Distribution Date
Class Factors
Trustee
Information
Agent
Monthly on the
Business Day before
the Distribution Date
Calculated Certificate
Factors
Trustee
Information
Agent
Monthly on the
Business Day before
the Distribution Date
Floating rate indices
Information Agent
Information
Agent
Monthly on each
Floating Rate
Adjustment Date
Announcement Financial
ation
OCS printing date
Agent
I-3-4
GINNIE MAE MULTICLASS SECURITIES PROGRAM
CONVENTIONS
1. Class
Naming
Ginnie Mae has established the following conventions that should be followed to
determine Class designations.
Name1
Type
Accrual
Interest Only, stripped from a group or the
entire deal2
Principal Only, stripped from a group or the
entire deal3
Floater
Inverse Floater
PAC5
Everything Else7
Component8
Residual
2.
Z, ZA, AZ, etc.
IO
PO
F, FA, FB, etc.
S, SA, SB, etc. (these names may vary within
the scope of the conventions); match with
floaters4
PA, PB, PC, etc6
A through Y (excluding R when used in the
prefix position)
Numerical suffix - A1 and A2
R, RI, RP, RR9, R1, R2, RR1, RR2, etc.
Increased Minimum Denomination Classes
The valuation of certain Classes may be highly sensitive to future events, such as
prepayment speeds or changes in financial indices. Classes of this type would
1
Triple lettering is not accepted.
If more than one Interest Only bond is included in the structure, the letter “I” in either the prefix or
suffix position is indicative of an IO bond (but is not required).
3
If more than one Principal Only bond is included in the structure, the letter “O” in either the prefix
or suffix position is indicative of a Principal Only bond (but is not required).
4
For example: if F pays with S and SA, skip FA. The next Floating Rate Class should be FB,
which will pay with SB.
5
The PAC range must be at least 30% PSA above and below the pricing PSA. The PAC II range,
while narrower than the PAC I range, must still be 30% PSA above and below the pricing PSA. “PAC”s that do not
meet these criteria will be called Scheduled Classes.
6
Refrain from using PO to avoid confusion with Principal Only Classes; refrain from using PP
because double lettering, with the exception of RR, is not permitted.
7
“R” may not be used in the prefix of any class designation, with the exception of a Residual
Security.
8
Only Components and multiple Residuals are allowed to be alpha-numeric; no hyphens are
permitted.
9
R — Single REMIC Residual, RI — Issuing REMIC Residual, RP — Pooling REMIC Residual,
RR — Stapled Residual, R1, R2, RR1, RR2, etc. — separate Residuals for several groups.
2
I-4-1
include, but are not necessarily limited to, Interest Only, Principal Only, Inverse
Floating Rate, Jump, Non-Sticky Jump, Sticky Jump, Toggle, certain Special
Classes, Classes that are subject to forced exchange and any other Class that
would customarily be treated in a yield sensitivity table in the disclosure in the
related offering document.
3.
Ginnie Mae believes that these highly sensitive Classes should be offered and sold
only to institutional “accredited investors,” as defined in Rule 501(a)(1), (2), (3)
or (7) of Regulation D of the Securities Act of 1933, as amended (an “Institutional
Accredited Investor”) or, in the case of a multifamily transaction, only to
“accredited investors,” as defined in Rule 501(a) of Regulation D of the Securities
Act of 1933, as amended (an “Accredited Investor”), that have substantial
experience in mortgage-backed securities and that are capable of understanding
and able to bear the risks associated with an investment in a Class of this type.
Ginnie Mae therefore will require that a Class of this type be designated an
Increased Minimum Denomination Class.
A Sponsor must inform all other broker/dealers to whom it has agreed to sell an
Increased Minimum Denomination Class at the Closing Date that such Class is
not intended to be distributed to any investor other than an Institutional
Accredited Investor or Accredited Investor, as applicable.
An Increased Minimum Denomination Class must be issued in minimum
denominations of the lesser of (a) (i) $1,000,000 in initial principal or notional
balances in the case of a Jump Class or (ii) $100,000 in initial principal or
notional balances in the case of all other Increased Minimum Denomination
Classes and (b) the initial principal or notional balance of such Increased
Minimum Denomination Class.
Accrual Classes and Partial Accrual Classes
An Accrual Class is a Class that accrues interest during an Accrual Period but does not
receive a distribution of that interest. Instead, its accrued interest is added to its Class Principal
Balance on the related Distribution Date, and an amount equal to the accrued interest (the
“Accrual Amount”) is distributed as principal generally to one or more other Classes. A Partial
Accrual Class is a Class that accrues a portion of its interest during an Accrual Period but does
not receive a distribution of such interest. A portion of the accrued interest of a Partial Accrual
Class is added to its Class Principal Balance on the related Distribution Date and the Accrual
Amount is distributed as principal to one or more designated Classes.
Some Accrual Classes never receive current interest distributions. Others accrue interest
without receiving a distribution of that interest until a trigger event, such as the retirement of the
related Accretion Directed Class, occurs. A trigger event occurs on the “cross-over date.” On
the cross-over date, all of the interest accrued on the Accrual Class or a portion of the interest
accrued, in the case of the Partial Accrual Class, is added to the Class Principal Balance of such
Class. The Accrual Amount is distributed to (and reduces the Class Principal Balance of) the
Classes receiving the Accrual Amount until retirement and then to the Accrual Class. On the
I-4-2
Distribution Date following the Distribution Date on which the trigger event occurs, the Accrual
Class receives current interest distributions and the Partial Accrual Class receives all of its
accrued interest as current interest distributions.
I-4-3
GINNIE MAE MULTICLASS SECURITIES TRANSACTION PARTICIPANTS
THE GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
The Government National Mortgage Association (“Ginnie Mae”) is the guarantor for
each Series of Ginnie Mae Multiclass Securities.
Ginnie Mae is a wholly-owned corporate instrumentality of the United States within the
Department of Housing and Urban Development. Section 306(g) of Title III of the National
Housing Act of 1934, as amended (the “National Housing Act”), authorizes Ginnie Mae to
guarantee the timely payment of the principal of, and interest on, mortgage-backed securities that
are based on and backed by a pool of mortgage loans insured or guaranteed by the Federal
Housing Administration (“FHA”) under the National Housing Act (each, an “FHA Loan”), by
Rural Development (“RD”) under Title V of the Housing Act of 1949 (each, an “RD Loan”), by
the Department of Veterans Affairs (“VA”) under the Servicemen’s Readjustment Act of 1944,
as amended, or Chapter 37 of Title 38, United States Code (each, a “VA Loan”), or by HUD
under Section 184 of the Housing and Community Development Act of 1992 (each, a “HUD
Loan” and, together with FHA Loans, RD Loans and VA Loans, “Government Loans”), and
participation interests in advances made to borrowers and related amounts (each, a
“Participation”) in respect of home equity conversion mortgage loans (each, a “HECM”), also
commonly referred to as “reverse mortgage loans,” insured by FHA.
Section 306(g) of the National Housing Act provides that “the full faith and credit of the
United States is pledged to the payment of all amounts which may be required to be paid under
any guaranty under this subsection.” To meet its obligations under its guaranties, Ginnie Mae is
authorized, under Section 306(d) of the National Housing Act, to borrow from the United States
Treasury with no limitations as to amount.
Ginnie Mae unconditionally guarantees the timely payment of interest and principal on
each Class of Securities (in accordance with the terms of those Classes as specified in the related
Trust Agreement). This guaranty (the “Ginnie Mae Guaranty”) is backed by the full faith and
credit of the United States of America.
Notices and other correspondence to Ginnie Mae regarding Ginnie Mae Multiclass
Securities should be sent to the following address:
Government National Mortgage Association
550 12th Street, SW, Third Floor
Washington, D.C. 20024
Attention: Senior Vice President, Capital Markets Division
Telephone: (202) 475-4926
Facsimile: (202) 485-0220
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GINNIE MAE’S LEGAL ADVISORS
Ginnie Mae’s Legal Advisors for the Ginnie Mae Multiclass Securities Program are
Hunton & Williams LLP and Sidley Austin LLP and/or any successor firms to be identified by
Ginnie Mae subsequent to the date of the Guide. The Legal Advisor assists Ginnie Mae in the
operation of the Ginnie Mae Multiclass Securities Program.
The Legal Advisor will advise Ginnie Mae concerning each Ginnie Mae Multiclass
Securities Program transaction. The Legal Advisor will review drafts of the offering document
and the operative documents for each transaction, which Trust Counsel will have prepared based
on the forms included in the Guide. In addition, the Legal Advisor will review the legal opinions
to be provided for the transaction. The Legal Advisor will advise Ginnie Mae concerning those
documents, including whether the documents are consistent with the Ginnie Mae Multiclass
Securities Program’s requirements.
Correspondence to Hunton & Williams LLP should be sent to the following address:
Hunton & Williams LLP
Riverfront Plaza, East Tower
951 East Byrd Street
Richmond, Virginia 23219-4074
Attention: Structured Finance and Securitization - Ginnie Mae Multiclass Securities
Program
Telephone: (804) 788-8200
Correspondence to Sidley Austin LLP should be sent to the following address:
Sidley Austin LLP
787 Seventh Avenue
New York, New York 10019
Attention: Global Finance - Ginnie Mae Multiclass Securities Program
Telephone: (212) 839-5300
Contact information for each Legal Advisor is available on Bloomberg and is posted on
Ginnie Mae’s contributed pages, which can be accessed with the command GNMA .
GINNIE MAE’S CAPITAL MARKETS SECURITIES TRANSACTIONS FINANCIAL
ADVISOR
Ginnie Mae’s Capital Markets Securities Transactions Financial Advisor (the “Financial
Advisor”) for the Ginnie Mae Multiclass Securities Program is PriceWaterhouseCoopers LLP
and/or any successor firms to be identified by Ginnie Mae subsequent to the date of the Guide.
On a continuing basis, the Financial Advisor will assist Ginnie Mae in determining whether
interested parties meet the eligibility requirements to act as Sponsors, Trustees and other
participants in the Ginnie Mae Multiclass Securities Program and will publish updated lists of
eligible participants. For each transaction, the Financial Advisor will review the proposed
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structure and the accounting comfort letters and will advise Ginnie Mae concerning the structural
integrity of the transaction.
Correspondence to the Financial Advisor should be directed as follows:
PriceWaterhouseCoopers LLP
1301 K Street NW, Suite 800W
Washington, D.C. 20005-3333
Attention: Ginnie Mae Transaction Team - FSR Group
Telephone: (202) 414-1000
Facsimile: (202) 414-1301
E-mail: [email protected]
Contact information for each Financial Advisor is available on Bloomberg and is posted
on Ginnie Mae’s contributed pages, which can be accessed with the command GNMA .
SPONSORS AND CO-SPONSORS
The Sponsor for a Ginnie Mae multiclass securities transaction will transfer the Trust
Assets to a Trust or MX Trust, as applicable, in consideration of the Ginnie Mae Securities
representing interests in such Trust or MX Trust.
The Sponsor will assemble the Trust Assets for a particular transaction and will develop
the structure for the transaction. The Sponsor and the Co-Sponsor will market the Securities.
The Sponsor will cause Trust Counsel to draft the applicable offering document and the Closing
Documents for the transaction. Pursuant to the applicable Trust Agreement, the Sponsor will
establish the Trust and sell the Trust Assets to the Trust in exchange for the Securities. Pursuant
to an MX Trust Agreement, if applicable, the REMIC Trust will issue the Underlying REMIC
Certificates to the MX Trust on behalf of the Sponsor and the MX Trust will issue Modifiable
and/or MX Securities.
The Sponsor will represent and warrant to Ginnie Mae that the multiclass securities
transaction is structurally sound. Any breach of this representation will require the Sponsor to
reimburse Ginnie Mae, with interest, for any payments Ginnie Mae must make pursuant to its
guaranty to holders of the related Securities.
If applicable, the Sponsor will provide an opinion in connection with the multiclass
securities transaction. See Part II.E.2., Form of Opinion of Sponsor, in the Guide for more
information regarding the form of Opinion of Sponsor to be delivered in connection with a
transaction. If the Trust Assets include or are backed by HECM MBS, the Sponsor will be
required to provide a Sponsor Certification. A Sponsor Certification certifies that (i) the fair
market value of each Participation in the pool of Participations underlying any HECM MBS
contributed to any Trust REMIC is equal to or greater than the outstanding principal amount of
such Participation, and (ii) the aggregate issue price of the Regular Securities issued by such
Trust REMIC is equal to or greater than the aggregate principal balance of the HECM MBS
contributed to any such Trust REMIC.
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A list of approved Sponsors and Co-Sponsors may be obtained by accessing the Ginnie
Mae page on Bloomberg or by contacting Ginnie Mae.
TRUST COUNSEL AND CO-TRUST COUNSEL
For each transaction, one firm will act as Trust Counsel, providing the legal services
necessary to establish the trust, close the transaction and issue the Securities. These services will
include drafting the applicable offering document and the applicable Closing Documents for the
transaction, based on the forms provided in the Guide. Trust Counsel will prepare drafts of these
documents, circulate the drafts to Ginnie Mae, the Legal Advisor, the Financial Advisor, the
Sponsor and other transaction participants, and respond to comments by these parties. The Trust
Counsel also will provide two opinions or, if there is an MX Trust, three opinions, each in the
form provided in the Guide.
Trust Counsel will coordinate the pre-closing and closing. Trust Counsel will ensure that
all required Closing Documents, including opinions of counsel from other law firms, accounting
comfort letters and certificates are executed prior to closing. Promptly after closing, Trust
Counsel will provide an appropriate number of CDs containing closing transcripts to the
participants as further described in “Trust Counsel’s Responsibilities” in the Guide. Trust
Counsel may work with Co-Trust Counsel on a transaction.
Trust Counsel’s fees and expenses will be paid by the Sponsor; neither Ginnie Mae nor
the Trustee will have any responsibility for these fees and expenses.
ACCOUNTANTS
An accounting firm will participate in each transaction, providing two agreed-upon
procedures reports in connection with the transaction. First, the Accountants will issue an
“Accountants’ Agreed-Upon Procedures Report concerning the Offering Circular,” based on
assumed collateral characteristics, with respect to certain percentages and amounts included in
the offering document. Second, the Accountants will issue an “Accountants’ Agreed-Upon
Procedures Report as of the Closing Date,” based on the actual collateral, updating the comfort
provided in the Accountants’ Agreed-Upon Procedures Report concerning the Offering Circular.
Forms of these two letters are included in the Guide.
The Accountants’ fees and expenses will be paid by the Sponsor; neither Ginnie Mae nor
the Trustee will have any responsibility for these fees and expenses.
TRUSTEE
For each transaction, a Trustee will act as trustee under the Trust Agreement and MX
Trust Agreement, if applicable, consisting of the REMIC Standard Trust Provisions or the MX
Standard Trust Provisions included in the Ginnie Mae Multiclass Securities Guide and a Trust
Agreement or MX Trust Agreement, a form of which included in the Guide.
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At closing, the Trustee will verify the ownership, eligibility and characteristics of the
Trust Assets and will execute the applicable Trust Agreements. The Trustee will authorize and
deliver the Securities. In addition, the Trustee will execute and authenticate the Certificated
Securities.
After closing, the Trustee will calculate monthly distribution amounts and other
information as required under the Trust Agreement and MX Trust Agreement, if any. The
Trustee will ensure that payments are made properly, will prepare and maintain accurate records
and reports and will execute all required United States federal, state and local tax returns.
In connection with each transaction, the Trustee will indemnify Ginnie Mae for all losses
resulting from the Trustee’s default or failure to perform under the Trust Agreement and MX
Trust Agreement, if applicable.
TRUSTEE’S COUNSEL
The Trustee’s Counsel is selected by the Trustee. The Trustee may select any law firm
independent of the Trustee to act as Trustee’s Counsel. The Trustee’s Counsel must provide an
Opinion of Counsel, in the form included in the Guide, concerning the authorization of the
Trustee to enter into the Trust Agreement and the MX Trust Agreement, if any, the validity and
enforceability of the Trust Agreement and MX Trust Agreement, if any, against the Trustee and
the valid authorization, execution and delivery of the Securities.
The Trustee is responsible for the Trustee’s Counsel’s fees and expenses.
TAX ADMINISTRATOR
Initially, the Trustee for each Trust and MX Trust, if any, will act as Tax Administrator
for the Trust and MX Trust, if any, and any related Trust REMIC or Trust REMICs.
BOOK-ENTRY DEPOSITORY
At the closing of each transaction, unless otherwise provided in the offering document,
all of the Securities, other than the Residual Securities, will be issued in book-entry form. The
Book-Entry Depository, or its nominee, will be the registered holder of each Book-Entry
Security.
In accordance with its normal procedures, the Book-Entry Depository is expected to
record the positions held by each of its participants in the Book-Entry Securities of any Series,
whether held for that participant’s own account or as custodian for another person. In general,
beneficial ownership of a Book-Entry Security will be subject to the rules and procedures
governing the Book-Entry Depository and its participants as in effect from time to time.
The Book-Entry Depository’s address for correspondence is:
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Federal Reserve Bank of New York
33 Liberty Street, 6th Floor
New York, NY 11045
Attn: Ginnie Mae Multiclass Securities Program
However, Participants should contact the Information Agent regarding all matters relating
to Book-Entry Securities.
INFORMATION AGENT
Ginnie Mae has designated The Bank of New York Mellon (“BNY Mellon”) to act as its
Information Agent. In this capacity, BNY Mellon will build and maintain a database of Ginnie
Mae Multiclass Securities information including Series data, Terms Sheet data, reverse
engineering data (e.g., REMIC Relay File, paydown rules, PAC, TAC and Scheduled Classes
schedules), offering documents, Underlying Certificate Disclosure Documents, closing collateral,
closing PAC, TAC and Scheduled Classes schedules data, CUSIP Numbers and monthly Class
Factors.
BNY Mellon is also responsible for posting Ginnie Mae Multiclass Securities
information on Ginnie Mae’s Multiclass Securities e-Access (“e-Access”) located on Ginnie
Mae’s website at www.ginniemae.gov. e-Access is a web-based application suitable for widely
dispersed users who need to retrieve, share and store Ginnie Mae Multiclass Securities
information and messages.
Correspondence should be directed to:
BNY Mellon
Ginnie Mae Relationship Services
4 New York Plaza, 17th Floor
New York, New York 10004
Attention: Evan Del Colle
Phone: 212-313-0107
FAX: 212-623-1190
PRINTERS
The offering document will be printed by a printer selected by the Sponsor and approved
by Ginnie Mae. The Sponsor will pay the fees and expenses of printing the offering document;
neither Ginnie Mae nor the Trustee will have any responsibility for these fees and expenses.
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TRUST COUNSEL’S RESPONSIBILITIES
Trust Counsel is responsible for drafting the offering document and Closing Documents
and for coordinating the logistics of closing the transaction. These tasks may be accomplished in
many ways. The following is a description of a typical way in which Trust Counsel might fulfill
its responsibilities. This description is intended to assist Trust Counsel but not to substitute for
Trust Counsel’s own experience and judgment. Ultimately Trust Counsel is responsible for
ensuring that the transaction complies with the Guide, including ensuring the timely printing and
closing of each transaction.
I.
DRAFTING THE WORKING GROUP LIST
Trust Counsel is responsible for creating a working group list for the transaction. The
working group list should include names, work and alternate telephone numbers, facsimile
numbers, mailing addresses and e-mail addresses for each participant in the transaction, should
indicate the documents that each contact should receive and should indicate a participant’s
principal contact for the transaction. For example, a number of people at the Financial Advisor
may wish to see drafts of the offering document, but only the deal manager at the Financial
Advisor may wish to see drafts of the Closing Documents. Trust Counsel should circulate a
working group list to the participants as soon as possible after the Final Structure Date.
II.
DRAFTING THE OFFERING DOCUMENT
Trust Counsel is responsible for drafting the applicable offering document. Except as
noted below, forms of the Offering Circular Supplements for Ginnie Mae single family and
Ginnie Mae multifamily REMIC and MX Securities, HREMIC Securities, SMBS Securities and
forms of the Offering Circular for Ginnie Mae Callable Securities are in the Guide. Trust
Counsel should circulate an initial draft of such offering document as soon as possible after the
Final Structure Date.
The Base Offering Circular for Ginnie Mae single family and Ginnie Mae multifamily
REMIC and MX Securities and Ginnie Mae SMBS Securities is provided in the applicable Part
of the Guide and is posted on Ginnie Mae’s website and will not be attached to the Offering
Circular Supplements for such transactions. A Callable Series has an Offering Circular drafted
by Trust Counsel for a specific transaction. Each Offering Circular Supplement or Offering
Circular, as applicable, will be final on, and dated as of, the Print Date. Ginnie Mae determines
the Print and Closing Dates for each transaction and posts such dates on the Ginnie Mae website.
Drafting the applicable offering document generally involves the following steps:
A.
Trust Counsel will contact the Printer and request a copy of the template of the
applicable offering document, which will be the starting point for drafting such offering
document.
B.
Based on information provided by the Sponsor, the Financial Advisor and the
Accountants will reverse engineer the transaction. Once all these participants have “tied out,”
the Financial Advisor will send electronically to the Printer any applicable decrement and
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weighted average life tables, yield tables, tabular information regarding Underlying Certificates
and Underlying SMBS Securities (which information will be included as an exhibit to the
applicable offering document) and for transactions involving Classes that receive payment on the
basis of schedules, the tables listing those Classes’ Scheduled Principal Balances or other
schedules, as applicable, and such other information as may be required for the applicable
transaction.
C.
The Accountants will prepare and distribute a terms sheet regarding the Securities
Structure (a “Terms Sheet”). Trust Counsel will revise the applicable form of offering document
based on the Terms Sheet and submit the changes to the Printer. As transaction parties comment
on the offering document, Trust Counsel will collect and submit to the printer all changes that
are in compliance with the applicable form of offering document in the Guide and as agreed to
by the transaction parties.
D.
The Printer will send a copy of the first draft of the applicable offering document
to Trust Counsel for review. Trust Counsel may direct the Printer to send any applicable
numerical tables to the Sponsor, the Accountants, Ginnie Mae, the Financial Advisor and the
Legal Advisor before the text of the document is ready for review. After Trust Counsel approves
the offering document, they will direct the Printer to distribute the draft of the offering document
to the appropriate transaction parties as identified on the working group list. The distribution list
should include Ginnie Mae, HUD OGC, the Financial Advisor, the Legal Advisor, the Trustee,
the Trustee’s Counsel, the Sponsor, the Co-Sponsor, the Accountants, the Co-Trust Counsel and
such other parties listed on the working group list.
E.
All comments from Ginnie Mae, HUD OGC and the Financial Advisor on the
Offering document will be sent to Trust Counsel and the Legal Advisor. All other transaction
parties will send comments to Trust Counsel and the Sponsor and if requested by such party, to
Ginnie Mae, HUD OGC and the Legal Advisor.
F.
The Financial Advisor, the Accountants and the Sponsor will continue to “tie-out”
on quantitative disclosures as needed and will send numerical changes directly to Trust Counsel
for submission to the Printer. In connection with transactions involving a complex Securities
Structure, Trust Counsel may wish to hold a conference call involving the Sponsor, Ginnie Mae,
HUD OGC, the Accountants, the Financial Advisor, Trust Counsel and the Legal Advisor to
discuss and ensure that the Securities Structure is accurately described in the offering document.
G.
The Accountants and the Financial Advisor should exercise special care in
checking the accuracy of the CUSIP Numbers located on the front cover of the applicable
offering document and in any applicable schedules of the applicable offering document and on
the Certificated Securities.
H.
The Sponsor is responsible for drafting the prices letter. The prices letter should
be distributed to the Trust Counsel, the Legal Advisor and the Financial Advisor prior to printing
the applicable offering document. The prices letter is used to determine whether certain Classes
will be issued with OID based on the anticipated prices at which the Classes will be sold.
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I.
All comments to the Base Offering Circular for Ginnie Mae single family and
Ginnie Mae multifamily REMIC and MX Securities and Ginnie Mae SMBS Securities and to the
Guide should be directed to the Legal Advisor. Tax-related comments may be directed to the
Legal Advisor’s tax lawyers.
III.
CREATING THE SPONSOR AGREEMENT AND GIVING THE
PRINT ORDER FOR THE OFFERING DOCUMENT
A Sponsor Agreement must be signed, delivered and released from escrow before the
Printer is given an order to print the offering document. The form of Sponsor Agreement is
contained in the Guide. Trust Counsel must use this form to draft the Sponsor Agreement and all
deviations from the form must be approved by Ginnie Mae. Trust Counsel can obtain an
electronic form of the Sponsor Agreement from the Legal Advisor. The Sponsor Agreement
incorporates by reference the Standard Sponsor Provisions contained in the Guide.
Drafts of the Sponsor Agreement, blacklined against the form in the Guide, should be
sent to Ginnie Mae, the Legal Advisor, the Financial Advisor and each party listed in the Notices
Section of the Sponsor Agreement. Trust Counsel should circulate a final version of the Sponsor
Agreement for execution at least two Business Days prior to the scheduled Print Date. The
Legal Advisor will obtain Ginnie Mae’s signature to the Sponsor Agreement and Trust Counsel
will obtain the Sponsor’s signature to the Sponsor Agreement. After the applicable transaction
parties agree that the offering document is final and all other applicable printing requirements
have been satisfied, Trust Counsel will provide the Sponsor’s executed signature page to the
Legal Advisor. Once the Legal Advisor is prepared to sign-off on the offering document for
printing and after the Legal Advisor has received the Sponsor’s executed signature page to the
Sponsor Agreement, the Legal Advisor will forward Ginnie Mae’s executed signature page to the
Sponsor Agreement to Trust Counsel and, subject to the provisions of the following paragraph,
will sign off for printing. After printing, Ginnie Mae and the Sponsor will provide to Trust
Counsel an original of their respective executed signature pages of the Sponsor Agreement.
Before the offering document can be printed, Trust Counsel will confirm that (a) the
Accountants have delivered a signed agreed-upon procedures report acceptable to all parties,
including Ginnie Mae and the Financial Advisor, (b) the Sponsor, Ginnie Mae, the Legal
Advisor and the Financial Advisor have agreed to the content of the offering document, (d) the
Financial Advisor has provided written advice to Ginnie Mae concerning the offering document
and (e) Trust Counsel and the Legal Advisor have exchanged executed signature pages to the
Sponsor Agreement. Trust Counsel is responsible for final proofreading of the offering
document. Trust Counsel is responsible for providing the Printer with the distribution list for
delivery of the offering document and should include the names, addresses, quantities and
delivery methods shown in Appendix 1 hereto.
IV.
DRAFTING OF CLOSING DOCUMENTS
Trust Counsel is responsible for drafting the Closing Documents and for circulating drafts
blacklined against the forms of such documents provided in the Guide. Trust Counsel may
obtain from the Legal Advisor an electronic version of the forms of such documents as they
appear in the Guide. The Legal Advisor will be responsible for drafting and circulating the
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Guaranty Agreement and for ensuring that one executed original is delivered to Trust Counsel
prior to the closing date.
Trust Counsel is responsible for drafting the remaining Closing Documents as follows:
A.
Trustee’s Receipt and Safekeeping Agreement.
This document is signed by the Trustee on and dated as of the “Pool Wire Date.” The
Pool Wire Date is the date on which the Sponsor must transfer the collateral to the Trustee’s
Limited Purpose Account. Trust Counsel will circulate a draft of the Trustee’s Receipt and
Safekeeping Agreement to the applicable transaction parties (and the Sponsor’s repo lender, if
applicable), including Ginnie Mae, the Financial Advisor and the Legal Advisor, at least one
business day prior to the Pool Wire Date.
The Trustee must attach information regarding the Trust Assets as an exhibit to the
Trustee’s Receipt and Safekeeping Agreement. An example of this exhibit can be obtained from
the Legal Advisor. The exhibit will be sent by the Sponsor or the Accountants to the Trustee,
and the Trustee will print the document and attach it to the Trustee’s Receipt and Safekeeping
Agreement before executing it. If the Trustee discovers any errors in the exhibit, the Trustee
may make corrections on it as long as the corrections are sent to the Sponsor and the
Accountants to enable the parties to confirm these corrections before the Closing Date. If new
parties are involved in the transaction, Trust Counsel will make sure that each of the parties
understands its role with respect to this agreement.
Once the Trustee signs the Trustee’s Receipt and Safekeeping Agreement and attaches
the appropriate exhibit, the Trustee should send an electronic and hard copy of the final Trustee’s
Receipt and Safekeeping Agreement to the addressees and to Trust Counsel. The Trustee should
send the original to Trust Counsel.
B.
Issuance Statement.
This document must be dated, signed by the Sponsor and delivered to the Trustee on the
Pool Wire Date, generally two Business Days before the Closing Date. The Issuance Statement
instructs the Trustee which Classes will be issued at closing. To complete the schedules to the
Issuance Statement, Trust Counsel will need to confirm with the Sponsor any Modifiable and
MX Classes to be issued at closing.
C.
Transfer Affidavit.
After the Trustee’s Receipt and Safekeeping Agreement and the Issuance Statement, the
next most time-sensitive document is the Transfer Affidavit because in many instances a
Transfer Affidavit must be signed by a company that otherwise is not involved in the closing.
The Sponsor, an affiliate of the Sponsor or the Sponsor’s repo lender (if applicable), must sign a
Transfer Affidavit even though it is permissible to transfer a Residual Security to a third party on
the Closing Date if the third party also signs a Transfer Affidavit. Trust Counsel will confirm
with the Sponsor whether the Sponsor, an affiliate of the Sponsor or the Sponsor’s repo lender (if
any) will be the initial Holder of the Residual Security or Securities and what entity, if any, will
be purchasing the Residual Security or Securities from such initial Holder. Trust Counsel is
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responsible for providing the Trustee with each Residual Security Holder’s taxpayer
identification number. Trust Counsel will circulate a draft of the Transfer Affidavit (including
the Transfer Affidavit of the third party, if applicable), blacklined against the form of Transfer
Affidavit provided in the Guide, to the Sponsor, the Trustee, Trustee’s Counsel, Ginnie Mae, the
Legal Advisor and the signatories of the Transfer Affidavit.
Once the applicable transaction parties have agreed on the terms of the Transfer Affidavit
and it is finalized, Trust Counsel will circulate execution copies of the Transfer Affidavit to the
initial Holders. Each of the initial Holders must execute the Transfer Affidavit and return the
originals to Trust Counsel no later than the day of the pre-closing.
D. Certif
icated Securities.
Trust Counsel will draft and circulate drafts of any Certificated Securities including the
Residual Securities at least three Business Days prior to pre-closing. The Certificated Securities
require two signatures from the Trustee. Trust Counsel will coordinate the timely delivery of
signatures from the Trustee.
1.
Creating the Forms of Certificated Securities
For any Regular Securities that will be issued in certificated form, Trust Counsel should
draft forms of such Securities substantially in the form of Exhibit 1 to the REMIC Standard Trust
Provisions, or, for MX Securities, forms of MX Securities substantially in the form of Exhibit 1
to the MX Standard Trust Provisions. Trust Counsel will complete the signature page, ensuring
that it remains on one page. Any changes to the forms of certificated securities must be
approved by Ginnie Mae and the Legal Advisor.
Trust Counsel will draft the forms of any applicable Residual Securities for the
transaction substantially in the forms that are attached as Exhibits 3–6 to the REMIC Standard
Trust Provisions. Turning these generic forms into forms for the specific transaction will involve
selecting the proper starting point (for example, the Class R Security for a Single REMIC Series)
and filling out the Series designation and information about the Class on the cover and signature
page.
Once all of the forms of Certificated Securities are complete, Trust Counsel will make
additional copies of each form of Security, marked “specimen,” to be used as exhibits to the
Trust Agreement and MX Trust Agreement, as applicable. These will be copies of the forms, not
the Securities themselves. Trust Counsel should leave the denomination, number and Holder’s
name in blank in the specimen and they will not be signed.
2.
Creating the Actual Securities for Certificated Classes
After completing the forms of Certificated Securities, Trust Counsel will need to create
the actual Securities to be signed. Trust Counsel will include the denomination and number on
the front page and will insert the name of the registered Holder on the second page. Certificated
Securities are numbered “1,” “2,” “3,” etc. For each Certificated Security, including the
Residual Security, Trust Counsel will obtain registration instructions from the Sponsor.
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Prior to pre-closing, Trust Counsel will arrange for the Trustee to sign each Certificated
Security and affix the Trustee’s seal. Once the Certificated Securities are fully executed and
authenticated, either Trust Counsel or, at Trust Counsel’s request, the Trustee will make a
photocopy of each Security for Trust Counsel’s use and the Trustee’s records and will stamp
these copies “specimen.” Trust Counsel will ensure that acceptable arrangements have been
made for the Trustee to return any Certificated Security to Trust Counsel by the pre-closing and
for the safekeeping of any Certificated Security while in its custody. Trust Counsel will
coordinate the transfer of any Certificated Security on the Closing Date.
Trust Counsel will confirm in advance that appropriate arrangements are in place for
signing and transferring the Certificated Securities in a timely manner.
E. Trust
Agreements.
Each applicable Trust Agreement incorporates by reference the applicable Standard Trust
Provisions included in the Guide. The Trust Agreements will be drafted and circulated by Trust
Counsel. At pre-closing, the Trust Agreements will be signed and notarized by the Trustee and
the Sponsor.
Trust Counsel is responsible for making sure that the correct schedules and exhibits will
be attached to the Trust Agreement. The Final Data Statement, or the Trustee’s Receipt
Schedule A in the case of any Series backed by Ginnie Mae Multifamily Certificates or HECM
MBS, will be a photocopy of the list attached to the Accountant’s letter delivered at closing.
If the transaction includes classes whose entitlement to payment is determined on the
basis of schedules and those schedules do not change after the offering document is printed,
Trust Counsel will photocopy those schedules from the offering document. If the schedules do
change, the Sponsor will provide a list of the updated Schedules via e-Access to the Accountants,
and the Accountants will print it out and make it available to Trust Counsel as an attachment to
the Accountants’ letter delivered at closing.
Other schedules are photocopies from the applicable offering document, and Trust
Counsel is responsible for including the relevant schedules with the Trust Agreements. Finally,
each form of Certificated Security is an exhibit to the Trust Agreement.
F.
Closing Flow of Funds Instruction Letter.
Trust Counsel will create this document by obtaining the amount of the Ginnie Mae
Guaranty Fee and any applicable Ginnie Mae MX Combination Fee from the Sponsor
Agreement and confirming with the Sponsor which Security will trigger the release of such fees
when received by the Sponsor. In addition, Trust Counsel will make sure that Ginnie Mae sends
the Trustee confirmation of the amount owed as well as wiring instructions. At closing, the
Trustee must send a copy of the Closing Flow of Funds Instruction Letter to Ginnie Mae’s
Treasurer’s Division. At closing, after receiving confirmation from the Accountants and the
Legal Advisor that such parties are ready to proceed to close, Trust Counsel will notify the
Trustee that the transaction may close. The Trustee will then transfer the Book-Entry Securities
to the Sponsor (unless instructed to transfer such Securities to another entity). The receipt of the
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Security identified in the Closing Flow of Funds Letter will trigger the release of the Ginnie Mae
Guaranty Fee and any applicable Ginnie Mae MX Combination Fee to Ginnie Mae.
G. Sponsor
Certification.
When the Trust Assets include HECM MBS, the Sponsor, or the Trust Counsel on its
behalf, will prepare and distribute drafts of the Sponsor Certification. In the Sponsor
Certification, the Sponsor certifies that (i) the fair market value of each Participation in the pool
of Participations underlying any HECM MBS contributed to any Trust REMIC is equal to or
greater than the outstanding principal amount of such Participation, and (ii) the aggregate issue
price of the Regular Securities issued by such Trust REMIC is equal to or greater than the
aggregate principal balance of the HECM MBS contributed to any such Trust REMIC. The form
of such certification is attached as Exhibit 5 to the Standard Sponsor Provisions. The
certification must be dated, signed by the Sponsor, and delivered to Ginnie Mae at pre-closing.
V.
DRAFTING AND COLLECTING OPINIONS
It is Trust Counsel’s responsibility to provide opinions required of Trust Counsel in the
form provided in the Guide, and to ensure that all other required opinions of transaction parties
are received by Trust Counsel, Ginnie Mae and the Legal Advisor prior to the Closing Date.
Ginnie Mae expects to receive opinions substantially in the forms provided in the Guide. Trust
Counsel can obtain an electronic file containing the opinion forms from the Legal Advisor.
Early in the transaction, Trust Counsel will ensure that all applicable parties and counsel
involved are willing and able to give the required opinions. Any proposed deviations from the
forms in the Guide must be discussed with the Legal Advisor as soon as possible.
Moreover, Trust Counsel will ensure that final drafts of all opinions are circulated to the
applicable parties, including the Legal Advisor, prior to pre-closing. The parties must be given
an opportunity to comment on any deviations from the forms in a reasonable time for counsel to
make any needed corrections and to provide final, signed opinions no later than the day of preclosing.
A.
Trust Counsel Transaction Opinion.
Trust Counsel must give a transaction opinion, pursuant to the laws of the United States
and New York. Unless Trust Counsel is obtaining an in-house legal opinion of the Sponsor, the
transaction opinion also must cover the law of the jurisdictions where the Sponsor is
incorporated or organized and the Sponsor’s principal place of business. To the extent that
neither the in-house counsel nor the Trust Counsel can cover the law of the jurisdiction in which
the Sponsor’s principal place of business is located, then a legal opinion of local counsel
authorized to practice law in such jurisdiction must be obtained.
B.
Trust Counsel Tax Opinion.
The Guide contains forms of tax opinions for the various Multiclass Securities
Transactions. The forms of tax opinions specific to the type of transaction shall be used by Trust
Counsel when drafting these opinions.
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C. Sponsor
Opinion.
If Trust Counsel obtains approval to eliminate the “corporate authority” opinions in its
own transaction opinion, Trust Counsel will need to make sure the Sponsor renders the
Sponsor’s Opinion, in the form provided in the Guide, and that a blacklined draft is circulated in
a timely manner and that a final draft is distributed prior to the Closing Date.
D.
Trustee’s Counsel’s Opinion.
Trustee’s Counsel must provide an opinion substantially in the form in the Guide. The
form includes a New York law enforceability opinion. It also includes a tax opinion based on the
law of the jurisdiction in which the Trustee will administer the Trust. Trust Counsel, promptly
after it is selected, will ensure that Trustee’s Counsel is able to provide this entire opinion and
that Trustee’s Counsel distributes promptly a blacklined draft of the opinion against the form of
opinion included in the Guide for comment.
VI.
PRE-CLOSING AND CLOSING
On pre-closing day, all closing documents should be finalized. Trust Counsel must send
the final executed versions of all closing documents to the Legal Advisor to be held in escrow
pending the transaction closing. The Accountants shall finalize and issue their Agreed-Upon
Procedures Report as of the Closing Date. After the Legal Advisor obtains and confirms receipt
of final executed copies of all closing documents, the Financial Advisor shall send its executed
written advice regarding the closing to Ginnie Mae, HUD OGC and the Legal Advisor.
On the Closing Date, after the Legal Advisor has received all final executed closing
documents, the executed Accountants Agreed-Upon Procedures Report and the executed
Financial Advisor’s written advice, and the Legal Advisor is otherwise ready to close, the Legal
Advisor will give Trust Counsel permission to close the transaction.
VII. POST-CLOSING MATTERS
A. Distribution
of Closing Documents.
Upon request, Trust Counsel will provide a set of Closing Documents to the Trustee and
the Legal Advisor shortly after the Closing Date. The parties who are entitled to a set of
originals are (1) the Trustee, (2) the Legal Advisor, (3) Ginnie Mae and (4) at the election of the
Sponsor, either the Sponsor or Trust Counsel.
B. Creation
and Distribution of CD Record Volumes.
Upon request, Trust Counsel will distribute originals of the Closing Documents to Ginnie
Mae. Within thirty days of the Closing Date, Trust Counsel will provide a CD with an electronic
copy of the Closing Documents to the following participants:
1. HUD
OGC
2.
Sponsor or Trust Counsel
3. Financial
Advisor
I-6-8
4. Legal
Advisor
5. Co-Trust
Counsel
6. Trustee’s
Counsel
In addition, Trust Counsel will send the Accountants an electronic copy of each of the
following Closing Documents: the Trust Agreements and the Trustee’s Receipt and Safekeeping
Agreement.
I-6-9
APPENDIX 1
DISTRIBUTION OF OFFERING DOCUMENTS
Name and Address
Government National Mortgage Association
550 12th Street, SW, Third Floor
Washington, DC 20024
Michael Nardacci
Quantity Delivery Method
Overnight delivery
Department of Housing and Urban
Development
451 7th Street, S.W., Suite 9252
Washington, DC 20410
Maura Malone (or other HUD Counsel)
Overnight delivery
Hunton & Williams LLP
Riverfront Plaza, East Tower
951 East Byrd Street
Richmond, VA 23219-4074
Amy M. Williams
Sidley Austin LLP
787 Seventh Avenue
New York, New York 10019
Attention: Global Finance - Ginnie Mae
Multiclass Securities Program
Carlos Rodriguez
10
3
Overnight delivery
5
Overnight delivery
5
Broadridge
1155 Long Island Avenue
Edgewood, NY 11717
Overnight delivery
10
I-6-10
POST-CLOSING MATTERS WITH RESPECT TO
GINNIE MAE MULTICLASS SECURITIES TRANSACTIONS
Amendment of Applicable Trust Agreements
Section 8.03(a) of each of the REMIC, MX, Callable and SMBS Standard Trust
Provisions, which are incorporated by reference in each applicable Trust Agreement, provides
that any Trust Agreement may be amended in specified respects without the consent of any
Holder or Holders. Any such amendment, however, requires the consent of Ginnie Mae.
A Sponsor or other Person who seeks Ginnie Mae’s consent to an amendment of a Trust
Agreement should proceed as follows:
(a)
The request must be submitted by the Sponsor in writing, addressed to Ginnie
Mae, and must (i) set forth the proposed amendment, (ii) state why the proposed amendment is
necessary or desirable and (iii) describe the action required in order to adopt the proposed
amendment in accordance with the related Trust Agreement.
(b)
The request must be accompanied by (i) an Opinion of Counsel (who, if the
amendment is requested by the Sponsor, may be Trust Counsel) that (A) it has examined the
proposed amendment, (B) it has examined the relevant portions of the related Trust Agreement
and (C) the amendment, if adopted as proposed, is permitted by the Trust Agreement and (ii) if
the proposed amendment involves a REMIC Trust, a Special Tax Opinion and any required
Special Tax Consents.
(c)
If the proposed amendment would involve a change in the Trust Assets, the
request must describe as of an appropriate recent date for each Trust Asset that is proposed to be
removed from or added to the Trust the characteristics required to be shown in a Final Data
Statement.
(d)
If the proposed amendment would have an effect on any investment characteristic
of any Class, the request must describe each such effect. If the proposed amendment would
involve a change in the collateral in the Trust, the Sponsor must describe the effect the change in
collateral would have on the Weighted Average Life of each Class.
(e)
If the proposed amendment would involve a change in the Trust Assets, the
Sponsor must provide an Accountants’ letter, dated the date of the amendment and in form and
substance satisfactory to Ginnie Mae, (i) confirming the information delivered by the Sponsor
with respect to the effect of the change of collateral on the Weighted Average Life of each Class,
(ii) confirming the characteristics described by the Sponsor with respect to the replaced and new
collateral and (iii) stating that the amendment would not affect the conclusions in the
Accountants’ Agreed-Upon Procedures Report as of the Closing Date with respect to payments
of interest and principal, including the conclusions with respect to payment of each Class to zero
by its Final Distribution Date, on the related Securities.
Ginnie Mae is under no obligation to consent to any proposed amendment.
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Sponsors (i) should be advised that Ginnie Mae will require a reasonable time to review
the request and the accompanying documents and (ii) should not expect an immediate response.
I-7-2
FORM OF TRANSACTION INITIATION LETTER FOR REMIC AND MX
TRANSACTIONS
[GINNIE MAE LETTERHEAD]
[Date]
Via Facsimile
[Sponsor]
[Sponsor’s Address]
Transaction Initiation Letter
Ginnie Mae [Multifamily] [HECM MBS] [REMIC] Trust 20 - [Ginnie Mae MX Trust 20 - ]
Ladies and Gentlemen:
In a recent telephone conversation, an authorized representative of __________________
(“Sponsor”) indicated that Sponsor intends to sponsor a Ginnie Mae Multiclass Securities offering under
the terms of the Ginnie Mae Multiclass Securities Guide (the “Guide”). Capitalized terms used in this
letter have the meanings assigned to them in the Ginnie Mae Multiclass Securities Guide currently in
effect. Sponsor has provided (i) a written description of the preliminary Securities Structure (which
includes a description of the type(s) of Trust Assets to be included in the above-referenced Trust, and an
affirmation that any Underlying Certificates or Underlying SMBS Securities included in such Trust will
evidence, directly or indirectly, Ginnie Mae Certificates), and (ii) in the case of a Trust that includes any
Underlying Certificate(s) that evidence(s) interests in Freddie Mac or Fannie Mae REMIC Securities, a
copy of the reference sheet(s) or terms sheet(s) (as applicable) from the related Underlying Certificate
Disclosure Document(s), which are attached to this letter, and answered the questions set forth in the
Ginnie Mae Financial Advisor’s Pricing Checklist for Sponsor (the “Checklist”), also attached to this
letter.
Sponsor will notify Ginnie Mae and its Legal Advisor and Financial Advisor promptly in writing
of any changes to the Securities Structure or to answers to the questions set forth in the Checklist and will
submit a final Securities Structure no later than the date specified in the Checklist (the “Final Structure
Date”). In addition, Sponsor will notify Ginnie Mae and its Legal Advisor and Financial Advisor of the
failure of any proposed Securities Structure to qualify as a REMIC. Ginnie Mae reserves the right to
approve or reject the final Securities Structure. If Ginnie Mae does reject the final Securities Structure,
Ginnie Mae will specify the reasons for its rejection in writing.
[Sponsor will deliver the Ginnie Mae Multifamily Certificates identified in the Checklist attached
to this letter. Sponsor may add Ginnie Mae Multifamily Certificates not listed in the Checklist only with
the consent of Ginnie Mae. Ginnie Mae Multifamily Certificates listed in the Checklist may be
eliminated from the delivery if it is established through documentation that the elimination is attributable
to (a) prepayments made on that Ginnie Mae Multifamily Certificate or (b) a determination that an
underlying Mortgage Loan is not current, or (c) with the consent of Ginnie Mae, other Ginnie Mae
Multifamily Certificates are substituted. Sponsor will deliver Ginnie Mae Multifamily Certificates with a
principal amount equal or exceeding the principal amount of the Certificates listed in the Checklist.]
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You are reminded that Ginnie Mae may require that certain Classes be designated Increased
Minimum Denomination Classes, that such Classes must have high minimum purchase prices (described
in the Guide in “Ginnie Mae Multiclass Securities Program Conventions”) and that you may offer or sell
such Classes only to institutional investors that have substantial experience in mortgage-backed securities
and that are capable of understanding and able to bear the risks associated with such an investment.
Based upon its preliminary evaluation of the proposed transaction and its review of the Checklist,
Ginnie Mae has assigned the following designation to the proposed Ginnie Mae Multiclass Securities
offering: Series 20___-__.
After a final Securities Structure for the transaction has been established, an Offering Circular
Supplement will be printed, and the Sponsor and Ginnie Mae will sign a Sponsor Agreement at the time
of the printing, which will supersede this letter and will constitute a binding contract between the parties,
subject to the terms and conditions therein. If no Sponsor Agreement has been executed on or before the
anticipated date of the Sponsor Agreement (as specified in the attached Checklist), neither Ginnie Mae
nor the Sponsor will have any obligation to proceed with the contemplated transaction.
Ginnie Mae believes that this letter (together with the attachments to this letter) fairly describes
the substance of the preliminary discussions with Sponsor. Sponsor is instructed to confirm Sponsor’s
agreement with the terms of this letter and its attachments by executing this letter at the space provided
below and is further instructed to return a fully-executed copy to Ginnie Mae within two days of this date
by Facsimile to (202) 485-0221. This letter does not, however, constitute a legally binding obligation on
the part of Sponsor or Ginnie Mae.
Very truly yours,
GOVERNMENT NATIONAL MORTGAGE
ASSOCIAT
ION
By: _________________________________
Its: _________________________________
ACKNOWLEDGED:
[Sponsor]
By: ____________________________________
Name: ____________________________________
Title: ____________________________________
Date: ____________________________________
I-8-2
GINNIE MAE MULTICLASS SECURITIES TRANSACTION
FINANCIAL ADVISOR PRICING CHECKLIST FOR SPONSOR
PROPOSED GINNIE MAE [REMIC][HREMIC][CALLABLE] TRUST 20__-[C]__
[AND MX TRUST 20__-___]
The purpose of this checklist is to gather information from a Sponsor about its proposed Ginnie
Mae REMIC Trust in order to support Ginnie Mae’s decision to initiate a transaction. The responses to
the following questions were obtained from the Sponsor, [Insert Sponsor Name], during one or more
telephone calls with [Insert Contact Name] on [Insert Date], Year.
1.
Characteristics of the proposed Ginnie Mae Certificates to be conveyed to the Ginnie Mae
[REMIC][HREMIC][Callable] Trust:
a)
Pool Type (Ginnie Mae I or Ginnie Mae II)
b)
Interest Rate Type (Fixed or Adjustable)
c)
Underlying Mortgage Loan Type (SF or Other)
d)
Aggregate Remaining Balance
e) Certificat
e Rate
2.
Anticipated key dates:
Final Structure Date
Latest Sponsor Agreement/Print Date
Pool Information Date
Pool Wire Date
Closing Date
3.
Identification of proposed Ginnie Mae–approved key Participants:
Ginnie Mae–
Approved
Role Name
Yes
No
Co-Sponsor
Trustee
Trust Counsel
Co-Trust Counsel
Accountant
4.
An announcement of the characteristics of the Trust Assets to be conveyed to the proposed
Ginnie Mae [REMIC][HREMIC][Callable] Trust will be posted to e-Access and distributed to the
press shortly after Noon Eastern Time on the second Business Day after pricing. Who are the
contact persons to be identified in the announcement?
Sponsor:
Sponsor Contact:
Phone:
Co-Sponsor:
Co-Sponsor Contact:
Phone:
I-8-3
Yes
5.
No
Does the proposed Ginnie Mae [REMIC][HREMIC][Callable] Securities Structure
comprise any Class:
a)
that is a "jump" Class or nonstandard, esoteric, particularly risky, new or
difficult for investors to understand, including a type of Class that has never
been issued previously in the Ginnie Mae Multiclass Securities Program?
b)
that is either:
a Class whose value will be highly sensitive to prepayments,
a Class whose value will be highly sensitive to an index (e.g., LIBOR), or
customarily a Class type for which a yield sensitivity table is provided
If so which Class(es)? Insert PO, Inverse Floater and IO Classes as needed)
Class Type(s) ______________________________________________________
c)
d)
e)
Are you aware that for each Class identified in response to question 5.b,
Ginnie Mae will require that you provide special disclosure such as yield
sensitivity tables in the Offering Circular Supplement?
Are you aware that Ginnie Mae will require that you designate each Class
that is a Callable Class with an Initial Redemption Date prior to the twelfth
Distribution Date as an Increased Minimum Denomination Class and issue
each such Class with an Original Principal Balance of not less than
$100,000?
Are you aware that Ginnie Mae will require that you designate each Class
identified in response to question 5.a and 5.b as an Increased Minimum
Denomination Class and issue each such Class in denominations included in
the following table:
Class Type
Interest Only Class
Inverse Floating Rate Class
Principal Only Class
Non-Sticky Jump Class
Sticky Jump Class
Special Class
Toggle Class
Classes subject to forced exchange
Increased Minimum Denomination
The lesser of (a) $100,000 Original Notional or
Original Principal Balance or (b) the Original
Notional or Original Principal Balance if such
balance is less than $100,000.
Jump Class
The minimum denomination for each jump class
in Original Notional or Original Principal
Balance is $1,000,000.
f)
Yes
No
Yes
No
In addition, have you informed or will you inform your sales force and other
Broker/Dealers to whom you will sell any Increased Minimum
Denomination Class on the Closing Date that no such Class is intended to be
distributed to investors who are not institutional “accredited investors,” as
defined in Rule 501(a)(1), (2), (3), or (7) of Regulation D of the Securities
Act of 1933, as amended and who do not have substantial experience in
mortgage-backed securities and are not capable of understanding and are
unable to bear the risks associated with such an investment?
I-8-4
6. Callable Class
a)
Do you intend to use a Ginnie Mae Callable Class to back a Ginnie Mae
REMIC Trust?
b)
Are you aware that in the event a Callable Class is included in a Ginnie Mae
REMIC Trust, the Trustee Fee for the Callable Trust must also serve as the
Trustee Fee for the REMIC Trust?
c)
Are you are aware that the Ginnie Mae REMIC Trust may not issue a
Principal Only Security with an initial Class Principal Balance in excess of
10% of the class Principal Balance of the Callable Class included in such
REMIC Trust?
d)
Are you aware that Ginnie Mae Platinum securities, Ginnie Mae I and
Ginnie Mae II Mortgage-Backed securities (“MBS”), and Non-Increased
Minimum Denomination Class REMIC securities will constitute “eligible
collateral” for all Callable Trusts?
7. Trustee Fee
a)
Has the Trustee Fee been determined?
b)
Will the Trustee Fee be structured as a strip of the Trust Assets?
c)
Are you aware that if there is more than one Trust Asset Group, you are
encouraged to allocate the Trustee Fee either pro rata between Trust Asset
Groups based on principal balance or to the Trust Asset Group(s) expected
to pay-off slower?
8.
Do you anticipate any difficulty in the acquisition of the proposed Trust Assets or
sale of the proposed Ginnie Mae [REMIC][HREMIC][Callable] Securities,
particularly the Classes to be designated as Increased Minimum Denomination
Classes?
9.
Are there any Sponsor operational difficulties anticipated for any aspect of the
proposed Ginnie Mae [REMIC][HREMIC][Callable] Securities?
10. Are there any unique or unusual features or Classes in the proposed Ginnie Mae
[REMIC][HREMIC][Callable] Securities Structure:
a)
in addition to those discussed above, that Ginnie Mae, the Financial Advisor
or the Legal Advisor should be made aware of?
b)
that may be inconsistent with the policies and purposes of the Ginnie Mae
Multiclass Securities Program as reflected in the Ginnie Mae Multiclass
Securities Guide currently in effect?
c)
that may present an increased risk of Ginnie Mae’s having to perform under
its guarantee of the proposed Ginnie Mae [REMIC] Securities?
d)
that might cause the Financial Advisor, Accountant or Tax Administrator
difficulty in reverse-engineering the transaction?
11. Do you anticipate any difficulty in qualifying the proposed Ginnie Mae
[REMIC][HREMIC] Securities Structure as a viable REMIC from a tax
perspective and obtaining an unqualified tax opinion?
12. Will you use Ginnie Mae’s standard Class naming and other conventions?
Yes
No
13. Are you aware that a Supplemental Statement and an investor Notification, in
I-8-5
substantially the forms attached as Exhibits 3 and 4 to the Standard Sponsor
Provisions, will be required if the actual characteristics of the Trust Assets are
such that there is a material change in the investment characteristics of any Class
as described in the Offering Circular [Supplement] or there is a 10% or greater
change in the projected Weighted Average Life of any Class at the pricing
prepayment speed as updated in the August 7, 2004 MPM 04-06?
14. HMBS
a) Do the Trust Assets include any HMBS?
b) If the Trust Assets include Ginnie Mae HECM MBS, will such MBS be
settled on or prior to the Print Date for the month of settlement?
c) Is the value of each Participation backing such HMBS equal to or greater than
par?
d) Will you be able to provide a Sponsor Certification verifying that (i) the fair
market value of each Participation in the pool of Participations underlying
any HMBS contributed to any Trust REMIC is equal to or greater than the
outstanding principal amount of such Participation, and (ii) the aggregate
issue price of the Regular Securities issued by such Trust REMIC is equal to
or greater than the aggregate principal balance of the HECM MBS
contributed to any such Trust REMIC?
15. High Balance Pools
a) Does the proposed Ginnie Mae REMIC Securities Structure comprise any
Trust Asset Group(s) that will include pool types that include Higher
Balance Loans as underlying collateral?
If so, what are the pool types that include Higher Balance Loans?
Insert X SF, M SF, M JM, M FS, C SF, C BD, X SN or All ARMs,
in the blank below, as applicable.
Pool Type
16. Characteristics of the proposed Underlying REMIC [or MX] Certificates or Ginnie
Mae Callable Class Securities to be conveyed to the Ginnie Mae
[REMIC][HREMIC][Callable] Trust:
Agency Transaction
Ginnie Mae 20__-____
Ginnie Mae 20__-____
Tranche
[Class]
[Class]
GNI/GNII
[GNI][GNII]
[GNI][GNII]
I-8-6
FORM OF SPONSOR AGREEMENT FOR REMIC AND MX TRANSACTIONS
SPONSOR AGREEMENT
GINNIE MAE REMIC TRUST 20[ ]-[ ]
[GINNIE MAE MX TRUST 20[ ]-[ ]]
THIS SPONSOR AGREEMENT is entered into as of ___________ __, 20__, by and
between the GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (“Ginnie Mae”) and
___________, a ___________ [corporation] [limited liability company] [limited partnership]
(the “Sponsor”) in connection with the issuance by the Ginnie Mae REMIC Trust 20__-_ of
approximately $__________ aggregate principal amount of Securities.
SECTION 1. Standard Sponsor Provisions.
The parties acknowledge and agree that the terms of the Standard Sponsor Provisions for
Guaranteed Pass-Through Securities as set forth in the Ginnie Mae Multiclass Securities Guide,
January 1, 2014 Edition[, as amended through __________, 20___], are herein incorporated by
reference and constitute part of this Sponsor Agreement as if set forth herein in full.
SECTION 2. Dates.
The Pool Information Date shall be __________ __, 20__; the Pool Wire Date shall be
___________ __, 20__; and the Closing Date shall be ____________ __, 20__. These dates may
not be changed without the written approval of Ginnie Mae.
SECTION 3. Fees.
Based upon the information regarding the Securities set forth in the Offering Circular
Supplement, the Ginnie Mae Guaranty Fee will be $____________ but will increase if the size of
the transaction increases [and the Ginnie Mae MX Combination Fee [will] [may] be
$____________]. [NOTE TO TRUST COUNSEL: The Ginnie Mae Guaranty Fee is an
amount that equals the sum of (a) $10,000 in the case of any Series backed by Ginnie Mae
Multifamily Certificates and (b) the greater of (i) 0.075% of the first $100,000,000 of the
aggregate Class Principal Balance of the Securities as of the Closing Date and 0.025% of any
remaining aggregate Class Principal Balance of the Securities as of the Closing Date and (ii)
$75,000. The Ginnie Mae MX Combination Fee is an amount equal to $3,000 for each
Combination set forth in the Combination Schedule.]10
SECTION 4. Notices.
Sponsor:
10
The Ginnie Mae Guaranty and MX Combination Fees are subject to change by Ginnie Mae.
I-9-1
Attention:
Facsim
Telephone:
ile:
Participating Affiliate(s)
of the Sponsor:
Attention:
Facsim
Telephone:
ile:
Co-Sponsor:
Attention:
Facsim
Telephone:
ile:
[Co-Manager:
Attention:
Facsim
Telephone:
ile:
_____________________________]
Trust Counsel:
Attention:
Facsim
Telephone:
ile:
Co-Trust Counsel:
Attention:
Facsim
Telephone:
ile:
2
I-9-2
Accountants:
Attention:
Facsim
Telephone:
ile:
Trustee:
Attention:
Telephone:
Facsim
ile:
[For the purpose of MX exchanges only:
Email: [ ]]
Trustee’s Counsel:
Attention:
Facsim
Telephone:
ile:
SECTION 5. Modifications to Standard Sponsor Provisions.
The parties acknowledge and agree that the following modifications of the Standard
Sponsor Provisions shall apply to the Securities: [None.]
3
I-9-3
IN WITNESS WHEREOF, the parties have caused this Sponsor Agreement to be
executed and delivered by their duly authorized representatives as of the day and year first above
written.
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
By:
Its:
[SPONSOR], as Sponsor
By:
Its:
I-9-4
STANDARD SPONSOR PROVISIONS FOR REMIC AND MX TRANSACTIONS
I-10-0
______________________________________________________________________________
STANDARD SPONSOR PROVISIONS
______________________________
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
GUARANTEED REMIC PASS-THROUGH SECURITIES
AND
GUARANTEED MULTIFAMILY REMIC PASS-THROUGH SECURITIES
____________
January 1, 2014 Edition
______________________________________________________________________________
I-10-1
STANDARD SPONSOR PROVISIONS
THESE STANDARD SPONSOR PROVISIONS are to be incorporated by reference in
each Sponsor Agreement relating to the issuance of Ginnie Mae REMIC Securities entered into
by and between the GOVERNMENT NATIONAL MORTGAGE ASSOCIATION and each
Sponsor.
SECTION 1. Definitions. Capitalized terms used and not defined herein shall have the
meanings assigned to them in the Glossary included in the Ginnie Mae Multiclass Securities
Guide in effect as of the date of the related Sponsor Agreement, except to the extent modified by
the following:
Class: As to any Series of Ginnie Mae Guaranteed REMIC Pass-Through Securities, all
of the Securities that together represent one of the Regular Interests in a particular Trust REMIC
or all of the Securities that together represent the Residual Interest in that Trust REMIC. As to
any Series of MX and Modifiable Securities, all such Securities sharing the same designation.
As to each Trust, the designations, Original Class Principal Balances (if any), original Class
Notional Balances (if any), Interest Rates (if any) and other specific characteristics of each Class
of Securities shall be as set forth in the related Trust Agreement.
SECTION 2. Commitment to Sell and Purchase. Subject to satisfaction of the
conditions to Sponsor’s obligations set forth in these Standard Sponsor Provisions, on the
Closing Date the Sponsor will establish one or more Trusts by executing one or more Trust
Agreements in form and substance substantially similar to the applicable form included in the
Ginnie Mae Multiclass Securities Guide, with only such changes as are necessary to reflect the
Securities Structure or as are approved by Ginnie Mae. Pursuant to a Trust Agreement, the
Sponsor (or its Participating Affiliates) will transfer all of Sponsor’s and the Participating
Affiliates’ interest in identified Trust Assets to the Trust in consideration of specified Securities,
representing undivided beneficial ownership interests in the Trust.
SECTION 3. Commitment to Issue Ginnie Mae Guaranty. Subject to satisfaction of
the conditions to Ginnie Mae’s obligations set forth in the Sponsor Agreement, including these
Standard Sponsor Provisions, Ginnie Mae will guarantee the timely payment of principal and
interest on each Security (in accordance with its terms) issued by a Trust pursuant to a Trust
Agreement. To effect the Ginnie Mae Guaranty, on the Closing Date, Ginnie Mae will execute a
Guaranty Agreement authorizing the Trustee to issue the related Series of Securities entitled to
the benefits of the Ginnie Mae Guaranty. In the case of Certificated Securities, the Guaranty
Agreement will authorize the Trustee to authenticate and deliver certificates representing the
Securities, which will contain the Ginnie Mae Guaranty. Each Book-Entry Security and
Uncertificated Security issued by the Trustee pursuant to the authority of the Ginnie Mae
Guaranty shall be entitled to the benefits of the Ginnie Mae Guaranty, and shall be valid and
obligatory for any purpose. Each Certificated Security that bears a certificate of authentication,
is in the form set forth in the related Trust Agreement and is manually executed by the Trustee,
shall be entitled to the benefits of the Ginnie Mae Guaranty and shall be valid or obligatory for
any purpose. The certificate of authentication of the Trustee, when manually executed by the
Trustee, shall be conclusive evidence that each Certificated Security has been duly authenticated
I-10-2
and delivered and that the Holder of that Security is entitled to the benefits of the Ginnie Mae
Guaranty. Ginnie Mae will have no obligation to issue the Ginnie Mae Guaranty except upon
full satisfaction of all conditions to closing. The obligations of Ginnie Mae on any Security or
pursuant to the related Guaranty Agreement will terminate upon the retirement of that Security
pursuant to the terms of the related Trust Agreement.
SECTION 4. Representations and Warranties of the Sponsor. The Sponsor hereby
represents and warrants, as of the date of the Sponsor Agreement, as follows:
(a)
The Sponsor and its Participating Affiliates have acquired or by the
Closing Date will acquire the Trust Assets in the ordinary course of its business, in good
faith, for value and without notice of any claim against or claim to any of the Trust Assets
on the part of any person.
(b)
Neither the Sponsor nor its Participating Affiliates have any actual or
constructive knowledge or notice of any interest in the Trust Assets contrary to the
interest of the Trustee under any Trust Agreement.
(c)
The Sponsor and its Participating Affiliates, as applicable, have the full
power, authority and legal right to transfer and convey the Trust Assets to the Trustee and
have the full power, authority and legal right to execute and deliver the Sponsor
Agreement, to engage in the transactions contemplated therein and to fully perform and
observe the terms and conditions thereof.
(d)
The execution and delivery by the Sponsor of the Sponsor Agreement are
within the legal power of, and have been duly authorized by all necessary actions on the
part of, the Sponsor. Neither the execution and delivery of the Sponsor Agreement by the
Sponsor, nor the consummation by the Sponsor of the transactions contemplated in the
Sponsor Agreement, nor compliance by the Sponsor with the provisions thereof, will (i)
conflict with or result in a breach of, or constitute a default under, any of the provisions
of the certificate of incorporation or bylaws of, or any law, governmental rule or
regulation, or any judgment, decree or order binding on, the Sponsor, its Participating
Affiliates or its properties, or any of the provisions of any indenture, mortgage, deed of
trust, contract or other instrument to which it or its Participating Affiliates are a party or
by which they are bound, or (ii) result in the creation or imposition of any lien, charge or
encumbrance upon any of its or its Participating Affiliates’ properties pursuant to the
terms of any such indenture, mortgage, deed of trust, contract or other instrument.
(e)
The Sponsor Agreement has been duly executed and delivered by the
Sponsor and constitutes a legal, valid and binding agreement of the Sponsor, enforceable
in accordance with its terms subject, as to enforcement of remedies, to applicable
bankruptcy, reorganization, insolvency or other similar laws affecting creditors’ rights
and to general principles of equity.
(f)
No consent, approval, authorization or order of or registration or filing
with, or notice to, any governmental authority or court is required for the execution,
I-10-3
delivery and performance of, or compliance by the Sponsor with, the Sponsor Agreement
or the consummation by the Sponsor of any other transaction contemplated thereby.
(g)
No certificate of an officer of the Sponsor or Participating Affiliate,
statement furnished pursuant hereto in writing, or report delivered pursuant to the terms
hereof to Ginnie Mae, any Affiliate or designee of Ginnie Mae, or the Trustee by the
Sponsor contains any untrue statement of a material fact, or omits a material fact
necessary to make the certificate, statement, or report not misleading in light of the
circumstances under which such certificate, statement or report is given.
(h)
Neither the Sponsor nor any of its Participating Affiliates has dealt with
any broker, investment banker, or agent or other person that may be entitled to any
commission or compensation in connection with the sale of Trust Assets to the related
Trust, or any such commission or compensation has been paid in full.
(i)
There is no litigation pending or, to the Sponsor’s knowledge, threatened
against the Sponsor or any of its Participating Affiliates that could reasonably be
expected to affect adversely the transfer of the Trust Assets, the issuance of the Securities
or the execution, delivery, performance or enforceability of the Sponsor Agreement,
including the Sponsor’s performance under any indemnification provisions.
(j)
At the time of the issuance of the Securities, the Trust Assets will be assets
of the related Trust and not assets of the Sponsor or any other person.
(k)
Immediately prior to the transfer of Trust Assets to the related Trust, the
Sponsor or its Participating Affiliates will be the sole owners of, and will have good and
marketable title to, the Trust Assets, subject to no prior lien, mortgage, security interest,
pledge, charge or other encumbrance or any such encumbrance will be discharged, and
on the Closing Date, all right, title and interest in the Trust Assets shall be transferred to
the related Trust and the Trust Assets shall be duly and validly delivered to such Trust,
together with any other documents or certificates required by the Sponsor Agreement.
Following the transfer of Trust Assets to a Trust, the Trust will own such Trust Assets,
free and clear of any lien, mortgage, security interest, pledge, charge or other
encumbrance.
(l)
The transfer, assignment and conveyance of the Trust Assets by the
Sponsor and its Participating Affiliates pursuant to the Sponsor Agreement are not
subject to bulk transfer laws or any similar statutory provisions in effect in any applicable
jurisdiction.
(m)
The Trust Assets (or, if the Trust Assets are segregated into Trust Asset
Groups, the Trust Assets in each Trust Asset Group) are of the type and with the payment
characteristics identified in the Offering Circular Supplement.
(n)
The Trust Assets consist solely of Trust MBS, Underlying Certificates,
Underlying SMBS Securities and/or Underlying Callable Securities that evidence,
directly or indirectly, interests in Ginnie Mae Certificates.
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(o)
At the time of issuance of the Securities in the case of any Series (other
than any Series backed by Ginnie Mae Multifamily Certificates), none of the Mortgage
Loans underlying any of the Trust Assets (or, if the Trust Assets consist of HECM MBS,
none of the HECMs related to the Participations underlying the HECM MBS) are in
default. At the time of issuance of any Securities for a Series backed by Ginnie Mae
Multifamily Certificates, none of the Mortgage Loans underlying any of the Trust Assets
are delinquent.
(p)
The consideration received by each of the Sponsor and any of its
Participating Affiliates upon the transfer of Trust Assets under a Trust Agreement
constitutes fair consideration and reasonably equivalent value for the Trust Assets
transferred by it.
(q)
The Sponsor is solvent, and the transfer of the Trust Assets will not cause
the Sponsor or any of its Participating Affiliates to become insolvent; the transfer of the
Trust Assets is not undertaken with the intent to hinder, delay or defraud any of the
creditors of the Sponsor or its Participating Affiliates.
(r)
The Sponsor relinquishes and will cause its Participating Affiliates to
relinquish all rights to possess, control and monitor the Trust Assets transferred to a Trust
except such rights as any may have as a Holder of the related Securities.
(s)
The description of the Securities Structure and the plan for distribution of
the Securities contained under the heading “Plan of Distribution” in the Offering Circular
Supplement related to the Securities does not contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary in order to
make the statements contained therein, in light of the circumstances under which they are
made, not misleading.
(t)
The Sponsor has delivered to Ginnie Mae financial statements (including
the notes attached thereto) of the Sponsor for its two most recently completed fiscal
years, certified by independent certified public accountants. Such financial statements
have been prepared in accordance with generally accepted accounting principles
consistently applied. These financial statements fairly reflect the financial condition of
the Sponsor and the results of its operations as of the dates and for the periods presented.
Since the dates of such statements, no materially adverse changes in the financial
condition, business or operations of the Sponsor have occurred that could reasonably be
expected to affect adversely the transfer of the Trust Assets, the issuance of the Securities
or the execution, delivery, performance or enforceability of the Sponsor Agreement,
including the Sponsor’s performance under any indemnification provisions.
(u)
The Offering Circular Supplement includes an accurate description of the
Securities Structure.
(v)
Assuming the full and timely payment of principal and interest on the
Trust Assets (as those Trust Assets are identified in the Offering Circular Supplement),
payments on those assumed Trust Assets in all possible prepayment scenarios will be
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adequate to make full and timely payments of principal and interest on the Securities in
accordance with the terms of the Securities as described in the Offering Circular
Supplement (giving effect, in each case, to all possible combinations set forth in the
related Combination Schedule) and will pay in full each Class of Securities by its Final
Distribution Date regardless of the rate of prepayment of the Mortgage Loans underlying
those assumed Trust Assets or level of any index upon which the Interest Rate of any
Class may be based.
(w)
Assuming the full and timely payment of principal and interest on the
Trust Assets, payments on the Trust Assets in all possible prepayment scenarios will be
adequate to make full and timely payments of principal and interest on the Securities (and
the Pooling REMIC Subaccounts, if any) in accordance with the terms of the related
Trust Agreement (giving effect, in each case, to all possible combinations set forth in the
related Combination Schedule) and will pay in full each Class of Securities (and each
Pooling REMIC Subaccount, if any) by its Final Distribution Date regardless of the rate
of prepayment of the Mortgage Loans underlying the Trust Assets or level of any index
upon which the Interest Rate of any Class may be based.
(x)
The Sponsor has obtained CUSIP Numbers for each Class of Securities.
(y)
To the extent a Co-Sponsor has been engaged by the Sponsor, the Sponsor
has engaged the Co-Sponsor identified in the Sponsor Agreement under an agreement
separate from the Sponsor Agreement to assist in the distribution of the Securities.
(y)
With respect to any Multifamily Series, and each Deposited Ginnie Mae
Construction Loan Certificate and each Undeposited Ginnie Mae Construction Loan
Certificate, the related Contracted Security Purchaser has duly executed and delivered a
Waiver Agreement.
(z)
With respect to any Series backed by Ginnie Mae Construction Loan
Certificates, on the date as of which the related Contracted Security Purchaser duly
executed and delivered the Waiver Agreement referred to in clause (y), the Sponsor
owned each Deposited Ginnie Mae Construction Loan Certificate.
(aa) The Sponsor has been duly incorporated, organized or formed, as
applicable, and is validly existing as a corporation, limited liability company or limited
partnership, as applicable, in good standing under the laws of the jurisdiction of its
incorporation, organization or formation, as applicable.
SECTION 5. Covenants of the Sponsor. Subject to the conditions set forth in Section
8, the Sponsor hereby covenants and agrees as follows:
(a)
The Sponsor shall create, no later than the Pool Information Date, the
Final Data Statement and the Final Schedule or Final Schedules for all transactions that
include PAC, Scheduled or TAC Classes, final versions of which (i) in the case of any
Series (other than any Series backed by Ginnie Mae Multifamily Certificates or HECM
MBS), will be attached to the Trust Agreement related to a Ginnie Mae REMIC Trust and
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(ii) in the case of any Series backed by Ginnie Mae Multifamily Certificates or HECM
MBS, will be provided by the Sponsor and posted to e-Access for each related Series.
(b)
The Sponsor shall provide, in substantially the form attached as Exhibit 2,
a list showing the Weighted Average Lives (based on the Trust Assets transferred to the
Trust) for all Classes at each prepayment speed (other than 0% PSA or CPR) shown in
the Weighted Average Lives tables in the Terms Sheet to the Offering Circular
Supplement and comparing such Weighted Average Lives to those shown in the Offering
Circular Supplement, showing both the differences and the percentage differences at each
speed. For this purpose, the Weighted Average Lives and the percentage differences
should be rounded to the nearest tenth.
(c)
On or before the Pool Wire Date, the Sponsor shall transfer (or cause to be
transferred) the Trust Assets of a Ginnie Mae REMIC Trust to the Trustee Limited
Purpose Account and/or Trust Asset Depository Account, where they will be held on
behalf of the Sponsor and its Participating Affiliates, as applicable, until closing. The
Sponsor and its Participating Affiliates, as applicable, shall release such Trust Assets to
the Trustee on the Closing Date.
(d)
The Sponsor shall calculate the original issue discount, if any, for each
Class. In addition, the Sponsor shall deliver a list showing the initial offering price to the
public at which the first substantial amount of Securities of each Class will have been
sold, assuming that preliminary indications of interest are confirmed upon delivery of the
Offering Circular Supplement and that such sales are consummated, or an estimate of the
sales price to Trust Counsel and Tax Administrator on or before the date on which the
Offering Circular Supplement is printed. Within ten Business Days after the Closing
Date, the Sponsor shall provide the Tax Administrator with any additional information
concerning the Securities that the Tax Administrator reasonably may require.
(e)
On or before the Closing Date, the Sponsor shall transfer to a special
purpose account of the Trustee sufficient funds to pay the Ginnie Mae Guaranty Fee, the
Ginnie Mae MX Combination Fee, if applicable, and the fees and expenses of any
Participant who is to be paid from the proceeds of the transaction.
(f)
The Sponsor shall use its best efforts to satisfy each of the conditions to
Ginnie Mae’s obligations under the Sponsor Agreement.
(g)
The Sponsor shall provide or cause to be provided or shall make available
in electronic form a copy of the Offering Circular Supplement to each and every Person
who purchases or otherwise acquires a Security from the Sponsor (including any
underwriter of the Securities) prior to or simultaneously with the confirmation of sale of
such Security to such Person and shall comply with the guidelines issued from time to
time by The Securities Industry and Financial Markets Association relating to the
distribution by “Government Sponsored Enterprises” of offering materials related to
securities exempt from registration under the Securities Act of 1933 (the “GSE
Guidelines”) and shall comply with any applicable federal or state laws relating to the
distribution, offer or sale of any Security. In connection with its compliance with the
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GSE Guidelines, the Sponsor shall amend its master agreement with each of its dealers in
a letter substantially in the form attached as Exhibit 1.
(h)
No Increased Minimum Denomination Class (as identified in the Terms
Sheet) shall be offered, sold or otherwise transferred by the Sponsor (or any other
underwriter of any such Class) to any investor, unless such investor, in the case of an
Increased Minimum Denomination Class issued in a single family transaction, is an
institutional “accredited investor,” as defined in Rule 501(a)(1), (2), (3) or (7) of
Regulation D of the Securities Act of 1933, as amended (an “Institutional Accredited
Investor”) or, in the case of an Increased Minimum Denomination Class issued in a
multifamily transaction, unless such investor is an “accredited investor,” as defined in
Rule 501(a) of Regulation D of the Securities Act of 1933, as amended (an “Accredited
Investor”), that has substantial experience in mortgage-backed securities and is capable of
understanding and is able to bear the risks associated with an investment in a Class such
as the Increased Minimum Denomination Class. In addition, the Sponsor shall inform all
other broker/dealers to whom it has agreed to sell an Increased Minimum Denomination
Class at the Closing Date that such Class is not intended to be distributed to any investor
other than an Institutional Accredited Investor or an Accredited Investor, as applicable.
(i)
The information concerning Trust Assets to be (i) included in the Final
Data Statement and (ii)(a) with respect to a Multifamily Series, set forth in Exhibit A and
Exhibit D, if any, to the Offering Circular Supplement and (b) with respect to any Series
backed in whole or in part by HECM MBS, set forth in Exhibit A to the Offering Circular
Supplement, is true and correct in all material respects as of the Closing Date.
(j)
The Sponsor shall transfer or cause to be transferred to the Trust, Trust
Assets with the characteristics identified in the Offering Circular Supplement. If the
actual characteristics of the Trust Assets transferred to the Trust are such that there is a
material change in the investment characteristics of any Class (including without
limitation the projected yields of a Class) from the description in the Offering Circular
Supplement or if there is a 10% or greater change in the projected Weighted Average
Life of any Class, or in the case of a Class with a Weighted Average Life of two years or
less as of the Closing Date, a difference of three or more months in the projected
Weighted Average Life of such Class, at the pricing prepayment speed, the Sponsor shall:
(1)
deliver or cause to be delivered to Ginnie Mae and the Financial
Advisor, for posting on e-Access, a Supplemental Statement, in substantially the
form attached as Exhibit 3 and, if applicable, with all numbers therein rounded to
the nearest tenth, of the Weighted Average Lives of the applicable Classes based
upon the Trust Assets actually included in the Trust to the Weighted Average
Lives for such Classes at each of the prepayment speeds (other than 0% PSA or
CPR) included in the Weighted Average Lives table in the related Offering
Circular Supplement, and
(2)
notify each person with whom the Sponsor has entered into an
agreement for the purchase of any Securities of any applicable Class (a
“Purchaser”) of the variance and confirm to Ginnie Mae, in a letter substantially
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in the form attached as Exhibit 4, that either (A) the Purchaser’s decision to
purchase the Securities of an applicable Class was not affected by the variance or
(B) the terms of the sale to the Purchaser were revised to the Purchaser’s
satisfaction.
(k)
In connection with any sale of a Security to a customer, the Sponsor shall
have reasonable grounds for believing that the proposed investment is suitable, in
accordance with the NASD Conduct Rules, for such customer.
(l)
The Sponsor shall deliver, or cause to be delivered, to the Information
Agent, no later than the Pool Information Date, one copy of each Underlying Certificate
Disclosure Document if one or more Underlying Certificates evidencing interests in
Freddie Mac or Fannie Mae Certificates are held in the Ginnie Mae REMIC Trust.
(m)
With respect to any Series backed by Ginnie Mae Construction Loan
Certificates, all Deposited Ginnie Mae Construction Loan Certificates and any related
Undeposited Ginnie Mae Construction Loan Certificates were issued on or after January
1, 2003.
(n)
With respect to any Series backed by HECM MBS, the Sponsor shall
deliver or cause to be delivered to Ginnie Mae a Sponsor Certification, in substantially
the form attached as Exhibit 5, that certifies that (i) the fair market value of each
Participation in the pool of Participations underlying any HECM MBS contributed to any
Trust REMIC is equal to or greater than the outstanding principal amount of such
Participation, and (ii) the aggregate issue price of the Regular Securities issued by such
Trust REMIC is equal to or greater than the aggregate principal balance of the HECM
MBS contributed to any such Trust REMIC.
(o)
To the extent that the Trustee’s Receipt and Safekeeping Agreement refers
to an Intermediary Bank, the Sponsor acknowledges the agreements of the Sponsor set
forth in the Trustee’s Receipt and Safekeeping Agreement relating to the issuance of the
Securities and agrees to be bound thereby to the same extent as though such agreements
were set forth in full in the Sponsor Agreement.
SECTION 6. Representations and Warranties of Ginnie Mae. Ginnie Mae hereby
represents and warrants to the Sponsor as follows:
(a)
Ginnie Mae is a wholly-owned corporate instrumentality of the United
States within the Department of Housing and Urban Development.
(b)
Pursuant to Section 308 of the National Housing Act, 12 U.S.C. § 1723,
the Secretary of HUD has adopted the bylaws of Ginnie Mae. The bylaws provide that
the President, each Vice President and each Assistant Vice President of Ginnie Mae are
severally expressly empowered in the name of Ginnie Mae to sign all contracts and other
documents, instruments, and writings that are required to be executed by Ginnie Mae in
the conduct of its business and affairs.
I-10-9
(c)
Ginnie Mae has the power and authority to make, execute, deliver and
perform the Sponsor Agreement and all the transactions contemplated hereby, including,
but not limited to, the authority to guarantee the timely payment of principal and interest
on the Securities in accordance with the Sponsor Agreement. Ginnie Mae has taken all
necessary action to authorize its execution, delivery and performance of the Sponsor
Agreement. The Sponsor Agreement constitutes the legal, valid and binding obligation
of Ginnie Mae enforceable in accordance with its terms.
(d)
The Ginnie Mae Multiclass Securities Guide contains an opinion of the
General Counsel to HUD to the effect that Ginnie Mae has the authority to guarantee
multiclass securities and that such guaranties will represent general obligations of the
United States backed by the full faith and credit of the United States. The Sponsor, the
Trustee, the Trust, the Trust Counsel and Holders of the Securities are entitled to rely on
that opinion.
(e)
The execution, delivery and performance of the Sponsor Agreement by
Ginnie Mae do not violate any provision of any existing federal law, regulation or
executive order applicable to Ginnie Mae or any order or decree of any court, or any
mortgage, indenture, contract or other agreement to which Ginnie Mae is a party or by
which it or any significant portion of its properties is bound.
(f)
All payment obligations of Ginnie Mae under the Sponsor Agreement,
including specifically the Ginnie Mae Guaranty, are obligations of the United States
backed by the full faith and credit of the United States.
(g)
with respect to each Deposited Ginnie Mae Construction Loan Certificate
and each Undeposited Ginnie Mae Construction Loan Certificate, Ginnie Mae
(i) acknowledges that the right of the related Contracted Security Purchaser with respect
to such Ginnie Mae Construction Loan Certificate to withhold consent to one or more
extensions of the applicable Maturity Date for a period that, in the aggregate, may not
exceed the term of the underlying project loan insured by FHA, has been irrevocably
waived by the Contracted Security Purchaser pursuant to the applicable Waiver
Agreement, (ii) agrees that, if the Ginnie Mae Issuer of any such Ginnie Mae
Construction Loan Certificate requests an extension of the applicable Maturity Date, such
Ginnie Mae Issuer may submit the applicable Waiver Agreement in lieu of any document
evidencing the consent to such extension by the holders or the Contracted Security
Purchaser, as applicable, of such Ginnie Mae Construction Loan Certificates (provided,
that such extension, together with all extensions previously granted in respect of such
Ginnie Mae Construction Loan Certificates, does not exceed the term of the underlying
project loan insured by FHA), and (iii) agrees that if the applicable Waiver Agreement is
submitted by any such Ginnie Mae Issuer in accordance with clause (g)(ii) above, Ginnie
Mae will not require, or condition the approval of such extension request upon, the
submission of any document evidencing the consent of the Contracted Security Purchaser
of such Ginnie Mae Construction Loan Certificates to such extension (provided, that
notwithstanding the submission of the applicable Waiver Agreement by any Ginnie Mae
Issuer in accordance with clause (g)(ii) above, Ginnie Mae may, in its sole discretion,
reject any extension request for any reason other than the failure of the Ginnie Mae Issuer
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to obtain the consent of the Contracted Security Purchaser of such Ginnie Mae
Construction Loan Certificates).
SECTION 7. Conditions to Obligation of Ginnie Mae. The obligation of Ginnie Mae
hereunder to guarantee the Securities is subject to the following conditions:
(a)
All of the representations and warranties of the Sponsor under this
Sponsor Agreement shall be accurate as of the Closing Date, and the Sponsor shall have
complied with all of its covenants and obligations under this Sponsor Agreement as of the
Closing Date.
(b)
Ginnie Mae, its Legal Advisor or another authorized agent shall have
received the following documents (collectively, the “Closing Documents”) in such forms
as are agreed upon and acceptable to Ginnie Mae, duly executed and delivered by all
signatories thereto:
(1)
Each applicable Trust Agreement, substantially in the form
included in the Ginnie Mae Multiclass Securities Guide or as provided by Ginnie
Mae, with only such changes to the form as have been approved by Ginnie Mae.
(2)
A Base Offering Circular and Offering Circular Supplement, in
form and substance acceptable to Ginnie Mae.
(3)
Applicable opinions of Trust Counsel, and, if applicable, an
Opinion of Sponsor, substantially in the form included in the Ginnie Mae
Multiclass Securities Guide, with only such changes as have been approved by
Ginnie Mae and the Sponsor.
(4)
An opinion of counsel to the Trustee, substantially in the form
included in the Ginnie Mae Multiclass Securities Guide, with only such changes
as have been approved by Ginnie Mae and the Sponsor.
(5)
A letter from the Accountants, dated the date of the Offering
Circular Supplement, confirming the accuracy of the numerical information
related to the Trust Assets and the numerical information related to the Securities
contained in the Offering Circular Supplement, substantially in the form included
in the Ginnie Mae Multiclass Securities Guide and otherwise in form and
substance satisfactory to Ginnie Mae and the Sponsor.
(6)
A letter from the Accountants, dated the Closing Date,
(i) confirming the information in the list delivered by the Sponsor pursuant to
paragraph (b) of Section 5 hereof and (ii) confirming the numerical information in
the Final Data Statement or the Trustee’s Receipt Schedule A, as applicable,
substantially in a form included in the Ginnie Mae Multiclass Securities Guide
and otherwise in form and substance satisfactory to Ginnie Mae and the Sponsor.
(7)
A Trustee’s Receipt and Safekeeping Agreement from the Trustee,
substantially in a form included in the Ginnie Mae Multiclass Securities Guide,
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acknowledging acceptance of Trust Assets on behalf of a Ginnie Mae REMIC
Trust.
(8)
A Closing Flow of Funds Instruction Letter from the Sponsor to
the Trustee regarding amounts to be remitted to Ginnie Mae in payment of the
Ginnie Mae Guaranty Fee and any applicable Ginnie Mae MX Combination Fee,
if applicable, and amounts to be remitted in payment of fees to any Participant
who is to be paid from the proceeds of the transaction.
(9)
An Issuance Statement from the Sponsor to the Trustee directing
the Trustee to issue the securities in the identified amounts.
(10) If the Trust Assets include HECM MBS, a Sponsor Certification,
certifying that (i) the fair market value of each Participation in the pool of
Participations underlying any HECM MBS contributed to any Trust REMIC is
equal to or greater than the outstanding principal amount of such Participation,
and (ii) the aggregate issue price of the Regular Securities issued by such Trust
REMIC is equal to or greater than the aggregate principal balance of the HECM
MBS contributed to any such Trust REMIC.
(c)
The transaction and transaction documents shall be in form and substance
reasonably acceptable to the Legal Advisor and the Financial Advisor, and Ginnie Mae
shall have received written advice to that effect.
(d)
There shall be no pending or threatened action, suit or proceeding before
any court or governmental agency, authority or body involving the Sponsor, the Trust,
Ginnie Mae or any other party to the transactions contemplated hereby, adversely
affecting any such transaction, or challenging the validity of or seeking to enjoin such
transaction.
(e)
Ginnie Mae shall have received the Ginnie Mae Guaranty Fee and, if
applicable, the Ginnie Mae MX Combination Fee, and any Participant who is to be paid
from the proceeds of the transaction shall have been paid.
(f)
The Sponsor shall have executed a certification and agreement relating to
the absence of fraud on the part of the Sponsor as requested by Ginnie Mae.
(g)
Following the execution of the Sponsor Agreement, (i) nothing shall have
occurred or first come to Ginnie Mae’s knowledge that has caused Ginnie Mae, in its sole
discretion, to determine that completion of the transaction would jeopardize the integrity
of, or otherwise materially and adversely affect, the Ginnie Mae Multiclass Securities
Program and (ii) no Participant shall have been suspended from participation in the
Ginnie Mae Multiclass Securities Program.
(h)
fulfilled.
All other terms and conditions of the Sponsor Agreement shall have been
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SECTION 8. Conditions to Obligation of Sponsor. The obligation of the Sponsor to
perform its obligations under the Sponsor Agreement is subject to the following conditions:
(a)
Receipt by the Sponsor of the Guaranty Agreement, substantially in the
form included in the Ginnie Mae Multiclass Securities Guide, duly executed by Ginnie
Mae.
(b)
Receipt of the Closing Documents listed in paragraph (b) of Section 7,
duly executed by the parties thereto.
(c)
The satisfaction of all rule-making and notice requirements related to the
transactions contemplated hereunder that are required to be completed prior to the
Closing Date.
(d)
There shall be no pending or threatened action, suit or proceeding before
any court or governmental agency, authority or body involving the Sponsor, a Trust,
Ginnie Mae or any other party to the transactions contemplated hereby, adversely
affecting any such transaction, or challenging the validity of or seeking to enjoin such
transaction.
(e)
All of the representations and warranties of Ginnie Mae under this
Sponsor Agreement shall be accurate as of the Closing Date.
SECTION 9. Fees and Deposits.
(a)
On the Closing Date, after receiving confirmation from the Accountants
and the Legal Advisor, Trust Counsel will notify the Trustee that the transaction may
close. The Sponsor shall cause funds for payment of the Ginnie Mae Guaranty Fee and,
if applicable, the Ginnie Mae MX Combination Fee to be made available in accordance
with the Closing Flow of Funds Instruction Letter such that, upon notification by Trust
Counsel that the transaction may close and the Trustee’s wiring of the Security identified
in the Closing Flow of Funds Instruction Letter, the Ginnie Mae Guaranty Fee and, if
applicable, the Ginnie Mae MX Combination Fee will be released to the Trustee and
submitted to Ginnie Mae via pay.gov.
(b)
The Sponsor shall pay (i) the fees and expenses of the Trust Counsel and
the Accountants and (ii) the expense of printing the Base Offering Circular, if required,
and the Offering Circular Supplement for the transaction, and neither Ginnie Mae nor the
Trustee shall have any responsibility for paying any such fee or expense.
SECTION 10. Indemnification.
(a)
In the event that Ginnie Mae must make any payment pursuant to the
Ginnie Mae Guaranty as a result of the Sponsor’s breach of any of its representations,
warranties, covenants or obligations set forth herein, in a Trust Agreement or in a
Sponsor Certification, the Sponsor shall promptly reimburse Ginnie Mae for any
payments made, together with interest thereon for the period from the date of such Ginnie
Mae Guaranty payment through the date of reimbursement at a rate equal to the rate of
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interest on three-month United States Treasury securities as of the date of that Ginnie
Mae Guaranty payment.
(b)
In the event that the Sponsor breaches its representations, warranties,
covenants or obligations set forth herein, in a Trust Agreement or in a Sponsor
Certification, the Sponsor shall indemnify and hold harmless Ginnie Mae from and
against any loss, damages, penalties, fines, forfeiture, legal fees and related costs,
judgments, and other costs and expenses resulting from any claim, demand, defense or
assertion based on or grounded upon, or resulting from, such breach. Promptly after
receipt by Ginnie Mae of notice of the commencement of any such action, Ginnie Mae
will, if a claim in respect thereof is to be made against the Sponsor, notify the Sponsor in
writing of the commencement thereof, but the omission to so notify the Sponsor will not
relieve the Sponsor from any liability hereunder unless such omission materially
prejudices the rights of the Sponsor. In case any such action is brought against Ginnie
Mae, and Ginnie Mae notifies the Sponsor of the commencement thereof, the Sponsor
will be entitled to participate therein, and to assume the defense thereof, with counsel
satisfactory to Ginnie Mae, and after notice from the Sponsor to Ginnie Mae of its
election to assume the defense thereof, the Sponsor will not be liable to Ginnie Mae
under this Section for any legal or other expenses subsequently incurred by Ginnie Mae
in connection with the defense thereof other than reasonable costs of investigation.
(c)
If an indemnification payment is made by the Sponsor to Ginnie Mae as
the result of a breach by the Sponsor of its representation made in paragraph (v) of
Section 4, Ginnie Mae will reimburse the Sponsor up to the amount of the payment and
interest thereon at the applicable Certificate Rate, as and only to the extent that Ginnie
Mae is entitled to distributions from a Trust as a result of a payment on the Ginnie Mae
Guaranty occasioned by the breach of the representation included in paragraph (v) of
Section 4.
SECTION 11. Notices. All demands, notices, approvals and communications hereunder
shall be in writing and shall be deemed to have been duly given if personally delivered to or
mailed by registered mail, postage prepaid, or transmitted by any standard form of written
telecommunications and confirmed by a similar mailed writing, as follows:
(a)
If to Ginnie Mae:
Government National Mortgage Association
550 12th Street, SW, Third Floor
Washington, D.C. 20024
Attention: Senior Vice President, Capital Markets Division
Telephone: (202) 475-4926
Facsimile: (202) 485-0220
With copies to:
Department of Housing and Urban Development
Office of General Counsel
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Room 9254
550 12th Street, SW, Third Floor
Washington, D.C. 20024
Attention: Assistant General Counsel Ginnie Mae/Finance
Telephone: (202) 708-3260
Facsimile: (202) 708-8776
and the Legal Advisor as of the date
of the demand, notice, approval or
communication.
(b)
If to the Sponsor or any other Participant, to the address indicated in the
Sponsor Agreement.
Any party may alter the address to which communications or copies are to be sent by
giving notice of such change of address in conformity with the provisions of this Section for the
giving of notice.
SECTION 12. Severability of Provisions. Any part, provision, representation or
warranty of the Sponsor Agreement that is prohibited or that is held to be void or unenforceable
shall be ineffective to the extent of such prohibition or unenforceability without invalidating the
remaining parts, provisions, representations or warranties hereof. Any part, provision,
representation or warranty of the Sponsor Agreement that is prohibited or unenforceable or is
held to be void or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to
the extent of such prohibition or unenforceability without invalidating the remaining parts,
provisions, representations or warranties hereof, and any such prohibition or unenforceability in
any jurisdiction shall not invalidate or render unenforceable such provision in any other
jurisdiction. To the extent permitted by applicable law, the parties hereto waive any provision of
law that prohibits or renders void or unenforceable any provision hereof.
SECTION 13. GOVERNING LAW. THE SPONSOR AGREEMENT AND THE
RIGHTS AND OBLIGATIONS OF GINNIE MAE AND THE SPONSOR UNDER THE
SPONSOR AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE UNITED STATES OF AMERICA.
INSOFAR AS THERE MAY BE NO APPLICABLE LAW OF THE UNITED STATES,
THE INTERNAL LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING
REGARD TO CONFLICTS OF LAWS PRINCIPLES OTHER THAN SECTIONS 5-1401
AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW) SHALL BE
DEEMED REFLECTIVE OF THE LAWS OF THE UNITED STATES OF AMERICA,
INSOFAR AS TO DO SO WOULD NOT FRUSTRATE THE PURPOSES OF ANY
PROVISION OF THE SPONSOR AGREEMENT OR THE TRANSACTIONS
GOVERNED THEREBY.
SECTION 14. Survival. Each party agrees that its representations, warranties and
covenants herein, and in any certificate or other instrument delivered pursuant hereto, shall be
deemed to be relied upon by the other party, notwithstanding any investigation heretofore or
hereafter made by the other party or on the other party’s behalf, and that the representations,
I-10-15
warranties and covenants made herein or in any such certificate or other instrument shall survive
the Closing Date.
SECTION 15. Miscellaneous.
(a)
The Sponsor Agreement may be executed in two or more counterparts,
each of which when so executed and delivered shall be an original, and all of which
together shall constitute one and the same instrument. The Sponsor Agreement shall
inure to the benefit of and be binding upon the parties thereto and their respective
successors and assigns.
(b)
Any person into which the Sponsor may be merged or consolidated or any
person resulting from a merger or consolidation involving the Sponsor or any person
succeeding to the business of the Sponsor shall be considered the successor of the
Sponsor under the Sponsor Agreement, without the further act or consent of either party.
The Sponsor Agreement cannot be assigned, pledged or hypothecated by any party
without the written consent of the other party to the Sponsor Agreement.
(c)
The Sponsor Agreement supersedes all prior agreements and
understandings relating to the subject matter thereof. Neither the Sponsor Agreement nor
any term thereof may be changed, waived, discharged or terminated orally, but only by
an instrument in writing signed by the party against whom enforcement of the change,
waiver, discharge or termination is sought. The headings in the Sponsor Agreement and
these Standard Sponsor Provisions are for purposes of reference only and shall not limit
or otherwise affect the meaning thereof.
SECTION 16. Request for Opinions. The Sponsor hereby requests and authorizes the
Trust Counsel to issue such legal opinions to Ginnie Mae, each Trust, the Trustee, the Financial
Advisor and the Legal Advisor as may be required by any and all documents, certificates or
agreements executed in connection with the Sponsor Agreement.
I-10-16
Exhibit 1
[Sponsor’s Letterhead]
_________ __, 20__
[Dealer Name]
[Dealer Address]
Dear Dealer:
Our records show that your firm has previously executed a Master Agreement with us
concerning the distribution of securities issued by the Federal Home Loan Mortgage Corporation
(“Freddie Mac”) or the Federal National Mortgage Association (“Fannie Mae”). This
Agreement requires compliance with the guidelines on Delivery of Offering Materials relating to
Securities of Government-Sponsored Enterprises (“GSE Guidelines”).
[Name of Sponsor] recently has entered into agreements with the Government National
Mortgage Association (“Ginnie Mae”) to distribute its securities. As a result of certification
requested in these agreements, we would like to amend our Master Agreement with you to
include “Ginnie Mae” in the definition of the term “issuer.”
This letter will serve as the required amendment. By your signature below, you agree to
comply with the GSE Guidelines with respect to securities guaranteed by Ginnie Mae. Please
have an authorized person sign both copies of this letter in the spaces indicated below and return
one letter to me in the enclosed envelope. Retain the other executed letter for your files.
Thank you for your prompt attention to this matter.
Sincerely,
___________________________________________
(Sponsor Name)
By:________________________________________
Seen and Agreed:
___________________________________________
(Firm Name)
By:________________________________________
(Authorized Signatory)
___________________________________________
(Printed Name of Signatory)
___________________________________________
(Title)
I-10-17
Exhibit 2
_
Classes
PRICING
WAL
___% [PSA] [CPR]
CLOSING
ABSOLUTE
WAL
DIFF
PRICING
WAL
___% [PSA] [CPR]
CLOSING
ABSOLUTE
WAL
DIFF
PRICING
WAL
___% [PSA] [CPR]
CLOSING
ABSOLUTE
WAL
DIFF
_
Classes
_
Classes
PERCENT
DIFF
%
PRICING
WAL
____% [PSA] [CPR]
CLOSING
ABSOLUTE
WAL
DIFF
PERCENT
DIFF
%
PRICING
WAL
____% [PSA] [CPR]
CLOSING
ABSOLUTE
WAL
DIFF
PERCENT
DIFF
%
PRICING
WAL
____% [PSA] [CPR]
CLOSING
ABSOLUTE
WAL
DIFF
PERCENT
DIFF
%
PERCENT
DIFF
%
PERCENT
DIFF
%
I-10-18
Exhibit 3
Government National Mortgage Association
Supplemental Statement
Guaranteed [Multifamily] REMIC Pass-Through Securities,
Ginnie Mae REMIC Trust 20___-__[and Ginnie Mae MX Trust 20___-__]
Reference is made to the Offering Circular Supplement, dated _______ __, 20__, for the
Ginnie Mae REMIC Trust 20__-_ [and the Ginnie Mae MX Trust 20___-__] (the “Offering
Circular Supplement”) and the related Base Offering Circular, dated _______ __, 20__ (the
“Base Offering Circular and, together with the Offering Circular Supplement, the “Offering
Circular”). Capitalized terms used herein and not otherwise defined herein shall have the
respective meanings assigned to them in Appendix II to the Base Offering Circular.
[NOTE TO TRUST COUNSEL: The information below is for Supplemental Statements
regarding certain WAL variances. Supplemental Statements are required if the actual
characteristics of the Trust Assets are such that there is a material change in the investment
characteristics of any Class as described in the applicable Offering Circular Supplement. If your
Supplemental Statement is unrelated to WAL variances, you will need to draft disclosure below
relating to the investment characteristics that materially changed from what is described in the
related Offering Circular.]
Special Disclosure — Weighted Average Lives
For the Class[es] listed below, the projected Weighted Average Lives, based on the actual
Trust Assets delivered on the Closing Date (the “Closing WALs”), differ as shown from the
projected Weighted Average Lives of such Class[es] as set forth in the Offering Circular
Supplement (the “Pricing WALs”). The only Class[es] listed below [is] [are] those for which
[the Closing WAL differs from the Pricing WAL by 10% or more] [, or, if] [the Pricing WAL is
two years or less[,] [and] the Closing WAL differs from the Pricing WAL by three or more
months] at the pricing prepayment speed of ___%. All numbers have been rounded to the
nearest tenth.
___% [PSA] [CPR] PREPAYMENT ASSUMPTION
Class
Pricing
WAL
Closing
WAL Di
fference
Percentage
Difference
%
%
___% [PSA] [CPR] PREPAYMENT ASSUMPTION
I-10-19
Class
Pricing
WAL
Closing
WAL Di
fference
Percentage
Difference
%
%
___% [PSA] [CPR] PREPAYMENT ASSUMPTION
Class
Pricing
WAL
Closing
WAL
Difference
Percentage
Difference
%
%
___% [PSA] [CPR] PREPAYMENT ASSUMPTION
Class
Pricing
WAL
Closing
WAL
Difference
Percentage
Difference
%
%
___% [PSA] [CPR] PREPAYMENT ASSUMPTION
Class
Pricing
WAL
Closing
WAL Di
fference
Percentage
Difference
%
%
___% [PSA] [CPR] PREPAYMENT ASSUMPTION
Class
Pricing
WAL
Closing
WAL Di
fference
Percentage
Difference
%
%
Supplemental Statement dated _______ __, 20__
I-10-20
Exhibit 4
____________ __, 20__
Government National Mortgage Association
550 12th Street, SW, Third Floor
Washington, DC 20024
Re:
Ginnie Mae Guaranteed REMIC Pass-Through Securities,
Ginnie Mae REMIC Trust 20_ - [and Ginnie Mae MX Trust 20_-_]
Ladies and Gentlemen:
We confirm that we have informed or will inform the purchasers from us of the Class [ ]
[and Class [ ]] Securities that, on the basis of the actual Trust Assets constituting the [Pooling]
[Trust] REMIC at the time of pool formation, the projected Weighted Average Lives of the Class
[ ] Securities at ____% [PSA] [CPR] would be _____ years rather than ____ years as set forth in
the Offering Circular Supplement dated _______________ __, 20___. We also have informed
or will inform such purchasers that a Supplemental Statement comparing the projected Weighted
Average Lives for such Class[es] at all percentages of [PSA] [CPR] shown in the Offering
Circular Supplement will be posted to e-Access. Capitalized terms used and not otherwise
defined herein shall have the meanings assigned to them in the Ginnie Mae Multiclass Securities
Guide, January 1, 2014 Edition.
[The persons at each of the purchasers with whom we ordinarily negotiate trades have
each informed us that either (A) the purchaser’s decision to purchase the Class [ ] Securities has
not been affected by the projected Weighted Average Lives, based on the actual Trust Assets, as
set forth above or (B) the terms of the sale to the purchaser have been revised to the purchaser’s
satisfaction.] [As of today, no part of the Class _____ Securities has been sold.] [NOTE TO
TRUST COUNSEL: Use preceding bracketed language when the affected securities have not
been sold.] For the initial distribution period, if we buy or sell any of the Class [ ] [or Class [ ]]
Securities, we will be responsible for disclosing to our customers the applicable projected
Weighted Average Life of such Class [or Classes], based on the actual Trust Assets, as set forth
above.
We acknowledge that you are agreeing to proceed with the closing of Ginnie Mae 20__-_
upon reliance upon the representations in this certificate.
[SPONSOR]
By: _____________________________________
[Title of Signatory]
I-10-21
Exhibit 5
FORM OF SPONSOR CERTIFICATION
[Closing Date]
Government National Mortgage Association
550 12th Street, SW, Third Floor
Washington, DC 20024
Sponsor Certification as to
Value of Participations Underlying HECM MBS
Ginnie Mae REMIC Trust 20[ ]-[ ]
Ladies and Gentlemen:
We are pro viding this letter to yo u in connection with the fo rmation of Ginnie Mae
REMIC Trust 20 [
]-[
] (“2 0[ ]-[ ]”) pursuant to the Trust Agreem
ent, dated as of
___________, 20__, (th e “Trus t Agreem ent”) and any Trus t Assets that will b e con tributed to
any Trust REMIC related to 20 [ ]-[ ] (a “20 [ ]-[ ] Trust R EMIC”) and any Regular Securities
issued by any 20 [ ]-[ ] Trust REM IC. Capita lized terms used but not defined herein have the
meanings ascribed to them in the Trust Agreement.
Based on our review of the Pa rticipations underlying each such HECM MBS included as
a Trust Asset in any 20 [ ]-[ ] Trust REMIC and the Regular Securities issued by any 20 [ ]-[ ]
Trust REMIC, we hereby certify, re present an d warran t that, as of the Closing Date, (i) with
respect to any HECM MBS contributed to any 20 [ ]-[ ] Trust REMIC, the f air market value of
each Participation in th e pool of Participations underlying such HECM MBS is equal to o r
greater than the outstanding principa l amount of such Participation, a nd (ii) with respect to all of
the Regular Securities issued by th e 20 [ ]-[ ] REMIC Trust tha t re lates to any T rust Asse ts
consisting of HECM MBS transferred to any 20 [ ]-[ ] Trust REMIC, the aggregate is sue price
of such Regular Secu rities is equ al to or g reater than the aggregate p rincipal b alance of the
HECM MBS contributed to any 20 [ ]-[ ] Trust REMIC. In order to m ake such a determination,
we analyzed and compared the HECM MBS to
other ass ets with m aterially s imilar
characteristics.
This le tter is solely f or the use an d inf ormation of the addressee s a nd Ginnie Mae’s
Financial A dvisor in c onnection with the is suance of the Securities covered by the Tru st
Agreement and is not intended to be and should not be used by anyone other than these specified
parties. It is not to be used, circulated, quot ed or otherwise referred to for any other purpose,
including but not lim ited to, the purchase or sale of the Securities, excep t that referen ce may be
made to it in the Sponsor Agreement or in any list of closing docum
ents pertaining to the
issuance of the Securities.
I-10-22
Yours truly,
[SPONSOR], as Sponsor
By:
Its:
I-10-23
BASE OFFERING CIRCULAR
FOR SINGLE FAMILY REMIC AND MX TRANSACTIONS
The Base Offering Circular for Ginnie Mae REMIC Securities backed by one or more pools of
single family Mortgage Loans is available in PDF format on Ginnie Mae’s website at
www.ginniemae.gov
I-11-1
FORM OF OFFERING CIRCULAR SUPPLEMENT FOR SINGLE FAMILY REMIC
AND MX TRANSACTIONS
I-12-0
Offering Circular Supplement
(To Base Offering Circular dated January 1, 2014)
$[
]
Government National Mortgage Association
GINNIE MAE®
Guaranteed REMIC Pass-Through Securities
[and MX Securities]
Ginnie Mae REMIC Trust 20[ ]-[ ]
The Securities
The Trust will issue the
Classes of
Securities listed on the front cover of
this offering circular supplement.
The Ginnie Mae Guaranty
Ginnie Mae will guarantee the tim ely
payment of p rincipal an d interest o n
the se curities. The Gin
nie M ae
Guaranty is backe d by t he full fai th
and cre dit of the Uni ted States of
America.
The Trust and its Assets
The Trust will own [(1)] [Ginnie Mae
Certificates] [,] [and] [(2)] [a] [certain
previously issued certificate[s],] [and]
[(3)] [certain callable securities] [and]
[(4)] [certain strip ped mortgagebacked securities].
Original
Principal
Class of
REMIC Securities
Balance(2)
[Security Group 1]
A[(1)]................................ $
B[(1)]................................
[Security Group 2]
C........................................
D................................…...
[Security Group 3]
E.......................................
F........................................
Residual[s]
[R].....................................
[RR]...................................
0 0.
Interest Principal Interest
Rate Type(3) Type(3)
%
[(5)]
0
CUSIP
Number
Final
Distribution
Date(4)
[(6)]
[(7)]
[(7)]
NPR
NPR
[(1) These Securities may be exchanged for MX Securities described in Schedule I to this Supplement.]
(2) Subject to increase as described under “Increase in Size” in this Supplement. [The amount shown for [the] [each]
Notional Class (indicated by “NTL” under Principal Type) is its original Class Notional Balance and does not
represent principal that will be paid.]
(3) As defined under “Class Types” in Appendix I to the Base Offering Circular. [The type of Class with which the
Class Notional Balance of [the] [each] Notional Class will be reduced is indicated in parentheses.] [The Class
Notional Balance of [the] [each] [Notional Class] [Class [ ]] will be reduced with the outstanding [principal] [or]
[notional] balance of the [related] Trust Asset [Group][Subgroup].
(4) See “Yield, Maturity and Prepayment Considerations— Final Distribution Date” in this Supplement.
[(5) See “Terms Sheet - Interest Rates” in this Supplement.]
[NOTE TO TRUST COUNSEL, for INV/Z Classes [(6) For additional discussion regarding the effect of LIBOR on
the rate of principal payments on these Securities, see “Risk Factors - The rate of principal payments on certain group
[1] classes will be sensitive to LIBOR,” “Yield Maturity and Prepayment Considerations - Securities that Receive
Principal on the Basis of Schedules” and “Decrement Tables” in this Supplement.]
[(7) [This] [Each of these] Class[es] [has] the SP (“Special”) designation in its [Interest] [Principal] Type
because….] [NOTE TO TRUST COUNSEL: Describe reason for SP designation.] See “Terms Sheet — Interest
Rates” in this Supplement.].
The secur ities may not be suitable investments for you. You should
risks of investing in them.
consider carefully the
See "Risk Factors" beginning on page S-[ ] which highlights some of these risks.
The Sponsor and the Co-Sponsor[s] will offer the securities from time to tim e in negotiated tran sactions at varying
], 20[ ] .
prices. We expect t he closing date to be [
You should read the Base Offering Circular as well as this Supplement.
The secu rities are ex empt from reg istration un der th e Sec urities Act of 19 33 an d are “ex empted securities” un der
the Securities Exchange Act of 1934.
[SPONSOR]
The date of this Offering Circular Supplement is [
[CO-SPONSOR]
], 20[ ].
I-12-1
AVAILABLE INFORMATION
You should purchase the secur ities only if you have read and understood the following
documents:
this
the
Offering Circular Supplement (this “Supplement”)[,] [and]
Base Offering Circular [,] [and]
[in
the c ase of the [Group [3]] [ and [ ]] securities, [each] [the] disclosure docum ent
relating to the Under lying Certif icate[s] (the “Underlying Cer tificate Disclosu re
Document[s]”) [and]
[in
the c ase of the [Group [4]] securities, the Serie s [20[ ]]–C[ ] Of fering Circular
attached to this Supplement as [Exhibit [C]] [and]
[in
the c ase of the [Group [5]] securities, the d isclosure docum ent re lating to the
Underlying SMBS [Security] [Securities] (the “Underlying SMBS Security Disclosure
Document[s]”)].
The Base Offering Circular [,] [and] [the Underlying Certificate Disclosure Docum ent[s]
[and] [the Underlying SMBS Security Disclosure Docum ent[s]] [is] [are] available on Ginnie
Mae’s website located at http://www.ginniemae.gov.
If you do not have acces s to the internet, call BNY Mellon, which will act as information
agent for the Trust, at (800) 234-GNMA, to or der copies of the Base Offering Circular. [In
addition, you can obtain copies of any ot
her docum ent listed a bove by contacting BNY
Mellon at the telephone number listed above.]
Please cons ult the stand ard abbrev iations of Class Types included in the Base Offe ring
Circular as Appendix I and the glossary included in the Base Offering Circular as Appendix II
for definitions of capitalized terms.
TABLE OF CONTENTS
Page
Page
[Exhibit A: Underlying Certificate[s] ... A-1]
Terms Sheet ........................................................3
[Exhibit B: Cover Page[s][,] [and]
Risk Factors ......................................................13
Terms Sheet[s][,] [and] [Schedule
The Trust Assets ..............................................23
I[, if applicable,]] [and Exhibit A[,
Ginnie Mae Guaranty .....................................27
if applicable,]] from Underlying
Description of the Securities .........................27
Certificate Disclosure
Yield, Maturity and Prepayment
B-1]
Document[s] ......................
Considerations ............................................ 35
[Exhibit
C:
Ginnie
Mae
Callable
Certain united states Federal Income
Trust [20[ ]]-C[ ] Offering
Tax Consequences ..................................... 51
Circular ......................
C- 1]
ERISA Matters ................................................ 54
[Exhibit
D:
Underlying
SMBS
Legal Investment Considerations ................ 55
[Security] [Securities]] ...................... D-1]
Plan of Distribution ........................................ 55
[Exhibit E: Cover Page[s] and Terms
Increase in Size ................................................55
Sheet[s] from Underlying SMBS
Legal Matters ................................................... 56
Security Disclosure Document[s] ..... E-1]
[Schedule I: Available
[Exhibit
F: Assumed Characteristics of
S-I-1]
Combination[s] ..................
the Mortgage Loans Underlying the
[Schedule II: Scheduled Principal
Group [ARM GROUP] Trust Assets . . . . F-1]
Balances .......................
S-II-1]
[Schedule III: [[ ]% PSA] [Jump]
Balances ......................................... S-III-1]
S-2 I-12-2
TERMS SHEET
This terms sheet contains selected information for quick reference only. You should read
this Supplem ent, particularly “Risk Factors, ” and each of t he other do cuments listed under
“Available Information.”
Sponsor: [
]
[Co-Sponsor: [
Trustee: [
]]
]
Tax Administrator: The Trustee
Closing Date: [
], 20[ ]
Distribution Date[s]: [For the Group [ ] Securities,][The 16th day of each m onth or, if the
16th day is not a Business Da y, the first Business Day thereafter, commencing in [
]
20[ ].] [For the Group [ ] Securities,][The 20th day of each m onth or, if the 20th day is
not a Busin ess Day, the first Busin ess Day th ereafter, commencing in
20 [ ].] [For the
Group [ ] Securities, the [ ] day of each m onth or, if the [ ] day is not a Business Day, the
first Business Day thereafter, commencing in
20[ ].]
Trust Assets:
Trust Asset
Group [or
Subgroup][(4)]
Trust Asset Type
Mae [I] [(5)] %
Mae [II]
Mae II
Certificate[s]
Callable
[Security] [Securities]
5 Underlying
SMBS
[Security] [Securities]
6 Ginnie
Mae II [(7)]
1 Ginnie
2[A] Ginnie
[2B] Ginnie
3 Underlying
4 Underlying
Certificate
Rate
Original Term
To Maturity
(in years)
[ ]%[(6)]
[30]
[15]
[30]
[(2)]
[(2)]
[(3)]
[(3)]
[(8)]
[30]
(1)
(1)
[(1) Certain i nformation rega rding t he Underlying C ertificate[s] is set forth in Exh ibits A an d B to th is
Supplement[NOTE TO TR UST COUNSEL: FO R I NSTANT REREMICS: , excep t in th e case o f
Ginnie Mae 20[ ]-[INSERT THIS DEAL], Class[es] [INSERT REMIC CLASSES BACKED BY OTHER
REMIC CLASSES FROM THIS DEAL] and [ ] for which this Supplement is th e Underlying Certificate
Disclosure Document].
[(2) Certain information regarding the Underlying Callable [Security] [Securities] is set forth in the Series [20[
]]-C[ ] Offering Circular attached to this Supplement as Exhibit C.]
[(3) Certain information regarding the Underlying SMBS [Security] [Securities] is set fo rth in Exhibits D and E
to this Supplement.]
[(4) The Group [2] Trust Assets consist of subgroups, Subgroup [2A] and Subgroup [2B] (each, a “Subgroup”).]
[(5) The Mortgage Loans underlying the Group [ ] Trust Assets consist primarily of buydown mortgage loans.
See “The Trust Assets-The Mortgage Loans” in this Supplement.] [ Less than [ ]% of the Mortgage Loans
underlying the Group [ ] Trust Assets are buydown mortgage loans.]
[(6) The Gi nnie M ae I MBS Certificates th at c onstitute th e Su bgroup [ ] Tru st Assets h ave Certificate Rates
ranging from [ ]% to [ ]%. The Weighted Average Certificate Rate shown for the Subgroup [ ] Trust
S-3 I-12-3
Assets represents the weighted average of the Certificate Rates of t hose Trust Assets, weighted on the basis
of the respective principal balances of such Trust MBS as of the Closing Date.]
[(7) The Group [ ] Trust Assets consist of adjustable rate Ginnie Mae II MBS Certificates.]
[(8) Each Ginnie Mae Certificate included in Trust Asset Group [ ] has an initial fixed rate period of [ ] years,
after wh ich it b ears in terest at a Certificat e Rate, ad justed ann ually, eq ual to [One Year T reasury Index
(“CMT”)] plus [[1.50]% (the “Certificate Margin”),] [a margin indicated on Exhibit A (each, a “Ce rtificate
Margin”),] s ubject t o a n a nnual a djustment cap o f plus or m inus [1.00]% per a nnum and a l ifetime
adjustment cap of [5.00]% abo ve th e initial Certificat e Rate or a flo or of [5.00]% b elow th e initial
Certificate Rate but not less than the Certificate Margin. The actual annual and lifetime caps on interest rate
adjustments may limit whether the Certificate Rate for each Trust Asset remains at CMT plus the applicable
Certificate Margin. [Each Certificate Rate is [ .00]% as of [ ] 1, 20[ ].] [The Group [ ] Trust Assets have
Certificate Rates ranging from [ ]% to [ ]%, as of [ ] 1, 20[ ], as identified in Exhibit A.] [For all of the
Group [ ] Trust Assets[, with the exception of the Ginnie Mae II MBS Certificate relating to Pool Number [
],] th e i nitial fix ed rate period h as exp ired. [The i nitial fix ed rate period fo r th e Ginnie Mae II MBS
Certificate relating to Po ol Number [
] will ex pire in [MONTH] of [YEAR].] See “The Trust Assets —
The Trust MBS” in this Supplement.]
[NOTE TO TRUST COUNSEL: In the e vent there are one or more subgroups in a deal, refere nces to groups
throughout this supplement may need to be modified to refer to subgroups.]
S-4 I-12-4
[Security Groups : This ser ies of Securities c onsists of multiple Se curity Grou ps (ea ch, a
“Group”), as shown on the front cover of this Supplement
[and on Schedule I to this
Supplement]. [Except in the c ase of [a] certain MX Class [es] in Groups [ ] and [ ] ,]
[p][P]ayments on each Group will be based solely on payments on the Trust Asset Group with
the same numerical designation.]
[Assumed] Characteristics of the Mortgage Loans Underlying the [Group [1]] [and [ ]]
[and] [Subgroup [2A]] Trust Assets](1):
Principal
Balance(2)
Weighted Average
Remaining Term to
Maturity (in
months)
Weighted Average
Loan Age
(in months)
[Weighted
Average]
Mortgage
Rate[(3)]
Group 1 Trust Assets
$
%
%
$
[Group 2] [Subgroup
[2A] Trust Assets
$[
$
] (4)
%
%
(1) As of _________ 1, 20[ ].
(2) Does not include the [Group ] Trust Assets that will be added to pay the Trustee Fee.
[(3) The M ortgage Loans underlying t he [Group [ ]] Tru st Assets m ay b ear in terest at rates rang ing fro m
0.25% to 1.50% per annum above the related Certificate Rate.]]
[(4) More t han 10 % of t he M ortgage L oans u nderlying t he [Group [ ] ] Tr ust Asset s m ay be hi gher ba lance
Mortgage Loans. See “Risk Factors” in this Supplement.] [NOTE TO TRUST COUNSEL: Only use this
footnote to id entify Tru st Asset Gro ups th at are b acked by “M JM”, “M FS”, “All ARMs”, “C SF”, “C
BD”, “X BD” or “X SN” Mortgage Loans.]
[The actual remaining terms to m aturity [and loan ages ] [, loan ages and [, in the c ase of the
Group [2] T rust Asse ts,] Mortgage Rates ] of many of the Mortgage Loans [underlying the
Group [ ] Trust Assets ] will d iffer from the weighted averages sh own above, perhaps
significantly. See “The Trust Assets — The Mortgage Loans” in this Supplement.]
[NOTE TO TRUST COUNSEL: FOR ARM MBS BACKED GROUPS:
Assumed Characteristics of the Mortgage Loans Underlying the Group [ ] Trust Assets:
The assumed characteristics of the Mortgage Loans underlying the Group [ ] Trust Assets are
identified in Exhibit [F] to this Supplement. There can be no assurance that the actual
characteristics of the Mortgage Loans underlying the Group [ ] Trust Assets will be the same
as the assumed characteristics identified in Exhibit [ F] to this Supplement. [More than 10%
of the Mortgage Loans underlying the Group [ ] Trust Assets may be higher balance
Mortgage Loans.] See “Risk Factors” in this Supplement.]
[Characteristics of the Mortgage Loans Underlying the Group [ ] [and [ ]] Trust Assets:
See Exhibit A to this Supplem ent for certain information regarding the charac teristics of the
S-5 I-12-5
Mortgage L oans included in the [related] Underlying Trust [s].] [See Exhib it D to th is
Supplement for certain inform ation regarding the characteristics of the Mortgage Loans
included in the [related] underlying SMBS Trus t[s]]. [See the Series [20[ ]]–C[ ] Offering
Circular attached to this Supplement as E
xhibit C for c ertain inform ation regarding the
characteristics of the Mortgage Lo
ans underlying the Underlying Callable
[Security]
[Securities].]
[Underlying Callable [Security ] [Securities] : The Group [4] Trust Assets include [an]
Underlying Callable [Security] [ Securities] as d escribed in the Series [20[ ]]-C[ ] Offering
Circular attached to this Suppl ement. The Underlying Callable [Security] [ Securities] are
subject to redemption on any related distribution date occurring in [
] 20[ ] or thereafter.
Any rede mption would result in the c oncurrent paym ent in full of the Group [4] [Security]
[Securities]. See “Risk Factors —— Early redemption of the underlying callable [security]
[securities] will sign ificantly affect yields on the group [4] [security] [s ecurities]” in this
Supplement.]
Issuance of Securities : The Securities, other than the Re sidual Secu rities, will initia lly b e
issued in book-entry form through the book-entry system of the U.S. Federal Reserve Banks
(the “Fedwire Book-Entry System ”). The Re sidual Securities will be issued in fully
registered, certificated form. See “Description of the Secur ities – Form of Securities” in this
Supplement.
[Modification and Exchange : If you own exchangeable S ecurities you will be able, upon
notice and paym ent of a n exchange fee, to exch ange them for a proporti onate interest in the
related Securities shown on Schedule I to this Supplem ent. [Under certain circumstances, [an
MX Class that is a Weighted Average Coupon Class] [Class [ ]] will be subject to mandatory
exchange, with no exchange fee, for its r elated REMIC Secur ities.] See “Description of th e
Securities — Modification and Exchange” in this Supplement.]
Increased Minimum Denomination Class[es ]: [None] [Each Cla ss tha t cons titutes a [n]
[Principal Only ][,] [Interest Only, ] [Non-Sticky Jum p,] [Sticky Jum p,] [Jump,] [ Toggle,]
[Special,] [ Weighted Average Coupon ]1 [or] [[Interest Only ] Inverse Floating Rate ] Class. ]
[See “Description of the Securities — Form of Securities” in this Supplement.]
Interest Rates: [The Interest Rate[s] [for the Fixed Rate Class [es]] [is] [are] shown on the
front cover of this Supplement [or on Schedule I to this Supplement].]
[Classes [ ] and [ ] are [Ascending Rate ] [and] [Descending Rate ] C lasses tha t will bea r
interest at the initial per a nnum Interest Rates shown below for the indicated num
ber of
Accrual Periods and then at the per annum Interest Rates shown below thereafter:
Class
Initial Interest Rate
Accrual Periods
Interest Rate
Thereafter]
1 [NOTE TO TRUST COUNSEL: All MX Classes subject to force d exchange are IMD. Whether or not a
WAC Class that is not sub ject to forced exch ange is IMD d epends on th e p ayment characteristics of that
Class. You should consult Ginnie Mae’s Legal Advisor to determine whether a particular Class is IMD.]
S-6 I-12-6
[Class [ ] is an [Ascending] [Descending] Rate Class th at will bear interest at a per annum
Interest Rate of [ ]% for the first [ ] Accrual Periods and [ ]% thereafter.]
[The [Floating Rate[,] [and] [Inverse Floating R ate] [and Toggle] Class[es] will bear interest
at per annum rates based on [one-month LIBOR ] (herein after referred to as “ [LIBOR]”) as
follows:
Class
Interest Rate
Formula[(1)]
Initial
Interest
Rate([2])
Minimum
Rate
Maximum
Rate
Delay
(in days)
LIBOR
for Minimum
Interest Rate
[(3)]
[(1) LIBOR will be established o n the b asis o f the [BBA LIBOR ] [LIBO] m ethod, a s desc ribed under
“Description of the Securities — In terest Distributions — [Floating Rate][,] [and] [Inverse Floating Rate]
[and Toggle] Class[es]” in this Supplement.]
[(2) The in itial In terest Rate will b e in effect du ring th e [first Accr ual Perio d]; th e In terest Rate will ad just
[monthly] thereafter.]
[(3) The M aximum Rate for C lass [ ] for any Accru al Period is th e Weighted Average Ce rtificate Rate
(“WACR”) of the Group [ ] Trust Assets.]
[Each of] [Class[es] [ ] [and [ ]] is a Weighted Average Coupon Class. [NOTE TO TRUST
COUNSEL: FOR REMIC WAC CLASS ES BACKE D B Y ARM MBS OR REMIC
WAC CLASSES BACKED BY MBS WITH DIFFERENT CE RTIFICATE RAT ES:
Class [ ] will accru e interest duri ng each Accrual Period at a per annum Interest Rate [equal
to the [WACR]] [based on the W eighted Average Certificate Rate ] of the Group [ ] Trust
Assets [less the Inte rest Rate f or Class [ ]] for t hat Accrual Period. The approxim ate initial
Interest Rate for Cl ass [ ], which will be in effect fo r the first Accru al Period, is [ ]%.]
[NOTE TO TRUST COUNSEL: FOR W AC MX CL ASSES: [ Class [ ]] [Each of the
Weighted Average Coupon Class [es]] will a ccrue interes t d uring each Accrual Period at an
equivalent annualized rate deriv ed by aggregat ing the accrued interest on its related REMIC
Classes for such Accrual Period expresse d as a percentage of its outstanding
[principal]
[notional] b alance for s uch Accrual Period [, subject to certain lim itations as set forth under
“Description of the Securities — Modifi cation and Exchange” in this Supplem ent].] [ The
approximate initial In terest Rate f or [Class [ ]] [each] [Weighted Average Coupon Class ],
which will be in effect for the first Accrual Period, is [ %] [as follows:
Class
Approximate
Initial Interest Rate
[ ]...................................................
[ ] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..
[ ] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..
[ ]%
[ ]%
[ ]%
]
[Upon any redem ption of Underlying Callable [Security] [ Securities], each related Class of
Securities [(other than any MX Securities )] will be entitled to additiona l interest as described
in “The Trust Assets—The Underlying Callable [Security] [Securities]” in this Supplement.]]
[NOTE TO TRUST COUNSEL: This only applies when there are delay CC Classes.]
S-7 I-12-7
[NOTE TO TRUST COUNSEL: In the case of a single s ecurity group, use the following
formulation to describe distributions of principal.]
[Allocation of Principal: On each Distribution Date, a percen
tage of the Principal
Distribution Am ount will be applied to the Tru stee Fee, an d the rem ainder of the Princip al
Distribution Amount [(the “Adjusted Principal Distribution Am ount”)] [and the [ ] Accrual
Amount [and the [ ] Accrual Amount]] will be allocated as follows:
[NOTE T O TRUST COUNS EL: W hen describing a “se quential” paydow n rule, use
language sim ilar to the following: “Sequentiall y, to A and B, in that order
. . .”. W hen
describing a “concurrent” paydown rule, us
e language sim ilar to the following:
“Concurrently, to A and B, pro rata . . .”.]
[The
[
] Accrual Amount [and the [
priority
] Accrual Amount] in the following order of
[The
] Accrual Amount] in the following order of
[
] Accrual Amount [and the [
priority:
The Adjusted
Principal Distribution Amount in the following order of priority:
]
[NOTE TO TRUST COUNSEL: In the ca se of multiple security groups use the f ollowing
formulation to describe distributions of principal.]
[Allocation of Princ ipal: On each Distribution Date [for a Security Group ], the f ollowing
distributions will be made to the related Securities:
SECURITY GROUP 1
[The Group 1 Prin cipal Distribution Amount will be allo cated in the following o rder of
priority:]
[A percentage of the ] [ The] Group 1 Principal Distribution Am ount [may] [will] be
applied to the Trustee Fee, and the rem ainder of the Group 1 Princi pal Distribution Am ount
[(the “Group 1 Adjusted Pr incipal Distribution Am ount”)] [and the [ ] Accrual A mount[s]
will be allocated as follows:
The
[
] Accrual Amount[s] in the following order of priority:
The
Group 1 Adjusted Principal Distribution Amount [and the [
the following order of priority:
] Accrual Amount] in
SECURITY GROUP 2
[The [Group 2 ] [Subgroup [2A] Principal Distribution Amount will be allocated in the
following order of priority:]
S-8 I-12-8
[A percentage of the ] [ The] Group 2 Principal Distribution Am ount [may] [ will] be
applied to the Trustee Fee, and the rem ainder of the Group 2 Princi pal Distribution Am ount
[(the “Group 2 Adjusted Pr incipal Distribution Am ount”)] [and the [ ] Accrual Am ount[s]
will be allocated as follows:
The
[
] Accrual Amount[s] in the following order of priority:
The
Group 2 Adjusted Principal Distribution Amount [and the [ ] Accrual Amount] in
the following order of priority:]
[The [Subgroup [2B] Principal Distribution Amount will be allocated in the following
order of priority: ]
SECURITY GROUP 3
[The Group 3 Prin cipal Distribution Amount will be allo cated in the following o rder of
priority:]
[A percentage of the ] [ The] Group 3 Principal Distribution Am ount [may] [ will] be
applied to the Trustee Fee, and the rem ainder of the Group 3 Princi pal Distribution Am ount
[(the “Group 3 Adjusted Pr incipal Distribution Am ount”)] [and the [ ] Accrual Am ount[s]
will be allocated as follows:]
The
[
] Accrual Amount[s] in the following order of priority:
The
[
] Accrual Amount[s] in the following order of priority:
The
Group 3 Adjusted Principal Distribution Amount [and the [
the following order of priority:
]
] Accrual Amount] in
[Scheduled Principal Balances: T he [Scheduled Principal Balances ] [or] [Aggregate
Scheduled Principal Balances ] for th e Class[es] listed below are included in Schedule [I] [II]
to this Sup plement. They were calculated
using [among other things ] the f ollowing
Structuring Range[s] [or Rate[s]]:
[NOTE: Trust Counsel may include a Security Group column in the table below.]
S-9 I-12-9
Structuring [Range[s]]
[or] [Rate[s]]
PAC [I][II] Class[es] [and Component[s]]
[ ][, [ ]] [and [ ] (in the aggregate)][*].......................
[ ][, [ ]] [and [ ] (in the aggregate)][*].......................
[ ]% PSA through [ ]% PSA
[ ]% PSA through [ ]% PSA
[Scheduled Class[es] [and Component[s]]
[ ][, [ ]] [and [ ]] [**] .................................................
[ ][, [ ]] [and [ ]] [**] .................................................
[ ]% PSA through [ ]% PSA
[ ]% PSA through [ ]% PSA
[TAC Class[es] [and Component[s]]
[ ][, [ ]] [and [ ] (in the aggregate)] ...........................
[ ][, [ ]] [and [ ] (in the aggregate)] ...........................
[[ ]% PSA] [[ ]% PSA through [ ]%
PSA]
[[ ]% PSA] [[ ]% PSA through [ ]%
PSA]
__________________
[* The initial Ef fective Range is [ ] % PSA through [ ] % PSA. ][NOTE TO TRUS T
COUNSEL: This footnote is used when the initial Effective Range is narrower than the
Structuring Range.]
[** No initial Effective [Range] [Rate].]
[[ ]% PSA] [Jump] Balances]: The [ ]% PSA [and [ ] % PSA Balances (together, the
“Jump Balances”)] Balances are included in Schedule III to this Supplement. The [ ]% [and [
]% PSA Balances] were calculated using a Structuring Rate of [ ]% PSA [and [ ] % PSA
Balances respectively, ] and [ the assum ed characteristics of the related Trust MBS to be
delivered on the Closing Date. The actua l characteristics of the related Trust MBS m ay vary
from the ch aracteristics assum ed in preparing the [ ]% P SA [Jump] Balances included in
Schedule III to this Supplem ent and, if so, the Sponsor may recalculate such balan ces. The
Sponsor will make them available on Ginnie Mae’s Multiclass Securities e-Access located on
Ginnie Mae’s website (“e-Access”) shortly after the Closing Date.]
[Accrual Class[es]: Interest will accrue on [the] [each] Accrual Class identified on the front
cover of this Supplem ent at the per annum rate set forth on that page. However, no interest
will be dis tributed to the Accrual Class [es] [until the Distribu tion Date f ollowing the
Distribution Date on which the Cla ss Principal Balance [s] of the rela ted Ac cretion Directed
Class[es] h ave been reduced to zero ][as in terest]. Inte rest [so accru ed and unp aid] [so
accrued] on [each] [the] Accrual C lass on each Distribution Date will constitute [an] [the]
Accrual Amount, which will be added to the Cl ass Principal Balance of that Class on each
Distribution Date [and[, with res pect to Cla ss[es] [ ] [ ,] [ and] [ ] [and [ ],] will be
distributable as principal as se t forth in this Term s Sheet unde r “Allocation of Principal.”
[After interest distributions commence on [an] [the] Accrual Class, in terest distributions will
continue until the Class Principal Balance of that Class is reduced to zero.]
[NOTE T O TRUS T COUNSE L: Include when Underly ing Certificates are Accrual
Classes: Principal will be distributed to Class [es] [ ] [,] [and] [ ] [and [ ]], when received as
principal f rom the relate d Underlyin g Certif icate[s], as set forth in th is Term s Sheet under
“Allocation of Principal.”] The [related] Underlying Certificate[s] [is] [are] also [an] Accrual
Class[es]. Interes t will accrue on [the] [each] Underlying Certificate at the rate set forth on
S-10 I-12-10
[the front cover ] [or] [Schedule I ][, as app licable,] of th e re lated Underly ing Certif icate
Disclosure Document included in Exhibit B to this Supplem ent. However, no interest will be
distributed to the Underlying Certificate [s] as interest, but will cons titute an Accrual Am ount
with respe ct to the re lated Underly ing Trust, which will be added to the Class Princip al
Balance of the related Underl ying Certificate on each Dist ribution Date and will be
distributable as principal as set forth in the Terms Sheet of the related U nderlying Certificate
Disclosure Document included in Exhibit B to this Supplement. [With respect to Group[s] [ ]
[,] [and] [ ] [and [ ], the] [The] Underlying Certificate [s] [is] [are] backed by [a] previously
issued certificate [s] tha t [is] [are] also [an] Accrual Class [es]. T he previou sly issu ed
certificates backing th e rela ted Underlying Certificate [s] [in Group [s] [ ] [,] [and] [ ] [and
[ ]] will not receive principal distributions until the Class Princip al Balances of [its] [their]
related Accretion Directed Class [es] [is] [are] reduced to zero. W
hen such principal
distributions commence, the [Group [ ] [,] [and] [ ] [and [ ]] [related] Principal Distribution
Amount[s] will include the Accrual Amount for the related Underlying Certificate.]
[Notional Class[e s]: The Notional Class [es] will not rec eive dis tributions of principal b ut
[have] [has a ] Class Notional B alance[s] f or convenience in describing
[their] [its]
entitlement[s] to inte rest. The C lass Notion al Balan ce of [the] [each] Notion al Class
represents the percen tage indicated below of, and reduces to that extent with, the [[Class] [or
Component] Principal Balance[s]] [or the] [outstanding [principal] [or] [notional] balance] of
the [related] Trust Asset [Group][Subgroup] in dicated: [NOTE TO TRUST CO UNSEL:
Classes in the following chart can be organized alphabetically or by group at the discretion of
Trust Counsel or the Sponsor.]
Original Class
Notional Balance
Class
.......................
$
.......................
.......................
.......................
.......................
.......................
.......................
.......................
.......................
.......................
.......................
[Total]
$
[Total]
$
[Total]
Represents [Approximately]
[ ]% of [Class] and [Class] [(in the
aggregate)]([Class Type])
[ ]% of [the [Notional Balance of
the] Group [ ] Trust Assets] ([Class
Type])
[ ]% of [Class] ([Class Type])
[ ]% of [Class] ([Class Type])
[ ]% of [Class] ([Class Type])
[ ]% of [Class] ([Class Type])
[ ]% of [Class] ([Class Type])
[ ]% of [Class] ([Class Type])
[ ]% of [Class] ([Class Type])
[ ]% of [Class] ([Class Type])
[ ]% of [Class] ([Class Type])
[Component Class[es]: For purposes of ca lculating distributions of [principal] [interest],
Class[es] [ ] [and [ ]] [is] [are] comprised of multiple co mponents having the designations
S-11 I
-12-11
and characteristics set forth be low. Com ponents are not separa tely transferable f rom the
related Class of Securities.
Class
Components
Principal
Type
Interest
Type
Interest
Rate
Original
[Principal]
[Notional]
Balance
[Segment[s]: For purpo ses of calcu lating distributions of princ ipal, c ertain Clas ses will be
apportioned as Segment[s] as follows:
Segment
Principal Type
Original
Principal Balance
Related
Classes
1
2
Tax Status: [Single] [Double] REMIC Series. [Separate REMIC elections will be m ade as
to [each Trust Asset Gro up of] the Underlying Callable [Security] [Securities] and the Trust
Assets other than the Underlying Callable [Security] [Securities]]. [[Single] [Double] REMIC
Series [as to the Group [ ] Trust Assets and [Single] [Double] REMIC Series as to the Group [
] Trust Asse ts]. [Separate REMIC elections will be m ade as to the Issuing REMIC and the
Pooling REMIC with respect to the Group [ ] Trust Assets and the Group [ ] Trust Assets (the
“Group [1] Pooling REMIC”, the “Group
[1] Issuing REMIC,” the “Group
[2] Pooling
REMIC” and the “Grou p [2] Issu ing REMIC,” respectively ).]] See “Certain United States
Federal Income Tax Consequences” in this Supplement and in the Base Offering Circular.
Regular and Residual Classes: [Class [R] [RR] is a Residual Class [and represents the
Residual Interest of [the] [each] [Trust REMIC] [the Issuing REMIC and [each] [the] Pooling
REMIC].] [Classes RR[ ] and R[ ] are Residual Classes. Class RR[ ] represents the Residual
Interest of the Group [ ] Issuing and Pooling REMICs. Class R [ ] represents the Residual
Interest of the Group [ ] REMIC. ] [ Classes RI and RP are Resi dual Classes. Class R I
represents the Residual Interest of the Issui ng REMIC and Class RP represents the Residual
Interest of the Pooling REMIC.] All other Classes of REMIC Securities are Regular Classes.
S-12 I-12-12
RISK FACTORS
You should purchase securities only if
you understand and are able to bear the
associated risks. The risks applicable to your investment depend on the principal and interest
type of your securities. This section highlights certain of these risks.
The rate of principal payments on the
underlying mortgage lo ans will affect the
rate of principal payments on
your
securities. The rate at which you will
receive principal pay ments will depend
largely on the rate of principal paym ents,
including prepaym ents, on the mortgage
loans underlying the related trust assets.
Any historical data regarding m
ortgage
loan prepaym ent rates m
ay not be
indicative of the rate of future prepayments
on the underlying m ortgage loans, and no
assurances can be given about the rates at
which the underly ing mortgage lo ans will
prepay. We expect the rate of principal
payments on the underlying mortgage
loans to vary. Borrowers generally m ay
prepay their m ortgage loans at any tim e
without penalty.
The term s of the m ortgage loans m ay be
modified to perm it, am ong other things, a
partial release of security, which releases a
portion of the mortgaged property from the
lien securing the related m ortgage loan.
Partial releases of security m ay reduce the
value of th e rem aining secur ity an d also
allow the rela ted borr ower to sell th e
released p roperty and generate p roceeds
that m ay be used to prepay the related
mortgage loan in whole or in part.
In addition to voluntary prepaym
ents,
mortgage lo ans can be prepaid as a resu lt
of governmental m ortgage insurance claim
payments, loss m itigation arrange ments,
repurchases or liquida tions of defaulted
mortgage loans. Although under certain
circumstances Ginnie Mae issuers have the
option to repurchase defaulted m ortgage
loans from the related pool underlying a
Ginnie Mae MBS certificate, they are not
obligated to do so. Defaulted m
ortgage
loans that rem ain in pools backing Ginnie
Mae MBS certificates m ay be subject to
governmental m ortgage insurance claim
payments, loss m itigation arr angements or
foreclosure, which could have the same
effect as voluntary prepaym ents on the
cash flow availab le to pay the securities.
No assuran ces can be given as to the
timing or fr equency of any governm ental
mortgage insurance claim payments, issuer
repurchases, loss m itigation a rrangements
or foreclosure proceedings with respect to
defaulted mortgage loans and the resulting
effect on the tim ing or rate of principal
payments on your securities.
[The mortgage loans underlyin
g the
group [ ] trust assets [consist primarily
of] [include] buydown mortgage loans. A
buydown mortgage loan is a mortgage loan
for which funds have been provided to
reduce the borrower’s monthly paym ents
during the early year s of the loan. A
buydown mortgage loan is based on an
assessment that th e bor rower will be able
to m ake hi gher paym ents in later years.
Increases in the
required monthly
payments on such loans m ay result in a
higher prepaym ent rate than that of nonbuydown, single-fam ily level-paym ent
loans. Consequently, this m ay accelerate
the paym ent of principal on the group [ ]
securities.]
Rates of principal payments can reduce
your yield. The yield on your securities
probably will be lower than you expect if:
S-13 I-12-13
you bought your securities at a
premium [(interest on ly securities,
for example) ] and principal
payments are faster than you
expected, or
you bought your securities at a
discount [(principal only securities,
for example) ] and principal
payments are slower than you
expected.
In addition, if your securities are [interest
only securities or] securities purchased at a
significant premium, you could lose money
on your investment if prepayments occur at
a rapid rate.
[The adjustable rate mortgage loans have
features of fixed rate mortgage loans and
adjustable rate mortgage loans. The
adjustable rate mortgage loans have an
initial fixed rate period. During this
period, these mortgage loans may exhibit
general payment characteristics associated
with fixed rate mortgages. After the initial
fixed rate period expires, these mortgage
loans will adjust annually, subject to
applicable annual and lifetime floors and
caps. During this period, these mortgage
loans may exhibit general payment
characteristics associated with adjustable
rate mortgage loans.]
[Adjustable rate mortgage loans may
exhibit general prepayment
characteristics that are different than
those of fixed rate mortgage loans. In
general, as prevailing mortgage interest
rates decline, borrowers with fixed rate
mortgage loans are more likely to
refinance their current, higher rate
mortgages, which may result in faster
prepayment rates. Additionally, as
prevailing mortgage interest rates rise,
borrowers with fixed rate mortgage loans
are less likely to refinance their current,
lower rate mortgages, which may result in
slower prepayment rates. In contrast, as
prevailing mortgage interest rates decline,
borrowers with adjustable rate mortgage
loans are less likely to refinance their
current mortgages, which may result in
slower prepayment rates. Additionally, as
prevailing mortgage interest rates rise,
borrowers with adjustable rate mortgage
loans are more likely to refinance their
current mortgages, which may result in
faster prepayment rates. Finally, increases
in prevailing mortgage interest rates may
result in increases in the required monthly
payments on adjustable rate mortgage
loans. This may result in higher default
rates on adjustable rate mortgage loans
which could lead to faster prepayment
rates and reduce the yield on the related
securities.]
[Adjustable rate mortgages with initial
fixed rate periods may be more likely to be
refinanced or become delinquent than
other mortgage loans The adjustable rate
mortgage loans [underlying the group [ ]
trust assets] have initial fixed rate periods
of [ ] years. After the fixed rate period,
the mortgage rates may increase up to
[one] percentage point per annum at the
first interest rate change date and on each
annual reset date thereafter, subject to
applicable lifetime caps and floors.
Borrowers may be more likely to refinance
these mortgage loans before a rate increase
becomes effective. If a borrower is unable
to refinance such a mortgage loan and
interest rates rise, particularly after the
initial fixed rate period, the borrower may
find it increasingly difficult to remain
current in its scheduled monthly payments
following the increase in the monthly
payment amount. This may result in
higher default rates on adjustable rate
mortgage loans which could lead to faster
prepayment rates and reduce the yield on
the related securities.]
[After [the] [any applicable] initial fixed
rate period of the mortgage loans
S-14 I-12-14
underlying the group [ ] trust assets, the
mortgage rates on such mortgage loans
will be adjusted annually and will be
based on [CMT], the level of which will
affect the yield on the related securities.
After [the] [any applicable] initial fixed
rate period of the mortgage loans
underlying the group [ ] trust assets, the
yield on the related securities will depend,
in part, on the level of [CMT]. [CMT] will
be determined annually and the rate of
[CMT] used with respect to the mortgage
loans underlying the group [ ] trust assets
will not necessarily reflect current levels of
[CMT]. After the initial fixed rate period
of the mortgage loans underlying the group
[ ] trust assets, if [CMT] performs
differently from what you expect, the yield
on your securities may be lower than you
expect. Lower levels of [CMT] will
generally reduce the weighted average
certificate rate on the group [ ] trust assets,
which will reduce or cap the interest rate
on the related securities. You should bear
in mind that the timing of changes in the
level of [CMT] may affect your yield:
generally, the earlier a change, the greater
the effect on your yield. It is doubtful that
[CMT] will remain constant.]
Adjustable rate mortgage loans are
subject to certain caps, which may limit
the amount of interest payable on such
mortgage loans and may limit the WACR
on the group [ ] trust assets and the
interest rates on the related securities
after the initial fixed rate period of the
related mortgage loans. After the initial
fixed rate period of the mortgage loans
underlying the group [ ] trust assets, if
[CMT] increases to a sufficiently high
level, the mortgage rates on such mortgage
loans may be limited by caps. As a result,
the WACR on the group [ ] trust assets, as
well as the interest rates on the related
securities, may be limited. The application
of any caps on the mortgage loans may
significantly impact the interest rate on
class [RELATED IO CLASS] because the
interest entitlement of such class of
securities is entirely dependent on the
excess of the WACR of the group [ ] trust
assets over the interest rate distributable to
class [RELATED P&I CLASS ].]
[The mortgage rate index for the
mortgage loans underlying the group [ ]
trust assets is different than the interest
rate index for the related securities, which
may impact, perhaps significantly, the
amount of interest distributable to the
related securities [after the initial fixed
rate period of the related mortgage loans].
[CMT] is the mortgage rate index for the
mortgage loans underlying the group [ ]
trust assets and [one-month LIBOR] is the
interest rate index for the related securities.
Because [CMT] and [LIBOR] are
determined in a different manner and at
different times, and because the certificate
rates on the group [ ] trust assets adjust
annually after the initial fixed rate period
and the interest rates on the related
securities adjust monthly, there may be a
mismatch between the certificate rates on
the group [ ] trust assets and the interest
rates on the related securities. If [CMT]
for the group [ ] trust assets is lower than
[LIBOR] for the related securities for any
accrual period, interest accruals with
respect to the related notional class[es] will
be reduced because such class is entitled to
receive the excess of interest accrued in
respect of the group [ ] trust assets over
the interest distributable to the related
floating rate class. In addition, if [CMT]
for the group [ ] trust assets is
significantly lower than [LIBOR] for the
related securities for any accrual period,
interest accruing on the related floating
rate class will be reduced because the
interest rate on such class is capped at a
S-15 I-12-15
rate equal to the WACR of the group [ ]
trust assets. In the event that [CMT] for
the group [ ] trust assets is higher than
[LIBOR] for the related securities, interest
accruing on the related floating rate class
will not be affected but interest accruals
with respect to the related notional class
will be increased. Because the index on
the group [ ] trust assets adjusts annually
after the initial fixed rate period of the
related mortgage loans but the index on the
related securities will adjust monthly, this
effect could be magnified during periods of
significant volatility of short-term interest
rates.]
[The mortgage rate index for the
mortgage loans underlying the group [3]
trust assets may not reset at the same time
as the interest rate index for the related
securities, which may impact, perhaps
significantly, the amount of interest
distributable to the related securities
[after the initial fixed rate period of the
related mortgage loans]. The interest rates
for the mortgage loans underlying the
group [3] trust assets and for the related
securities are based on [CMT][LIBOR]
and will reset annually [after the initial
fixed rate period]. However, there can be
no assurance that the rate index reset for
the group [3] trust assets will occur at the
same time as the rate index reset for the
related securities. A difference in the
timing of any such reset may result in a
mismatch between the certificate rates on
the group [3] trust assets and the interest
rates on the related securities. If
[CMT][LIBOR] for the group [3] trust
assets is significantly lower than
[CMT][LIBOR] for the related securities
for any accrual period, interest accruals on
the related floating rate class will be
reduced because the interest rate on such
floating rate class is capped at a rate based
on the WACR of the group [3] trust assets.
If [CMT][LIBOR] for the group [3] trust
assets is higher than [CMT][LIBOR] for
the related securities, interest accruals on
the related floating rate class will not be
affected but interest accruals with respect
to the related notional class will be
increased. This effect could be magnified
during periods of significant volatility of
[CMT][LIBOR].
Under certain circumstances, a Ginnie
Mae issuer has the right to repurchase a
defaulted mortgage loan from the related
pool of mortgage loans underlying a
particular Ginnie Mae MBS certificate,
the effect of which would be comparable
to a prepayment of such mortgage loan.
At its option and without Ginnie Mae’s
prior consent, a Ginnie Mae issuer may
repurchase any mortgage loan at an
amount equal to par less any amounts
previously advanced by such issuer in
connection with its responsibilities as
servicer of such mortgage loan to the
extent that (i) in the case of a mortgage
loan included in a pool of mortgage loans
underlying a Ginnie Mae MBS certificate
issued on or before December 1, 2002,
such mortgage loan has been delinquent
for four consecutive months, and at least
one delinquent payment remains uncured
or (ii) in the case of a mortgage loan
included in a pool of mortgage loans
underlying a Ginnie Mae MBS certificate
issued on or after January 1, 2003, no
payment has been made on such mortgage
loan for three consecutive months. Any
such repurchase will result in prepayment
of the principal balance or reduction in the
notional balance of the securities
ultimately backed by such mortgage loan.
No assurances can be given as to the
timing or frequency of any such
repurchases.
[NOTE T O TRUST COUNSE L: For
INV/Z OR FLT/Z Classes ] [ The rate of
S-16 I-12-16
principal payments on certain grou p [ ]
classes will be sensitive to LIBOR.
The
rate of principal payments on class [ ] will
depend in part on the rate at which interest
accrues on class [ ], which in tu rn will
depend on the level of LIBOR. In
particular, during periods when the level of
LIBOR [exceeds [ ]%] [ is lower than
expected], the principal balance
[s] of
class[es] [ ] will be paid more slowly than
would otherwise be th e case, and their
weighted av erage liv es m ay be extended,
perhaps significantly.]
[The level of LIBOR will af fect the yields
on [floating rate][,] [and] [inverse
floating rate][,] [and] [weighted average
coupon] [and [under certain
circumstances,] toggle] securities.
I f
LIBOR perfor ms diffe rently from what
you expect, the yield on your securities
may be lower than you expect. Lower
levels of LIBOR will g enerally reduce the
yield on [floating rate ][,] [and] [weighted
average coupon ] [and [under certain
circumstances,] toggle ] securities; higher
levels of LIBOR will g enerally reduce the
yield on inverse floating rate [and [under
certain circum stances,] toggle ] se curities.
You should bear in m ind that the tim ing of
changes in the leve l of LIBOR may affect
your yield: generally, the earlier a change,
the greater the effect on your yield. It is
doubtful that LIBOR will remain constant.]
of higher yielding investm
ent
opportunities. The final paym ent on your
security m ay occur m uch earlier than the
final distribution date.
[Support securities will be mor e sensitive
to rates of principal payments tha n other
securities. If principal prepaym ents result
in principal distributions on any
distribution date equal to or les s th an the
amount needed to produce scheduled
payments on the
[PAC][,] [scheduled]
[and] [TAC] class [es] [and com ponents],
the [related] support class
[es] [and
components] will not receive any principal
distribution on that date [(other tha n f rom
any applicable accrual am
ount)]. If
prepayments result in principal
distributions on any
distribution date
greater than the am ount needed to produce
scheduled paym ents on the
[related]
[PAC][,] [scheduled] [and] [TAC]
class[es] [and com ponents] for t
hat
distribution date, this excess will be
distributed to the [related] support class[es]
[and components].]
[The occur rence of a trigger event may
significantly affect the weighted average
life of [no n-sticky ju mp], [sticky jump]
[and] [jump] secur ities. [The p rincipal
distribution priorities of non-sticky jum p
securities will change temporarily upon the
occurrence of a specif ied tr igger e vent o n
any Distribution Date as described under
“Terms Sheet -- Allocation of Principal” in
An investment in the s ecurities is subject
to significa nt reinve stment r isk. The rate
this Supplem ent.]
[The principal
of principal paym ents on your securities is
distribution priorities of stick y jump
uncertain. You m ay be unable to reinvest
securities will change perm anently upon
the paym ents on your securities at the
the occurrence of a specified trigger event
on any Distribution Date as described
same returns provided by the securities.
under “Term s Sheet -- Allocation of
Lower prevailing inte rest rate s m ay result
Principal” in this Sup
plement. ] [The
in an unexpected return of principal. In
principal d istribution p riorities of jump
that in terest rate cl imate, higher yielding
securities will chan
ge [permanently]
reinvestment opportunities m ay be limited.
[temporarily] upon the occurrence of any
Conversely, higher prevailing interest rates
of the spe cified trigg er even ts on any
may result in slower re turns of principal,
Distribution Date
as described under
and you may not be able to take advantage
S-17 I-12-17
“Terms Sheet -- Allocation of Principal” in
this Supplem ent.] A c hange in principal
distribution priority could significantly
extend or shorten the weighted average life
of any [non-sticky jump ], [sticky jum p]
[or] [jump] class from the anticipated
weighted average life at the tim
e of
purchase. Consequently, an investor in
[non-sticky jum p], [sticky jum p] [and]
[jump] securities should carefully consider
the likelihood and probable frequency of
the occurrence of the trigger ev
ent in
analyzing the anticipated weighted average
life of the securities acquired.]
[Accelerated secur ities will gener ally be
more sensitive to rates of principa
l
payments than non-accelerated securities.
The accelerated s ecurity clas s[es] will b e
entitled to [a] principal distribution [s] on
any distribution date only after the nonaccelerated security class [es] [has] [have]
received [its] [their] priority am ount. To
the extent that principal payments result in
principal distributions on any distribution
date greater than the amount needed to
produce the priority amount on the nonaccelerated secu rity class [es] for t hat
distribution date, the entire exces s will b e
distributed to the accelerated security
class[es], until retired.]
[The rate o f payments on the underly ing
certificate[s] will directly affect the rate of
payments o n the [group [3]] sec urities.
The underlying certif icate[s] will be
sensitive [in varying degrees] to:
the rate of paym ents of principal
(including prepaym ents) of the
related mortgage loans[.][, and
the priorities for the distribution of
principal among the classes of the
[related] underlying series.]†
† NOTE TO TRUST COUNSEL: This can be
deleted i f eac h underlying certificate i s t he only
[As described in the [related] und erlying
certificate disclosu re docum ent, the
underlying certificate [s] [included in trust
asset group [ ] consists of a [non-sticky
jump], [sticky jump] or [jump] class whose
principal distribution pr iorities will change
[temporarily] [ or] [ permanently] (“jum p”)
on any Distribution Date if the applicable
“trigger” ev ent occu rs. See “Term s Sheet
— Allocation of Principal” in Exhibit B.
A change in principal distribution priority
of the underlying
certificate could
significantly extend or shorten the
weighted average life of the underlying
certificate. Consequently, an investor in a
group [__] class shou ld carefully consider
the likelihood and probable frequency of
the oc currence of the tr igger ev ent in
analyzing the anticipated weighted average
life of the group [__] securities. The effect
that the occurrence of the trigger event will
have on each class of group [__] securities
will va ry de pending up on f actors s uch as
the paym ent priority of such class, when
the trigger event occurs and if so, whether
it con tinues to oc cur on subsequent
distribution dates. For exam ple, upon the
occurrence and continuance of the trigger
event sho rtly f ollowing the clos ing date,
the weighted average life of those group
[__] securities with a later payment priority
may be affected more significantly than the
weighted average life of those group [__]
securities with an ear lier payment priority.
The effect that the
occurrence of the
trigger event will have on a class o f group
[_] secur ities m ay be m itigated if the
trigger event is not m et on a subse quent
distribution date.
See “Group
[__]
Classes” in this supplement and Exhibit
B.]
certificate i n i ts underl ying sec urity gr oup t o
receive principal payments.
(continued…)
S-18 I-12-18
[NOTE T O TRUST COUNSE L: For
sequential classes of second or lower
priority, including PAC, TAC, SCH or
SUP Classe s with a sequentia l pay rule. ]
[As described in the [related] und erlying
certificate d isclosure document[s], [certain
of] the und erlying certificate [s] [included
in trust asset group
[3]] [are] [is] not
entitled to distribu tions of principal
[NOTE TO TRUST COUNSEL: Include
only if such accrual amount is payable
while hig her
priority
bonds are
outstanding.] [ (other than from any
applicable accrual am ount)] un til [a]
certain class [es] of the rela ted underlying
series [has] [have] been retired and,
accordingly, distribu tions of principal of
the related mortgage loans for extended
periods m ay be applie d to th e distr ibution
of principal of [that] [those] cl ass[es] of
certificates having pr
iority ov er th e
underlying certificate [s].] Accordingly,
[these] [this] underlying certificate [s] ma y
receive no principa l distributions for
extended periods of time.
[NOTE T O TRUST COUNSE L: For
PAC, TAC, SCH or SUP Classes that fit
the description .] [ In addition, [certain of ]
the underlying certificate [s] [included in
trust asset group [3]] [are] [is a ] class [es]
that pr ovide[s] support to
[an] other
class[es], and [they are ] [it is] en titled to
receive principal distributions [NOTE TO
TRUST COUNSEL: Include only if such
accrual amount is payable while higher
priority bonds are outstanding. ] [ (other
than from any applicable accrual amount) ]
[only if scheduled paym ents have been
made on other specified classes of the
related underlying series [(or if specified
classes have been retired) ]]. Ac cordingly,
[these] [ this] underlying certificate [s] ma y
receive no principa l distributions for
extended periods of tim e [or m ay receive
principal paym ents that vary widely fro m
period to period].]
[[One] [ Certain] [of] [t]he underlying
certificate[s] [ included in trus
t asse t
group[s] [ ] [ and [ ]] has [have] been
issued with [a] class notional balance [s]
that [is] [are] calculated on the basis of the
class principal balance of
[a] support
class[es] of the [related] underlying series.
Accordingly, the yield on such underlying
certificate[s] m ay be reduced, perhaps
significantly, if princi pal paym ents on the
[related] support class [es] occu r at a rapid
rate.]
[In addition, [the pr incipal en titlement[s]
of] [the red uctions in n otional ba lance of ]
[certain of ] the underlying certificate [s]
[included in trust asset group [3]] on any
payment date [is] [are] calculated[, directly
or indirectly,] on the basis of schedules; no
assurance can be give n that the underlying
certificate[s] will adher e to [their] [its]
schedules.] Further, prepaym ents on the
related mortgage loans m ay have occurred
at rates faster or s lower than those initially
assumed.
[The trus t asset [s] underlying [certain of ]
the underlying certificate [s] [included in
trust asset group[s] [ ] [and [ ]] [is also
a] [are also] previously issued certificate[s]
that repres ent[s] beneficial ownership
interests in [a] separate trust [s]. The rate
of paym ents on the
previously issued
certificate[s] backing [this] [these] [the]
underlying certificate[s] will directly affect
the timing and rate of paym ents on [your]
[the group [ ] [and [ ]] securities. You
should read the
[related] underlying
certificate disclos
ure docum
ent[s],
including the risk factors contained therein,
to understand the paym ents on and related
risks of the previous ly issued certificate [s]
backing [this] [these] [the] underlying
certificate[s].]
This supplem ent contains no inform ation
as to whether
[the] [ an] und erlying
certificate[s] [or the rela ted c lass[es] with
S-19 I-12-19
which [the] [a] notional underlying
certificate[s] reduce [s]] [has] [ have]
[adhered to [any app licable] principal
balance schedules, ] [whether any related
supporting classes remain outstanding] [or]
whether the underlying certificate
[s]
otherwise] [ has] [have]] performed as
originally anticip ated. A
dditional
information as to the underlying
certificate[s] m ay be obtained by
performing an analysis of current principal
factors of the unde rlying certificate [s] in
light of applicable inform ation contained
in the
[related] und erlying cer tificate
disclosure document[s].]
[The rate of principal payment s on the
underlying SMBS [security][securities]
will d irectly af fect the rate of pr incipal
payments o n the [gr oup [5]] sec urities.
The underlying SMBS
[security]
[securities] will be sen sitive [in v arying
degrees] to the rate of payments of
principal (including prepaym ents) of the
related m ortgage loans. [The certificate
rate of the underlying SMBS
[security]
[securities] exceeds the interest rate on the
related m ortgage loans. ] If prevailing
interest ra tes are h igher than the interes t
rates on the related m ortgage lo ans, then
borrowers will b e les s likely to m ake
principal prepaym ents resulting in slower
returns of principal payments on the [group
[5]] secu rities. If prev ailing inte rest rate s
are lower than the in terest r ates on the
related mortgage loans, then the underlying
SMBS
[security] [ securities] ma y
experience significant p
rincipal
prepayments resulting in faster
prepayments than anti cipated by investors
in the [group [5]] securities.
performing an analysis of current factors of
the underlying S
MBS
[security]
[securities] in ligh
t of applicab le
information contained in the
[related]
underlying SMBS security disclosure
document[s].
[Early r edemption of the unde rlying
callable [ security] [securities] will
significantly affect yields on the group [4]
securities. The underlying callable
[security] [ securities] are subject to
redemption on any distribution date
beginning in [
] 20 [ ]. No assurance
can be made as to whether any redemption
will occur on the underly
ing callab le
[security] [ securities] o r the tim ing of any
redemption. Any redemption would result
in the r etirement of the
[group [4]]
securities, as described in this supplem ent.
You will not be reimbursed f
or any
reduction in yield resulting from an early
redemption of the underlying callable
[security] [securities] or otherwise.]
Any redemption of the underlying callable
[security] [ securities] will decr ease the
weighted av erage lives of the [group [4]]
securities, perhaps s ignificantly. The
earlier that a red
emption occu rs, th e
greater th e effect on the
[group [4]]
securities’ weighted average lives.]
The risk of redem ption m ay reduce the
possibility that th e [group [4]] se curities
will s ell a t a p remium (regardless of
prevailing interest rates).
[NOTE TO TRUST COUNSEL:
FOR
USE IN ALL DEALS ] Up to 10 % of the
mortgage loans underlying the [group ]
trust asse ts [NOTE TO TRUST
COUNSEL: SPECIFY NON-J UMBO
ASSET GROUPS (“X SF” OR “M SF”
This supplem ent contains no inform ation
POOLS) ONLY IF
DEAL ALSO
as to whether the underlying SMBS
INCLUDES JUMBO (“M JM”, “M FS”,
[security] [ securities] have perform ed as
“All ARMs”, “C SF”, “C BD”, “X BD”
originally anticip ated. A
dditional
or “X SN”) POOLS ] [and up to [100] % of
information as to the underlying SMBS
the mortgage loans underlying the group
[security] [ securities] m ay be obtained by
S-20 I-12-20
[ ] trust assets ] [N OTE TO TRUST
COUNSEL: INSERT ALL GROUPS
BACKED BY “M JM”, “M FS”, “All
ARMs”, “C SF”, “C BD”, “X BD” or “X
SN”) POOLS AND APPROXIMATE
PERCENTAGE OF THE TRUST ASSETS
FOR THAT GROUP CONSISTING OF
“M JM” OR “M FS” POOLS ] may be
higher balance mortgage loans. Subject
to spec ial p ooling pa rameters set f orth in
the Ginnie Mae Mortgag
e-Backed
Securities Guide, qualifying federallyinsured o r g uaranteed mortgage loan s that
exceed certain balance th
resholds
established by Ginnie Mae (“higher
balance mortgage loans”) m ay be included
in Ginnie Mae guaranteed pools. There are
no historical perform ance data regarding
the prepaym ent rates for higher balance
mortgage loans. If the higher balance
mortgage loans prepay faster or slower
than exp ected, the weighted av erage liv es
and yields of the re
lated secu rities are
likely to be affected, perhaps significantly.
Furthermore, higher balance mortgage
loans tend to be concentrated in certain
geographic areas, which m ay experien ce
relatively higher ra tes of def aults in the
event of adv erse economic cond itions. No
assurances can be given about the
prepayment experience or performance of
the higher balance mortgage loans.
The securities may n ot be a suitable
investment for you.
The securities
,
[especially the [group [3]][,] [4] [and] [ 5]
securities and, ] in particular, the
[component,] [support,] [interest only, ]
[principal o nly,] [inverse f loating rate, ]
[interest only inverse floating rate, ] [nonsticky jump, ] [sticky jum p,] [jump,]
[toggle,] [special,] [weighted average
coupon,]‡ [ ascending rate, ] [ descending
rate,] [accrual,] [accelerated security] [and]
residual classes, are not suitab
le
investments for all investors.
In addition, although the sponsor intends to
make a market for the purchase and sale of
the se curities af ter the ir initia l issua nce, it
has no obligation to do so. There is no
assurance that a seco ndary m arket will
develop, that any secondary m arket will
continue, or that the price at which you can
sell an inves tment in any class will enable
you to realize a desired yield on that
investment.
You will b ear th e m arket risks of your
investment. The m arket values of the
classes are likely to
fluctuate. These
fluctuations m ay be significant and could
result in significant losses to you.
The secon dary m arkets for m ortgagerelated securities have experienced periods
of illiquidity and can be expected to do so
in the f uture. Illiqu idity can h ave a
severely ad verse effect on the prices of
classes that are especially sensitive to
prepayment[,] [redemption] or inter est rate
risk o r th at have been structured to m eet
the inves tment requ irements of lim ited
categories of investors.
The res idual securities m ay experien ce
significant adverse tax tim
ing
consequences. Accordingly, you are urged
to consult tax advisors and to consider the
after-tax effect of ow nership of a residual
security and the suitab ility of the re sidual
securities to your investm ent objectives.
See “Certain United
States F
ederal
Income Tax Consequences” in
this
supplement and in the base offering
circular.
You are en couraged to consult ad visors
regarding the financial, legal, tax and other
‡ [NOTE TO TRUST COUNSEL: INCLUDE
WAC CLASSES THAT ARE IMD.]
(continued…)
S-21 I-12-21
aspects of an investm ent in the securities.
You should not purchase the securities of
any class u nless you understand and are
able to b ear the p repayment, yield,
liquidity[,] [and] ma rket [and any
redemption] risks ass ociated with that
class.
The actual characteristics of the
underlying mortgage lo ans will affect the
weighted average lives and yields o f your
securities. The yield an d decrement tables
in th is supp lement are based on assum ed
characteristics which are likely to be
different from the actual characteris tics.
As a result, the yields on your securities
could be lower than yo u expected, even if
the m ortgage loans prep ay at the constant
prepayment rates set forth in the applicable
table.
It is highly unlikel y that the underlying
mortgage lo ans will pr epay at any of the
prepayment rates a
ssumed in this
supplement, or at any constant prepaym ent
rate.
S-22 I-12-22
THE TRUST ASSETS
General
The Sponsor intends to acquire the T rust Assets in privately negotiate d transactions prior
to the Closing Date and to sell them to the Trust according to the terms of a Trust Agreem ent
between the Sponsor and the Trustee. The Sp onsor will make certain repres entations and
warranties with respect to the Trust Assets. All Trust Assets[, regardless of whether the assets
consist of [Trust MBS ][,] [or] [the] [an] [Underlying Certificate[s]] [or Underlying Callable
[Security] [ Securities] [ or] [ the] [ Underlying SMBS [ Security] [ Securities],] will evidence,
directly or indirectly, Ginnie Mae Certificates.
The Trust MBS [(Group[s] [1] [and] [2])]
[The [Trust MBS] [Group [1]] [Trust Assets] are either:
1.
Ginnie Mae I MBS Certificates guaranteed by Ginnie Mae, or
2.
Ginnie Mae Platinum Certificates b acked by G innie M ae I MBS Certificates and
guaranteed by Ginnie Mae.
Each Mortgage Loan underlying a Ginnie Mae I MB S Certificate bears interest at a Mortgage
Rate 0.50% per annum greater than the related Certificate Rate . The difference between the
Mortgage Rate and the Certif icate Rate is used to pay the rela ted servicers of the Mortgage
Loans a m onthly servicing fee and Ginnie M ae a fee for its guaranty of the Ginnie Mae I
MBS Certificate of 0.44% per annum and 0.06% per annum, respectively, of the outstanding
principal balance of the Mortgage Loan.]
[The [Trust MBS] [[Group] [Subgroup] [2][2A]] [Trust Assets] are either:
1.
Ginnie Mae II MBS Certificates guaranteed by Ginnie Mae, or
2.
Ginnie Mae Platinum Certificates b acked by Ginnie Mae II MBS Certificates and
guaranteed by Ginnie Mae.
[The Group [ ] Trust Assets are adjustable rate Ginni e Mae II MBS Certificates guaranteed
by Ginnie Mae. Ea ch adjustable rate Ginnie Mae Certificate has an initial fixed rate period.
After the initial fixed rate period, th e Certificate Rate will adjust annually to a rate equal to
the sum , rounded to the nearest 1/8 of one percent, of (i) [CMT] an d (ii) the Certif icate
Margin, subject to an annual adju stment cap of plus or m inus [1.00]% per annum , and a
lifetime adjustm ent cap of [5.00]% above the initial Certificate Rate or a floor of
[5.00]%
below the initial Cer tificate Rate, but not les s than the Certificate M argin. [The Certif icate
Margin is [1.50]% for each of the adjustab le rate Ginnie M ae Certificates.] [The Certificate
Margin’s range from [ ]% to [ ]% as of [ ], as identified in Exhibit [F].] Adjustments to the
Mortgage Rates will be m ade in the sam e manner as adjustments to the Certif icate Rate. See
“The Trust Assets —The Mortgage Loans” in this Supplement.]
Each Mortgage Loan underlying a Ginnie Mae II MBS Certificate issued prior to July 1, 2003
bears interest at a Mortgage Rate 0.50% to 1.50% per
annum greater than the related
Certificate Rate. Each Mortgage L oan underlying a Ginnie Mae II MBS Certificate issued on
or after July 1, 2003 bears interest at a Mortgage Rate 0.25% to 0.75% per annum greater than
the related Certificate Rate. Ginnie Mae receives a fee (the “Ginnie Mae Certificate Guaranty
S-23 I-12-23
Fee”) for its guaranty of each Ginnie Mae II
MBS Certificate of 0.06% per ann um of the
outstanding principal balance of each related Mortgage Loan. The difference between (a) the
Mortgage Rate and (b) the sum of the Certif icate Rate and the r ate of the Ginnie Ma e
Certificate Guaranty Fee is used to pay the related servicers of the Mortgage Loans a monthly
servicing fee.]
[The Underlying Certificate[s] [(Group[s] [3] [and [ ]])]
The Group [3] [ and [ ]] Trust Asset [s] [is an ] [are] Underlying Certificate [s] tha t
represent[s] beneficial ownership interests in [a] [one or m ore] separate trust[s], the assets of
which evid ence direct or ind irect beneficial ownership interests in certain Ginnie Mae
Certificates. [Each][The] Underlying Certificate constitutes all or a portion of a class of a
[separate] S eries of certificates des cribed in the [related] Underlying C ertificate Disclosure
Document, excerp ts of which are attach ed as Exhibit B to this Supplem ent [NOTE TO
TRUST COUNSEL: FOR INSTANT REREMICS: , except in the case of Ginnie Mae 20[
]-[ ] Class [es] [ ] and [ ] for which this Supplem ent is the Underlying Disclosure
Document]. [Each][The] Underlying Certificate Disclosure Document may be obtained from
the Inform ation Agent as described under “Available Infor
mation” in this Supplem ent.
Investors are caution ed that m aterial changes in facts and circum stances may have occurred
since the date of [the] [each] Underlying Certificate Disclosu re Document, including changes
in prepayment rates, prevailing interest rates and other economic factors, which may limit the
usefulness of, and be dir ectly contrary to the assumptions used in prepar ing the inf ormation
included in, the offering docum ent. See “Underly ing Certifica tes” in the Base Offering
Circular.
[Each] [The] Underlying Certificate provides for monthly distributions and is further
described in the table contained in Exhibit A to this Supplem ent. The table also sets forth
information regarding approxim ate weighted aver age remaining terms to m aturity, loan ages
and mortgage rates of the Mortgage Loans underlying the related Ginnie Mae Certificates.]
[The Underlying Callable [Security] [Securities]
The Group [4] Trus t Assets cons ist of the Class [A1] [Security] [ and Class [A2]
Securities] of Ginnie Mae Callable Trust [20[ ]]-C[ ] described in the Series [20[ ]]-C[ ]
Offering Circular attached to th is Supplement as Exhibit C. Principal and interest paym ents
on the Underlying Callable [Security] [ Securities] will be passed thro ugh m onthly to the
[Group [4]] Securities. The Underly ing Callable [Security] [ Securities] are su bject to
redemption in full on any distribution date beginning in [
] 20[ ], as described in the Series
[20[ ]]-C[ ] Offering Circular. Any redemp tion of the Underlying Callable [Security]
[Securities] would resu lt in th e con current pay ment in f ull of the [Group [4]] Se curities.
Upon a redem ption of the Underlying Callable [Security] [ Securities], each Holder of a
[Group [4]] Security will receive an am ount equal to the sum of (1) the outstanding principal
amount, if a ny, of the Security, (2) accrued interest for the pr eceding Accrual Perio d at the
Interest Rate borne by the Security and (3) [in the case of a Fixed Rate or Delay Class4 ([other
4
NOTE TO T RUST COUNSEL: This is tru e only if th e Fixed Rate Class is a Delay Class; it may not be
true in the case of an MX Class that is synthesized from one or more non-delay Classes.
S-24 I-12-24
than any fixed rate MX Cla ss that is for med from one or more non-delay Classes ] [Classes
and ])] additional interest at the related Interest Rate for the period from the first day of the
month of re demption to the Distribution Date on which the redem ption occurs (calculated on
the basis of the principal am ount of the Secu rity that would have remained outstanding
immediately after the redem ption date had no redem ption occurred). See “Description of the
Securities — Redemption and Exchange” in the Series [20[ ]]-C[ ] Offering Circular and
“Yield, Maturity and P repayment Considerati ons — Yield Considerations — Prepayments
and Redemption: Effect on Yields
[on the Fixed Rate and Delay Classes
]” in th is
5
Supplement. ]
[The Underlying SMBS [Security] [Securities] [(Group [5])]
The Group [5] Trust Assets [consist of an] [are] Underlying SMBS [Security] [Securities]
that represent[s] beneficial ownership interests in [a] [one or more] separate trust[s], the assets
of which evidence direct or indirect benefici al ownership interests in certain Ginnie Mae
Certificates. Distributions on [each] [the] Underlying SMBS Security are based on and backed
by the prin cipal and in terest distributions from Ginnie Mae II Certificates which have a
Certificate Rate of [5.5%]. [Each][The] Underly ing S MBS Secur ity con stitutes all o r a
portion of a class of a [separate] Series of certif icates described in the [related] Underlying
SMBS Security Dis closure Document, excer pts of which are attached as Exhibit [D] to this
Supplement. [Each][The] Underlying SMBS Security Disclosure Document may be obtained
from the Inform ation Agent as described under “Available Information” in th is Supplement.
Investors are caution ed that m aterial changes in facts and circum stances may have occurred
since the date of [the] [each] Underlying SMB S Security Di sclosure Docum ent, including
changes in prepayment rates, prevailing intere st rates and other econom ic factors, which may
limit the usefulness of, and be di rectly contra ry to the as sumptions used in prep aring the
information included in, the offering docum ent. See “Underlying SMBS Securities” in the
Base Offering Circular.
[Each] [The] Underlying SMBS Security provides
for monthly distributions and is
further described in the ta ble contained in Exhibit [D] to this Supplement. The table also sets
forth information regarding approxim ate weighted average r emaining terms to m aturity, loan
ages and mortgage rates [and ranges of mortgage rates] of the Mortgage Loans underlying the
related Ginnie Mae Certificates.]]
The Mortgage Loans
[The Mortgage Loans underlying the [Group [1] and [2]] T rust Assets are expected to
have, on a weighted average ba sis, the characteri stics set forth in the Term s She et under
“Assumed Characteristics of the Mortgage Loans Underlying the [Group [ ]] Trust Assets”
and the general characteristics described in the Base Offering Circular.] [NOTE TO TRUST
COUNSEL: FOR ARM MBS BACKED GROUPS: The Mortgage Loans underlying the
Group [ ] Trust Assets are expected to have, on a we ighted average basis, the characteristics
set forth in Exhibit [F] to this Supplement.] [The Mortgage Loans underlying the Underlying
5
NOTE TO TRUST COUNSEL: Discuss the distribution of “additional interest” with respect to any nondelay Securities included in the Security Group.
S-25 I-12-25
Certificate[s] are expected to have, on a weighted average basis, the characteristics set forth in
Exhibit A to this Supplem ent.] [The M ortgage Loa ns unde rlying the Underlying SMBS
[Security] [Securities] are expected to have, on a weighted average basis, the characteristics
set forth in Exhibit [D] to this Supplement]. [The Mortgage Loans underlying the Underlying
Callable [Security] [ Securities] are expected to have, on a we
ighted average basis, th e
characteristics set forth in th e Series [20[ ]]-C[ ] Offering Circu lar attached to th is
Supplement as Exhibit C .] The Mo rtgage Loans will con sist of first lien, single -family, fixed
rate [or adjustable rate ], residential m ortgage loans that are insured or guaranteed by the
Federal Housing Adm inistration, the United States Departm ent of Ve terans Affairs, Rural
Development (form erly the Rura l Housing Service) or the Un ited States Dep artment of
Housing and Urban Development (“HUD”). See “The Ginnie Mae Certificates — General”
in the Base Offering Circular.
[NOTE T O TRUST COUNSE L: FOR ARM MBS BACKE D GROUPS: The
Mortgage Loans underlying the Group [ ] T rust Assets are adju stable rate m ortgage loans
with initial fixed rate periods. After the initial fixed rate period, the Mortgage Rates on the
Mortgage L oans will adjust annually, rounded to the nearest 1/8 of one percent, based on
[CMT], subject to an annual adjust ment cap of plus or m inus [1.00]% per annum and a
lifetime adjustm ent cap of [5.00]% above the initial Mortga ge Rate or a floor of [5.00]%
below the initial Mortgage Rate but not less than the margin added to [CMT] (the “Mortgage
Margin”). Ginnie Mae pooling specifications requi re that all adjustable rate Mortgage Loans
backing a particular Ginnie Mae Certificate
have the sam e index, first Mortgage Rate
adjustment date, annual Mortga ge Rate adjustm ent date, mort gage paym ent adjustm ent date
and index reference date. One m onth after each Mortgage Rate adjustment date, the payment
amount of the related Mortgage L oan will be reset so that the remaining principal balance of
that Mortgage Loan will fully amortize in equal monthly payments over its remaining term to
maturity, assuming its Mortgage Rate remains constant at the new rate. See “Risk Factors —
Adjustable rate mortgage loans are subject to certain caps, which may limit the amount of
interest payable on such mortgage loans and may limit the WACR on the group
[ ] trust
assets and the interest rates on the related secur ities after the initial fixed rate period of the
related mortgage loans” in this Supplement. ]
[Specific information regarding the characteristics of the Mortgage Loans [underlying the
Trust MBS] is not available. For purposes of this Supplement, certain assumptions have been
made regarding the remaining terms to maturity [and loan ages] [, loan ages and [, in the case
of the Group [2] Trust Assets,] Mortgage Rates] [NOTE TO TRUST COUNSEL: FOR
ARM MBS BACKED GROUPS: and, in the case of the Group [ ] Trust Assets, Mortgage
Margins and first Mortgage Rate adjustment dates] of the Mortgage Loans [underlying the
Trust MBS]. However, the actual remaining terms to maturity [and loan ages] [, loan ages
and [, in the case of the Group [2] Trust Assets,] Mortgage Rates] [NOTE TO TRUST
COUNSEL: FOR ARM MBS BACKED GROUPS: and, in the case of the Group [ ]
Trust Assets, Mortgage Margins and first Mortgage Rate adjustment dates] of many of the
Mortgage Loans will differ from the characteristics assumed, perhaps significantly. This will
be the case even if the weighted average characteristics of the Mortgage Loans are the same
as the assumed characteristics. Small differences in the characteristics of the Mortgage Loans
can have a significant effect on the Weighted Average Lives and yields of the Securities. [In
addition, the Mortgage Loans underlying the Group [ ] Trust Assets [consist primarily of]
[include] buydown mortgage loans, which are level-payment mortgages for which funds have
S-26 I-12-26
been provided to reduce the borrowers’ monthly payments during the early years of the
loans.] See “Risk Factors” and “Yield, Maturity and Prepayment Considerations” in this
Supplement.]
The Trustee Fee
[On each Distribution Date, the Trustee will retain a fixed percentage of a ll principal and
interest distributions received on specified Trust Assets in payment of the Trustee Fee.] [The
Sponsor will contribute certain Ginnie Mae Certif icates in resp ect of the Trustee Fee. On
each Distribution Date, the Trustee will re tain all principal and interest distributions received
on such Ginnie Mae Certificates in paym ent of the Trustee Fee. ] [NOTE TO TRUS T
COUNSEL: GINNIE MAE CE RTIFICATES THAT ARE CONTRIBUTE D TO A
SEPARATE TRUS T ASSE T GROUP IN RE SPECT OF THE TRUSTEE F EE MUS T
HAVE THE LONGEST WARM COMPARE D TO ALL OTHER TRUST ASS
ET
GROUPS. NOTE ALS O THAT THE TRUS TEE FEE SHOULD NOT COME FROM
ANY GROUP THAT IS SEPARATEL
Y COLLAPSIBLE HAVING ITS OWN
RELATED RESIDUAL CLASS].
GINNIE MAE GUARANTY
The Governm ent National Mortgage Associ ation (“Gin nie Ma e”), a wholly -owned
corporate instrumentality of the United States of Am erica within HUD, g uarantees the timely
payment of principal and interest on the S
ecurities. The Genera l Counsel of HUD ha s
provided an opinion to the eff ect th at Ginnie M ae has the au thority to guarantee m ulticlass
securities and that Gin nie Mae gu aranties will constitute general obligations of the United
States, for which the f ull faith and credit of the United Sta tes is p ledged. See “Ginnie Ma e
Guaranty” in the Base Offering Circular.
DESCRIPTION OF THE SECURITIES
General
The description of the Securi ties contained in this Supplem ent is not com plete and is
subject to, and is qualified in it s entirety by ref erence to, all of the provisions of the Trust
Agreement. See “Description of the Securities” in the Base Offering Circular.
Form of Securities
Each Class of Securities other than the Resi dual Secur ities initia lly will be issued and
maintained, and m ay be transferred only on th e Fedwire Book-Entry System . Beneficial
Owners of Book-Entry Securities will ordinarily hold these S ecurities through one or m ore
financial intermediaries, such as banks, brokera ge firms and securities clearing organizations
that are elig ible to m aintain book-entry accoun ts on the F edwire Book-Entry System . By
request accompanied by the paym ent of a transfer fee of $25,000 pe r Certificated Security to
be issued, a Beneficial Owner may receive a Regular Security in certificated form.
The Residual Securities will not be issued in book-entry form but will be issued in fully
registered, certificated f orm and may be transf erred or ex changed, su bject to th e transfer
restrictions applicable to Residual Securities
set f orth in the Trus t Agreem ent, at the
S-27 I-12-27
Corporate T rust Office of the Trustee.
See “Description of the Securities — Forms of
Securities; Book-Entry Procedures” in the Base Offering Circular.
Each [Regular and MX ] Class [(other than the In creased Minim um Denom ination
Class[es])] will be issu ed in m inimum dollar denom inations of initia l prin cipal balance of
[$1,000] an d integ ral multiples o f $1 in ex cess of $1, 000. [The Increased Minim um
Denomination Class[es] [other than [Class __] [the Jump Classes]] will be issued in minimum
denominations that equal [(i)] $100,000 in initial [principal] [or] [notional] balance [or (ii) the
initial [principal] [or] [ notional] balance if such balance is less than $100,000 ].] [The Jump
Class[es] will be issued in minimum denominations that equal $1,000,000.]
Distributions
Distributions on the Securities will be made on each Distribution Date as specified u nder
“Terms Sheet—Distribu tion Date [s]” in this Su pplement. On each Distribu tion Date for a
Security, or in the case of the Certificated
Securities, on the first Business Day after the
related Distribution Date, the Distribution Amount will be distributed to the Holders of record
as of the related Record Date. Beneficial
Owners of Book-Entry Securities will receive
distributions through credits to accounts m aintained for their benefit on the books and records
of the appr opriate f inancial inte rmediaries. H olders of Certificated S ecurities will receive
distributions by check or, subject to the restrictions set forth in the Base Offering Circular, by
wire transfer. See “Description of the Securities
— Distributions” and “— Method of
Distributions” in the Base Offering Circular.
[Upon any redem ption of an Underlying Callable Security, Holders of the [Group [4]]
Securities will be ent itled to the am ounts describ ed un der “The Trust Assets — The
Underlying Callable [Security] [Securities] (Group [4])” in this Supplement.]
Interest Distributions
The Interest Distributio n Am ount will be di stributed on each Distribu tion Date to the
Holders of all Classes of Securities entitled to distributions of interest.
Interest will be calculated on the basis of a 360-day year consisting of twelve 30-day
months.
Interest distributable [(or accrued in the case of [an] [the] Accrual Class)] on any Class
for any Distribution Date will consist of
30 days’ interest on its Class Principal
Balance [(or Class Notional Balance)] as of the related Record Date [plus, [in the case
of the Group [4] Securities, ] upon any redem ption of the Underlying Callable
[Security] [ Securities], additional interest as descri bed under “T rust Assets — The
Underlying Callable [Security] [Securities] (Group [4])” in this Supplement].
Investors can calculate the am ount of interest to be distributed [(or accrued in the case
of [an] [the] Accrual Class)] on each Class of Securities for any Distribution Date by
using the Class Factors publishe d in the preceding m onth. See “— Class Factors”
below.
Categories of Classes [and Components]
For purposes of interest distribution s, the Classes will b e categorized as shown under
“Interest Type” on the front cover of this Supplem ent [and on Schedule I to this Supplem ent]
[, and Components will be categorized as show n above under “Term s Sheet — Component
S-28 I-12-28
Classes” in this Supplem ent]. The abbreviations used in this Supplem ent to describe the
interest entitlements of the Classes are expl ained under “Class Types” in Appendix I to the
Base Offering Circular.
Accrual Period[s]
[The Accrual Period for each Regular [and MX] Class is the calend ar month preceding
the related Distribution Date.]
[The Accrual Period for each Regular [and MX] Class is set forth in the table below:
Class
Accrual Period
[Fixed Rate[,] [and]
[Delay][,] [and]
Weighted Average
Coupon[,] [and]
[Ascending Rate]
[and Descending
Rate] Class[es]
The calendar month preceding the related Distribution Date
[Group [1]]
[Floating Rate][,]
[and] [Inverse
Floating Rate][,]
[and] [Toggle] [and
Weighted Average
Coupon Classes]
[other than Delay
Class[es]]
[Group [2]]
[Floating Rate]
[and] [Inverse
Floating Rate
Classes] [other than
Delay Class[es]]
From the [ ] day of the m onth preceding the month of the related
Distribution Date through the
[ ] day of the m
onth of that
Distribution Date
From the [ ] day of the m onth preceding th e month of the related
Distribution Date through the
[
] day of the m onth of that
Distribution Date]
[Trading
For the sole purpose of f acilitating trading and s ettlement, the Princ ipal Only Class [es]
will be tre ated as [a] non-delay class [es].] [NOTE TO TRUST COUNSEL: Confirm with
Sponsor whether principal only classes are to be marketed as delay or non-delay classes.]
[Fixed Rate Class[es]
Each Fixed Rate Class will bear in terest at the per annum Interes t Rate shown o n the
front cover of this Supplement [or on Schedule I to this Supplement].]
[Ascending Rate [and Descending Rate] Class[es]
The Ascending Rate [and Descending Rate] Class[es] will bear interest at the per annum
Interest Rates set forth for each Accrual Period under “Term s Sheet — Interest Rates” in this
Supplement.]
S-29 I-12-29
[[Floating Rate][,] [and] [Inverse Floating Rate][,] [and Toggle] Class[es]
The [Floating Rate ][,] [and] [Inverse Floating R ate][,] [and Toggle ] Class [es] will b ear
interest as shown under “Term s Sheet — Interest Rates” in th is Supplem ent. The Interest
Rates for the [Floating Rate][,] [and] [Inverse Floating Rate][,] [and Toggle] Class[es] will be
based on [LIBOR]. [LIBOR will be determined based on the [BBA LIBOR] [LIBO] method,
as described under “Description of the Securities — Interest Rate Indices — Determination of
LIBOR — [BBA LIBOR][LIBO Method]” in the Base Offering Circular.]] [In the case of the
Group [3] [ ,][4] [and] [5] Securities, the Trustee will use th e same values of LIBOR as are
used for th e [related] Underlying [Certificate[s]] [ Callable Securitie s] [ SMBS Securities ].
[NOTE TO TRUST COUNSEL: The preceding disclosure applies only in the event that the
related Underly ing Cer tificate(s), Underlying SMBS Se curity or Underlying Callable
Security is backed by a Ginnie Mae Certificate (that is a floating rate security).]
For information regarding the manner in which the Trustee determines [LIBOR] [NOTE
TO TRUST COUNSEL: FOR REMIC CLAS SES INDEXED T O CMT: and One-Month
CMT] and calculates the Interest Rates for the
[Floating Rate ][,] [and] [Inverse Floating
Rate][,] [and Toggle] Class[es], see “Description of the Securities — Interest Rate Indices —
Determination of [LIBOR]” [NOTE TO TRUST COUNSEL: FOR REMIC CLASSES
INDEXED TO CMT: and “Description of the Securitie s — Interest Rate Indices —
Determination of the T reasury Index ] in the B ase Offer ing Circular. We can provide no
assurance that LIBOR for a Dis tribution Date a ccurately represents the offered rate at whic h
one-month U.S. dollar deposits are being quoted to prim e banks in the London interbank
market, nor that the procedures for calculating the interest settlement rate of the BBA for onemonth U.S. dollar deposits will not change. An y change in LIBOR values resulting from any
change in reporting or in the determ
ination of LIBOR m ay cause LIBOR to fluctuate
disproportionately to changes in other market lending rates.]
[Weighted Average Coupon Class[es]
The W eighted Average Coupon Class [es] will bear inte rest [at [a] per annum Interest
Rate[s]] [based on [Group [ ]] [Subgroup [ ]] WAC R] as shown under “Term s Sheet —
Interest Rates” in this Supplement.]
[NOTE TO TRUST COUNSEL:
Include the following paragraph when there are
Floating Rate, Inverse Floating Rate, T oggle or W eighted Average Coupon Classes .] [ The
Trustee’s [determination of [LIBOR] [and] [CMT] and its ] calcu lation of the Intere st Rate s
will be f inal except in the case of clear erro r. I nvestors can obtain [[LIBOR] [and] [CMT]
levels and] Interest Rates for the current and preceding Accrual Periods from [Ginnie Mae’s
Multiclass Securities e-Access located on Ginnie Mae’s website ] [(“e-Access”)] or by calling
the Information Agent at (800) 234-GNMA.]
[Accrual Class[es]
[Each of] Class[es] [ ] [and [ ]] is an Accrual Class. Interest will accrue on the Accrual
Class[es] and be distributed as described under “Term s She et — Accrual Class [es]” in th is
Supplement.]
S-30 I-12-30
Principal Distributions
The Principal Distribution Am ount [or the Adjusted Principal Distribution Am ount] [for
each Group] [or Subgroup, as applicable, ] [and [the] [ ] [each] Accrual Am ount[s]] will be
distributed to the Holders entitled thereto as described under “Term s Sheet — Allocation of
Principal” in this Supplem ent. [NOTE TO TRUST CO UNSEL: Include when Underlying
Certificates are Accrual Classes: With respect to Security Group[s] [ ], the [related] Principal
Distribution Amount shall include any Accrual Am ount[s] paid as p rincipal on the [related]
Underlying Certificate [s] as described in the
[related] Underlying Certificate Disclosure
Document.] Investors can calcul ate the am ount of principal to be distributed with respect to
any Distribution Date by using the Class Factors pub lished in the p receding an d current
months. See “— Class Factors” below . [As to any Dis tribution Date, in the ev ent th at
Certificate Factors for the Underlying Callable [Security] [Securities] are not av ailable to the
Trustee on the date specified in the Trust Agreement, no amounts with respect to principal on
the Underlying Callable [Security] [ Securities] will be distributable on the
[Group [4]]
Securities on the Distribution Date.]
Categories of Classes [and Components]
For purposes of principal distributions, the Cl asses will be catego rized as shown under
“Principal Type” on the front
cover of this Supplem
ent [and on Schedule I to this
Supplement], [and Components will be categorized as shown above under “Term s Sheet —
Component Classes” in this Supplem ent]. T he abbreviations used in this Supp lement to
describe the principal entitlem ents of the Classes are explained under “Class Types” in
Appendix I to the Base Offering Circular.
[Segments
For conven ience in describ ing principal p ayments, certain of the Classes w
ill b e
apportioned into Segm ents. Each Segm ent wi ll have the original principal am ount shown
under “Term s Sheet — Segm ents” in this S upplement. Paym ents of principal m ade with
respect to the Segments on any Distribution Date will be allocated as described under “Terms
Sheet — Allocation of Principal” in this Supplem ent. The Segm ents are not separate Classes
and will not be separately issued or transferable.]
[Component Class[es]
[Each of] [Class
] [and Class
] is a Component Class and has Com ponents with
the designations and characteristics shown und er “Term s Sheet — Com ponent Classes” in
this Supplement. Components will not be separately issued or transferable.]
[Notional Class[es]
The Notion al Clas s[es] will not receive principal d istributions. For convenience in
describing interest distributions, the Notional C lass[es] will have the original Class Notional
Balance[s] shown [on the front cover of this Supplem
ent] [and] [on Schedule I to this
Supplement]. The Class Notional Balance [s] will be reduced as s hown under “Term s Sheet
— Notional Class[es]” in this Supplement.]
Residual Securities
[The Class R Securities will represent the beneficial ownership of the Residual Interest in
the Trust REMIC, as described in “Certain United States Federal Income Tax Consequences”
S-31 I-12-31
in the Base Off ering Circu lar.] [ The Class R [ ] and R [ ] Secur ities will repr esent th e
beneficial ownership of the Residual Interest in the Group [ ] and [ ] REMICs, respectively,
as described in “Certain United States Fede
ral Incom e Tax Consequences” in the Base
Offering Circular. ] [The Class RR Securities w ill repr esent the benef icial ownersh ip of the
Residual Interest [in each Trust REMIC] [in the Issuing REMIC and the beneficial ownership
of the Residual Interes t in [the] [each] Pooling REMIC ], as described in “Certain United
States Federal Income Tax Consequences” in the Base Offering Circular ]. [The Class RR[ ]
and RR [ ] Securities will rep resent the ben eficial ownership of the Resi dual Interest in the
related Issuing REMICs and the beneficial ownership of the Re sidual Interest in th e related
Pooling REMICs, respectively, as described in “Certain United Sta tes Federal In come Tax
Consequences” in the Base Offering Circular. ] [The Class RI Securities will rep resent th e
beneficial ownership of the Residual Intere st in the Issuing REMIC, and the Class RP
Securities will rep resent the bene ficial ownership of the Residual I nterest in [the] [each]
Pooling REMIC, as de scribed in “Certa in United States Federal Incom e Tax Consequences”
in the Base Offering Circular. ] [The Class [R] [RR] [RI and Class RP ] [R[ ] and [RR][ ]]
Securities h ave no Class Principal Balance and do not accrue interest. ] [In ad dition to
payments of principal and interest, the ] [The] Class [R] [R[ ]] [RR] [RI and RP ] Securities
will be en titled to rec eive the p roceeds of th e disposition of any assets rem aining in the
[related] Trust REMIC [s] af ter th e Class Princ ipal Balance [or Class Notional Balance ] of
each Class of Regular Securities [in the re lated Security [Group] [or] [Groups]] has been
reduced to zero. However, any rem aining pro ceeds are n ot likely to be significa nt. The
Residual Securities m ay not be transferred to a Plan Investor, a Non-U.S. Person or a
Disqualified Organization.
Class Factors
The Trustee will calcu late and m ake available for each Class of Securitie s, no later than
the day p receding the [applicable] Distribution Date, the factor (carried out to eigh t decimal
places) th at when m ultiplied by th e Original Class Principal Balan ce [(or or iginal Clas s
Notional Balance)] of th at Class, determines the Class Prin cipal Balance [(or Class N otional
Balance)] after giving effect to the distribution of principal to be made on the Securities [(and
any addition to the Class Principa l Balance of [the] [an] Accrual Class)] [or any reduction of
Class Notional Balance] on that Distribution Date (each, a “Class Factor”).
The Class Factor for an y Class of Securi ties for each m onth following the issuance of
the Securities will ref lect its r emaining Class Princip al Balance [(or Class Notio nal
Balance)] after giving effect to any principal distribution [(or addition to principal)] to
be m ade [or any reduction of Class Notional Balance
] on the Distribution Date
occurring in that month.
The Class Factor for each Class for the month of issuance is 1.00000000.
[The Class Factors for the MX Classes and th e Classes of REMIC Se curities that are
exchangeable for th e MX Classes will be calculated as suming that the m aximum
possible amount of each Class is outstanding at all times, regardless of any exchang es
that may occur.]
Based on the Class Factors pub lished in the preceding and curren t m onths (and
Interest Rates), investors in any Class
[(other than [an] [ the] Accrual Class)] can
S-32 I-12-32
calculate the am ount of prin cipal and interest to be distributed to that Class [and
investors in [the] [an] Accrual Class can calculate the total am ount of principal [and
interest] to be distr ibuted to (or in terest to be added to the Class Prin cipal Balance of)
that Class] on the Distribution Date in the current month.
Investors may obtain cu rrent Class Factors on [Ginnie Mae’s Multiclass Securities eAccess located on Ginnie Mae’s website (“e-Access”)] [e-Access].
See “Description of the Securities — Distributions” in the Base Offering Circular.
Termination
The Trustee, at its option, m ay pur chase or caus e the sale of the Trust Assets and thereby
terminate the Trust on any Distribution Date on which the aggrega te of the Class Princ ipal
Balances of the Secu rities is less than 1% of the aggregate Original Class Principal Balances
of the Securities. On any Di stribution Date upon the Trustee’s determination that the REMIC
status of [any] [the] Trust REMIC has been lost o r that a substantial risk exists that this status
will be lost for the then current taxable year, the Trustee will terminate [the Trust] [such Trust
REMIC and any related Trust R
EMIC] and retire the [related] Se curities. [For these
purposes, the Trust REMICs and the Securities with corresponding numerical designations are
related as follows:
Trust REMICs
Group [ ] [Issuing and
Pooling] REMIC[s]
Group [ ] REMIC
Related Securities
Group [ ] Securities
Group [ ] Securities]
Upon any term ination of the Trust [(or one or more related Trust REMICs) ], the Holder
of any [related] outstanding Security (other than a Residual [or Notional] Class Security) will
be entitled to receive that Holder’s allocable share of the Class Principal Balance of that Class
plus any accrued and unpaid interest thereon a t the applicable Inte rest Rate[, and any Holder
of any [related] outstanding Notional Class Secur ity will be e ntitled to re ceive that Holder’s
allocable sh are of any accrued and unpaid intere st thereon at the app licable In terest Rate ].
The Residual Holders will be entitled to the ir pr o rata sha re of any assets rem aining in the
[related] Trust REMIC [s] after paym ent in full of the a mounts described in the foregoing
sentence. However, any remaining assets are not likely to be significant.
[Modification and Exchange
All or a portion of the Class[es] of REMIC Securities specified on the front cover m ay be
exchanged f or a proportionate interest in the r elated MX [Class] [or] [Classes] shown on
Schedule I to this Supplem ent. Sim ilarly, all or a portion of the related MX [Class] [or]
[Classes] may be exchanged for proportio nate interests in the re lated [Class] [or] [Classes] of
REMIC Securities [and[, in the case of Combination[s][ ]], other related MX Classes ]. This
process may occur repeatedly.
S-33 I-12-33
Each exchange may be effected only in proportions that result in the principal and interest
entitlements of the Securities received being
equal to th e entitlem ents of the Securitie s
surrendered.
[[In the case of Combination[s] [ ], [the Class [ ] [and Class [ ]]] [The related REMIC]
Securities may be exchanged for proportionate in terests in various subcom binations of MX
Classes. Similarly, all or a portion of these MX Classes m ay be exchanged for proportionate
interests in the related REMIC Securities or
in other subcom binations of the related MX
Classes. Each subcombination may be effected only in proportions that result in the principal
and inter est entitlem ents of the Securities r eceived being equal to the entitlem ents of the
Securities surrendered. See the example under “D escription of the Securities — Modification
and Exchange” in the Base Offering Circular.]
[In the case of Combination[s] [ ], [Class [ ]] [each of the MX Securities] is a Weighted
Average Coupon Class that will accrue interest as described under “Term s Sheet — Interest
Rates” in this Supplem ent. [In the event that th e Interest Rate of [any] such MX Class will
equal or exceed 1,200% per annum for any Accrual Period, the Trustee will, prior to the close
of business on the las t Business Day of the cal endar month immediately preceding the related
Distribution Date, effect a m andatory exchange of [Class [ ]] [that MX Class ] for its related
REMIC Securities. Thereaf ter, no f urther exchanges of s uch REMIC Securitie s will be
permitted. ]]
A Beneficial Owner proposing to effect an ex change must notify the Trustee through the
Beneficial Owner’s Book-Entry Depository particip ant. This notice m ust be received by the
Trustee not later than two Busi ness Days before the proposed exchange date. The exchange
date can be any Business Day other than the la st Business Day of the month. The notice must
contain the outstanding principal [and] [notional] balance[s] of the Securities to be included in
the exchange and the proposed exchange date. The notice is required to be delivered to the
Trustee [by em ail to [ ] or ] in writing at its Corporate Trust Office at
[ADDRESS],
Attention: [
]. The Trustee may be contacted by telephone at ([ ]) [ ]–[ ] and by
fax at ([ ]) [ ]–[ ].
A fee will b e payable to the Trus tee in connect ion with each exchange equal to 1/3 2 of
1% of the outstanding principal balance [(or notional balance) ] of the Securities surrendered
for exchange (but not less than $2,000 or m ore than $25,000) [; provided, however, [that no
fee will b e payable in respect of a m andatory exchange described above; and provided,
further,] tha t no f ee will be payab le in r espect of an inte rest on ly se curity] [unless all
securities involved in th e exchange are interes t only securities ]]. [If the notional balance of
the interest only securities surrendered exceeds that of the interest only securities received, the
fee will be based on the latter.] The fee must be paid concurrently with the exchange.
The first distribution on a REMI C Security or an MX Security received in an ex change
will be made on the Distribution Date in the month following the month of the exchange. The
distribution will be m ade to the Ho lder of reco rd as of the Record Date in the month of
exchange.
See “Description of the Securities — Modific ation and Exchange” in the Base Offering
Circular.]
S-34 I-12-34
YIELD, MATURITY AND PREPAYMENT CONSIDERATIONS
General
The prepay ment experience of the Mortgage Loans will af fect the W eighted Average
Lives of and the yields realized by investors in the [related] Securities.
The Mortgage Loans do not contain “due-on-sale” provisions, and any Mortgage Loan
may be prepaid in full or in part at any time without penalty.
The rate of payments (including prepayments and payments in respect of liquidations)
on the Mortgage Loans is dependent on a va riety of economic, geographic, social and
other factors, including prevailing market interest rates and general economic factors.
The rate of prepaym ents with resp ect to s ingle-family mortgage loans has fluctuated
significantly in recent years. Although there is no assurance that prepayment patterns for the
Mortgage Loans will conform to patterns for more traditional types of conventional fixed-rate
[or adjustable rate] mortgage loans, generally:
if m ortgage inter est rates f all m aterially be low the Mortg age Rates on any of the
[NOTE T O TRUS T COUNSEL: FOR ARM MBS B ACKED GROUPS: fi xed
rate] Mortgage Loans (giving consideration to the cost of refinancing), the rate of
prepayment of those Mortgage Loans would be expected to increase; [and]
if m ortgage intere st ra tes rise m aterially abov e the Mortg age Rates o n any of the
[NOTE T O TRUS T COUNSEL: FOR ARM MBS B ACKED GROUPS: fi xed
rate] Mortg age Loans, the rate of prepaym ent of those Mortgage Loans would be
expected to decrease[.][; and]
[NOTE TO TRUST COUNSEL: FOR ARM MBS BACKED GROUPS: declines
in prevailing m ortgage interest rates w ould be expected to decrease the rate of
prepayment of the adjustable rate Mortgage Loans; and
increases in prevailing mortgage in terest rates would be expected to in crease the rate
of prepayment of the adjustable rate Mortga ge Loans (giving consideration to the co st
of refinancing).]
In addition, following any Mortgage Loan defa ult and the subsequent liquidation of the
underlying Mortgaged Property, th e princip al balance o f the Mortgage Loan will be
distributed through a co mbination of liquidation proceeds, advances fro m the related Ginnie
Mae Issuer and, to the extent necessary, proc eeds of Ginni e Mae’s guaranty of the Ginnie
Mae Certificates. As a result, defaults experienced on the Mortgage Loans will accelerate the
distribution of principal of the Securities.
The term s of the Mortgage Loans m ay be m odified to perm it, am ong other things, a
partial release of security, which releases a portion of the mortgage d property from the lien
securing th e related M ortgage Lo an. Partial rele ases of security m ay allow th e rela ted
borrower to sell the released property and generate proceeds that m ay be used to prepay the
related Mortgage Loan in whole or in part.
Under certain circum stances, the T rustee ha s the option to purchas e th e Trus t Ass ets,
thereby effecting early retire ment of the Securities. See “ Description of the Securities —
Termination” in this Supplement.
S-35 I-12-35
[Investors in the [Group [3]] Securities are urged to re view the discussion under “Risk
Factors — The rate of payments on the underlying certificate [s] will directly affect the rate of
payments on the [group [3]] secur ities” in this Supplem ent.] [Investors in th e [Group [4]]
securities are urged to review th e discussion under “Risk Factors — Early redemption of the
underlying callable [security] [ securities] will significantly affect yields on the group
[4]
securities” in this Supplem ent.] [ Investors in th e [Group [5]] Securities are urged to review
the discussion under “Risk Factors — The rate of principal payments on the underlying SMBS
[security] [ securities] will d irectly affec t the r ate of pr incipal paymen ts on the [group [5]]
securities” in this Supplement.]
[NOTE TO TRUST COUNSEL: For INV/Z Classes] [In addition, changes in LIBOR
will affect the rate of principal payments on Class [es] [ ]. Investors in these Securities are
urged to review the discussion under “Risk F actors — T he rate of principal payments on
certain group [
] cla sses will b e sensitive to LIBO R,” “Yield, Ma turity and Prepayment
Considerations — Securities that Receive Principal on the Basis of Schedules” and “—
Decrement Tables” in this Supplement.]
[Accretion Directed Class[es]
Class[es] [ ] [and [ ] are] [is an] Accretion Directed Clas s[es]. The [related] Accrual
Amount[s] will b e applied to m aking princip al distr ibutions on [those] [ that] [Class[es]]
[Class [ ]] as described in this Supplem ent. [[Each of] Class[es] [ ] [and [ ]] is a Notional
Class whose Class Notional Balance is determined by reference to the Class Principal Balance
of [Class [ ]] [the related Accretio n Directed [Class] [or] [Classes] shown under “Term s
Sheet — Notional Class[es]” in this Supplement].]
[[Each of [the Accretion Directed Classes] [Classes [ ] and [ ]]] [Class [ ]] has the AD
designation in the suffix position, rather than th e prefix pos ition, in its class p rincipal typ e
because it does not h
ave prin cipal paym ent stability through the applicable pricing
prepayment assum ption. [Class[es] [ ] [ and [ ]] [NOTE TO TRUS T COUNS EL: Insert
suffix AD Classes tha t will be displayed in th e table. ] will have principal paym ent stability
only through the prepaym ent rate shown in the table below [and within [their][its] Effective
Range[s][, if applicable]].] [[[The remaining Accretion Directed Classes are] [Classes [ ] and
[ ] are] [Class [ ] is] [NOTE TO TRUS T COUNSEL: Insert suffix AD Classes that will
not be displayed in the table. ] [not listed in the table below because, ] [although [they are] [it
is]] [ Although the Accretion Directed Class [es] are] en titled to rece ive paym ents from the
[related] Accrual Am ount[s], [they do] [it does] not have principal paym ent stability through
any prepaym ent rate signi ficantly higher than 0% PSA [, except with in [their][its] Effect ive
Range[s][, if applicable]].]
[The Accretion Directed Classes are ] [Class [ ] is] entitled to princ ipal payments in an
amount equal to interest accrued on the [related] Accru al Class [es].] [[With resp ect to the
Classes liste d in the tab le below, th e] [The] W eighted Average Life of [each such Class ]
[Class [ ]] cannot exceed its W eighted Average Life as shown in the f ollowing table under
any [constant] prepayment scenario, even a scenario where there are no prepayments.
Moreover, based on the Mode ling Assumptions, if the [related] Mortgage Loans
prepay at any constant rate at or below the rate for
[an Accretion Directed Clas s]
[Class [ ]] shown in the table below , the Class P rincipal Balance of such Class would
S-36 I-12-36
be reduced to zero [on, but not before, ] [before] its Final Distribution D ate, and the
Weighted Average Life of such Cl ass would equal its m aximum Weighted Average
Life shown in the table below.
However,
th e Weighted Average [Lives] [Life] of Class [es] [ ] [and [ ]] [especially
Classes [ ] and [
], which are also Support Classes ], will be reduced [, and may
be reduced significantly ,] at p repayment speeds higher th an the constant rates show n
in the table below . See “Y ield, Maturity and Pr epayment Considerations —
Decrement Tables” in this Supplement.
Accretion Directed Class[es]
Class
Maximum Weighted
Average Life
(in years)(1)
Final Distribution Date
Prepayment Rate
at or below
% PSA
% PSA
(1) The ma ximum We ighted A verage L ife fo r [Class [ ]] [[the] [ each] Class show n in this
table] is based on the Modeling Assum
ptions and the assumption that the [related]
Mortgage loans prepay at any constant rate at or below the rate shown in the table for such
Class. [That W eighted Average Lif e could ex tend, perhaps significantly, under certain
non-constant prepaym ent scenarios or if the actual Mortgage Loan characteristics differ
from the Modeling Assumptions.]]
The Mortga ge Loans will hav e cha racteristics that dif fer f rom those of the Modeling
Assumptions. Therefo re, even if the [related] Mortgag e Loans prepay at a rate at o
r
somewhat below the “at or below” rate shown for [any Accretion Directed Class][Class [ ] or
[ ]], the Class Principal Balance [(or Class Notional Balance, in the case of Class [ ])] of that
Class could be reduced to zero before its F inal Distribution Date, and its Weighted Average
Life could be shortened.]
[Securities that Receive Principal on the Basis of Schedules
As described in this Supplem ent, each [PAC], [Scheduled] and [TAC] Class [or
Component] will receiv e princ ipal paym ents in accordan ce with a sch edule [ or schedules,
each] calculated on the basis of, among other things, a Structuring Range [or Rat e]. See
“Terms Sheet — Scheduled Principal Balances.”
Howev er, whether any such Class [or
Component] will adhere to its schedule [or schedules] and receive “Scheduled Payments” on a
Distribution Date will largely depend on the level of prepayments experienced by the [related]
Mortgage Loans [NOTE TO TRUST COUNS EL: For INV/Z Classes ][and, in the case of
Class [ ], on the level of LIBOR for each accrual period].
Each [PAC], [Scheduled] and [TAC] Class [or Component] exhibits an E ffective Range
[or Rate ] of constant prepaym ent rates [for each related schedule ] at which such Class will
receive Scheduled Paym ents. That range [or rate] may differ from the Structuring Range [or
Rate] us ed to c reate the r elated princ ipal balance schedule.
Based on the Modeling
Assumptions, the initial Effective Range [s] [or Ra te[s]] fo r t he [PAC], [Scheduled] and
[TAC] Classes [and Components] are as follows:
[NOTE: Trust Counsel may include a Security Group column in the table below.]
S-37 I-12-37
PAC [I][II] Class[es] [and
Component[s]]
Initial Effective [Range[s]] [or] [Rate[s]]
[ ] [and [ ] (in the aggregate)] . . . . . . . . . . . . ..
[ ] [and [ ] (in the aggregate)] . . . . . . . . . . . . ..
[ ] [and [ ] (in the aggregate)] . . . . . . . . . . . . ..
[ ]% PSA through [ ]% PSA
[ ]% PSA through [ ]% PSA
[ ]% PSA through [ ]% PSA
Scheduled Class[es] [and Component[s]]
[ ] [and [ ] (in the aggregate)] .............
.
[ ] [and [ ] (in the aggregate)] . . . . . . . . . . . . ..
[ ] [and [ ] (in the aggregate)] . . . . . . . . . . . . ..
[ ]% PSA through [ ]% PSA
[ ]% PSA through [ ]% PSA
[ ]% PSA through [ ]% PSA
TAC Class[es] [and Component[s]]
[ ] [and [ ] (in the aggregate)] .............
. [[ ]% PSA] [[ ]% PSA through [ ]% PSA]]
[ ] [and [ ] (in the aggregate)] . . . . . . . . . . . . .. [[ ]% PSA] [[ ]% PSA through [ ]% PSA]]
The
principal payment stability of the PAC Class[es] [and Components] will be supported
[in pa rt] by t he [related] [Scheduled], [TAC] [and] [Support] Cl ass[es] [and
Components].
The
principal paym ent stability of the Scheduled Class [es] [and Com ponents] will be
supported [in part] by the [related] [TAC] and [Support] Class[es] [and Components].
The
princip al paym ent stability o f the TAC Class [es] [and Com ponents] will be
supported [in part] by the [related] [Support] Class[es] [and Components].
If [all of] the Cla ss[es] [and Components] [and Segm ents] supporting a given Class
[or Component] [or Segment] [is ] [are] re tired before the Class [or Component] [o r
Segment] being supported is r
etired, the outstanding Class [or Component] [or
Segment] w ill no longer have an Effectiv e Range [or Rate] and w ill become mor e
sensitive to prepayments on the [related] Mortgage Loans.
There is no assurance that the [related] Mo rtgage Loans will have th e charac teristics
assumed in the Modeling Assum ptions, which were used to dete rmine the initia l Ef fective
Range[s] [or Rate[s]]. If the initia l Effective Range[s] [or Rate[s]] were calculated using the
actual characteristics of the [related] Mortgag e Loans, the initial Ef fective Range [s] [or
Rate[s]] coul d di ffer from [those] [that] shown in the above table [s] [or an initial Ef fective
Rate m ight not exist ]. Therefore, even if the Mortgage L oans were to prepay at a constant
rate within the initial Effective Range [or at the initial Effective Rate] shown for any Class [or
Component] [or Segm ent] in the above table [s], that Class [or Com ponent] [or Segm ent]
could fail to receive Scheduled Payments.
[NOTE TO TRUST COUNSEL: For INV/Z Classes.] [It is not likely that LIBOR will
remain at th e cons tant level set f orth in the m odeling assu mption f or Class [ ] , which was
used to de termine the In itial Effective Rate for Class [ ] . If LIBOR increas es significantly
above that level, the Effective Rate for Class
[ ] m ay c hange or cease to exist and its
Weighted Average Life may be extended, perhaps significantly.]
Moreover, the [related] Mortg age Loans will not prep ay at any constant rate. Nonconstant prepaym ent rates can caus e [any] [the] [PAC], [Scheduled] or [TAC] Cl ass [or
Component] not to receive Scheduled Paym ents, even if prepayment rates rem ain within the
S-38 I-12-38
initial Effective Range [(or if prepayment rates average the E ffective Rate)][, if any,] for that
Class [or C omponent]. Further, the Effective Range for [any] [the] [PAC] or [Scheduled]
Class [or Component] can narrow, shift over time or cease to exist[, and the Effective Rate for
any TAC Class [or Component ] can change or ceas e to exist, ] depending on the actual
characteristics of the [related] Mortgage Loans.
If the [related] Mortgage Loans prepay at rates that are g enerally below the Effective
Range [or Rate ] for [any] [the] [PAC] [ ,] [Scheduled] or [TAC] Class [or Com ponent], the
amount available to pay principal on the Secu rities may be i nsufficient to produce Scheduled
Payments on such [related] [PAC][,] [Scheduled] [or] [TAC] Class [or Component], [if any,]
and its Weighted Average Life may be extended, perhaps significantly.]
If the [related] Mortg age Loans prepay at rates th at are generally abo ve the Effective
Range [or Rate ] for [any] [the] [PAC], [Scheduled] or [TAC] Class [or Com ponent], its
supporting [Class] [or] [Classes] [and Components] [or Segments] may be retired earlier than
that [PAC], [Scheduled] or [TAC] Class [or Component[s]], and its Weighted Average Life
may be shortened, perhaps significantly.
[Group [__] Classes [N OTE TO TRUS T COUNSEL: Insert for each Trust Asset Group
which consists of Underlying Certificates th at are Non-Stic ky Jum p, St icky Jum p or Jum p
Classes.]
The Group [__] Classes are backed by an Underly ing Certificate th at is a Non-Sticky
Jump, [Sticky Jum p] [or] [Jump] Class, whose principal dist ribution priority will change
[temporarily] [permanently] (“jump”) on any Distribu tion Date that the applic able tr igger is
met [but will r evert (no t “stick” ) o n any subse quent Distribution Date that the ap plicable
trigger is not met]. See “Terms Sheet — Allocation of Principal” in Exhibit B.
The Weighted Average Life of a [Non-Sticky Jump][,] [Sticky Jump] [or] [Jump] Class
that jumps ahead in priority of principal distributions may be shortened, perhaps significantly.
Conversely, the Weighted Average Life of a [Non-Sticky Jump][,] [Sticky Jump] [or] [Jump]
Class that is jumped by another Class, may be extended, perhaps significantly. Consequently,
the yield to investors m ay be less than anticipated for any Group [4] Class purchased at a
premium if the Weighted Average Life of the Underlying Certificate is shortened and for any
Class purchased at a discount if the W eighted Average Life of the Underlying Certificate is
extended.
The [trigger event for the Underlying Certificate [included in T rust Asset Group [ ]] is
determined by reference to schedules of [__]% PSA Balances ][, and the ] [first trigger event
for the Underlying Certific ate in Trust Asset Group
[ ] is de termined by ref erence to
schedules of [ ] % PSA Balances] [and [__] CPR Balances ], [each of] which were calcu lated
as set forth under “Term s Sheet — [__] PSA Balances [and [__] CPR Balances ]” in Exhibit
B.]
[Non-Sticky Jump][,] [Sticky Jump] [and] [Jump] Classes
Classes [ ] and [ ] have been designated as [Non-Sticky Jump][,] [Sticky Jump] [and]
[Jump] Classes be cause the ir p rincipal dis tribution p riorities will ch ange [temporarily]
[permanently] (“jump”) on any Dis tribution Date that the a pplicable trigger is m et [but will
S-39 I-12-39
revert (not “stick”) on any subsequent Distribution Date that the applicable trigger is not met].
See “Terms Sheet—Allocation of Principal” in this Supplement.
The Weighted Average Life of a [Non-Sticky Jump][,] [Sticky Jump] [and] [Jump] Class
that jumps ahead in priority of principal distributions may be shortened, perhaps significantly.
Conversely, the W eighted Average Life of a
[Non-Sticky Jum p][,] [Sticky Jump ] [and]
[Jump] Class that is jum ped by another C lass [or C lasses] m ay be extended, perhaps
significantly. The yield to invest ors may be less than anticipated for any Class purchased at a
premium if the Weighted Average Life is shortened and for any Class purchased at a discount
if the Weighted Average Life is extended.
[The] trigger event[s] for the Non-Sticky Jump Classes [is] [are] determined by reference
to the [[____]% PSA ] [Jump] Balances, which were calculated as set forth under “Terms
Sheet—[___]% PSA] [Jump] Balances” in this Supplement.]
The Sponsor may recalculate the [[____]% PSA] [Jump] Balances based upon the actual
characteristics of the Group [ ] Trust Assets delivered on the Closing Date, which m ay vary
from the characteristics assumed in preparing the [ ]% PSA Balances set forth in Schedule
III to this Supplem ent. If recalculated, the [[____]% PSA ] [Jump] Balances will r eflect the
aggregate unpaid principal am ount of the Group [ ] Trust Assets, net of the Trustee Fee, for
each Distrib ution Date assum ing that the Mortgage Loans underly ing the Group [ ] Trust
Assets prepay at a constant rate of approxim ately [ ]% PSA [or [ ]% PSA] and that each of
the Mortgage Loans underlying the Group
[ ] Trust Assets has th e sam e interest rate ,
remaining term to m aturity and lo an age as the weighted averag e m ortgage rate, weighted
average remaining term to m aturity and weighted average loan age of the Group [ ] Trust
Assets delivered on the Closi ng Date. If recalculated, the [[____]% PSA] [Jump] Balances
will be made available on e-Access shortly after the Closing Date.]
Assumability
Each Mortgage Loan m ay be assum ed, subj ect to HUD review and approval, upon the
sale of the related Mortgaged Property. See “Yield, Maturity and Prepayment Considerations
— Assumability of Government Loans” in the Base Offering Circular.
Final Distribution Date
The Final D istribution Date for each Class, wh ich is set forth on the front cover of this
Supplement [or on Schedule I to this Supplement], is the latest date on which the related Class
Principal Balance [or Class Notional Balance] will be reduced to zero.
The
actual retirement of any Class may occur earlier than its Final Distribution Date.
According
to the te rms of the Ginnie Mae Guar anty, Ginnie Mae will g uarantee payment
in full of the Class Prin cipal Balance of each Class of Securities no la ter than its Final
Distribution Date.
Modeling Assumptions
[The] [Unless otherwise indicated, the] tables that follow have been prepared on the basis
of [the cha racteristics o f th e Underlying Certificate [s], the priorities of distributions on the
S-40 I-12-40
Underlying Certificate [s]], [the characteristics of the Underlyin
g SMBS [Security]
[Securities]] [and] the following assumptions (the “Modeling Assumptions”), among others:
1.
[The Mortgage Loans underlying the [Group [1]] [and] [2] T rust Assets have the
assumed characteristics shown under “Assumed
Characteristics of the Mortgage Loans
Underlying the [Group [
]] Trust Assets” in the Terms Sheet, [NOTE T O TRUS T
COUNSEL: FOR INSTANT REREMICS: and the Mortgage Loans underlying the Ginnie
Mae [INSERT CURRENT DEAL DESIGNATION - ] Class[es] [INSERT REMIC CLASSES
IN THIS DEAL THA T ARE THE TRUST ASSET FOR ANOTHER GROUP IN THIS
DEAL] [and [ ]] Underlying Certificate[s] have the assumed characteristics shown thereunder
for the Group [ ] [and [ ]] Trust Assets[, respectively] [and the Mortgage Loans underlying
the [Group [4]] Trust Assets have the assumed characteristics shown in the Terms Sheet of the
Series [20[ ]]-C[ ] Of fering Circu lar a ttached to th is Sup plement;] e xcept in the case of
information set forth under the 0% PSA
Prep ayment Assumption Rate, for which each
Mortgage L oan [underlying a Group [1][4] T rust Asset [NOTE T O T RUST COUNSEL:
FOR INS TANT RE REMICS: or the Ginnie Mae
[INSERT CURRE NT DEAL
DESIGNATION - ] Class[es] [INSERT REMIC CLASSES IN THIS DEAL THAT ARE THE
TRUST ASSET F OR ANOTHER GR OUP I N THIS DEAL ] [and [ ]] Underlying
Certificate[s]] is as sumed to hav e an orig inal a nd a r emaining te rm to m aturity of [180]
months[, each Mortgage Loan underlying a Group [2][3] [and [5]] Trust Asset is a ssumed to
have an original and a remaining term to maturity of [360] months] and] [each Mortgage Loan
underlying a Group [2] T rust Asset [NOTE TO TRUST COUNSE L: FOR INST ANT
REREMICS: or the Ginnie Mae [INSERT CURRENT DEAL DESIGNATION - ] Class[es]
[INSERT REMIC CLASSES IN
THIS DE AL THA T ARE THE TRUST ASSET FOR
ANOTHER GROUP IN THIS DEAL] [and [ ]] Underlying Certificate[s]] is assumed to have
a Mortgage Rate of 1.50% per annum higher than the relate d Certificate Rate ]. [NOTE TO
TRUST COUNSEL: FOR INST ANT REREMICS: The Group [ ] Trust Assets and the
Mortgage L oans underlying the Group [ ] Trust Assets h ave the ass umed characteristics
shown in Exhibit [F].]
2.
The Mortgage Loans prepay at the constant percentages of [PSA] [or] [CPR][, as
applicable,] (described below) shown in the related table.
3.
Distributions on the [Group [1]] Securities are always receiv ed on the [16th day of
the month] and distributions on the Group [ ] and [ ] Securities are always receiv ed on the
[20th day of the month], [in each case,] whether or not a Business Day, commencing in [insert
month following Closing Date] 20[ ].
4. A term ination of the Trust [or [either] [any] T rust REMIC][or the Underlying
Trust[s]] does not occur.
5.
The Closing Date for the Securities is [
], 20[ ].
6.
No expenses or fees are paid by the Trust other than the Trustee Fee, which is paid as
described under “The Trust Assets — The Trustee Fee” in this Supplement.
7.
[Distributions on the Underlying Certificate[s] are made as described in the [related]
Underlying Certificate Disclosure Docum ent[s].] [ Distributions on th e Unde rlying SM BS
[Security] [ Securities] are m ade as described in the [related] Underlying SMB S Security
Disclosure Document[s].]
S-41 I-12-41
8.
[Distributions on the Underlying Callable [Security] [ Securities] are m ade as
described in the Series
[20[ ]]-C[ ] Offering Circular.]
9.
[Except as otherwise in dicated, there is no redemption of t he Underlying Callable
[Security] [Securities].]
10. [Each Clas s is he ld f rom the Closing Date an d is no t ex changed in whole or in
part[.][, including that there is no m andatory excha nge of any MX Class that is a Weighted
Average Coupon Class.]]
11. [The [[____]% PSA ] [Jump] Balances are as
Supplement.]
12.
set forth in Schedule III to this
[Other or different assumptions, as applicable.]
13. [NOTE TO TRUST COUNSE L: For INV/Z Classes. ] [ The Interest Rate
Applicable to Class [ ] for each Accrual Period is based on a constant LIBOR level of [ ] %,
except with respect to the Decrement Tables and Yield Tables.]
14. [NOTE T O TRUS T COUNSEL: TH E FOLLOWING FOUR MODELING
ASSUMPTIONS ARE FOR ARM MBS BACKED GROUPS: The Certificate Rate on the
Group [ ] Trust Assets for the f irst Distribution Date is bas ed on the in formation set forth in
Exhibit [F]. The Mortgage Mar gin, lif etime Mortgage L oan inter est rate cap an d lif etime
Mortgage Loan inte rest r ate f loor will equa l the re lated Certif icate Mar gin, Lif etime
Certificate Interest Rate Cap and Lif etime Certificate Interest Rate Floo r, as applica ble, plus
the Servicing and Guaranty Fee Rate, each as shown in Exhibit [F].
15. For purposes of the decrem ent tables for Security Group [ ], on all Distribution
Dates occurring after the first Mortgage Rate adjustment date for the related Mortgage Loans,
the constant value of [CMT] shown with respe ct to any decr ement table is used to c alculate
the Mortgag e Rate with respect to the Mortgag e Loans, subject to any applicab le caps and
floors.
16. One m onth after each Mortga ge Rate adjustm ent date, the paym ent amount of the
related Mortgage Loan will be res et so tha t the remaining principal balance of that Mortgage
Loan will f ully am ortize in equal monthly paym ents over its rem aining term to m aturity,
assuming its Mortgage Rate remains constant.
17. When calculating the Mortgage Rate or Ce rtificate Rate with respect to the Group [
] Trust Assets, the rate is not rounded to the nearest 1/8 of one percent.]
When reading the tables and the related text, investors should bear in mind that the
Modeling Assumptions, like any other stated assumptions, are unlikely to be entirely
consistent with actual experience.
For example, most of the Mortgag e Loans will not have the characteristics assumed,
many Distribution Date s will oc cur on a Busin ess Day af ter the [[16th] [20th] day of
the month] [16th or 20th day of the month, as applicable], and the Trustee may cause a
termination of the Trust as d escribed under “Descrip tion of the Securities —
Termination” in this Supplement.
S-42 I-12-42
In addition, distributions on the Securi
ties are based on Certificate Factors and
Calculated Certificate Factors, if applicable, which m ay not reflect actual receipts on
the Trust Assets.
See “Description of the Securities — Distributions” in the Base Offering Circular.
Decrement Tables
Prepayments of mortgage loans are commonly measured by a prepayment standard or
model. The model[s] used in this Supplement, [Prepayment Speed Assumption (“PSA”)]
[and] [Constant Prepayment Rate (“CPR”)], [is][are] the standard prepayment assumption
model[s] of The Securities Industry and Financial Markets Association. [PSA represents an
assumed rate of prepayment each month relative to the then outstanding principal balance of
the Mortgage Loans to which the model is applied.] [CPR represents a constant rate of
prepayment on the Mortgage Loans each month relative to the then outstanding aggregate
principal balance of the Mortgage Loans for the life of those Mortgage Loans.] See “Yield,
Maturity and Prepayment Considerations — Standard Prepayment Assumption Models” in
the Base Offering Circular.
The decrement tables s et forth below are based on the assum ption that the Mortgage
Loans prepay at the indicated percentages of PSA (the “PSA Prepayment Assumption Rates”)
[or CPR (the “CPR Prepayment Assumption Rates”)][, as applicable]. As used in the table[s],
each of the PSA Prepaym ent Assumption Rates [or CPR prepaym ent Assum ption Rates ]
reflects a percentage of the 100% P SA [or CPR] assumed prepayment rate. The Mortgage
Loans w ill not prepay at any of the
PSA Prepayment Assumption Rates [or CPR
Prepayment Assumption Rates], and the timing of changes in the rate of prep ayments
actually experienced on the Mortgage Loans will not follow the pattern described for the
PSA [or CPR] assumption.
The decrement tables s et f orth below illustr ate the perce ntage of the Original Class
Principal Balance [(or, in the case of [a] [the] Notional Class, the o riginal Clas s Notion al
Balance)] that would rem ain outstanding followi ng the distribution m ade each specified
month for each [Regular] [or MX] Class, based on the assumption that the [related] Mortgage
Loans prepay at the PSA Prepaym ent Assum ption Rates [or CPR Prepaym ent Ass umption
Rates][, a s applic able,] [NOTE TO TRUST COUNSEL: For INV/Z or FLT/Z Classes: [,]
[and,] in the case of Class [ ], under various assumed constant levels of LIBOR] [NOTE TO
TRUST COUNSEL: FOR ARM MBS BACKED GROUPS: and in the case o f the Group
[ ] Securities, that [CMT] is at the specified level]. The percentages set forth in the following
decrement tables have been rounded to the
nearest whole percentage (including rounding
down to zero).
The decrement tables also indicate the W eighted Average Life of each Class und er each
PSA Prepaym ent Assumption Rate [or CPR Prepaym ent Assum ption Rate ][, as a pplicable].
The Weighted Average Life of each Class is calculated by:
(a)
multiplying the net redu ction, if any , of the Cla ss Princip al Balance [(or t he net
reduction of the Class Notiona l Balance, in th e case of [a] [the] Notional Class )]
from one Distribution Date to the next Distribution Date by the number of year s
from the date of issuance thereof to the related Distribution Date,
S-43 I-12-43
(b)
(c)
summing the results, and
dividing the sum by the aggregate amount of the assumed net reductions in principal
balance [or notional balance, as applicable,] referred to in clause (a).
[The information shown for [the] [each] Notional Class is f or illustrative purposes only,
as a Notion al Class is n ot entitled to distri butions of principal and has no W eighted Average
Life. The Weighted Average Life shown for [the] [each] Notional Class has been calculated
on the assumption that a reduction in the Class Notional Balance thereof is a distribution of
principal.]
The Weighted Average Lives are likely to vary, perhaps significantly, from those set
forth in the tables below due to th e differences between the actual character istics of the
Mortgage Loans unde rlying the [related] Trust Assets and the Modeling Assumptions.
[In addition, the Weighted Average Lives [of th e Group [ ] Se curities] [of Class [ ]] a re
likely to v ary due to differences betw een actual [LI BOR] [C MT] and the assumed
constant levels of [LIBOR] [C MT]. [NOTE TO TRUS T COUNSEL: This last bracketed
clause applies when there are INV/Z or FLT/ Z Classes or when there are ARM MBS-backed
groups.]
S-44 I-12-44
Percentages of Original Class Principal [(or Class Notional)] Balances
and Weighted Average Lives
Distribution Date
Initial Percent . . .
[Month] 20[ ] . . .
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
[Month] 20[ ] ...
Weighted Average
Life (years) ....
0%
%
Class[es] [ ]
%
%
%
Security Group 1
[PSA] [CPR] Prepayment Assumption Rates
Class [ ]
0%
%
%
%
%
S-45 I-12-45
0%
%
Class [ ]
%
%
%
Distribution Date
Initial Percent . . . .
125
0%
%
Class [ ]
%
%
%
Security Group 2
PSA Prepayment Assumption Rates
Class [ ]
%
%
%
%
0%
0%
Class [ ]
%
%
%
%
[Month] 20[ ] . . . .
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
Weighted Average
Life (years) .....
Distribution Date
Initial Percent . . . .
[Month] 20[ ] . . . .
[Month] 20[ ] . . . .
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
[Month] 20[ ] ....
Weighted Average
Life (years) .....
0%
%
Class [ ]
%
%
%
0%
Security Group 3
PSA Prepayment Assumption Rates
Class [ ]
%
%
%
%
S-46 I-12-46
0%
%
Class [ ]
%
%
%
Yield Considerations
An investor seeking to m aximize yield should make a decision whether to invest in any
Regular [or MX] Class based on the anticipated yield of that Class resulting from its purchase
price[,] [ and] the investor’s own projection of Mo rtgage Loan prepaym ent rates under a
variety of scenarios [,] [ and,] [ in the case of the Group [3] Securities ], [the investor’s own
projection of paym ent rates on the Underlying Certificate [s] under a variety of scenarios ][,]
[and,] [in the case of the Group [4] Securities, the investor’s own projection of the likelihood
and tim ing of any redemption on the Underlying Callable
[Security] [ Securities] under a
variety of scenarios ] [,] [and,] [in the case of the Group [5] Securities], [the investor’s own
projection of payment rates on the Underlying SMBS [Security] [Securities] under a variety
of scenarios] [and, in the case of [a Floating Rate][,] [or] [an [Interest Only] Inverse Floating
Rate][,] [or] [a Toggle] [or a W eighted Average Coupon ] Class [or the Class [ ] Securities],
the investor’s own projection of levels of [LIBOR] under a variety of scenarios [and, in the
case of the Group [ ] Securities, the investor’s own project of levels of [CMT] under a variety
of scenarios]]. No representation is made regarding Mortgage Loan prepayment rates [,
Underlying Certificate payment rates] [, Un derlying S MBS Security paymen t rates ] [,
the occurrence of a redemption o f the Und erlying Callable [Secu rity] [Securities ]] [,
[LIBOR] levels][, [CMT] levels] or the yield of any Class.
Prepayments [and Redemption]: Effect on Yields
The yields to investors will be s ensitive in varying degrees to the r ate of prepayments on
the [related] Mortg age Loans [and [, in the case of the Group
[4] Securities, ] to any
redemption of the Underlying Callable [Security] [Securities]].
In the case of Regular Securities
[or MX Securities ] purchased at a prem ium
[(especially [the] Inte rest Only Class [es])], faster than anticipated rates of principal
payments [(or[, in the case of the Group
[4] Securities, ] a redem ption of the
Underlying Callable [Security] [Securities])] could result in actual yields to investors
that are lower than the anticipated yields.
[Investors in the Inte rest Only Class [es] should also consider th e risk th at rapid rate s
of principal paym ents [or a redemption ] cou ld result in the f ailure o f investors to
recover fully their investments.]
In the cas e of Regular Securities
[or MX Securities ] purchased at a d iscount
[(especially [the] Principal Only Clas s[es])], slower than anticipated rates of principal
payments [(and[, in the case of the Group [4] Securities,] the absence of a redem ption
of the Unde rlying Callable [Security] [ Securities])] could result in actual yields to
investors that are lower than the anticipated yields.
[NOTE T O TRUS T COUNSEL: FOR ARM MBS BACKED G ROUPS: The
rates of principal am ortization on the Mortgage Loans underlying the Group [ ] Trust
Assets will depend upon the level of a
nd annual adjustm ents in the applicable
Mortgage Rates, with higher Mortgage Rate s and earlier in creases in Mortgage Rates
affecting the rates of prepaym ents, which could result in actual yields to investors that
are lower than the anticipated yields.]
[Investors in [a Weighted Average Coupon Cla ss] [Class [ ]] should consider that
differing rates of reduction in the r elated REM IC Securitie s [will] [ may] ultim ately
S-47 I-12-47
cause su ch Class to b e exchang ed for th e related REMIC Securities (consisting
primarily or exclusively of an Interest Only Class). In certain instances, [the Weighted
Average Coupon Class ] Class [ ] will become an Interes t Only Class over tim e prior
to such exchange.]
See “Risk Factors — Rates of principal payments can reduce your yield” in this Supplement.
Rapid rates of prepayment s on the Mortgage L oans [or a redem ption of the Underlying
Callable [Security] [Securities]] are likely to coincide with p eriods of low prevailing interest
rates.
During periods of low prevailing interest rates , the yie lds at which an investor may be
able to reinvest am ounts received as principal payments on the investor’s Class of Securities
may be lower than the yield on that Class.
Slow rates of prepaym ents on the Mortgage L oans [and the absence of a redem ption of
the Underlying Callable [Security] [ Securities]] are likely to coincide with periods of high
prevailing interest rates.
During periods of high prevailing interes t rates, the amount of principal pay
available to an investor for reinvestment at those high rates may be relatively low.
ments
The Mortgage Loans will not prepay at any constant rate until maturity, nor will all of the
Mortgage L oans [NOTE TO TRUST COUNS EL: Include the f ollowing if there is m ore
than one Group: underlying any Trust Asset Group ] prepay at th e same rate at any one tim e.
The timing of changes in the rate of prepaym ents may affect the actual y ield to an investor,
even if the average rate of prin cipal prepayments is consistent with the investor’s expectation.
In general, the earlier a prepaym ent of principal on the Mortgage Loans [or a redem ption of
the Underlying Callable [Security] [Securities]], the greater the effect on an investor’s yield.
As a result, the effect on an inves tor’s y ield of principal prepaym ents occurring at a rate
higher (or lower) than the rate anticipated
by the investor during the period immediately
following the Closing Date is not likely to be
offset by a later equivalent reduction (or
increase) in the rate of principal prepayments.
[[LIBOR]: Effect o
n Yields of the
[Floating Rate ][,] [and]
Rate][,][and][Weighted Average Coupon] [and Toggle] Class[es]
[Inverse Floating
[Low levels of [LIBOR] can reduce the y ield of the [Floating Rate ][,] [and] [Weighted
Average Coupon ] [and [under certain circum stances,] Toggle ] Class [es].] [High levels of
[LIBOR] can [significantly] reduce the yield of the Inverse F loating Rate [and [under certain
circumstances,] Toggle ] Class [es].] [In addition, [the] [certain] [Floating Rate ][,] [and]
[Weighted Average Coupon ] [and [under certain circum stances,] Toggle ] Class [es] will not
[necessarily] benefit from a higher yield at high levels of LIBOR
] [and] [[the] [certain]
Inverse F loating Rate Class [es] may not benefit from par ticularly low levels of LIBOR ]
because the rate on such Class[es] is capped at a maximum rate described under “Terms Sheet
— Interest Rates.”]]
[Payment Delay: Effect on Yields [of the Fixed Rate ][,] [and] [ Ascending Rate ][,] [and]
[Descending Rate][,] [and] [Delay][,] [and] [Weighted Average Coupon] Class[es]]
The effective yield on any [Fixed Rate ][,] [or] [Ascending Rate ][,] [or] [Descending
Rate][,] [or] [Delay] [ or W eighted Average Coupon ] Class [(other than any fixed rate MX
S-48 I-12-48
Class that is formed from one or more non-delay Classes)] [(other than Class [ ])] will be less
than th e yield otherwise produced b y its Inte rest Rate and purchase price becau se, on eac h
Distribution Date, 30 days’ interest will be payable on [(or added to the principal amount of) ]
that Class even though interest began to accrue approxim ately [46] [or] [50] days earlier [,as
applicable][; except that[, in the case of the Group [4] Securities,] in the event of a redemption
of the Underly ing Callable [Security] [ Securities], interest payable on the
[Group [4]]
Securities will inc lude accrued in terest to th e date of redem ption as describe d in this
Supplement. [NOTE TO TRUST COUNSEL: Discuss the distribution of additional interest
with respect to any Securities included in a Security Group backed by one or more Underlying
Callable Securities.]]
Yield Table[s]
The following table [s] show [s] the pre-tax yields to m aturity on a corporate bond
equivalent basis of [specified Classes] [Class [ ]] at various constant percentages of PSA [or
CPR, as applicab le,] [and, in the cas e of the Group [4] Securities, under various redemption
scenarios for the [related] Underlying Callable [Security] [Securities]] [and, in the case of the
[Floating Rate ][,] [ and] [Inverse Floating Rate ] [and Toggle ] Class [es], at various constant
levels of [LIBOR] [and in the case of the Class [ ] Securities, at various constant levels of
[LIBOR and] [CMT]].
The Mortgage Loans will not prepay at any constant rate until maturity, [and it is unlikely
that [LIBOR] [ or CMT] will remain constant]. Moreover, it is likely that the Mortgage Loans
will experience actual prepayment rates th at differ from those of the Modeling Ass umptions.
[In addition, no assurance can be m ade as to the likelihood or tim ing of a redem ption of the
Underlying Callable [Security] [ Securities].] Therefore, the actual pre-tax yield of [any
Class] [Cla ss [ ]] may differ fro m those sho wn in the [applicable ] table below for that
Class even if the Class is purchased at the assumed price shown.
The yields were calculated by
1.
determining the monthly discount rates that, when applied to the applicable assumed
streams of cash flows to be paid on the a pplicable Class, would cause the discounted
present value of the assum ed streams of cash flows to equal the assu med purchase
price of that Class p lus accrued in terest [(in th e case of interest-bearin g Classes )],
and
2.
converting the monthly rates to corporate bond equivalent rates.
These calculations do not take into account vari ations that may occur in the interest rates
at which investors m ay be able to reinvest funds received by them as distributions on their
Securities and consequently do not purport to reflect the return on any investment in any Class
when those reinvestment rates are considered.
The inf ormation se t f orth in th e f ollowing ta ble[s] was prepared on the basis o f the
Modeling Assumptions and the assumption[s] that [[(1)] the Interest Rate applicable to [each]
[the] [Floating Rate] [and] [Inverse Floating Rate] [and Toggle] Class for each Accrual Period
following the first Accrual Period will be based on the indicated level of [LIBOR] and] [(2)]
the purch ase price of [each] Class [ ] (expressed as a percen tage o f its or iginal [Class
Principal Balance ] [or] [Class Notional Balance ]) plus accrued interest [(in the case of
S-49 I-12-49
interest-bearing Classes)] is as indicated in the [related] table. The assumed purchase price
is not necessarily that at which actual sales will occur.
SECURITY GROUP 1
Sensitivity of Class [ ] to Prepayments
Assumed Price [ ]%*
%
%%
%
PSA Prepayment Assumption Rates
%
%
%
[0.0]%1 %
%
Sensitivity of Class [ ] to Prepayments
Assumed Price [ ]%*
PSA Prepayment Assumption Rates
%
%
%
%
LIBOR
% [and below] . . . . . . . . . . . . . . . . . . . . . . .
% ...................................
% [and above] . . . . . . . . . . . . . . . . . . . . . . .
%
%
%
%
%
%
%
%
%
%
%
*
Sensitivity of Class [ ] to Prepayments
Assumed Price [ ]%*
PSA Prepayment Assumption Rates
%
%
%
%
LIBOR
% [and below] . . . . . . . . . . . . . . . . . . . . . . .
% ...................................
% [and above] . . . . . . . . . . . . . . . . . . . . . . .
%
%
%
%
%
%
%
%
%
%
%
%
Sensitivity of Class [ ] to Prepayments
Assumed Price [ ]%*
PSA Prepayment Assumption Rates
%
%
%
%
LIBOR
% [and below] . . . . . . . . . . . . . . . . . . . . . . .
% ...................................
% [and above] . . . . . . . . . . . . . . . . . . . . . . .
%
%
%
%
%
%
%
%
%
%
%
%
1
[NOTE TO TRUST COUNSEL: Include for Interest Only Fixed Rate Classes only.]
*
The price does not include accrued interest. Accrued interest has been added to the price in calculating the
yields set forth in the table.
Indicates that investors will suffer a loss of virtually all of their investment.
**
S-50 I-12-50
SECURITY GROUP 2
Sensitivity of Class [ ] to Prepayments
Assumed Price [ ]%*
PSA Prepayment Assumption Rates
%
%
%
%
LIBOR
% [and below] . . . . . . . . . . . . . . . . . . . . . . .
% ...................................
% [and above] . . . . . . . . . . . . . . . . . . . . . . .
%
%
%
%
%
%
%
%
%
%
%
*
SECURITY GROUP 3
Sensitivity of Class [ ] to Prepayments
Assumed Price [ ]%*
[Redemption in [Month/Year]]
PSA Prepayment Assumption Rates
%
%
%
%
LIBOR
% [and below] . . . . . . . . . . . . . . . . . . . . . . .
% ...................................
% [and above] . . . . . . . . . . . . . . . . . . . . . . .
%
%
%
%
%
%
%
%
%
%
%
%
[Redemption in [Month/Year]]
PSA Prepayment Assumption Rates
%
%
%
%
LIBOR
% [and below] . . . . . . . . . . . . . . . . . . . . . . .
% ...................................
% [and above] . . . . . . . . . . . . . . . . . . . . . . .
%
%
%
%
%
%
%
%
%
%
%
%
Sensitivity of Class [ ] to Prepayments
Assumed Price [ ]%*
%
%%
*
**
%
PSA Prepayment Assumption Rates
%
%
%
%
%
%
The price does not include accrued interest. Accrued interest has been added to the price in calculating the
yields set forth in the table.
Indicates that investors will suffer a loss of virtually all of their investment.
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
The following tax discussion, when read in co njunction with the discussion of “Certain
United States Federal Income Tax Consequences” in the Base Offering Circular, describes the
material United Sta tes f ederal inco me tax considera tions f or investor s in the Se curities.
However, these two tax discussions do not purport to deal with all United States federal ta x
consequences applicable to a ll categories of investors, som e of which m ay be s ubject to
special ru les. [In particular, the discussions do not consider the United States federal ta x
S-51 I-12-51
consequences to a beneficial owner of a [Group [4]] Security if the owner also has an inte rest
in the Call Class described in the Series [20[ ]]-C[ ] Offering Circular.]
U.S. Treasury Circular 230 Notice
The discussion contained in this Supplement and the Base Offering Circular as to
certain United States federal tax consequences is not intended or written to be used, and
cannot be used, for the purpose of avoiding United States federal tax penalties. Such
discussion is written to support the promotion or marketing of the transactions or
matters addressed in this Supplement and the Base Offering Circular. Each taxpayer to
whom such transactions or matters are being promoted, marketed or recommended
should seek advice based on its particular circumstances from an independent tax
advisor.
REMIC Election[s]
In the opinion of [INSERT NAME OF TRUST COUNSEL], the Trust will constitute a
[Single REMIC Series [as to the Group [ ] Trust Assets[, the Group [ ] Trust Assets and the
Group [ ] Trust Assets]] [and a] [Double REMIC Series [as to th e Group [ ] Trust Assets],
each for United States federal income tax purpos es. [Separate REMIC elections will be made
for [the][each] Pooling REMIC[,] [and] [the] [each] Issuing REMIC] [the Group [ ] REMIC,
the Group [ ] REMIC and the Group [ ] REMIC ] [as to [each Trust Asset Group of ] the
Underlying Callable [Security] [ Securities] and the Trust Assets other than the Underlying
Callable [Security] [Securities]].]
Regular Securities
The Regula r Secur ities will b e tre ated a s deb t ins truments issued by the [Group [ ]]
[Issuing] [Trust] REMIC[s] [or the Group [ ] REMIC, as applicable] for United States federal
income tax purposes. Incom e on the Regular Securities m ust be reported under an accrual
method of accounting.
[The [Principal Only ][,] [Notional] [and] [Accrual] Class [es] of Regular Securities will
be issued with orig inal i ssue discount (“OID”), and ] [C][c]ertain [other] Classes of Regular
Securities may be is sued with [original issue discount (“OID”) ] OID. See “Certain United
States Federal Income Tax C onsequences—Tax Treatment of Regular Securities—Original
Issue Discount,” “—Variable Rate Securities” and “—Interest Weighted Securities and NonVRDI Securities” in the Base Offering Circular.
The prepaym ent assumption that should be used in determ ining the rates of accrual of
OID, if any, on the Regular Secu rities is [
]% PSA [in the case of the Group [ ]
Securities](as describ ed in “Yield , Maturity and Prepaym ent Considera tions” in this
Supplement). [In the case of the [Class [ ] Securities] [[Floating Rate] [and Inverse Floating
Rate] [Classes]], th e interest rate va lue[s] to be used f or these dete rminations [is] [ are] the
initial In terest Rate [s] as set forth in the Term
s Sheet under “Interest Rates.” ] No
representation is made, however, about the rate at which prepay ments on the Mortgage Loans
underlying [the] [any Group of] Trust Assets actually will occur [or the level of [LIBOR] [or]
[CMT] at any tim e after the da te of this Supplem ent]. See “Certain United Sta tes Federal
S-52 I-12-52
Income Tax Consequences” in the Base Offering Circu lar. [Code Section 1272(a)(6),
however, authorizes regulations regarding the “Pricing Prepayment Assumption” to be used in
making these determ inations. If these regula tions are is sued, they m ay require that a
beneficial owner of a [Group [4]] Security take into account, in making these determinations,
the possibility of the retirement of [the Group [4]] Securities concurrently with the redemption
of the Underlying Callable [Security] [Securities].]
The Regular Securities generally will be treat ed as “regular interests ” in a REMIC for
domestic building and loan associations and “real es tate a ssets” f or r eal es tate in vestment
trusts (“REITs”) as described in “Certain United States Federal Income Tax Consequences” in
the Base Of fering Cir cular. Sim ilarly, in terest on the Regular Securities will be co nsidered
“interest on obligations secure d by m ortgages on real property ” for REITs as describ ed in
“Certain United States Federal Income Tax Consequences” in the Base Offering Circular.
Residual Securities
[The Class R Securities will represent the beneficial ownership of the Residual Interest in
the Trust R EMIC.] [The Class R [ ] Securities will rep resent the benef icial ownership of the
Residual Interest in the Group [ ] REMIC, and the Class R [ ] Securities will rep resent th e
beneficial ownership of the Re sidual Interest in the Group [ ] REMIC. ] [The Class RR
Securities will r epresent the ben eficial ownership of the Residual I nterest in [each Trus t
REMIC] [the] [each] Pooling REMIC and the beneficial ow nership of the Residual Interest in
the Issuing REMIC].] [The Class RI Secur ities will repr esent the beneficial ownership of the
Residual Interest in the Issuing R EMIC, and the Clas s RP Securities will rep resent the
beneficial ownership of th e Residu al In terest in [the] [each] Pooling REMIC. ] [The Class
RR[ ] Securities will rep resent the beneficial ownership of the Residual Interest in the Group
[ ] Pooling REMIC and the beneficial owners hip of the Residual In terest in the Group [ ]
Issuing REMIC, and the Class RR [ ] Securities will represent the beneficial ownership of the
Residual Interest in the Group [ ] Pooling R EMIC and the bene ficial ownership of the
Residual Interest in the Group [ ] Issuing REMIC . ] The Residual Securities, i.e., the Class
[R] [R[ ] and R [ ]] [RR] [RR[ ] and RR [ ]] [RI and RP] Securities, generally will be treated
as “residual interests” in a REMIC for dom estic building and loan associations and as “real
estate assets” for REI Ts, as described in
“Certain United States Federal Incom e Tax
Consequences” in the Base Offering Circular, but will not be treated as debt for United States
federal income tax purposes. Instead, the Holder s of the Residual Securities will be required
to repo rt, and will b e taxed on, th eir p ro rata shares of the taxab le incom e or loss of the
[related] Trust REMIC[s], and these requirements will continue until there are no [outstanding
regular interests in the respective Trust REMICs] [Securities of any Class outstanding] [, even
though the Holders previously m ay have received full paym ent of the ir stated interest and
principal]. [Thus, Residual Holde rs will h ave taxable income attributa ble to the Residual
Securities even though they will not receive princi pal or interest distributions with respect to
the Residual Securities, which could result in a negativ e af ter-tax re turn f or the Residual
Holders.] [[Even though the Holders of the Residual S ecurities are not enti tled to any stated
principal or inte rest payments on the Residual Securities, ] the [related] Trust REMIC [s] may
have substa ntial taxab le incom e in certain periods, and offsetting tax losses m ay not occur
until much later periods. Accordingly, the Holde rs of the Residual Securities may experience
substantial adverse tax timing consequences.] Prospective investors are urged to consult their
S-53 I-12-53
own tax advisors and consider the after-tax eff ect of ownership of the Residual Securities and
the suitability of the Residual Securities to their investment objectives.
Prospective Holders of Residual Securities should be aware that, at issuance, based on the
expected prices of the Regul ar and Residual Securities and the prepaym
ent assum ption
described above, the residual interests represented by the Residual Securities will be treated as
“noneconomic residual interests” as that term is defined in Treasury regulations.
[OID accru als on the Underlying Certificate [s] [and the Underlying SMBS [Security]
[Securities]] will be co mputed using the same prepaym ent assum ption as set forth under
“Certain Un ited States Federal Incom e Tax C onsequences — Regular Securities” in th is
Supplement.]
[MX Securities
For a discussion of certain United S tates federal income tax consequences applicable to
the MX Class [es], se e “Certa in U nited S tates Federa l Incom e Tax Consequences — Tax
Treatment of MX Securities”, “— Exchanges of MX Classes and Regul ar Classes” and “—
Taxation of Foreign Holders of REMIC Securiti es and MX Securities” in the Base Offering
Circular.]
Investors should consult their own tax advi sors in determin ing the United States
federal, sta te, loca l, fo reign and any other tax consequences to them of the purchase,
ownership and disposition of the Securities.
ERISA MATTERS
Ginnie Mae guarantees distributions of prin
cipal and interes t with respect to the
Securities. The Ginnie Mae Guar anty is supported by the full fa ith and credit of the United
States of Am erica. The Regular
[and MX ] Securities will qu alify as “guaranteed
governmental m ortgage pool certificates” with in the m eaning of a Departm ent of Labor
regulation, the effect of which is to provid e th at m ortgage loans and p articipations the rein
underlying a “guaranteed government al m ortgage pool certificat e” will not be considered
assets of an em ployee benefit plan subject to the Em ployee Retirement Income Security Act
of 1974, as a mended (“ERISA”), or subject to section 4975 of the Code (each, a “Plan”),
solely by reason of the Plan’s purchase and holding of that certificate.
Governmental plans and certain church pl
ans, while not subjec t to the f iduciary
responsibility provisions of ERISA or the prohibited transacti on provisions of ERISA and the
Code, may nevertheless be subject to local, state or other federal laws that are substantially
similar to the foregoing provision s of ERISA and the Code. Fiduciaries of any such plans
should consult with their counsel before purchasing any of the Securities.
Prospective Plan Investors should consult with their advisors, however, to determine
whether the purchase, holding or resale of a Security could give rise to a transaction that
is prohibited or is not otherwise permissible under either ERISA or the Code.
See “ERISA Considerations” in the Base Offering Circular.
The Residual Securities are not offered to, and may not be transferred to, a Plan Investor.
S-54 I-12-54
[The discussion under “ERISA Considerations” in the Series
[20[ ]]-C[ ] Offering
Circular regarding the hol ding by an ERISA plan of the Underlying Callable [Security]
[Securities] or the related Call Class, and the holdi ng by a party in interest of the other
security, would apply equally w ith respect to the holding of a [Group [4]] Secu rity of this
Series and the Call Class.]
LEGAL INVESTMENT CONSIDERATIONS
Institutions whose investm ent activities ar e subject to legal investm
ent laws and
regulations or to review by cer tain regulatory authorities m ay be subject to restrictions on
investment in the Securities. No representation is made about the proper characterization
of any Class for legal investme nt or other pu rposes, or abou t the p ermissibility of the
purchase by particular investors of any
Class under applicable legal investmen
t
restrictions.
Investors should consult their own legal ad visors regarding applicable investment
restrictions and the effect of any restrictions on the liq uidity o f th e Securitie s prior to
investing in the Securities.
See “Legal Investment Considerations” in the Base Offering Circular.
PLAN OF DISTRIBUTION
Subject to the terms and conditions of the S ponsor Agreement, the Sponsor has agreed to
purchase all of the Securities if any are sold and purchased. The Sponsor proposes to offer
the [Regular [ and MX ] Class[es]] to the public from ti me to tim e for sale in negotiated
transactions at varying prices to be dete rmined at the tim e of sale, plu s acc rued in terest[, i f
any,] [from [(1) [
] 1, 20 [ ] on the [Fixed Rate] [, Ascending Rate ] [, Descending Rate ]
[(other than Class [ ])][,] [and] [Delay] [and Weighted Average Coupon] Classes][,] [and] (2)
[
] [16], 20[ ] on the [Group [1]] [Floating Rate][,] [and] [Inverse Floating Rate][,] [and]
[Toggle] [and Weighted Average Coupon] Class[es] [other than the Delay Classes ] and Class
[ ]] and (3) [
] [20], 20 [ ] on the [Group [2]] Floa ting Rate and I nverse Floating Rate
Class[es]]]. The Sponsor m ay effect these transa ctions by sales to or through certain
securities d ealers. These dealers m ay recei ve com pensation in th e form of discounts,
concessions or comm issions from the Sponsor and/or commissions from any purchasers for
which they act as agents. Som e of the Secur ities m ay be sold through dealers in relatively
small sales. In the usual case, the commission charged on a relatively sm all sale of securities
will be a higher percentage of the sales price than that charged on a large sale of securities.
INCREASE IN SIZE
Before the Closing Date, Ginni e Mae, the Trustee and the S ponsor may agree to increase
the size of this offering. In that event, the [Group [ ] and [ ]] Securities will have the same
characteristics as described in this Supplem ent, except that [(1)] the Or iginal Class Principal
Balance [(or orig inal Class Notio nal Balanc e)][,] [and] [(2)] [the Original Component
Principal Balance of each Co mponent of each related Class ][,] [and] [(3)]] the [[ ]% PSA]
[Jump] Balances, ] [ and] [ (4)] [the Scheduled P rincipal Balances [and Aggregate Scheduled
Principal Ba lances] [of [each] [the] Class [or C omponent] [receiving principal distributions
[or interest distributions based upon a notional balance ] from [the same] Trust Asset Group ]
will increase by the sam e proportion]. The Tr ust Agreement, the Final Data State ment [, the
S-55 I-12-55
Final Schedules] and the Supplem ental Statement, if any, will reflect any in crease in the size
of the transaction.
LEGAL MATTERS
Certain legal m atters will be passed upon for G innie Mae by [Hunton & W illiams LLP]
[and Harrell & Cham bliss LLP, Richm ond, Virginia], for the Trust by [
], and
for the Trustee by [
].
S-56 I-12-56
Schedule I
Available Combination[s]
REMIC Securities
Class
Original Class
Principal Balance
[or Class
Notional Balance]
(1)
MX Securities
Related Maximum Original Class Principal
MX
Balance [or Class
Class
Notional Balance](2)
Principal
Type (3)
Interest
Rate
Interest
Type
(3)
CUSIP
Number
Final Distribution
Date (4)
Security Group 1
Combination 1
$
$
%
$
$
%
Combination 2 [(6)]
Security Group[s] 2
[and 3]
Combination 3
[(7)][(8)]
[(10)]
$
[(5)][(9)]
$
S-I-1
I-12-57
__________
(1) All exchanges must comply with minimum denomination restrictions.
(2) The am ount s hown f or [each] [the] M X C lass re presents the m aximum Original Clas s Pri ncipal Bal ance [(or orig inal Class Notional Balan ce)] of t hat
Class, assuming it were to be issued on the Closing Date.
(3)
As defined under “Class Types” in Appendix I to the Base Offering Circular.
(4)
See “Yield, Maturity and Prepayment Considerations — Final Distribution Date” in this Supplement.
[(5) The Interest Rate will be calculated as described under “Terms Sheet — Interest Rates” in this Supplement.]
[(6) [In the case of Combination[s] [ ] [ and [ ]], various] [Various] sub combinations are p ermitted. See “Description o f th e S ecurities—Modification and
Exchange” in the Base Offering Circular for a discussion of subcombinations.]
[(7) MX Class.]
[(8) Co mbination[s] [ ] [and [ ]] [are] [is] derived from REMIC classes of separate Security Groups.
[(9) [NOTE TO TRUST COUNSEL fo r INV/Z Classes Only: For additional discussion regarding the effect of LIBOR on the rate of principal payments on
these Secu rities, see “Risk F actors — The rate of pr incipal pa yments on certa in g roup [ ] cl asses will b e sen sitive to LIBOR,” “Yield , Ma turity a nd
Prepayment Considerations — Securities that Receive Principal on the Basis of Schedules” and “— Decrement Tables” in this Supplement.]
[(10) In the event that th e Interest Rate of t his MX Class will equal or exceed 1,200% per annum for any Accrual Period, the Trustee will, prior to the close of
business on the last Business Day of the ca lendar month immediately preceding the rel ated Distribution Date, effect a mandatory exchange of this MX
Class for its related REMIC Securities and, thereafter, no further exchanges of such REMIC Securities will be permitted.]
Schedule II
SCHEDULED PRINCIPAL BALANCES
Class[es] [ ]
[(in the aggregate)]
Distribution Date
Initial Balance ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] ...........................................................................
[Month] 20[ ] and thereafter ....................................................
S-II-1 I-12-58
Class[es] [ ]
[(in the aggregate)]
Schedule III
[[
]% PSA] [JUMP] BALANCES
S-III-1 I-12-59
Exhibit A
Underlying Certificate[s]
Trust Asset
Group [or
Subgroup]
Issuer Series
Class
Issue
Date
CUSIP
Number
Interest
Rate
Interest
Type(1)
Final
Distribution
Date
Principal
Type(1)
Original
[Principal]
[or]
[Notional]
Balance of
Class
Underlying
Certificate
Factor(2)
[Principal]
[or]
[Notional]
Balance in
Trust
Percentage
of Class in
Trust
Approximate
Approximate
Weighted Average
[Approximate
Weighted
Remaining Term to Average Loan
Weighted
Maturity of
Age of Mortgage
Average] Coupon
Mortgage Loans
Loans (in
of Mortgage
(in months) (3)
Loans(3)
months) (3)
Ginnie
Mae
I or II
[(4)]
[(6)]
[(7)]
[(5)]
[(6)]
[(8)]
A-1
(1)
(2)
(3)
[(4)
[(5)
As defined under “Class Types” in Appendix I to the Base Offering Circular.
[Underlying Certificate Factor[s] [are] [is] as of [
] 20[ ].
Based on information as of [INSERT CURRENT MONTH AND YEAR].
MX Class.]
The Interest Rate will b e calcu lated or described und er “Term s Sh eet — In terest Rates” in th e [related] Underly ing Ce rtificate Disclos ure Document,
excerpts of which are attached as Exhibit B to this Supplement.]
[(6) The Mortgage Loans underlying Class [ ] may include higher balance Mortgage Loans. See “Risk Factors” in this Supplement.]
[NOTE TO TRUST COUNSEL: Modify footnotes (7), (8) and (9) as appropriate for Underlying Certificates in the Transaction.]
[(7) [Class[es] [ ] [and [ ]] [is an] [are] MX Class[es] that [is] [are] derived from [REMIC Classes] [other MX Classes] of separate Security Groups.]
[(8) [Class[es] [ ] [and [ ]] [is] [are] backed by [a] previously issued [REMIC] [or] [MX] certificate[s], Class[es] [ ] [and [ ]] from Ginnie Mae [ - ] [and
Class [ ] from Ginnie Mae [ - ], copies of the Cover Page[s] and Terms Sheet[s] from which are included in Exhibit B to this Supplement.]
[(9) [Class[es] [ ] [and [ ]] [is] [are] backed by [a] previously issued [REMIC] [or] [MX] certificate[s], Class[es] [ ] [and [ ]] from Ginnie Mae [ - ] [and
Class [ ] from Ginnie Mae [ - ].] [Class [ ] is in turn backed by [a] previously issued [REMIC] [or] [MX] certificate[s], Class [ ] from Ginnie Mae [ - ]
[and Class [ ] from Ginnie Mae [ - ]]. [Copies of the Cover Page[s][,] [and] Terms Sheet[s][, and Ex hibit A][, and Schedule I][, if app licable] from
Ginnie Mae [ - ], [ - ] and [ - ] are included in Exhibit B.] [[This] [These] previously issued certificate[s] are [indirectly] backed by certain mortgage
loans whose approximate weighted average characteristics are as follows:
Series
Class
[Approximate Weighted Average]
Coupon of Mortgage Loans(3)
Approximate Weighted Average
Remaining Term to Maturity of
Mortgage Loans (in months) (3)
Approximate Weighted Average Loan
Age of Mortgage Loans (in months) (3)]
I-12-60
Exhibit B
Cover Page[s][,] [and] Terms Sheet[s][,] [and] [Schedule I[, if applicable,]] [and Exhibit A[,
if applicable,]] from Underlying Certificate Disclosure Document[s]
B-1 I-12-61
Exhibit C
Ginnie Mae Callable Trust [20[ ]-C[ ]]
Offering Circular
C-1 I-12-62
EXHIBIT D
Underlying SMBS [Security] [Securities]
Trust Asset
Group
Issuer
Series
Class
Issue Date
CUSIP
Number
Interest
Rate
Interest
Type(1)
Final
Distribution
Date
Principal
Type(1)
(1) As defined under “Class Types” in Appendix I to the Base Offering Circular.
(2) Underlying Certificate Factor[s] [is] [are] as of [
] 20[ ].
Original
Principal
or Notional
Balance of
Class
Underlying
Certificate
Factor(2)
Principal
or Notional
Balance in
the Trust
Approximate
Weighted
Average
Coupon of
Percentage
Mortgage
of Class in
Loans
Trust
Approximate
Weighted
Average
Remaining
Term to
Maturity of
Mortgage
Loans (in
months)
Approximate
Weighted
Average Loan
Age of
Mortgage
Loans (in
months)
Ginnie Mae
I or II
D-1
I-12-63
Exhibit E
Cover Page[s] and Terms Sheet[s]
from Underlying SMBS Security Disclosure Document[s]
E-1 I-12-64
Assumed Characteristics of the Mortgage Loans Underlying the Group [ ] Trust Assets(1)
Pool
Number
Ginnie
Mae
Certificate
Principal
Balance(2)
Approximate
Weighted
Average
Remaining
Term to
Maturity
(in
months)(3)
Approximate
Weighted
Average
Loan Age
(in
months)(4)
Approximate
Weighted
Average
Current
Mortgage
Rate(5)
Current
Certificate
Rate(6)
Approximate
Weighted
Average
Servicing
and
Guaranty
Fee Rate(7)
Index
Certificate
Margin(8)
Issue Date
First
Mortgage
Rate
Adjustment
Date(9)
Mortgage
Rate Reset
Frequency(10)
Periodic
Certificate
Interest
Rate
Limit(11)
Lifetime
Certificate
Interest
Rate
Cap(12)
EXHIBIT F
Lifetime
Certificate
Interest
Rate
Floor(13)
Final
Maturity
Date
Initial
Certificate
Rate at MBS
Issuance(14)
_______________
(1)
F-1
I-12-65
The information in this Exhibit F is provided by the Sponsor as of [INSERT CLOSING MONTH] 1, 20[ ]. It is based on information
regarding the Group [ ] Trust Assets and the related Mortgage Loans. All weighted averages provided in this Exhibit [F] are weighted
based on the outstanding principal amounts of the Mortgage Loans as of [INSERT CLOSING MONTH] 1, 20[ ].
(2) The Ginnie Mae Certificate Principal Balance is the sum of the outstanding principal am ounts of the Mortgage Loans underlyi ng the
related Trust MBS.
(3) The Approximate Weighted Average Remaining Term to Maturity (in months) is the approximate weighted average remaining term to
maturity of the Mortgage Loans underlying the related Trust MBS.
underlying the related Trust MBS.
(5) The Approximate Weighted Average Current Mortgage Rate is the approximate weighted average of the interest rates of the Mortgage
Loans underlying the related Trust MBS.
(6) The Current Certificate Rate is the current certificate rate of the related Trust MBS.
(7) The Approxim ate W eighted Averag e Servicing and Guaranty Fee Rate is the appro ximate weighted averag e m onthly fee rate for
servicing and for the Ginnie Mae Certificate Guaranty Fee.
(8) The Certificate Margin is the m argin of the Mortgage Loans underlying the relate d Trust MBS net of the Servicing and Guara nty Fee
Rate.
(9) The Next Mortgage Rate Adjustment Date is the date on which the Mortgage Rate of each Mortgage Loan underlying the related Trust
MBS resets under the Mortgage Rate formula and the related Mortgage Loan documents.
(10) The Mortgage Rate Reset Frequency is the frequency that the Mortgage Rate of each Mortgage Loan re sets under the Mortgage Rate
formula and related Mo rtgage Loan docum ents applicable to each Mortgage Loan underly ing the related T rust MBS after the first
Mortgage Rate adjustment date.
(11) The Periodic Certificate Interest Rate Limit is the maximum periodic interest rate adjustment possible based on the MBS Guide.
(12) The Lifetime Certificate Interest Rate Cap is the maximum certificate interest rate possible based on the MBS Guide.
(13) The Lifetime Certificate Interest Rate Floor is the minimum certificate interest rate possible based on the MBS Guide.
(14) The Initial Certificate Rate at MBS Issuance is the initial certificate rate of the related Trust MBS.
The remaining terms to maturity, loan ages, Mortgage Rates, Mortgage Margins and first Mortgage Rate adjustment dates of many of
the Mortgage Loans underlying the Group [ ] Trust Assets will dif fer f rom the charac teristics assum ed, perhaps s ignificantly. See “The
Trust Assets — The Mortgage Loans” in this Supplement.
$[
]
Government National
Mortgage Association
GINNIE MAE®
Guaranteed REMIC Pass-Through Securities
[and MX Securities]
Ginnie Mae REMIC Trust 20[ ]-[ ]
____________________________________________
OFFERING CIRCULAR SUPPLEMENT
[
], 20[ ]
________________________________________--___
[SPONSOR]
[CO-SPONSOR]
I-12-66
FORM OF TRANSFER AFFIDAVIT FOR REMIC TRANSACTIONS
TRANSFER AFFIDAVIT
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
GINNIE MAE REMIC TRUST 20__-[ ]
Re:
Government National Mortgage Association
Ginnie Mae REMIC Trust 20__ (the “Trust”),
Guaranteed [Multifamily] REMIC Pass-Through Securities
Class [R] [RR] [RP and/or RI] [R[ ]] Securities
Under penalties of perjury, I, [Representative of Purchaser], declare that, to the best of
my knowledge and belief, the following representations and warranties are true, correct, and
complete.
1.
That I am [Title of Representative] of [Purchaser], a _______________ (the
“Purchaser”), whose mailing address is [Address of Purchaser] and whose taxpayer identification
number is ______________, and on behalf of which I have the authority to make this affidavit.
If the Purchaser is disregarded as an entity separate from its owner under Treasury Regulation
Section 301.7701-3(b)(1)(ii) or is characterized as a partnership for United States federal income
tax purposes, each owner of the Purchaser is identified on Schedule 1. Further, if the Purchaser
is disregarded as an entity separate from its owner under Treasury Regulation Section 301.77013(b)(1)(ii), the Purchaser makes the following representations both in respect of itself and its
beneficial owner. [__________ has been chosen as Nominee for the Purchaser (the “Nominee”).
The mailing address for the Nominee is ______________ and its taxpayer identification number
is ______________.]
2.
That the Purchaser is acquiring a Class [R] [RR] [RP and/or RI] [R[ ]] Security
representing a residual interest in one or more Trust REMICs for whose designated assets a real
estate mortgage investment conduit (a “REMIC”) election or elections are to be made under
Section 860D of the United States Internal Revenue Code of 1986, as amended (the “Code”).
3.
That the Purchaser understands that no residual interest may be transferred, sold,
or otherwise assigned without the express written consent of the Trustee and that as a condition
to that consent, any transferee (including the initial purchaser) of such an interest must provide
the Trustee with a properly completed transfer affidavit, substantially in the form of this
affidavit.
4.
That the Purchaser agrees that the Trustee can execute all instruments of transfer
to assist the Purchaser’s transfer, sale, or other form of assignment (“Transfer”) of the residual
interest and do all other things necessary in connection with such Transfer.
5.
That the Purchaser is (i) a citizen or resident of the United States, (ii) a
corporation that is organized under the laws of the United States, any state thereof or the District
of Columbia, including an entity treated as a corporation for United States federal income tax
purposes, (iii) a partnership, including any entity treated as a partnership for United States
I-13-1
federal income tax purposes (other than a partnership that is not treated as a United States person
under any applicable Treasury Regulation) organized under the laws of the United States, any
state thereof or the District of Columbia, none of the interests of which are owned, directly or
indirectly through one or more pass-through entities, by any person that is not a U.S. Person
within the meaning of this paragraph, (iv) an estate that is subject to United States federal
income taxation regardless of the source of its income, (v) a trust if a court within the United
States is able to exercise primary supervision over the administration of such trust and one or
more United States persons have the authority to control all substantial decisions of the trust (or
to the extent provided in the applicable Treasury Regulations, certain trusts in existence on
August 20, 1996 that are eligible to be treated as United States persons), (vi) a foreign person
who would be subject to United States federal income taxation on a net basis on income derived
from the Class [R] [RR] [RP and/or RI] [R[ ]] Securities ((i)-(vi), a “U.S. Person”), or
(vii) treated as a disregarded entity for United States federal income tax purposes that is wholly
owned by a U.S. Person within the meaning of this paragraph. The term “United States person”
shall have the meaning ascribed to it in Section 7701 of the Code.
6
Any purchaser that is characterized as a partnership for United States federal
income tax purposes certifies that, during all periods in which it holds the Class [R] [RR] [RP]
and/or [RI] [R[ ]] Securities, all income from such Securities will be allocated to partners that
are U.S. Persons.
7.
That the Purchaser is not (i) the United States, (ii) any state or political
subdivision thereof, (iii) a foreign government, (iv) an international organization, (v) an agency
or instrumentality of any of the foregoing, (vi) a tax-exempt organization (other than a
cooperative described in Section 521 of the Code) that is exempt from United States federal
income tax unless that organization is subject to tax under the unrelated business taxable income
provisions of the Code, (vii) an organization described in Section 1381(a)(2)(C) of the Code,
(viii) an electing large partnership within the meaning of Section 775 of the Code, (ix) a foreign
permanent establishment or fixed base (within the meaning of an applicable income tax treaty) of
a U.S. Person or (x) any other entity identified as a disqualified organization by the REMIC
Provisions (a “Disqualified Organization”). A corporation will not be treated as an
instrumentality of the United States or any state or political subdivision thereof for purposes of
this paragraph if all of its activities are subject to tax and, with the exception of the Federal
Home Loan Mortgage Corporation, a majority of its board of directors is not selected by that
governmental unit.
8.
That the Purchaser is not acquiring the residual interest as a nominee, trustee or
agent for any Person that is not a U.S. Person or that is a Disqualified Organization.
9.
That the Purchaser is not (i) a “benefit plan investor” that is described in or
subject to the Department of Labor regulations set forth in 29 C.F.R. § 2510.3-101, as modified
by ERISA Section 3(42) (the “Plan Asset Regulations”), (ii) a plan or arrangement that is subject
to Code Section 4975, (iii) a “governmental plan” as defined in Section 3(32) of ERISA, (iv) any
plan or arrangement that is subject to any federal, state, or local law that is substantially similar
to the Plan Asset Regulations, Code Section 4975, or ERISA Section 3(32), (v) a person acting
on behalf of or utilizing the assets of any of the foregoing, or (vi) an insurance company that
cannot represent and warrant that all funds used by it in acquiring the Security were held by it in
I-13-2
its general account, that it will hold the Security in its general account, and that it reasonably
believes that its general account and the Security do not and will not constitute “plan assets” for
purposes of ERISA and the Plan Asset Regulations (any of the foregoing, a “Plan Investor”).
10.
That the Purchaser agrees that it shall immediately notify the Trustee if it
becomes aware that any representation and warranty made herein will or has become false.
11.
That the Purchaser agrees not to Transfer or cause the Transfer of its residual
interest to any Person if (i) such Person does not supply the Trustee with a properly completed
Transfer Affidavit or (ii) the Purchaser has actual knowledge that the Transfer Affidavit supplied
by such Person is false.
12.
That the Purchaser historically has paid its debts as they have come due and
intends to pay its debts as they come due in the future and the Purchaser intends to pay the taxes
associated with holding the Class [R] [RR] [RP and/or RI] [R[ ]] Securities as such taxes
become due. That, if the Purchaser is characterized as a partnership or disregarded entity for
United States federal income tax purposes, based on the Purchaser’s knowledge or due inquiry,
each person or entity that holds an interest (directly or indirectly through a pass-through entity)
in such partnership or disregarded entity intends to pay its share of any tax liabilities due in
respect of such partnership’s or disregarded entity’s ownership of the Class [R] [RR] [RP and/or
RI] [R[ ]] Securities.
13.
That the Purchaser understands that it may incur tax liabilities with respect to the
Class [R] [RR] [RP and/or RI] [R[ ]] Securities in excess of cash flows generated by the Class
[R] [RR] [RP and/or RI] [R[ ]] Securities. That, if the Purchaser is characterized as a
partnership or disregarded entity for United States federal income tax purposes, based on the
Purchaser’s knowledge or due inquiry, each partner in or the beneficial owner of the Purchaser to
whom income from the Class [R] [RR] [RP and/or RI] [R[ ]] Securities is allocated understands
that it may incur tax liabilities with respect to such Securities in excess of cash flows generated
by such Securities.
14.
That the Purchaser will not Transfer the Class [R] [RR] [RP and/or RI] [R[ ]
Securities to any person or entity from which the Purchaser has not received an affidavit
substantially in the form of this affidavit and as to which the Purchaser has actual knowledge or
reason to know that the requirements set forth in paragraph 5, 6, 7, 11 or 12 hereof are not
satisfied.
15.
That the Purchaser has provided financial statements or other financial
information requested by the Transferor in connection with the Transfer of the Class [R]
[RR][RP] and /or RI] [R[ ]] Securities to permit the Transferor to assess the financial capability
of the Purchaser to pay such tax.
16.
That the Purchaser agrees to such amendments of the Trust Agreement as may be
required to further effectuate the restrictions on Transfer of the Class [R] [RR] [RP and/or RI]
[R[ ]] Securities to a Disqualified Organization, an agent thereof, a Plan Investor or a person that
does not satisfy the requirements of paragraphs 5, 6, 7, 11 and 12 hereof.
I-13-3
17.
That the Purchaser agrees to be bound by, and understands that its rights as owner
of a residual interest are expressly subject to, all terms of the related Trust Agreement applicable
to owners of residual interests, including the special transfer restrictions relating to residual
interests in Section 2.04 of the Standard Trust Provisions.
18.
That the Purchaser understands that the Transfer of the Class [R] [RR] [RP and/or
RI] [R[ ]] Securities to a U.S. Person will be disregarded for all United States federal income tax
purposes if a significant purpose of the Transfer is to impede the assessment or collection of any
taxes associated with the Securities within the meaning of Treasury Regulation Section 1.860E1(c)(1).
IN WITNESS WHEREOF, the Purchaser has caused this instrument to be duly executed
on its behalf, by its duly authorized [Title of Representative] this _____ day of
_______________.
[Purchaser]
By:_____________________________
Its:_____________________________
Personally appeared before me [Representative of Purchaser], known or proved to me to
be the same person who executed the foregoing instrument and to be [Title of Representative] of
the Purchaser, and acknowledged to me that [he/she] executed the same as [his/her] free act and
deed and as the free act and deed of the Purchaser.
Subscribed and sworn before me
this ______ day of __________, _____.
________________________________
Notary Public
My commission expires: _______________________
I-13-4
Schedule 1
[NOTE TO TRUST COUNSEL: IDENTIFY ALL OWNERS OF THE PURCHASER IF
REQUIRED BY PARAGRAPH 1 OF THE TRANSFER AFFIDAVIT OR INDICATE NOT
APPLICABLE.]
[The following are all of the Purchaser’s [members] [partners] [owners] for United States federal
income tax purposes:
Name:
Taxpayer ID:
Address:
]
[N/A]
I-13-5
FORM OF GUARANTY AGREEMENT FOR
SINGLE FAMILY REMIC AND MX TRANSACTIONS
GINNIE MAE REMIC [AND MX] SECURITIES GUARANTY AGREEMENT
Pursuant to Section 306(g) of the National Housing Act, the Government National
Mortgage Association (“Ginnie Mae”) hereby guarantees the timely payment of principal and
interest on the Ginnie Mae REMIC Securities [and Ginnie Mae MX Securities] in accordance
with their respective terms as established by the Trust Agreement, dated as of ___________,
20__, relating to Ginnie Mae REMIC Trust 20__-__ (the “[REMIC] Trust Agreement”) [and the
Trust Agreement, dated as of ____________, 20__, relating to Ginnie Mae MX Trust 20__-__
(the “MX Trust Agreement” and together with the REMIC Trust Agreement, the “Trust
Agreements”)].
Ginnie Mae hereby authorizes the Trustee under [the] [each] Trust Agreement to issue
the Securities provided for issuance thereunder, each of which Security shall be entitled to the
benefits of the guaranty set forth below, and, in the case of Certificated Securities, to authenticate
and deliver certificates representing such Securities, with the form of each such certificate to
include a guaranty to the following effect:
GUARANTY: THE GOVERNMENT NATIONAL MORTGAGE ASSOCIATION,
PURSUANT TO SECTION 306(g) OF THE NATIONAL HOUSING ACT,
GUARANTEES THE TIMELY PAYMENT OF PRINCIPAL AND INTEREST ON
THIS SECURITY IN ACCORDANCE WITH THE TERMS AND CONDITIONS SET
FORTH HEREIN AND IN THE RELATED TRUST AGREEMENT. THE FULL
FAITH AND CREDIT OF THE UNITED STATES OF AMERICA IS PLEDGED TO
THE PAYMENT OF ALL AMOUNTS THAT MAY BE REQUIRED TO BE PAID
UNDER THIS GUARANTY.
For purposes of determining the amount guaranteed by Ginnie Mae to the Holders of any
Residual Securities, “principal and interest” shall mean the amount to which such Holders are
entitled pursuant to the [applicable] Trust Agreement, notwithstanding the stated Original
Principal Balance and Interest Rate of such Securities. Capitalized terms used and not otherwise
defined herein shall have the meanings assigned to them in the Trust Agreement[s].
IN WITNESS WHEREOF, Ginnie Mae has executed and delivered this Guaranty
Agreement as of the date set forth below.
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
By:_________________________________________________
Dated: ____________________
I-14-1
FORM OF ACCOUNTANTS’ AGREED-UPON PROCEDURES REPORT
CONCERNING THE OFFERING CIRCULAR SUPPLEMENT FOR
SINGLE FAMILY REMIC AND MX TRANSACTIONS
, 20__ [insert print date]
[Sponsor]
[Co-Sponsor]
Government National Mortgage Association
550 12th Street, SW, Third Floor
Washington, D.C. 20024
Independent Accountants’ Report on
Applying Agreed-Upon Procedures
Ginnie Mae REMIC Trust 20__-_
[and Ginnie Mae MX Trust 20__-_]
Ladies and Gentlemen:
We have performed the procedures enumerated below, which were agreed to by the
addressees, relating to the recomputation of certain information (which is the responsibility of
the Sponsor and is identified below) included in the Offering Circular Supplement dated _______
__, 20__ (the “Supplement”), to the Base Offering Circular dated January 1, 2013, relating to the
offering of $ __________ aggregate Original Class Principal Balance of Ginnie Mae REMIC
Trust 20__ - __ Guaranteed REMIC Pass-Through Securities (the “[REMIC] Securities”) [and
Ginnie Mae MX Trust 20__-_ Guaranteed Grantor Trust Pass-Through Securities (the “MX
Securities” and, together with the REMIC Securities, the “Securities”)]. This agreed-upon
procedures engagement was conducted in accordance with attestation standards established by
the American Institute of Certified Public Accountants. The sufficiency of these procedures is
solely the responsibility of the addressees. Consequently, we make no representations regarding
the sufficiency of the procedures described below either for the purpose for which this report has
been requested or for any other purpose. Capitalized terms used but not defined herein have the
meanings ascribed to them in the Supplement.
We are independent certified public accountants with respect to Ginnie Mae REMIC
Trust 20__-_ [and Ginnie Mae MX Trust 20__-_] within the meaning of Rule 101 of the Rules of
Conduct of the Code of Professional Conduct of the American Institute of Certified Public
Accountants.
For purposes of this report, we have obtained:
1. the Supplement; and
I-15-1
2. the attached listing of CUSIP Numbers for each Class of Securities provided to us by
Standard & Poor’s CUSIP Service Bureau (the “CUSIP Listing”).
In addition, using (i) the Modeling Assumptions [,] (ii) [[a] listing[s] of Ginnie Mae
Certificates (the “File[s]”) underlying the Group [__] and Group [__] Trust Assets (the
“Underlying Ginnie Mae Certificates”) obtained from [e-Access] [Freddie Mac’s Internet Website] [Fannie Mae’s Internet Web-site], (iii) [listing[s] of the Ginnie Mae Certificates comprising
the Group [ ] [and Group [ ]] Trust Assets and their corresponding Maturity Date (the “Group
[__] File” [and the “Group [__] File”, respectively]) provided by the Sponsor,] [(iv)]Class Factors
relating to [the][each] Class of the Underlying Trust[s] obtained from [e-Access] [Freddie Mac’s
Internet Web-site] [Fannie Mae’s Internet Web-site], [(v)] information relating to [each of] the
Underlying Ginnie Mae Certificate[s] [shown in or] derived from a Ginnie Mae Factor Tape as
of
__, 20__ obtained from NYSE Technologies, Inc. (hereinafter referred to as “NTI”) (the
“Factor Report”) and a NTI Ginnie Mae Weighted Average Tape (the “Weighted Average
Tape”) (using the most recent tape for which such information was available)][or, with respect to
Pool Number ___ and its related weighted average coupon, weighted average remaining term to
maturity and weighted average loan age for [month/year], Bloomberg Financial Markets on-line
data service (“Bloomberg”)] and [(vi)] the terms of the Securities set forth in the Supplement,
we have performed the following procedures with respect to the information set forth under each
of the following captions in the Supplement.
Front Cover [and Schedule I] - Final Distribution Date:
Using the Final Distribution Date calculation assumptions and methodologies provided to
us by the Sponsor as described in Exhibit I hereto, we recomputed the date on which the Class
Principal Balance [(or Class Notional Balance)] of each of the Regular Classes [in Security
Group[s] [ ] [and [ ]]] would be reduced to zero. We compared each such date to the Final
Distribution Date for the related Class as shown in the table and found them to be in agreement.
[As instructed by representatives of the Sponsor, for [each Regular Class in Security Group[s] __
[and __]] [Class[es] __ [and __]], we confirmed that the Final Distribution Date shown in the
table has been set equal to the Distribution Date in the month of the latest Maturity Date obtained
from the Factor Report for [the Group __ Trust Assets shown on Exhibit A] [Pool Number[s]
______ [and ______]]]. [In addition, we confirmed that the Final Distribution Date for [(i) Class
[ ] has been set equal to the Distribution Date in the month of the latest Maturity Date of any of
the Ginnie Mae Certificates set forth in the [Group [ ]] File,] [(ii) each Class in Security Group
__ has been set equal to the [latest] Final Distribution Date of the [related] Underlying
[Certificate[s]] [SMBS Securities], [(iii) each MX Class is the [latest] Final Distribution Date for
any of its related REMIC Securities] and [(iv)] [the][each] Residual Class[es] is the latest Final
Distribution Date of any of the Regular Classes [in the related REMIC Pool].
Front Cover [and Schedule I] - CUSIP Number:
For each Class of Securities, we compared the CUSIP Number shown in the table[s] to
the CUSIP Number for such Class shown in the CUSIP Listing and found them to be in
agreement.
[Page S-_ - Scheduled Principal Balances:
I-15-2
Using [(a)] the lesser of the principal payments available on each Distribution Date at the
lowest and highest constant rate of PSA of the Structuring Range [or (b) the principal payments
available on each Distribution Date at the Structuring Rate, as applicable,] for the [PAC],
[Scheduled] and [TAC] Classes, [Components] and [Segments][(except with respect to [the
Group __ PAC Classes][Class[es] ___ [and
])] [and allowing for any payments required to be
made to Classes with a higher payment priority] [, assuming (as instructed by representatives of
the Sponsor) that in the case of Class[es] ___ [and
], that ...], we determined that [the
applicable portion of] each such amount was equal to the reduction in the [Scheduled Principal
Balance] [or] [Aggregate Scheduled Principal Balance] for that [Class] [or] [group of Classes][,
as applicable,] for the respective Distribution Date. As a result, we proved the mathematical
accuracy of the calculations which show that the [PAC], [Scheduled] [and] [TAC] Classes, [and]
[Components] [and] [Segments] [(except with respect to [the Group __ PAC Class[es]][Class[es]
___ [and ___])] have the Structuring [Range[s]] [and] [Rate[s]] shown in the table.]
[Page S-_ - Notional Class[es]:
For [the][each] Notional Class [(or portion thereof)], we recomputed the original Class
Notional Balance [(or portion thereof)] as the product of (i) the related percentage shown in the
table and (ii) the Original Class Principal Balance of the related Class[es] [,] [or] Classes[,]
[Component[s]] [or Components] [or initial outstanding [principal][notional] balance of the
related Trust Asset [Group][Subgroup]. We truncated such recomputed original Class Notional
Balance[s] [(or portion[s] thereof)], compared [it][them] to the corresponding information shown
in the table and found [it][them] to be in agreement.
[Page S-_ - Accretion Directed Class[es]:
We proved the mathematical accuracy of the calculations that show that if the [related]
Mortgage Loans were to prepay at a constant rate at or below the rate shown for [each] [the]
Accretion Directed Class shown until its Class Principal Balance is reduced to zero, then [(i) the
Class Principal Balance of [each] [such] Accretion Directed Class would be reduced to zero [on,
but not before,] [before] its Final Distribution Date shown in the table and (ii)] the Weighted
Average Life of [each] such Accretion Directed Class would be equal to the Maximum Weighted
Average Life shown in the Supplement. In addition, we recomputed the Maximum Weighted
Average Life of [each] such Accretion Directed Class [shown]. We compared [each] such
recomputed Maximum Weighted Average Life to the corresponding Weighted Average Life in
the Supplement and found them to be in agreement.]
[Pages S-__ Securities that Receive Principal on the Basis of Schedules:
We proved the mathematical accuracy of the calculations which show that [each] [the
group of] [PAC,] [Scheduled] [and] [TAC] Class[,] [and] Component] [and] [Segment] [or
group of Classes, as applicable,] would receive Scheduled Payments if the [related] Mortgage
Loans prepay at a constant rate equal to the following until that Class [or group of Classes] has
been retired:
[(a) for the [PAC] [and] [Scheduled] Class[es][,] [Class[es] [ ] [and [ ]]][,] [and]
[Component] and [Segment]:
I. the lowest constant rate of PSA shown in the table,
II. the highest constant rate of PSA shown in the table, and
III. each integral multiple of 25% PSA [, if any] that falls between the rates
I-15-3
shown for that Class [or group of Classes] in the table[.][;]]
(b) [for the [Scheduled] [and] [TAC] Class[es][,] [Class[es] [ ] [and [ ]]][,] [and]
[Component] [and] [Segment], the constant rate of PSA shown for that Class [or
group of [Classes] in the table.]
Pages S-__ through S-__ - Decrement Tables:
We recomputed for each Regular Class [and MX Class] (i) the percentage of its Original
Class Principal Balance [(or original Class Notional Balance)] that would remain outstanding
following the distributions made on each of the Distribution Dates and at each of the constant
percentages of [PSA] [or] [CPR][, as applicable,] [and, in the case of Security Group[s] __ [and
__], at each constant level of {INDEX}] indicated in the [related] table and (ii) its corresponding
Weighted Average Life. We compared such recomputed percentages and Weighted Average
Lives to the corresponding information set forth in the table[s] and found them to be in
agreement.
Pages S-__ through S-__ - Yield Table[s]:
Using the assumed purchase price[s] set forth in the yield table[s], we recomputed the
pre-tax yield to maturity (corporate bond equivalent) of [each] [the] indicated Class at each
[constant] percentage of [PSA] [or] [CPR][, as applicable,] [and, in the case of the [Floating
Rate] [and] [Inverse Floating Rate] Class[es] [ ], at each constant level of {INDEX}] [and in
the case of Class[es] __ [and __], at each constant level of {INDEX}[and {INDEX}]] shown in
the [related] table. We compared such recomputed yields to the corresponding yields shown in
the [related] table and found them to be in agreement.
[Schedule I – Available Combination[s]:
Using the information for the exchange of Securities shown on Schedule I to the
Supplement, we proved the mathematical accuracy of the calculations which show that [(i) except
for Combination[s] [ ] [and [ ]],] (a) the aggregate principal balance[, if any,] of the Securities so
surrendered equals that of the Securities so received and (b) the aggregate monthly interest
entitlement[, if any,] on the Securities so received equals that of the Securities so surrendered[,
and (ii) with respect to Combination[s] [ ] [and [ ]], the aggregate monthly interest entitlement of
the related REMIC Classes is just sufficient to provide for payment of the aggregate monthly
interest entitlement of the maximum Original Class Principal Balance of each MX Class when
combined with the appropriate principal or notional amount of another MX Class.]
[Exhibit A: Underlying [Certificate[s]] [SMBS Securities]:
Using the File[s], we compared the [Approximate Weighted Average] Coupon of
Mortgage Loans, Approximate Weighted Average Remaining Term to Maturity of Mortgage
Loans and Approximate Weighted Average Loan Age of Mortgage Loans underlying [each] [the]
Underlying [Certificate] [SMBS Security] to the corresponding information shown in or derived
from the Factor Report and the Weighted Average Tape (using the most recent tape for which
such information was available) using the methodology relating to generic pools set forth in The
Securities Industry and Financial Markets Association’s [(formerly known as The Bond Market
Association)] Standard Formulas for the Analysis of Mortgage-Backed Securities and Other
Related Securities - Chapter SF Section C (the “Standard Formulas”)[, or Bloomberg, as
I-15-4
applicable,], and found them to be in agreement. In addition, [for [the] [each] Underlying
[Certificate] [SMBS Security],] we compared the Underlying Certificate Factor shown in Exhibit
A to the corresponding information obtained from [e-Access][Ginnie Mae’s Internet Web-site]
[Freddie Mac’s Internet Web-site] [Fannie Mae’s Internet Web-site], and found them to be in
agreement. [For [the] [each] Underlying [Certificate] [SMBS Security],] [W/w]e recalculated the
Principal [or Notional] Balance in Trust by determining the product of the (i) Original Principal
[or Notional] Balance of Class, (ii) Underlying Certificate Factor and (iii) Percentage of Class in
Trust and found such amount to be in agreement. Lastly, [for each Underlying [Certificate]
[SMBS Security],] we compared the Issue Date, CUSIP Number, [Interest Rate [(only with
respect to the Group [ ] Trust Asset)],] Interest Type, Final Distribution Date, Principal Type and
Original Principal [or Notional] Balance of Class to the corresponding information set forth in the
[related] Underlying [Certificate] [SMBS Security] Disclosure Document and found them to be in
agreement. We have not performed any procedures relating to the Percentage of Class in Trust
and make no representations with respect thereto.]
*****
Using the Modeling Assumptions and the terms of the Securities set forth in the
Supplement and assuming (i) the timely payment of principal and interest on the Trust Assets, (ii)
that no taxes are imposed on the Trust REMIC[s] and (iii) that no expenses are incurred, we
determined that payments on the Trust Assets would be adequate to (a) make full and timely
payments of principal and interest on the Securities and (b) reduce the Class Principal Balance
[(or Class Notional Balance)] of each Class of Securities to zero by its Final Distribution Date, in
each case in accordance with the terms as set forth in the Supplement regardless of the rate of
prepayments of the Mortgage Loans underlying the Trust Assets [or the level of {INDEX} [or]
{INDEX}].
*****
It should be understood that we make no representations as to (a) questions of legal
interpretation; (b) the sufficiency for your purposes of the procedures enumerated in the
preceding paragraphs; (c) the accuracy of the information reported in [e-Access,]
[Bloomberg,][Freddie Mac’s Internet Web-site,] [Fannie Mae’s Internet Web-site,] [the Factor
Report,] [the Group [ ] File,] [the Weighted Average Tapes,] [the Underlying [Certificate]
[SMBS Security] Disclosure Document[s] [or] the CUSIP Listing; or (d) whether the actual
payments on the Trust Assets and the Securities will correspond to the payments calculated in
accordance with the assumptions and methodologies set forth in the Supplement or provided to
us by the Sponsor as expressly noted herein. Further, we have addressed ourselves solely to the
foregoing data as set forth in the Supplement and we make no representations as to the adequacy
of disclosure or as to whether any material facts have been omitted.
We were not engaged to conduct, and did not conduct, an examination, the objective of
which would be the expression of an opinion on the above information. Accordingly, we do not
express such an opinion. Had we performed additional procedures, other matters might have
come to our attention that would have been reported to you. Furthermore, there will usually be
differences between the actual payments on the Trust Assets and the Securities as compared to
the payments calculated in accordance with the assumptions and methodologies set forth in the
Supplement and described herein, because events and circumstances frequently do not occur as
I-15-5
expected, and those differences may be material. We have no responsibility to update this report
for events and circumstances occurring after the date of this report.
This report is solely for the information and use of the addressees and Ginnie Mae’s
Financial Advisor, solely in connection with its work on behalf of Ginnie Mae, in connection
with the offering of the Securities covered by the Supplement, and is not intended to be and
should not be used by anyone other than these specified parties. It is not to be used, circulated,
quoted or otherwise referred to for any other purpose, including but not limited to the purchase
I-15-6
or sale of the Securities, nor is it to be filed with or referred to in whole or in part in the
Supplement or any other document, except that reference may be made to it in the Sponsor
Agreement or in any list of closing documents pertaining to the offering of the Securities.
Yours truly,
[Accountants]
[NOTE TO ACCOUNTANTS: Attach the letter/e-mail from the CUSIP Bureau with the
CUSIP Listing]
I-15-7
Exhibit I
Ginnie Mae REMIC Trust 20 [NOTE: For Trust MBS] The Sponsor has calculated the Final Distribution Dates for the
Regular Classes in [Security Group(s) [ ]] assuming, among other things, that each Mortgage
Loan underlying the [related] Trust Assets, as of [ ] [ ], 20[ ], has (a) a remaining term to
maturity of 360 months and (b) [in the case of the Mortgage Loans underlying the Group [3]
Trust Assets,] a Mortgage Rate equal to [1.5% plus the related Certificate Rate] [0.75% plus the
related Certificate Rate] and that [no Mortgage Loan prepayments occur.][the following
prepayment scenarios occur (all references to “steps” relate to the noted rules for allocation of
principal for the related Security Group):
y
[Group [3] PAC Classes: No payments of principal are made from the Group [3]
[Adjusted] Principal Distribution Amount pursuant to Step __ on page S-__ of the
Supplement and no Mortgage Loan prepayments occur.]
y
[Scheduled Classes:]
y
[[Pass-Through][Support] [and] [Sequential Pay] Classes: No Mortgage Loan
prepayments occur.]
[In addition, the Final Distribution Date for any Notional Class [other than Class [ ]] is the
latest Final Distribution Date of any Class with which it reduces proportionately.] [The Final
Distribution Date for Class[es] [ ] [and [ ]] assumes no Mortgage Loan prepayments occur.]
I-15-8
FORM OF ACCOUNTANTS’ AGREED-UPON PROCEDURES REPORT
AS OF THE CLOSING DATE FOR SINGLE FAMILY REMIC AND MX
TRANSACTIONS
, 20__
[Sponsor]
[Co-Sponsor]
Government National Mortgage Association
550 12th Street, SW, Third Floor
Washington, D.C. 20024
Independent Accountants’ Report on
Applying Agreed-Upon Procedures
Ginnie Mae REMIC Trust 20__-_
[and Ginnie Mae MX Trust 20__-_]
Ladies and Gentlemen:
We have performed the procedures enumerated below, which were agreed to by the
addressees, relating to the issuance of $____________ aggregate Original Class Principal
Balance of Ginnie Mae REMIC Trust 20__-__ Guaranteed REMIC Pass-Through Securities (the
“[REMIC] Securities”) pursuant to a Trust Agreement dated as of
, 20__ (the
“[REMIC] Trust Agreement”) [and Ginnie Mae MX Trust 20__-_ Guaranteed Grantor Trust
Pass-Through Securities (the “MX Securities” and, together with the REMIC Securities, the
“Securities”) pursuant to a Trust Agreement dated as of __________ __, 20__ (the “MX Trust
Agreement” and, together with the REMIC Trust Agreement, the “Trust Agreement”)]. This
agreed-upon procedures engagement was conducted in accordance with attestation standards
established by the American Institute of Certified Public Accountants. The sufficiency of these
procedures is solely the responsibility of the addressees. Consequently, we make no
representations regarding the sufficiency of the procedures described below, either for the
purpose for which this report has been requested or for any other purpose. Capitalized terms
used but not defined herein have the meanings ascribed to them in the Trust Agreement.
We are independent certified public accountants with respect to Ginnie Mae REMIC
Trust 20__-_ [and Ginnie Mae MX Trust 20__-_] within the meaning of Rule 101 of the Rules of
Conduct of the Code of Professional Conduct of the American Institute of Certified Public
Accountants.
I-16-1
For purposes of this report, we obtained the following:
(a)
(b)
(c)
[(d)
[(e)
[(f)
[(g)
[(h)
[(i)
The 20__-_ Offering Circular Supplement;
[Part III of the Ginnie Mae Multiclass Securities Guide];
The Trust Agreement;
The Series 20__-C_ Offering Circular;]
The Underlying [Certificate] [SMBS Security] Disclosure Document[s];]
The attached schedule of the Trust Assets provided to us by, and which is the
responsibility of, the Sponsor (“Schedule A”);]
The attached schedule of Weighted Average Lives for each Class of Securities [in
Security Groups ____ and ] [(including Class[es] __, which [are Classes][is a Class] that
relate[s] to multiple Security Groups)] provided to us by, and which is the responsibility
of, the Sponsor (“Schedule B”);]
The attached Supplemental Statement provided to us by, and which is the responsibility
of, the Sponsor (“Schedule C”)[.][; and]
The attached schedule of Group ___ underlying Ginnie Mae Certificates provided to us
by the Sponsor (“Schedule [C] [D]”). [NOTE: Include in a SF transaction for a Trust
Asset Group backed by an Underlying Certificate that is a Callable Class being issued
on the same Closing Date as the SF transaction]]
Based on the foregoing, we performed the following procedures:
1.
We provided an electronic listing of the information for the related Trust Assets shown
on Schedule A to the Information Agent, the Financial Advisor and the Trustee through
Ginnie Mae’s Internet Web-site.
2.
[NOTE: For Trust Asset Group(s) with Underlying Certificate(s)][For [each] [the]
[Group __ and Group ] Trust Asset shown on Schedule A, we compared the CUSIP
Number, Issue Date, [NOTE: Include if fixed rate: , Certificate Rate [(only with respect
to the Group [ ] Trust Asset)]] and Maturity Date shown on Schedule A to the
corresponding information shown for that Trust Asset in the related Underlying
[Certificate] [SMBS Security] Disclosure Document and found them to be in
agreement.]
3.
[NOTE: For Trust Asset Group(s) with Underlying Certificate(s) with variable
rate(s)][For [each] [the] [Group __ and Group ] Trust Asset shown on Schedule A, we
compared the Certificate Rate shown on Schedule A to the corresponding information
shown for [each] such Trust Asset on [e-Access] [Freddie Mac’s Internet Web-site]
[Fannie Mae’s Internet Web-site], and found them to be in agreement.]
4.
[NOTE: For Trust Asset Group(s) with Underlying Certificate(s)][For [each] [the]
[Group __ and Group ] Trust Asset shown on Schedule A, we recomputed the current
principal [or notional] balance by multiplying the [insert month and year of Closing
Date] factor obtained from [e-Access] [Freddie Mac’s Internet Web-site] [Fannie Mae’s
Internet Web-site] for that Trust Asset, by the original principal [or notional] balance
I-16-2
shown on Schedule A, and compared such recomputed amount to the corresponding
current principal [or notional] balance shown on Schedule A and found them to be in
agreement.]
5.
[NOTE: For Trust Asset Group(s) with an Underlying Certificate that is a Callable
Class][For [each] [the] Group __ Trust Asset shown on Schedule A, we compared the
CUSIP Number, Issue Date, Certificate Rate, Maturity Date and current principal
balance shown on Schedule A to the corresponding information shown for that Trust
Asset in the Series 20__-C_ Offering Circular and found them to be in agreement.]
6.
[NOTE: For Trust Asset Group(s) with Trust MBS][For [each] [the] [Group ____ and
Group
] Trust Asset shown on Schedule A [as having an Issue Date prior to
_______ 1, 20__] ,11 we compared the CUSIP Number, Trust Asset pool number, Trust
Asset pool type, Trust Asset pool suffix, Issue Date, Certificate Rate and Maturity Date
shown on Schedule A to the corresponding information shown for that Trust Asset in the
Ginnie Mae Factor Tape as of [insert 6th business day of the Closing Date month]
obtained from NYSE Technologies, Inc. (hereinafter referred to as “NTI”) (the “Factor
Report”) and found them to be in agreement.]
7.
[NOTE: For Trust Asset Group(s) with Trust MBS][For [each] [the] [Group
] Trust
Asset shown on Schedule A [as having an Issue Date of ______ 1, 20 ]], we compared
the items of information listed in the immediately preceding paragraph to the
corresponding information obtained from [the NTI Ginnie Mae Daily Pool Tapes for
[insert month and year of Closing Date] (the “New Pool Tapes”)] [the Bloomberg
Financial Markets on-line data service (“Bloomberg”)] and found them to be in
agreement.]
8.
[NOTE: For Trust Asset Group(s) with adjustable rate Trust MBS] [For [each] [the]
Group __ and Group __ ] Trust Asset shown on Schedule A, we compared the CUSIP
Number, Trust Asset pool number, Trust Asset pool type, Trust Asset pool suffix, Issue
Date, Certificate Rate, Maturity Date, Initial Certificate Rate at MBS Issuance,
Certificate Margin, Next Payment Adjustment Date and Next Mortgage Rate
Adjustment Date shown on Schedule A to the corresponding information shown for that
Trust Asset [obtained from the Factor Report] [obtained from the NTI Ginnie Mae Daily
Pool Tapes for [insert month and year of Closing Date] (the “New Pool Tapes”)] [New
Pool Tapes] and found them to be in agreement.
9.
[NOTE: For Trust Asset Group(s) with adjustable rate Trust MBS] For [the] [each]
unique combination of Trust Asset pool suffix and Trust Asset pool type for [the Group
__ and Group __] Trust Assets shown on Schedule A, we obtained information in
Chapter 26 of Ginnie Mae’s MBS Guide (the “Guide”) located on Ginnie Mae’s Internet
Web-site and noted the following characteristics for such combination[s] disclosed in
the table below.
11
In all date blanks (unless otherwise noted) insert first day of month and year of Closing Date. Example:
For transactions closing in October, 2013 insert “October 1, 2013”.
I-16-3
Pool
Suffix Pool
Type
Index
Lifetime
Rate Cap
Periodic
Rate Cap
Interest
Rate
Payment
Adjustment Adjustment
Frequency Frequency
(Months)
(Months)
10.
[NOTE: For Trust Asset Group(s) with adjustable rate Trust MBS] [For [each] [the]
Group __ and Group __ ] Trust Asset shown on Schedule A, we compared the Index,
Periodic Certificate Interest Rate Cap, Payment Adjustment Frequency (Months) and
Interest Rate Adjustment Frequency (Months) shown on Schedule A to the
corresponding information for such Trust Asset in the table above (based on its Pool
Suffix and Pool Type) and found them to be in agreement.
11.
[NOTE: For Trust Asset Group(s) with adjustable rate Trust MBS] [For [each] [the]
Group __ and Group __ ] Trust Asset shown on Schedule A, we recomputed the
Lifetime Certificate Interest Rate Cap as the sum of (i) the Initial Certificate Rate at
MBS Issuance for such Trust Asset as shown on Schedule A and (ii) the Lifetime Rate
Cap for such Trust Asset in the table above (based on its Pool Suffix and Pool Type) and
compared such recomputed amount to Lifetime Certificate Interest Rate Cap as shown
on Schedule A and found it to be in agreement.
12.
[NOTE: For Trust Asset Group(s) with adjustable rate Trust MBS] [For [each] [the]
Group __ and Group __ ] Trust Asset shown on Schedule A, we recomputed the
Lifetime Certificate Interest Rate Floor as the greater of (a) the Certificate Margin for
such Trust Asset as shown on Schedule A and (b) the excess, if any, of (i) the Initial
Certificate Rate at MBS Issuance for such Trust Asset as shown on Schedule A over (ii)
the Lifetime Rate Cap for such Trust Asset in the table above (based on its Pool Suffix
and Pool Type) and compared such recomputed amount to Lifetime Certificate Interest
Rate Floor as shown on Schedule A and found it to be in agreement.
13.
[NOTE: For Trust Asset Group(s) with Trust MBS][For [each] [the] [Group ____ and
Group ____] Trust Asset shown on Schedule A [as having an Issue Date prior to
________1, 20__], we recomputed the current principal balance by multiplying a factor
obtained from the Factor Report for that Trust Asset by the original principal balance
shown on Schedule A, and compared such recomputed amount to the current principal
balance shown on Schedule A and found them to be in agreement.]
14.
[NOTE: For Trust Asset Group(s) with Trust MBS]For [each] [the] [ Group ____ and
Group ____] Trust Asset shown on Schedule A [as having an Issue Date of _______ 1,
20__], we determined that the current principal balance shown on Schedule A is equal
to the original principal balance shown on Schedule A.
15.
[NOTE: For Trust Asset Group(s) with Trust MBS; include WAC only if all Trust MBS
are Ginnie Mae II’s][For [each] [the] [Group ____ and Group
] Trust Asset [(other
I-16-4
than Pool Number ___)] shown on Schedule A [as having an Issue Date prior to ______
1, 20__], we compared [the current Weighted Average Coupon (the “WAC”)], the
current Weighted Average Remaining Term to Maturity (the “WARM”) and the current
Weighted Average Loan Age (the “WALA”) shown on Schedule A to the corresponding
information for that Trust Asset derived from a NTI Ginnie Mae Weighted Average
Tape (the “Weighted Average Tape”) (using the most recent tape for which such
information was available) using the methodology relating to generic pools set forth in
The Securities Industry and Financial Markets Association’s [(formerly known as The
Bond Market Association)] Standard Formulas for the Analysis of Mortgage-Backed
Securities and Other Related Securities - Chapter SF Section C (the “Standard
Formulas”) and found them to be in agreement.][With respect to Pool Number ___, we
compared the current WARM and WALA shown on Schedule A to the corresponding
information for such Trust Asset obtained from the Bloomberg Financial Markets online data service (“Bloomberg”) and found them to be in agreement.]
16.
[NOTE: For Trust Asset Group(s) with T rust MBS] [For [each] [the] [Group ____ and
Group
] Trust Asset shown on Schedule A [as having an Issue Date of________ 1,
20__], we compared the current [Weighted Average Coupon (the “WAC”)][WAC,]
WARM and WALA shown on Schedule A to the corresponding information for that
Trust Asset derived from the New Pool Tapes using the methodology relating to
generic pools set forth in the [The Securities Industry and Financial Markets
Association’s [(formerly known as The Bond Market Association)] Standard Formulas
for the Analysis of Mortgage-Backed Securities and Other Related Securities - Chapter
SF Section C (the “Standard Formulas”)] [the Standard Formulas] and found them to be
in agreement.]
17.
[NOTE: For Trust Asset Group(s) with Ginnie Mae I MBS][For [each] [the] [Group __
and Group __ ] Trust Asset shown on Schedule A, we compared the current [Weighted
Average Coupon (the “WAC”)][WAC] shown on Schedule A to the corresponding
information for that Trust Asset derived using the Certificate Rate shown on Schedule A
and an assumed fixed servicing spread of 0.50% and found them to be in agreement.]
18.
19.
[NOTE: For Trust Assets Group(s) with Ginnie Mae II MBS]For each [Group __ and
Group ] Trust Asset shown on Schedule A [as having an Issue Date prior to 1, 20__]
[(other than Pool Number[s] ______ [and ______])], we compared the current [Weighted
Average Coupon (the “WAC”)][WAC] shown on Schedule A to the corresponding
information for that Trust Asset derived from the Weighted Average Tape (using the
most recent tape for which such information was available) using the methodology
relating to generic pools set forth in the Standard Formulas and found them to be in
agreement. [With respect to Pool Number[s] ______ [and ______], we compared the
current WAC shown on Schedule A to the corresponding information for such Trust
Asset obtained from Bloomberg and found it to be in agreement.]
[NOTE: For Trust Asset Group(s) with Ginnie Mae II MBS]For each Group __ and
Group __ Trust Asset shown on Schedule A [as having an Issue Date of _______ 1,
20__], we compared the current [Weighted Average Coupon (the “WAC”)][WAC]
I-16-5
shown on Schedule A to the corresponding information for that Trust Asset derived from
the New Pool Tapes using the methodology relating to generic pools set forth in the
Standard Formulas and found them to be in agreement.
20.
[NOTE: For Trust Asset Group(s) with Trust MBS][For [each] [the] [Group __ and
Group __ ] Trust Asset shown on Schedule A [as having an Issue Date prior to
________ 1, 20__] [(other than Pool Number[s] ______ [and ______])], [we obtained
the Weighted Average Original Loan Term ("WAOLT") shown for that Trust Asset
from the Weighted Average Tape]. [For [each] [the] [Group __ and Group __] Trust
Asset shown on Schedule A [as having an Issue Date of ________ 1, 20__],] [we
obtained the WAOLT shown for that Trust Asset from the New Pool Tapes]. [For Pool
Number[s] _____ [and _____], we obtained the WAOLT shown for that Trust Asset
from [the Bloomberg Financial Markets on-line data service (“Bloomberg”)]
[Bloomberg].] We noted that the WAOLT shown for [each such] [the] Trust Asset is
[not less than 241 months for a Trust Asset in a [Group] [or] [Subgroup] indicating an
Original Term to Maturity of 30 years in the Offering Circular Supplement][,][and] [not
more than 240 months for a Trust Asset in a [Group] [or] [Subgroup] indicating an
Original Term to Maturity of 20 years in the Offering Circular Supplement] [and not
more than 180 months for a Trust Asset in a [Group] [or] [Subgroup] indicating an
Original Term to Maturity of 15 years in the Offering Circular Supplement]. [For Pool
Number[s] ______ [and _______], we obtained the pool description from
www.eMBS.com (“eMBS”) and compared the number of years to maturity from the
pool description for that Trust Asset to the Original Term to Maturity indicated in the
Offering Circular Supplement for the related [Group] [or] [Subgroup] and found them to
be in agreement].
21.
We recomputed the sum of the current balances of the Trust Assets [in each Trust Asset
Group] shown on Schedule A ([each, an] [the] “Aggregate Balance”) and found [each]
such amount to be in agreement with the corresponding amount shown on Schedule A.
We determined that the Aggregate Balance [for each group of Trust Assets] [(net of any
related portion thereof payable as part of the Trustee Fee)][(other than the Group T Trust
Asset[s])], is not less than the aggregate Original Class [Principal][or][Notional]
Balance of the Securities [in the related Security Group].
22.
We compared the CUSIP Number, Trust Asset pool type, Trust Asset pool number, Trust
Asset pool suffix, Certificate Rate, Issue Date, Maturity Date and original principal [or
notional] balance of each Trust Asset shown on Schedule A to the corresponding
information included in the Trustee’s Receipt and Safekeeping Agreement provided to
us by the Trustee and found them to be in agreement.
23.
[NOTE: For Trust Asset Group(s) with Trust MBS and/or Underlying Certificate that is
a Callable Class][Based upon the assumption that each Mortgage Loan underlying [(1)]
each [related Group ____ and Group ] Trust Asset [NOTE: Include for Underlying
Callable Class: and underlying Group ____ Ginnie Mae Certificate] shown on Schedule A
[and Schedule D, respectively,] has a remaining term to maturity equal to its current
WARM, a loan age equal to its current WALA and an interest rate equal to its current
WAC [NOTE: Include for Trust Asset Group(s) with adjustable rate Trust MBS: and (2)
I-16-6
[each] [the] [Group __ and Group __] Trust Asset shown on Schedule A has a periodic
rate cap equal to its Periodic Certificate Interest Rate Cap, a next interest adjustment date
equal to its First Mortgage Rate Adjustment Date, a next payment adjustment date equal
to its First Payment Adjustment Date, an interest rate adjustment frequency equal to its
Interest Rate Adjustment Frequency (Months), a payment adjustment frequency equal to
its Payment Adjustment Frequency (Months), a mortgage margin equal to the sum of (a)
its Certificate Margin and (b) the excess of (i) its current WAC over (ii) its current
Certificate Rate, a lifetime mortgage interest rate cap equal to the sum of (a) its Lifetime
Certificate Interest Rate Cap and (b) the excess of (i) its current WAC over (ii) its current
Certificate Rate and a lifetime mortgage interest rate floor equal to the sum of (a) its
Lifetime Certificate Interest Rate Floor and (b) the excess of (i) its current WAC over (ii)
its current Certificate Rate], using the [Group __ and Group __] Trust Assets shown in
Schedule A, the terms of the Securities set forth in the Trust Agreement, and the
applicable definitions and methodologies set forth in the 20__-_ Offering Circular
Supplement under the caption “Yield, Maturity and Prepayment Considerations,” and also
assuming that (i) the underlying Mortgage Loans prepay at each of the constant rates of
[PSA] [or] [CPR] [, as applicable,] [and at each of the constant levels of One-Year CMT
(“CMT”), if applicable ,] shown on Schedule B, (ii) payments on the Trust Assets and the
Securities are received on the [16th] [20th] day of the month (in the case of the Group [1]
Trust Assets) and the [16th] [20th] day of the month (in the case of the Group [2] Trust
Assets)] of the month [and] [, (iii) no redemption occurs], [(iii)] [(iv)] no optional
termination is exercised [and] [[(iv)] [(v)] [in the case of Security Group ], the Non-Cash
Fee (as defined in Part III of the Ginnie Mae Multiclass Securities Guide) is equal to
____/____ of the principal and interest payments on each underlying Group __ Ginnie
Mae Certificate], we recomputed (a) the Weighted Average Life of each [Regular] Class
[in Security Groups ____ and ____] [(including Class[es] __, which [are Classes][is a
Class] that relate[s] to multiple Security Groups)] and (b) the absolute and percentage
differences between each such Weighted Average Life and the Weighted Average Life for
such Class set forth in the 20__-_ Offering Circular Supplement at the corresponding
constant rate of [PSA] [or] [CPR] [, as applicable] [, and at each of the constant levels of
[One-Year CMT (“CMT”)] [CMT], if applicable]. We compared such recomputed
Weighted Average Lives, absolute differences and percentage differences (expressed as a
percentage of the Weighted Average Life set forth in the 20__-_ Offering Circular
Supplement) to the corresponding information shown on Schedule B and found them to be
in agreement. [NOTE: Include for Supplemental Statement with WAL variance(s): In
addition, we compared the Weighted Average Lives, absolute differences and percentage
differences shown on Schedule C to the corresponding information shown on Schedule B
and found them to be in agreement.]
Using the Trust Assets on Schedule A and the terms of the Securities set forth in the
Trust Agreement, and assuming (i) the timely payment of principal and interest on the Trust
Assets, (ii) that no taxes are imposed on the Trust REMIC[s] and (iii) that no expenses are
incurred (other than the Trustee Fee), we determined that payments on the Trust Assets, net of
any Trustee Fee, would be adequate to make full and timely payments of principal and interest
on the Securities [and the Pooling REMIC Subaccounts] and to reduce the Class Principal
Balance [(or Class Notional Balance)] of each Class of Securities to zero by its Final
Distribution Date, in each case, in accordance with the terms as set forth in the Trust
I-16-7
Agreement regardless of the rate of prepayments on the Mortgage Loans underlying the Trust
Assets [or the level of [Index] [or] [Index]].
It should be understood that we make no representations as to (a) questions of legal
interpretation; (b) the sufficiency of these procedures for your purposes; (c) the accuracy of any
information reported [on] [in] [e-Access,] [Ginnie Mae’s Internet Web-site,] [Bloomberg,]
[Freddie Mac’s Internet Web-site,] [Fannie Mae’s Internet Web-site,] [the Underlying
[Certificate] [SMBS Security] Disclosure Document(s),] the Factor Report, the Weighted
Average Tape[s] [, eMBS] or the New Pool Tapes; (d) the accuracy of the original principal
balances set forth on the Trustee’s Receipt; [or] (e) the reasonableness of any of the
assumptions used above[; or (f) whether the Weighted Average Lives of the Securities will
correspond to those on Schedule B] [NOTE: Include for Supplemental Statement with WAL
variance(s): or Schedule C].
We were not engaged to conduct, and did not conduct, an examination, the objective of
which is the expression of an opinion on the above information. Accordingly, we do not express
such an opinion. Had we performed additional procedures, other matters might have come to our
attention that would have been reported to you, but such procedures would not necessarily reveal
any material misstatement of the information referred to above. Furthermore, there will usually
be differences between the actual payments on the Trust Assets and the Securities as compared to
the payments calculated in accordance with the assumptions and methodologies set forth in the
Supplement and described herein, because events and circumstances frequently do not occur as
expected, and those differences may be material. We have no responsibility to update this report
for events and circumstances occurring after the date of this report.
This report is solely for the information and use of the addressees and Ginnie Mae’s
Financial Advisor, solely in connection with its work on behalf of Ginnie Mae, in connection
with the issuance of the Securities covered by the Trust Agreement and is not intended to be and
should not be used by anyone other than these specified parties. It is not to be used, circulated,
quoted or otherwise referred to for any other purpose, including but not limited to, the purchase
or sale of the Securities, nor is it to be filed with or referred to in whole or in part in the Trust
Agreement or the Supplement or any other document, except that reference may be made to it in
the Sponsor Agreement or in any list of closing documents pertaining to the issuance of the
Securities.
Yours truly,
[Accountants]
I-16-8
Schedule A
CUSIP
Pool
Number/
Pool
Suffix
Pool
Type
Issue
Date
Certificate
Rate
Maturity
Date
Original
Principal
Balance
Current
Principal
Balance
Current
WAC
Current
WALA
Current
WARM
Group
ID
Depository
Institution I
ndex
Initial
Certificate
Rate at
MBS
Issuance
Lifetime
Certificate
Interest
Rate Cap
Lifetime
Certificate
Interest
Rate Floor
Certificate
Margin
Periodic
Certificate
Interest
Rate Cap
Payment
Adjustment
Frequency
(Months)
Interest
Rate
Adjustment
Frequency
(Months)
Next
Payment
Adjustment
Date
Next
Mortgage
Rate
Adjustment
Date
_______ _______
_______ _______
Aggregate Group __ Trust Assets: _______ _______
Aggregate Group __ Trust Assets: _______ _______
I-16-9
Schedule B
[ATTACH SCHEDULE OF WEIGHTED AVERAGE LIVES FOR SECURITY GROUPS
BACKED BY TRUST MBS] [ATTACHED SCHEDULES C AND D, AS NEEDED]
I-16-10
FORM OF CLOSING FLOW OF FUNDS INSTRUCTION LETTER FOR REMIC AND
MX TRANSACTIONS
CLOSING FLOW OF FUNDS INSTRUCTION LETTER
REGARDING THE TRANSFER OF FUNDS
BY THE SPONSOR TO THE TRUSTEE
AND THE SUBSEQUENT DISBURSEMENT OF FUNDS
BY THE TRUSTEE TO GINNIE MAE
____________ __, 20___
[Trustee]
Ginnie Mae REMIC Trust 20[ ]-[ ] [and Ginnie Mae MX Trust 20[ ]-[ ]]
Ladies and Gentlemen:
Reference is hereby made to the above-referenced transaction which is scheduled to close
on the date hereof (the “Closing Date”). Capitalized terms used but not defined herein have the
meanings ascribed to them in the Sponsor Agreement related to the above-referenced transaction.
On the Closing Date, using a delivery versus payment function, simultaneously upon transfer to
us (or our designee) of the Class ____ Securities [NOTE TO TRUST COUNSEL: Insert the
name of a REMIC Security that is not subject to exchange, or if all REMIC securities are subject
to exchange, insert a REMIC or MX Class that is issued at closing; provided that if you reference
an MX Class, you must include a reference to the MX Trust in the subject line above and
reference the Ginnie Mae MX trust in the following bracketed language option] of [the abovereferenced trust] [Ginnie Mae MX Trust 20[ ]-[ ]], we shall transfer to you $__________
representing the Ginnie Mae Guaranty Fee [and $__________ representing the Ginnie Mae MX
Combination Fee] which shall be disbursed to Ginnie Mae to cover the fees and expenses of
those persons who are to be paid from the proceeds of the transaction. We hereby instruct you to
disburse such amounts to Ginnie Mae via pay.gov.
*
*
*
*
*
*
I-17-1
If you have any questions, please call Ginnie Mae’s Treasurer’s division at (202) 7082257.
Very
truly yours,
[Sponsor]
By:______________________________
Its:______________________________
cc: Ginnie
Mae
Treasurer’s Division
[NOTE: THE EXECUTED VERSION OF THIS DOCUMENT SHOULD BE SCANNED
AND E-MAILED TO THE FOLLOWING PERSONS AT GINNIE MAE’S TREASURER’S
DIVISION: [email protected], Paul.A. [email protected] and
[email protected]]
I-17-2
GLOSSARY dated as of January 1, 2014
98% Optional Repurchase Event: The option of a Ginnie Mae Issuer to purchase all
Participations related to any HECM to the extent that any borrower’s request for an additional
advance in respect of such HECM, if funded, together with the outstanding principal amount of
such HECM is equal to or greater than 98% of the related Maximum Claim Amount.
Accelerated Security: A Security that is generally expected to receive principal payments more
rapidly than the related Non-Accelerated Security during the period in which the NonAccelerated Security is receiving limited or no principal payments.
Accountants: With respect to each Series or Callable Series, an accounting firm, designated in
the related Sponsor Agreement, that is responsible for performing certain agreed-upon
procedures relating to certain numerical information (a) in the Offering Circular and (b) on the
Final Data Statement, Final Schedules, if applicable, and Supplemental Statement, if any.
Accounting Date: For any Class, with respect to each Distribution Date, the last day of the
related Accrual Period.
Accredited Investor: An “accredited investor” as defined in Rule 501(a)(1), (2), (3) or (7) of
Regulation D of the Securities Act of 1933, as amended.
Accretion Directed Class: A Class that is designed to receive principal distributions from
interest accretions on specified Partial Accrual or Accrual Classes. Such a Class also may
receive principal payments from principal paid in respect of Trust Assets.
Accrual Amount: With respect to each Series (or, if the Series is segregated into Security
Groups, each Security Group) and each Distribution Date, the amount of interest accrued on any
Partial Accrual Class or Accrual Class and not distributable as interest on such Class on that
Distribution Date. When preceded by a Class designation (e.g., the “Z Accrual Amount”), such
amount with respect to the specified Partial Accrual Class or Accrual Class.
Accrual Class: A Class on which interest accrues during any Accrual Period and the accrued
interest (a) is added to its Class Principal Balance on each Distribution Date and (b) is not
distributable as interest thereon until a later date or the occurrence of a specified future event, if
ever.
Accrual Period: Unless otherwise provided in the applicable Trust Agreement, MX Trust
Agreement, Callable Trust Agreement or SMBS Trust Agreement, the Accrual Period relating to
any Distribution Date will be (a) for Fixed Rate, Variable Rate and Delay Classes, the calendar
month preceding the month of the Distribution Date or (b) for Floating Rate and Inverse Floating
Rate Classes that are not Delay Classes, the period from the Distribution Date in the month
preceding the month of the Distribution Date through the day preceding the Distribution Date.
Accrual Security: A Security of an Accrual Class or Partial Accrual Class.
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”
I-18-1
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
(including, without limitation, partnership interests or interests of members of a limited liability
company), by contract or otherwise; and the terms “controlling” and “controlled” have meanings
correlative to the foregoing.
Aggregate Remaining Balance: For any Distribution Date, and with respect to the Termination
Price for any Series, the aggregate of the remaining principal balances to which the Trust Assets
underlying a specified Series would be reduced in the month in which that Distribution Date
occurs, based on, in the case of Trust MBS and Underlying Callable Securities, the related
Certificate Factors, Corrected Certificate Factors and Calculated Certificate Factors, and, in the
case of Underlying Certificates and Underlying SMBS Securities, the related Underlying
Certificate Factors.
Alternative Rate Event: The failure by the FHLB of San Francisco to publish COFI for a period
of 65 calendar days.
Announcement: An announcement posted on e-Access.
Annual Report: The annual report, reflecting principal and interest allocated to each Class
during the previous calendar year, prepared by the Trustee and provided to Holders pursuant to
the Trust Agreement or SMBS Trust Agreement.
Ascending Rate Class: A Class that has a predetermined Interest Rate that increases one or
more times on dates determined before issuance.
Asset Pool: For any Trust, a group of assets identified in the Trust Agreement or in Section 1.03
of the REMIC Standard Trust Provisions as comprising a Trust REMIC.
Base Offering Circular: The offering document containing basic information about Securities
in general, to which, for each REMIC Series an Offering Circular Supplement relates, which, to
the extent related to Ginnie Mae Multifamily Certificates, will be referred to as the “Multifamily
Base Offering Circular.”
BBA: British Bankers’ Association.
BBA Interest Settlement Rate: As defined in Section 3.08(b)(i) of the REMIC Standard Trust
Provisions.
Beneficial Owner: The beneficial owner of any Security.
Book-Entry Depository: The Federal Reserve Bank of New York, any successor to the Federal
Reserve Bank of New York or any other depository selected by Ginnie Mae to act in the
equivalent capacity as the Federal Reserve Bank of New York.
Book-Entry Depository Account: An Eligible Account that is a limited purpose account
maintained by the Trustee at the Book-Entry Depository, which account shall, among other
things, be credited with all distributions in respect of the Trust Assets maintained through the
I-18-2
book-entry system of the Book-Entry Depository, and from which amounts distributable to the
holder of Book-Entry Securities shall be payable.
Book-Entry Security: Any Security (other than an Uncertificated Security) the beneficial
ownership of which is reflected in book-entry form rather than certificated form through the
facilities of the Book-Entry Depository.
Borrower: Any obligor on a mortgage note.
Business Day: A day other than (a) a Saturday or Sunday, (b) a day on which the banking
institutions in the State of New York are authorized or obligated by law or executive order to
remain closed or (c) a federal legal public holiday as defined in 5 U.S.C. section 6103.
Calculated Certificate Factor: With respect to any Trust MBS (other than Trust MBS that
consist of Ginnie Mae Multifamily Certificates or Ginnie Mae Platinum Certificates) for which a
Certificate Factor is not available on the Certificate Factor Date, a factor shall be calculated by
the Trustee for such date by assuming receipt of all scheduled principal and interest on such
Trust MBS and taking into account actual receipts through the applicable Ginnie Mae Certificate
Payment Date during the month preceding the month of calculation. For purposes of that
calculation, the Trustee shall assume that such Trust MBS represents a single mortgage loan that
amortizes on a level installment basis and has the following characteristics: (a) a principal
balance equal to the outstanding principal balance of the Trust MBS, (b) a remaining term to
maturity equal to the period from the date of calculation to the Maturity Date of such Trust MBS
and (c) an interest rate equal to the Certificate Rate of such Trust MBS plus in the case of a
Ginnie Mae I Certificate, 0.50% or in the case of a Ginnie Mae II Certificate issued prior to July
1, 2003, 1.50% or in the case of Ginnie Mae II Certificate, issued on or after July 1, 2003,
0.75%. With respect to Securities that are backed by HECM MBS, any additional assumptions
to be used in calculating this factor shall be set forth in the related Trust Agreement.
With respect to any Ginnie Mae Multifamily Certificate for which a Certificate Factor either (a)
is not available on the Certificate Factor Date or, (b) if available, cannot be verified by the
Trustee as correct and has not been replaced by a Corrected Certificate Factor by 12:00 Noon
Eastern time on the second Business Day preceding a Distribution Date, a factor calculated by
the Trustee for such Distribution Date by assuming (i) in the case of a Ginnie Mae Project Loan
Certificate, the receipt of all scheduled principal and interest on such Ginnie Mae Project Loan
Certificate and (ii) in the case of a Ginnie Mae Construction Loan Certificate, the receipt of no
scheduled payments of principal on such Ginnie Mae Construction Loan Certificate.
Call Class: Any class of Ginnie Mae Guaranteed Callable Pass-Through Security denominated
as a Call Class.
Call Class Security: Any Ginnie Mae Guaranteed Callable Pass-Through Security denominated
as a Call Class Security.
Callable Class: With respect to any REMIC Trust, any Class that is designed to receive
payments based on distributions on Underlying Callable Securities. With respect to a Callable
Trust, any Class of Callable Class Securities issued by such Callable Trust pursuant to the related
Callable Trust Agreement.
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Callable Class Security: Any Ginnie Mae Guaranteed Callable Pass-Through Security
denominated as a Callable Class Security and guaranteed by Ginnie Mae under the Ginnie Mae
Multiclass Securities Program.
Callable Series: A series of Ginnie Mae Guaranteed Callable Pass-Through Securities issued
pursuant to a Trust Agreement and having the numerical or other designation specified in the
related Trust Agreement.
Callable Standard Trust Provisions: With respect to each Callable Trust, the standard trust
provisions in effect as of the date of the related trust agreement and incorporated by reference
therein.
Callable Trust: A trust created pursuant to a Callable Trust Agreement for the purpose of
issuing Call and Callable Class Securities.
Callable Trust Agreement: An agreement that provides for the establishment of a Callable
Trust. A Callable Trust Agreement incorporates the related Standard Trust Provisions by
reference and may modify, amend or supplement the conditions of such Standard Trust
Provisions in any respect.
Certificate Factor: With respect to each Trust MBS or Underlying Callable Security and each
Certificate Factor Date, the factor for such date.
Certificate Factor Date: With respect to each Distribution Date and any Ginnie Mae I
Certificate, Ginnie Mae II Certificate or Ginnie Mae Multifamily Certificate, the seventh
Business Day of the month in which such Distribution Date occurs. With respect to each
Distribution Date and any Underlying Callable Security, the Business Day during the month in
which such Distribution Date occurs on which the Certificate Factor therefor is published.
Certificate Guaranty Agreement: With respect to each Ginnie Mae MBS Certificate and each
Ginnie Mae Multifamily Certificate, an agreement under which, among other things, (a) with
respect to Ginnie Mae MBS Certificates other than HECM MBS, the related Ginnie Mae Issuer
has agreed to advance its own funds in order to make timely payments on the Ginnie Mae MBS
Certificate or Ginnie Mae Multifamily Certificate, even if the amounts received on the
underlying Mortgage Loans are less than required to make these payments, (b) with respect to
HECM MBS, the related Ginnie Mae Issuer has agreed to pay out of its own corporate funds in
certain circumstances in order to make timely payments on the HECM MBS and (c) Ginnie Mae
has agreed to guarantee payments on the Ginnie Mae MBS Certificate or Ginnie Mae
Multifamily Certificate.
Certificate Margin: With respect to any Trust MBS representing a Ginnie Mae II Certificate
backed by adjustable rate Mortgage Loans, the percentage per annum to be added to the OneYear Treasury Index on a Certificate Rate Adjustment Date to determine the new Certificate
Rate applicable to the Trust MBS representing a Ginnie Mae II Certificate until the next
Certificate Rate Adjustment Date.
Certificate Payment Adjustment Date: With respect to any Trust MBS representing a Ginnie
Mae II Certificate backed by adjustable rate Mortgage Loans, the Ginnie Mae Certificate
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Payment Date in the month following the month in which the Certificate Rate Adjustment Date
for the Trust MBS representing a Ginnie Mae II Certificate occurs.
Certificate Rate: For any Distribution Date and as to any Trust MBS, the per annum interest rate
payable on the Trust MBS on the applicable Ginnie Mae Certificate Payment Date. For any
Distribution Date and as to any Underlying Certificate, the per annum interest rate payable on
such Underlying Certificate on the applicable Underlying Certificate Payment Date. For any
Distribution Date and as to any Underlying Callable Security, the per annum interest rate payable
on such Underlying Callable Security on the applicable Underlying Callable Security Payment
Date. For any Distribution Date and as to any Underlying SMBS Security, the per annum
interest rate payable on such Underlying SMBS Security on the applicable Underlying SMBS
Security Payment Date.
Certificate Rate Adjustment Date: With respect to a Trust MBS representing a Ginnie Mae II
Certificate backed by adjustable rate Mortgage Loans, the Mortgage Rate Adjustment Date of the
Mortgage Loans.
Certificate Rate Formula: With respect to a Trust MBS representing a Ginnie Mae II
Certificate backed by adjustable rate Mortgage Loans, the formula, consisting of the One-Year
Treasury Index and a Certificate Margin, upon which the Certificate Rate is based when the
initial Certificate Rate for the Trust MBS representing a Ginnie Mae II Certificate is no longer in
effect.
Certificated Security: A Security represented by one or more physical certificates, that is not a
Book-Entry Security.
Certificated Shortfall Amount: The amount described in Section 3.04(b) of the REMIC
Standard Trust Provisions.
Class: As to any Trust REMIC, all of the Securities that together represent one of the Regular
Interests in such Trust REMIC or all of the Securities that together represent the Residual
Interest in that Trust REMIC. As to any MX Trust, all MX Securities or Modifiable Securities
sharing the same designation. As to any Callable Series, all Securities sharing the same
designation. As to any SMBS Trust, all Securities sharing the same designation. The Trust
Agreement, MX Trust Agreement, Callable Trust Agreement or SMBS Trust Agreement, as
applicable, shall specify the designations, Original Class Principal Balances (if any), original
Class Notional Balances (if any), Interest Rates (if any) and other specific characteristics of each
Class of Securities.
Class Factor: With respect to each Class (other than any Class issued by an SMBS Trust), a
number truncated to eight decimal places calculated by the Trustee and published or otherwise
made available to investors on or about one Business Day preceding each Distribution Date that,
when multiplied by the Original Class Principal Balance (or original Class Notional Balance) of
that Class, determines the Class Principal Balance (or Class Notional Balance), after giving
effect to any distribution of principal to be made on the Securities (and any addition to the Class
Principal Balance of any Accrual Class or Partial Accrual Class) on that Distribution Date.
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Class Notional Balance: The balance used as a reference to calculate the amount of interest due
on a Notional Class.
Class Principal Balance: As to any Class other than a Notional Class as of any Distribution
Date, the Original Class Principal Balance of that Class less all payments of principal previously
allocated to that Class (plus amounts, if any, added to the Class Principal Balance) on previous
Distribution Dates, except as otherwise provided in the related Offering Circular and Trust
Agreement, MX Trust Agreement, Callable Trust Agreement or SMBS Trust Agreement, as
applicable.
Class R Security: A Security that represents a Residual Interest in a Trust REMIC.
Class RI Security: A Security that represents a Residual Interest in an Issuing REMIC.
Class RP Security: A Security that represents a Residual Interest in a Pooling REMIC.
Class RR Security: A Security that represents a Residual Interest in two or more Trust REMICs.
Class Type: An Interest Type, Principal Type or Other Type.
Closing Date: For each Series, the date upon which the Sponsor, pursuant to the Trust
Agreement, MX Trust Agreement, Callable Trust Agreement or SMBS Trust Agreement,
deposits the Trust Assets in the Trust, the MX Trust, the Callable Trust or the SMBS Trust, as
applicable, in exchange for the related Securities and settles such Securities.
Closing Documents: With respect to each Series, those documents, specified in the related
Sponsor Agreement, that are to be executed by the parties to the transaction on or before the
Closing Date.
Closing Flow of Funds Instruction Letter: The letter prepared by Trust Counsel on behalf of
the Sponsor pursuant to the Ginnie Mae Multiclass Securities Guide regarding the transfer of
funds by the Sponsor to the Trustee and the subsequent disbursement of funds via pay.gov by the
Trustee to Ginnie Mae in respect of the Ginnie Mae Guaranty Fee and, if applicable, the MX
Combination Fee.
Code: The United States Internal Revenue Code of 1986, as amended.
COFI: The weighted average cost of funds for member savings institutions of the Eleventh
Federal Home Loan Bank District.
COFI Class: A Class bearing interest at a rate determined by reference to COFI.
Collection Account: With respect to any Trust, Callable Trust or SMBS Trust an Eligible
Account, established and maintained by the Trustee to the extent required by the applicable Trust
Agreement, Callable Trust Agreement or SMBS Trust Agreement.
Collection Excess Amount: The amounts as defined in Section 3.03(a) of the Standard Trust
Provisions and Section 4.03(a) of the SMBS Standard Trust Provisions.
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Combination: Any permitted combination of REMIC and/or MX Securities set forth in the
Combination Schedule.
Combination Schedule: The schedule entitled “Available Combinations” and attached as an
exhibit to an Offering Circular Supplement.
Component: With respect to any Component Class, one of the component parts of such Class.
The Components of a Component Class may have different principal and/or interest distribution
characteristics, but together they constitute a single Class, and are not separately transferable
from the related Class. Each Component may be categorized according to one or more Class
Types.
Component Class: A Class composed of Components.
Component Principal Balance: As to any Component other than any Notional Component as of
any Distribution Date, the Original Component Principal Balance of that Component less all
principal previously allocated to that Component (plus Accrual Amounts or Partial Accrual
Amounts, if any, added to the Component Principal Balance) on previous Distribution Dates,
except as otherwise provided in the related Offering Circular and Trust Agreement.
Contracted Security Purchaser: With respect to any Ginnie Mae Multifamily Certificate, an
entity bound under contract with a Ginnie Mae Issuer to purchase Ginnie Mae Construction Loan
Certificates relating to a particular multifamily project.
Corporate Trust Office: With respect to a Series or Callable Series, the meaning specified in the
related Trust Agreement, MX Trust Agreement, Callable Trust Agreement or SMBS Trust
Agreement, as applicable.
Corrected Certificate Factor: With respect to any Ginnie Mae Multifamily Certificate for which
an incorrect Certificate Factor is reported, a corrected certificate factor agreed to by the related
Ginnie Mae Issuer and the Trustee by 12:00 noon Eastern Standard Time on the second Business
Day preceding a Distribution Date.
Co-Manager: With respect to any Series backed by Ginnie Mae Multifamily Certificates, the
entity so designated in the related Offering Circular Supplement.
Co-Sponsor: With respect to a Series, the Person, identified in the Sponsor Agreement, with
whom the Sponsor has entered into an agreement pursuant to which the Co-Sponsor at its
election may distribute certain of the Securities.
Co-Trust Counsel: With respect to a Series, a law firm, identified in the Sponsor Agreement,
whom the Sponsor has retained to perform legal work assisting Trust Counsel in the discharge of
Trust Counsel’s responsibilities.
Current Interest Class: A Class that bears interest and is not an Accrual or Partial Accrual
Class.
Current Interest Security: A Security of a Current Interest Class.
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CUSIP Number: A unique nine-character designation assigned by the CUSIP Service Bureau to
each Class.
Cut-Off Date: With respect to any Series backed by Ginnie Mae Multifamily Certificates, the
date specified in the related Offering Circular Supplement for such Series.
Delay Class: A Class for which there is a delay between the end of its Accrual Period and the
related Distribution Date.
Deposited Ginnie Mae Construction Loan Certificate: Each Ginnie Mae Construction Loan
Certificate delivered by the Sponsor to the Trust on the Closing Date.
Depository: A Book-Entry Depository or Trust Asset Depository, as the context requires.
Depository Account: The Book-Entry Depository Account or a Trust Asset Depository Account,
as the context requires.
Depository Shortfall Amount: The amount described in Section 3.04(b) of the REMIC Standard
Trust Provisions.
Descending Rate Class: A Class that has predetermined Interest Rates that decrease one or
more times on dates determined before issuance.
Differential Class: A Class with Interest Rates that are equal to the difference between two
specified indices.
Disqualified Organization: Either (a) the United States, (b) any state or political subdivision
thereof, (c) any foreign government, (d) any international organization, (e) any agency or
instrumentality of any of the foregoing, (f) any tax-exempt organization (other than a cooperative
described in Section 521 of the Code) that is exempt from United States federal income tax
unless that organization is subject to tax under the unrelated business taxable income provisions
of the Code, (g) any organization described in Section 1381(a)(2)(C) of the Code, (h) an
“electing large partnership” as defined in Section 775 of the Code, (i) a foreign permanent
establishment or fixed base (within the meaning of an applicable income tax treaty) of a U.S.
Person or (j) any other entity identified as a disqualified organization by the REMIC Provisions.
A corporation will not be treated as an instrumentality of the United States or any state or
political subdivision thereof if all of its activities are subject to tax and, with the exception of
Freddie Mac, a majority of its board of directors is not selected by that governmental unit.
Distribution Amount: With respect to each Series or Callable Series (or, if the Series or
Callable Series is segregated into Security Groups, each Security Group) and each Distribution
Date, the sum of the Principal Distribution Amount (less principal, if any, payable to the Trustee
as a Trustee Fee), the Interest Distribution Amount and the Accrual Amount(s) for the Series or
Callable Series (or Security Group).
Distribution Date: The date specified in the Trust Agreement, MX Trust Agreement, Callable
Trust Agreement or SMBS Trust Agreement, as applicable, relating to each Series or Callable
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Series (or Security Group) upon which distributions are required to be made to Holders of
Securities of such Series or Callable Series (or Security Group).
Distribution Date Statement: With respect to each Series or Callable Series and each
Distribution Date, a statement, in such form as is approved by the Trustee which specifies (i)
amounts distributed as principal, interest and prepayment penalties, if any, to Holders of BookEntry and Certificated Securities, (ii) the Trustee Fee paid as of such Distribution Date and (iii)
the Ginnie Mae Interest Amount for the Distribution Date for the immediately preceding
calendar month.
Double REMIC Series: A Series that provides for an Issuing REMIC and one or more Pooling
REMICs.
Due and Payable Purchase Event: The option of any Ginnie Mae Issuer to purchase all
Participations related to a HECM that becomes, and continues to be, due and payable in
accordance with its terms.
e-Access: Ginnie Mae’s Multiclass Securities e-Access, a web-based information system that
contains information relating to Ginnie Mae Securities and Ginnie Mae Platinum Certificates,
located at www.ginniemae.gov.
Effective Range: With respect to any PAC, Scheduled or TAC Class or Component, the range
of constant prepayment rates for which such Class or Component adheres to its schedule of
Scheduled Principal Balances.
Effective Rate: With respect to any PAC, Scheduled or TAC Class or Component, the constant
prepayment rate for which such Class or Component adheres to its schedule of Scheduled
Principal Balances.
Eligible Account: An account or accounts maintained with (a) the Book-Entry Depository, (b)
the Trustee in its corporate trust department acting in its fiduciary capacity or (c) a federal or
state chartered depository institution or trust company the long-term unsecured debt obligations
of which (or, in the case of a depository institution or trust company that is the principal
subsidiary of a holding company, the long-term unsecured debt obligations of that holding
company) are rated by a nationally recognized statistical rating organization in one of its two
highest long-term rating categories at the time any amounts are held on deposit therein.
Eligible Certificates: Any Ginnie Mae Securities, as well as any Fannie Mae Securities or
Freddie Mac Securities that are held in book-entry form.
Eligible Investments: Eligible Investments shall consist of (a) direct obligations of, or
obligations fully guaranteed as to principal and interest by, the United States or any agency or
instrumentality thereof, provided those obligations are backed by the full faith and credit of the
United States and mature no later than the Business Day immediately preceding the Distribution
Date on which the funds invested therein are required to be distributed, (b) securities of an
investment company subject to the provisions of the Investment Company Act of 1940, as
amended, whose assets consist solely of obligations of the type described in clause (a) above,
and/or repurchase agreements with respect thereto, which securities are rated in the highest rating
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category of a nationally recognized statistical rating organization and (c) or such other
investments as approved by Ginnie Mae.
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
Excess Class: A Class that receives any principal and interest paid on the Underlying Trust
Assets in excess of the amount of the prescribed principal and interest required to be paid on all
Classes in the Series.
Excess MBS Portion: The excess of the principal balance of the Trust MBS underlying a
Callable Class Security over the Class Principal Balance of such Callable Class Security.
Exchange Fee: With respect to a Callable Series, the greater of (i) $5,000 or (ii) the lesser of
$15,000 or 1/32 of 1% of the outstanding principal balance of the Callable Class being
redeemed.
Fannie Mae: The entity formally known as the Federal National Mortgage Association.
Fannie Mae Securities: Any securities previously issued and guaranteed by Fannie Mae, that
evidence beneficial ownership interests in Ginnie Mae Certificates.
FASB: The Financial Accounting Standards Board.
Fedwire Book Entry System: The book entry system for securities operated and maintained by
the U.S. Federal Reserve Banks.
FDIC: The Federal Deposit Insurance Corporation.
FHA: The Federal Housing Administration.
FHA Loans: With respect to a Ginnie Mae Certificate other than a Ginnie Mae Multifamily
Certificate, residential mortgage loans insured by FHA. With respect to a Ginnie Mae
Multifamily Certificate, multifamily mortgage loans insured by FHA or coinsured by FHA and a
mortgage lender.
FHLB of San Francisco: The Federal Home Loan Bank of San Francisco.
Final Data Statement: With respect to each Series or Callable Series, the final list of Trust
Assets to be included in the related Trust. This Final Data Statement will be prepared on the
basis of a document in computer-readable format furnished to the related Accountants, Financial
Advisor and Trustee by the Sponsor. In the case of any Series (other than any Series backed by
Ginnie Mae Multifamily Certificates and HECM MBS), a copy of the Final Data Statement will
be attached to the Accountants’ Agreed Upon Procedures Report as of the Closing Date and a
copy of which will be attached to the related Trust Agreement as of the Closing Date. In the case
of each Callable Series, the Final Data Statement will be attached as Schedule A to the
Accountants’ Agreed Upon Procedures Report as of the Closing Date, a copy of which will be
attached to the related Callable Trust Agreement as of the Closing Date. In the case of any
Series backed by Ginnie Mae Multifamily Certificates or HECM MBS, investors may obtain the
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related Final Data Statement from e-Access or by calling the Information Agent at (800) 234GNMA. The Final Data Statement separately identifies the Trust Assets in each Trust Asset
Group and, if applicable, Subgroup.
Final Distribution Date: As to each Class, the Distribution Date, set forth in the Trust
Agreement, MX Trust Agreement, Callable Trust Agreement or SMBS Trust Agreement, as
applicable, on or before which the final payment due on that Class will be made. With respect to
each Pooling REMIC Regular Interest, the Final Distribution Date shall be the latest of the Final
Distribution Dates of the corresponding Security or Securities.
Final Redemption Date: The last date on which a Class of Callable Class Securities may be
redeemed, as specified in the related Trust Agreement.
Final Schedule: With respect to any PAC, Scheduled or TAC Class or Component, a final
schedule of Scheduled Principal Balances, which schedule will be attached to the related Trust
Agreement.
Final Structure Date: The date by which the Sponsor must submit a final Securities Structure to
Ginnie Mae.
Financial Advisor: An entity, chosen by Ginnie Mae, that serves as financial advisor to Ginnie
Mae in connection with the Ginnie Mae Multiclass Securities Program. The name and address of
the current Financial Advisor are contained in the Ginnie Mae Multiclass Securities Guide in the
document entitled “Ginnie Mae Multiclass Securities Transaction Participants.”
FIRREA: The Financial Institutions Reform, Recovery and Enforcement Act of 1989, as it may
be amended from time to time.
Fixed Rate Class: A Class with an Interest Rate that is fixed throughout the life of the Class.
Floating Rate Adjustment Date: With respect to REMIC Securities or MX Securities, if any,
that evidence beneficial ownership interest in Trust MBS, unless otherwise provided in the
related Trust Agreement, as to any Accrual Period (after the initial Accrual Period), the second
business day before that Accrual Period begins, or, in the case of a COFI Class that is also a
Delay Class, the second business day of that Accrual Period. With respect to Securities that
evidence beneficial ownership interest in an Underlying Certificate, unless otherwise provided in
the related Trust Agreement, as to any Accrual Period (after the initial Accrual Period), the
business day on which the Certificate Rate for such Underlying Certificate is determined. For
this purpose, “business day” means a day on which banks are open for dealing in foreign
currency and exchange in New York City or London.
Floating Rate Class: A Class with an Interest Rate that is reset periodically based on an index
and that varies directly with changes in that index.
FRB: The Board of Governors of the Federal Reserve System.
Freddie Mac: The Federal Home Loan Mortgage Corporation.
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Freddie Mac Securities: Any securities previously issued and guaranteed by Freddie Mac that
evidence beneficial ownership interests in Ginnie Mae Certificates.
FRS: The Federal Reserve System.
Ginnie Mae: The Government National Mortgage Association.
Ginnie Mae I Certificate: A Ginnie Mae I MBS Certificate or a Ginnie Mae Platinum
Certificate backed by Ginnie Mae I MBS Certificates.
Ginnie Mae I MBS Certificate: A certificate, directly or indirectly, backed by one or more
pools of single-family or multifamily Mortgage Loans, guaranteed by Ginnie Mae pursuant to a
Certificate Guaranty Agreement and issued pursuant to the Ginnie Mae I Program.
Ginnie Mae I Program: A Ginnie Mae mortgage-backed securities program governed by the
provisions contained in the MBS Guide.
Ginnie Mae II Certificate: A Ginnie Mae II MBS Certificate or a Ginnie Mae Platinum
Certificate backed by Ginnie Mae II MBS Certificates.
Ginnie Mae II MBS Certificate: A certificate backed by a pool of single-family Mortgage
Loans or a pool of Participations related to HECMs, guaranteed by Ginnie Mae pursuant to a
Certificate Guaranty Agreement and issued pursuant to the Ginnie Mae II Program.
Ginnie Mae II Program: A Ginnie Mae mortgage-backed securities program governed by the
provisions contained in the MBS Guide.
Ginnie Mae Callable Securities Guide: Part V of the Ginnie Mae Multiclass Securities Guide.
Ginnie Mae Certificate: Any Ginnie Mae I Certificate or Ginnie Mae II Certificate.
Ginnie Mae Certificate Payment Date: For each Ginnie Mae MBS Certificate and Ginnie Mae
Multifamily Certificate, the day of each month on which payment is required to be made to the
holder of that Trust MBS; for each Ginnie Mae Platinum Certificate, the day of each month on
which payment is required to be made to the holder of that Ginnie Mae Platinum Certificate; and
for each Callable Class Security, the day of each month on which payment is required to be made
to the holder of that Callable Class Security.
Ginnie Mae Construction Loan Certificate: A certificate, directly or indirectly, backed by a
pool of one multifamily Mortgage Loan during the construction phase of a multifamily project,
guaranteed by Ginnie Mae pursuant to a Certificate Guaranty Agreement and issued pursuant to
the Ginnie Mae I Program that is redeemable upon conversion for a Ginnie Mae Project Loan
Certificate.
Ginnie Mae Guaranty: The guaranty of Ginnie Mae with respect to the timely payment of all
principal and interest on each Security in accordance with the terms of that Security as set forth
in the related Trust Agreement, MX Trust Agreement, Callable Trust Agreement or SMBS Trust
Agreement. The Ginnie Mae Guaranty is set forth on each Certificated Security. The Ginnie
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Mae Guaranty does not extend to the payment of Prepayment Penalties or to the payment of any
premium included in any Redemption Price for a Callable Class Security.
Ginnie Mae Guaranty Fee: The fee payable to Ginnie Mae in exchange for the Ginnie Mae
Guaranty relating to a Series (other than any Series issued pursuant to the terms of a Callable
Trust Agreement or an SMBS Trust Agreement), consisting of the sum of (i) $10,000, in the case
of any Series backed by Ginnie Mae Multifamily Certificates, (ii) the greater of (y) $75,000 and
(z) the Ginnie Mae Guaranty Fee Percentage of the aggregate Original Class Principal Balance of
the related Securities, payable to Ginnie Mae on the Closing Date, (iii) any Ginnie Mae Interest
Amounts and (iv) any amounts transferred to the Variance Account pursuant to Section 3.03(b)
of the REMIC Standard Trust Provisions. The fee payable to Ginnie Mae in exchange for the
Ginnie Mae Guaranty relating to any Series issued pursuant to the terms of an SMBS Trust
Agreement, consisting of the sum of (i) the Ginnie Mae Guaranty Fee Percentage of the
aggregate Original Class Principal Balance of the Securities to be issued on the Closing Date and
(ii) any Ginnie Mae Interest Amounts and (iii) any amounts transferred to the Variance Account
pursuant to Section 4.03(b) of the SMBS Standard Trust Provisions. The fee payable to Ginnie
Mae in exchange for the Ginnie Mae Guaranty relating to any Callable Series issued pursuant to
the terms of a Callable Trust Agreement, consisting of the greater of (i) the sum of 0.02% of the
first $200,000,000 of Original Principal Balance of the related Callable Class (or Classes) and
0.01% of any additional amounts; and (ii) $40,000. The Ginnie Mae Guaranty Fee is subject to
change by Ginnie Mae and is set forth in the related Sponsor Agreement.
Ginnie Mae Guaranty Fee Percentage: With respect to a Series (other than any Series issued
pursuant to the terms of an SMBS Trust Agreement), the amount equal to the sum of (i) 0.075%
of the first $100 million of the aggregate Class Principal Balance of the Securities as of the
Closing Date and (ii) 0.025% of the remaining aggregate Class Principal Balance of the
Securities as of the Closing Date. With respect to any Series issued pursuant to the terms of an
SMBS Trust Agreement, the amount equal to 0.03125%.
Ginnie Mae Guaranty Payment: Any payment made by Ginnie Mae pursuant to the Ginnie Mae
Guaranty.
Ginnie Mae HREMIC Guide: Part VII of the Ginnie Mae Multiclass Securities Guide.
Ginnie Mae Interest Amount: With respect to the Collection Account and each Ginnie Mae
Certificate (other than Ginnie Mae Certificates backing Underlying Certificates), an amount,
payable monthly, equal to interest accrued at the Federal Funds Rate as published in the Wall
Street Journal in effect on the Ginnie Mae Certificate Payment Date (or such other rate as
approved by Ginnie Mae in writing) less a reasonable transaction cost, on the balance in such
account as of the close of business on the Ginnie Mae Certificate Payment Date for the period, if
any, from the Ginnie Mae Certificate Payment Date to the related Distribution Date.
Ginnie Mae Issuer: A Person who has issued a Ginnie Mae MBS Certificate, a Ginnie Mae
Platinum Certificate or a Ginnie Mae Multifamily Certificate, or such Person’s successors and
assigns.
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Ginnie Mae Issuer Purchase Event: Any Due and Payable Purchase Event, Mandatory
Purchase Event or 98% Optional Purchase Event.
Ginnie Mae MBS Certificate: Any Ginnie Mae I MBS Certificate or Ginnie Mae II MBS
Certificate.
Ginnie Mae Multiclass Securities Guide: The Ginnie Mae Multiclass Securities Guide, as
amended from time to time, which includes the Ginnie Mae REMIC Guide in Parts I and II, the
Ginnie Mae Platinum Guide in Part III, the Ginnie Mae Multifamily Guide in Part IV, the Ginnie
Mae Callable Securities Guide in Part V, the Ginnie Mae SMBS Guide in Part VI and the Ginnie
Mae HREMIC Guide in Part VII.
Ginnie Mae Multiclass Securities Program: The program established by Ginnie Mae pursuant
to Section 306(g) of the National Housing Act, as amended, for the issuance of Securities.
Ginnie Mae Multifamily Certifica te: A Ginnie Mae Project Loan Certificate or a Ginnie M ae
Construction Loan Certificate.
Ginnie Mae Multifamily Certificate Group: One of two or more groups into which the Ginnie
Mae Multifamily Certificates sold to a Trust may be segregated as described in the related Trust
Agreement.
Ginnie Mae Multifamily Guide: Part IV of the Ginnie Mae Multiclass Securities Guide.
Ginnie Mae MX Combination Fee: Unless otherwise specified in the related Sponsor
Agreement, the fee payable to Ginnie Mae in connection with each Combination set forth in the
Combination Schedule to an Offering Circular Supplement which shall be equal to $3,000 for
each Combination.
Ginnie Mae Platinum Certificate: One of the certificates issued by the Ginnie Mae Platinum
Trust, guaranteed by Ginnie Mae pursuant to a Ginnie Mae Platinum Guaranty Agreement and
transferred to a depositor of the Ginnie Mae Platinum Trust in exchange for the Ginnie Mae
MBS Certificates transferred to the Ginnie Mae Platinum Trust by the depositor.
Ginnie Mae Platinum Guaranty Agreement: With respect to a series of Ginnie Mae Platinum
Certificates, the agreement pursuant to which Ginnie Mae guarantees the timely payment of
principal and interest on the Ginnie Mae Platinum Certificates in accordance with their terms.
Ginnie Mae Platinum Guide: Part III of the Ginnie Mae Multiclass Securities Guide.
Ginnie Mae Platinum Trust: The trust, formed pursuant to a trust agreement, that issues Ginnie
Mae Platinum Certificates.
Ginnie Mae Project Loan Certificate: A certificate, directly or indirectly, backed by a pool of
one or more multifamily Mortgage Loans, guaranteed by Ginnie Mae pursuant to a Certificate
Guaranty Agreement and issued pursuant to the Ginnie Mae I Program or a Ginnie Mae Platinum
Certificate issued by a Ginnie Mae Platinum Trust and backed by Ginnie Mae Project Loan
Certificates.
I-18-14
Ginnie Mae REMIC Guide: Parts I and II of the Ginnie Mae Multiclass Securities Guide.
Ginnie Mae REMIC Security: A Ginnie Mae Guaranteed REMIC Pass-Through Security or a
Ginnie Mae Guaranteed Multifamily REMIC Pass-Through Security.
Ginnie Mae REMIC Trust: A trust created pursuant to a Trust Agreement for the purpose of
issuing Ginnie Mae REMIC Securities.
Ginnie Mae SMBS Guide: Part VI of the Ginnie Mae Multiclass Securities Guide.
Ginnie Mae SMBS Trust: A trust created pursuant to an SMBS Trust Agreement for the
purpose of issuing Ginnie Mae Guaranteed Stripped Mortgage-Backed Securities.
Ginnie Mae Security: Any Ginnie Mae REMIC Security, Modifiable Security or MX Security.
Ginnie Mae SMBS Security: A Ginnie Mae Guaranteed Stripped Mortgage-Backed Security.
Glossary: This glossary of defined terms.
GNMA: Ginnie Mae.
Government Loans: Collectively, FHA Loans, VA Loans, RD Loans and HUD Loans.
Guaranty Agreement: With respect to each Series or Callable Series, the agreement pursuant to
which Ginnie Mae guarantees the timely payment of principal and interest on the Securities in
accordance with their terms.
Guide: The Ginnie Mae Multiclass Securities Guide.
HECM: A home equity conversion mortgage loan, also referred to as a “reverse mortgage
loan,” insured by FHA.
HECM MBS: A Ginnie Mae II MBS Certificate, backed by a pool of Participations related to
HECMs, guaranteed by Ginnie Mae pursuant to a Certificate Guaranty Agreement and issued
pursuant to the Ginnie Mae II Program.
HECM MBS Accrual Class: A HECM MBS Accrual Class (“HZ”) is a Class that is backed in
whole or in part by Trust Assets consisting of HECM MBS on which interest accrues during any
Accrual Period and all or a portion of the accrued interest is (a) distributable as interest up to the
amount available in respect of the underlying HECM MBS and (b) added to its Class Principal
Balance on each Distribution Date to the extent that there is not available cashflow from the
Trust Assets to distribute the total accrued interest. There are no Accretion Directed Classes
associated with any HECM MBS Accrual Class.
HECM MBS Base Prospectus: The offering document containing basic information about
HECM MBS in general, to which for each issuance of HECM MBS, a HECM MBS Prospectus
Supplement relates.
I-18-15
HECM MBS Pass-Through Class: A HECM MBS Pass-Through Class (“HPT”) is a Class that
is backed in whole or in part by Trust Assets consisting of HECM MBS that either individually
or together with other Classes receive on each Distribution Date all, or substantially all, of the
principal and/or interest payments received on the related Trust Assets and that is not a Strip
Class or HECM MBS Sequential Pay Class.
HECM MBS Prospectus Supplement: The supplement to the HECM MBS Base Prospectus
that contains detailed information regarding the characteristics of a particular issuance of HECM
MBS and information regarding the underlying Participations and the related HECMs.
HECM MBS Rate: With respect to any HECM MBS and as of any distribution date, the
weighted average of the Participation Interest Rates of the Participations underlying the HECM
MBS.
HECM MBS Sequential Pay Class: A HECM MBS Sequential Pay Class is a Class that is
backed in whole or in part by Trust Assets consisting of HECM MBS that receives distributions
of principal in a prescribed sequence, that do not have predetermined schedules and that
generally are designed to receive distributions of principal continuously from the first
Distribution Date on which they receive principal until they are retired. A HECM MBS
Sequential Pay Class may receive principal distributions concurrently with one or more other
HECM MBS Sequential Pay Classes.
HECM MBS Weighted Average Coupon Class: A HECM MBS Weighted Average Coupon
Class (“HWAC”) is a Class that is backed in whole or in part by Trust Assets consisting of
HECM MBS and whose Interest Rate is based on or determined by reference to a Weighted
Average Coupon Rate, as described in the related Offering Circular Supplement
HMBS-Backed Class: A Ginnie Mae Security, backed by Trust Assets all or a portion of which
consist of HECM MBS.
Holder: Any person whose name appears on the books and records of the Registrar as the record
holder of a Security. Notwithstanding the foregoing, where used under “Certain United States
Federal Income Tax Consequences” in the Offering Circular, the term “Holder” refers to
Beneficial Owners of the Securities, regardless of whether the Beneficial Owner is also the
registered Holder, except where the context requires otherwise.
HUD: The United States Department of Housing and Urban Development.
HUD Loans: Residential mortgage loans guaranteed by HUD pursuant to Section 184 of the
Housing and Community Development Act of 1992.
Increased Minimum Denomination Class: A Class designated as such in the Trust Agreement,
MX Trust Agreement or Callable Trust Agreement, as applicable, which is to be offered and sold
in higher minimum denominations than $1,000.
Index Allocation Class. A Class whose principal distribution allocations are based on the value
of an index.
I-18-16
Information Agent: BNY Mellon or another Person designated by Ginnie Mae, that will, among
other things (a) provide information about the factors on the Trust Assets to the Trustee of the
Trust that owns those Trust Assets, (b) make certain information about the Securities available to
the public (by posting it on e-Access) and forward that information to Ginnie Mae and the
Holders as provided in the Standard Trust Provisions or SMBS Standard Trust Provisions, as
applicable, and (c) keep and furnish to investors, upon request, copies of any Underlying
Certificate Disclosure Documents and disclosure documents relating to any Underlying Callable
Securities and copies of any Underlying SMBS Security Disclosure Documents.
Initial Redemption Date: The initial date upon which a Callable Class Security may be
redeemed, as specified in the related Callable Trust Agreement.
Interest Distribution Amount: With respect to each Series or Callable Series (or, if the Series or
Callable Series is segregated into Security Groups, each Security Group) and each Distribution
Date, the aggregate interest accrued at the Interest Rate of each related Class for the applicable
Accrual Period excluding any related Accrual Amount.
Interest Only Class: A Class that (a) does not have a Class Principal Balance (other than a Class
Notional Balance) and is entitled to payments of interest only (and may be entitled to
Prepayment Penalties, if applicable) or (b) has only a nominal Class Principal Balance and a
disproportionately high Interest Rate.
Interest Only Security: A Security of an Interest Only Class.
Interest Rate: As of any date of determination and with respect to each Class or Pooling
REMIC Interest, the annual interest rate on that Class or Pooling REMIC Interest, determined in
accordance with the related Trust Agreement, MX Trust Agreement, Callable Trust Agreement
or SMBS Trust Agreement, as applicable.
Interest Type: With respect to a Security, the category of its interest payment allocation, as
identified in Appendix I of the Base Offering Circular, the Multifamily Base Offering Circular or
the SMBS Base Offering Circular, as applicable.
Internal Revenue Service: The United States Internal Revenue Service.
Inverse Floating Rate Class: A Class with an Interest Rate that is reset periodically based on an
index and that varies inversely with changes in that index.
Issue Date: The date of issuance of a Trust MBS, an Underlying Certificate or an Underlying
SMBS Security.
Issuing Portion: (a) in the case of a Double REMIC Series in respect of a single Issuing REMIC,
the Segregated Portion of such Trust REMIC Ac count that relates to the Issuing REMIC and (b)
in the cas e of a Double REMIC Series in re
spect of more than on e Issuing R EMIC, the
Segregated Portion of each such Trust REMIC A
ccount that relates to a particu lar Issu ing
REMIC.
I-18-17
Issuing REMIC: (a) in the case of a Double REMIC Series in respect of a single Issuing
REMIC, the Trust REMIC that holds the Pooling REMIC Regular Interests issued by one or
more Pooling REMICs and the Issuing Portion of each Trust REMIC Account and (b) in the case
of a Double REMIC Series in respect of more than one Issuing REMIC, a Trust REMIC that
holds the Pooling REMIC Regular Interests issued by specified Pooling REMICs and the
Segregated Portion of each Trust REMIC Account that relates to such Issuing REMIC.
Jump Class: Any Class subject to more than one priority-changing condition or any jump
condition that fails to meet all of the requirements of a Sticky Jump Class or a Non-Sticky Jump
Class.
Legal Advisor: With respect to each Series, a law firm designated by Ginnie Mae to act as legal
advisor to Ginnie Mae. The name and address of the current Legal Advisor are contained in Part
I of the Ginnie Mae Multiclass Securities Guide in the document entitled “Ginnie Mae Multiclass
Securities Transaction Participants.”
LIBOR: The arithmetic mean of the London interbank offered quotations for Eurodollar
deposits with a maturity of one month, or, if so specified in the related Trust Agreement or MX
Trust Agreement, as the case may be, and the Offering Circular Supplement, a maturity of three
months, one year or some other specified duration.
LIBOR Class: A Class bearing interest at a rate determined by reference to the applicable
LIBOR.
Location-Based Tax: Any state or local tax imposed on a Trust, SMBS Trust, related Trust
REMIC, Callable Trust or related Asset Pool that would not have been imposed in the absence of
a legal or business connection between the Trustee or the Tax Administrator, as the case may be,
and the jurisdiction imposing such tax. For purposes of the foregoing sentence, the Trustee or
the Tax Administrator, as the case may be, shall be held responsible for the actions of its agents
that are carrying out the duties assigned to it under the Trust Agreement, Callable Trust
Agreement or SMBS Trust Agreement, as applicable. Notwithstanding the foregoing, a
Location-Based Tax shall not include (a) any tax arising from a change in law that is enacted,
decided, or otherwise promulgated after the Closing Date and that takes effect after the Closing
Date or (b) any real estate taxes imposed on a Mortgaged Property acquired from the Mortgagor
pursuant to a foreclosure or similar proceeding.
Lockout End Date: With respect to any Mortgage Loan, the date as of which any such
Mortgage Loan would no longer be subject to any lockout for voluntary prepayments of
principal.
Mandatory Purchase Event: The obligation of the Ginnie Mae Issuer to purchase all
Participations related to a HECM when the outstanding principal amount of the related HECM is
equal to or greater than 98% of the Maximum Claim Amount.
Maturity Date: With respect to a Trust MBS (other than any Ginnie Mae Construction Loan
Certificate), the final Ginnie Mae Certificate Payment Date for such Trust MBS. With respect to
a Ginnie Mae Construction Loan Certificate, the final Ginnie Mae Certificate Payment Date, as
adjusted for any extensions made thereto as a result of one or more extension requests submitted
I-18-18
by the related Ginnie Mae Issuer and approved by Ginnie Mae. With respect to an Underlying
Certificate, the final Underlying Certificate Payment Date for such Underlying Certificate. With
respect to an Underlying Callable Security, the final Underlying Callable Security Payment Date
for such Underlying Callable Security. With respect to an Underlying SMBS Security, the final
Underlying SMBS Security Payment Date.
Maturity Event: With respect to any HECM, the occurrence of any of the following events: (i)
a borrower dies and the property is not the principal residence of at least one surviving borrower,
(ii) a borrower conveys all of his or her title in the mortgaged property and no other borrower
retains title to the mortgaged property, (iii) the mortgaged property ceases to be the principal
residence of a borrower for reasons other than death and the mortgaged property is not the
principal residence of at least one surviving borrower, (iv) a borrower fails to occupy the
mortgaged property for a period of longer than 12 consecutive months because of physical or
mental illness and the mortgaged property is not the principal residence of at least one other
borrower, or (v) a borrower fails to perform any of its obligations under the HECM (for example,
the failure of the borrower to make certain agreed upon repairs to the mortgaged property or the
failure of the borrower to pay taxes and hazard insurance premiums).
Maximum Claim Amount: With respect to any HECM, the lesser of the appraised value of the
property, the sales price of the property being purchased or the national mortgage limit, as
determined in accordance with FHA guidelines.
Maximum Rate: With respect to any Trust MBS representing a Ginnie Mae II Certificate
backed by adjustable rate Mortgage Loans, the initial Certificate Rate on the Ginnie Mae II
Certificate plus 5%.
MBS Guide: Ginnie Mae Mortgage-Backed Securities Guide 5500.3, as amended.
Minimum Rate: With respect to any Trust MBS representing a Ginnie Mae II Certificate backed
by adjustable rate Mortgage Loans, the greater of (a) the initial Certificate Rate on the Ginnie
Mae II Certificate less 5% and (b) the applicable Certificate Margin.
Modifiable Class: Each Class issued in respect of an MX Trust that may be exchanged for
proportionate interests in a related MX Class or Classes but is not itself identified as an MX
Class in the Combination Schedule. Each Modifiable Class relates to a Class of REMIC
Securities with the same designation (for example, a Modifiable Class designated Class A
corresponds to the Class of REMIC Securities designated Class A).
Modifiable Security: A Ginnie Mae Guaranteed Grantor Trust Pass-Through Security relating to
a Modifiable Class that is issued pursuant to the Ginnie Mae Multiclass Securities Program.
Monthly Information: With respect to each Series or Callable Series, the information, such as
the Series Factors, the Class Factors and Interest Rates, posted on e-Access on a monthly basis.
Monthly Tranche Factor File: The filed posted on e-Access by the Information Agent and
prepared by the Trustee containing the Monthly Information.
I-18-19
Mortgage: A first lien one- to four-family residential mortgage, either insured or guaranteed by
FHA, RD or VA, that underlies a Ginnie Mae Certificate other than a Ginnie Mae Multifamily
Certificate. A mortgage on an interest in real property that is either a multifamily property or a
nursing facility, insured by FHA or co-insured by FHA and a mortgage lender, that underlies a
Ginnie Mae Multifamily Certificate.
Mortgage Loan: With respect to each Trust Asset other than Trust Assets consisting of HECM
MBS, each mortgage loan in the pool or pools underlying such Trust Asset or with respect to
each Trust Asset consisting of HECM MBS, each of the HECMs as to which the Participations
underlying such Trust Asset relate.
Mortgage Margin: With respect to any adjustable rate Mortgage Loan backing a Ginnie Mae II
MBS Certificate, the percentage per annum to be added to the One-Year Treasury Index on a
Mortgage Rate Adjustment Date to determine the new Mortgage Rate applicable to the Mortgage
Loan until the next Mortgage Rate Adjustment Date.
Mortgage Note: The instrument evidencing the debt underlying the related Mortgage.
Mortgage Payment Adjustment Date: With respect to any adjustable rate Mortgage Loan
backing a Ginnie Mae II Certificate, the first day of the month immediately following the month
in which the Mortgage Rate Adjustment Date for the Mortgage Loan occurs.
Mortgage Rate: With respect to any Mortgage Loan, the per annum interest rate on the related
Mortgage Note.
Mortgage Rate Adjustment Date: With respect to any adjustable rate Mortgage Loan backing a
Ginnie Mae II MBS Certificate, the annual date, which shall be either January 1, April 1, July 1
or October 1, on which the Mortgage Rate is adjusted.
Mortgaged Property: With respect to any Mortgage Loan backing a Ginnie Mae Certificate
other than a Ginnie Mae Multifamily Certificate, the one- to four-family residential property
including a condominium unit located in any one of the 50 states, the District of Columbia or any
U.S. territory, commonwealth or possession, securing or the subject of a Mortgage Loan.
With respect to any Mortgage Loan backing a Ginnie Mae Multifamily Certificate, the
multifamily property or nursing facility, located in any one of the 50 states, the District of
Columbia or any U.S. territory, commonwealth or possession, securing or the subject of a
Mortgage Loan.
Mortgagor: The obligor on a Mortgage Note.
Multifamily Base Offering Circular: A Base Offering Circular for Ginnie Mae Guaranteed
Multifamily REMIC Pass-Through Securities.
Multifamily Series: A series of Ginnie Mae Multifamily REMIC Pass-Through Securities
issued pursuant to a Trust Agreement and having the numerical or other designation specified in
the related Trust Agreement.
I-18-20
MX Class: A Class issued in respect of an MX Trust that may be exchanged for proportionate
interests in related Classes of Modifiable Securities.
MX Security: Any Ginnie Mae Guaranteed Grantor Trust Pass-Through Security issued
pursuant to the Ginnie Mae Multiclass Program in respect of an MX Class.
MX Standard Trust Provisions: With respect to each MX Trust, the standard trust provisions in
effect as of the date of the related MX Trust Agreement and which are incorporated therein by
reference.
MX Trust: A trust that is established to hold one or more REMIC Securities and issue one or
more Modifiable Securities and/or MX Securities.
MX Trust Agreement: An agreement that provides for the establishment of an MX Trust. Each
MX Trust Agreement incorporates the related Standard Trust Provisions by reference and may
modify, amend or supplement the conditions of such Standard Trust Provisions in any respect.
MX Trust Asset: As to any MX Trust, any Ginnie Mae REMIC Securities conveyed thereto by
the related Sponsor.
Net Certificate Rate: For any Distribution Date as to any Ginnie Mae Multifamily Certificate,
the applicable Certificate Rate less the Trustee Fee Rate, if any, for the related Series.
Nonpermitted Transferee: Any Person that acquires an Ownership Interest in a Transfer that is
considered null and void by the Trustee under the Trust Agreement.
Non-Accelerated Security: A Security that is designed to receive limited or no principal
prepayments prior to a designated date and thereafter such Security is entitled to receive a
gradually increasing percentage of principal prepayments in subsequent months.
Non-HECM MBS Certificates: Any Trust MBS other than HECM MBS.
Non-HECM MBS Ginnie Mae II Certificates: Any Ginnie Mae II Certificates other than
HECM MBS.
Non-U.S. Person: A Person other than a U.S. Person.
No Payment Residual Class: A Class that is designed to receive no distributions of principal or
interest.
Non-Sticky Jump Class: A Class for which the principal distribution priorities change
temporarily upon the occurrence of one or more “trigger” events. A Non-Sticky Jump Class
“jumps” to its new priority on each Distribution Date when the trigger condition is met and
reverts to its original priority (i.e., does not “stick” to the new priority) on each Distribution Date
when the trigger condition is not met.
I-18-21
Notional Class: A Class that does not have a Class Principal Balance (but rather has a Class
Notional Balance) and is entitled to payments of interest only (and may be entitled to
Prepayment Penalties, if applicable).
OCC: The Office of the Comptroller of the Currency.
Offering Circular: In connection with each offering of Ginnie Mae REMIC Securities, the Base
Offering Circular or the Multifamily Base Offering Circular therefor and the related Offering
Circular Supplement. In connection with each offering of Ginnie Mae Guaranteed Callable PassThrough Securities, the offering circular therefor (including any Supplemental Statement). In
connection with each offering of Ginnie Mae SMBS Securities, the SMBS Base Offering
Circular therefor and the related Offering Circular Supplement.
Offering Circular Supplement: The supplement to the Base Offering Circular, the Multifamily
Base Offering Circular or the SMBS Base Offering Circular constituting a part of the Offering
Circular and all supplements, if any, to the supplement, including any Supplemental Statement.
One-Year LIBOR Index: An index, determined in accordance with the Ginnie Mae II Program,
upon which changes in the Mortgage Rates on certain adjustable rate Mortgage Loans that back
Ginnie Mae II MBS Certificates are based.
One-Year Treasury Index: An index, determined in accordance with the Ginnie Mae II
Program, upon which changes in the Mortgage Rates on certain adjustable rate Mortgage Loans
that back Ginnie Mae II MBS Certificates are based.
Opinion of Counsel: A written opinion of counsel, given by counsel reasonably acceptable to
the addressee and Ginnie Mae, upon which Ginnie Mae is authorized to rely.
Optional Purchase Event: Any of the 98% Optional Purchase Event or the Due and Payable
Purchase Event.
Original Class Principal Balance: As to each Class other than a Notional Class, the original
principal amount of that Class of Securities, as set forth in the related Offering Circular
Supplement and Trust Agreement, MX Trust Agreement, Callable Trust Agreement or SMBS
Trust Agreement, as applicable.
Original Component Principal Balance: As to each Component that is entitled to payments of
principal, the original principal amount of the Component, as set forth in the related Offering
Circular and Trust Agreement.
Other Type: With respect to a Security, the category of a characteristic other than principal or
interest payment allocation, as identified in Appendix I of the Base Offering Circular,
Multifamily Base Offering Circular or SMBS Base Offering Circular, as applicable.
Outside Reserve Fund: As to any Trust REMIC, any fund or Trust Account (including the
Variance Account or Segregated Portions thereof) that is not an asset of such Trust REMIC and
that satisfies the requirements of an “outside reserve fund” within the meaning of Section
1.860G-2(h) of the Treasury Regulations. For all United States federal tax purposes, an Outside
I-18-22
Reserve Fund shall be treated as owned by the Trustee or by such other Person as is designated
as its owner in the Trust Agreement (or the related Standard Trust Provisions), and amounts
transferred by a Trust REMIC to an Outside Reserve Fund shall be treated as distributed by the
Trust REMIC to the Trustee or such other Person as part of the Trustee Fee or other fee payable
to such Person under the Trust Agreement.
Ownership Interest: Any ownership interest in a Residual Interest, including any interest in that
Residual Interest as the Holder of the Residual Interest and any other interest in the Residual
Interest, whether direct or indirect, legal or beneficial.
P&I Custodial Account: With respect to a Ginnie Mae Construction Loan Certificate, the noninterest bearing custodial account of the related Ginnie Mae Issuer into which any principal
payments, unscheduled payments of principal, and prepayment penalties received on the related
Mortgage Loan prior to the applicable Maturity Date are deposited.
PAC Class: A Class that is designed to receive distributions of principal using a predetermined
schedule derived by assuming two constant prepayment rates for the Mortgage Loans related to
the Trust Assets. These two rates are the endpoints for the Structuring Range for the PAC Class.
The endpoints must be at least 30 percentage points above and below the pricing speed. The
PAC Classes in any Series or Security Group may be subdivided into different categories (e.g.,
PAC I, PAC II) having different structuring ranges. The structuring range for a PAC I Class of a
Series or Security Group usually is wider than the structuring range for a PAC II Class of such
Series or Security Group, as applicable.
PAC Component: A Component that is designed to receive distributions of principal using a
predetermined schedule derived by assuming two constant prepayment rates for the Mortgage
Loans related to the Trust Assets. These two rates are the endpoints for the Structuring Range
for the PAC Component. The endpoints must be at least 30 percentage points above and below
the pricing speed. The PAC Component in any Series or Security Group may be subdivided into
different categories (e.g., PAC I, PAC II) having different structuring ranges. The structuring
range for a PAC I Component of a Series or Security Group usually is wider than the structuring
range for a PAC II Component of such Series or Securities Group, as applicable.
Partial Accrual Class: A Class on which interest accrues during any Accrual Period and (a) a
portion of such accrued interest is added to its principal amount on each Distribution Date and is
not distributable as interest thereon until a later date or the occurrence of a specified future event,
and (b) simultaneously, the Class receives distributions of the remainder of such accrued interest
as interest. The interest that accrues on such Class but is not distributed to such Class is
distributed to certain Accretion Directed Classes or other Classes as principal.
Partial Accrual Security: A Security of a Partial Accrual Class.
Participant: With respect to a Series or Callable Series, a Person named in the related Sponsor
Agreement as Sponsor, Participating Affiliate, Co-Sponsor (if any), Trust Counsel, Co-Trust
Counsel (if any), Accountants, Trustee or Trustee’s Counsel.
Participating Affiliate: As specified in the Sponsor Agreement, an Affiliate of the Sponsor,
which Affiliate is participating in the related transaction.
I-18-23
Participation: Any participation interests in advances made to borrowers of HECMs and other
related amounts created pursuant to the issuance of a HECM MBS.
Participation Interest Rate: With respect to any Participation, the related interest rate.
Pass-Through Class: A Class that either individually or together with other Classes receive on
each Distribution Date all or substantially all of the principal payments received on the related
Trust Assets and that is not a Strip or Sequential Pay Class.
Paying Agent: The Book-Entry Depository or another Person appointed with Ginnie Mae’s
consent to act, pursuant to a Trust Agreement, SMBS Trust Agreement, MX Trust Agreement or
Callable Trust Agreement, as applicable, as paying agent.
Percentage Interest: As to any Security or Pooling REMIC Interest, for purposes of allocating
distributions, the percentage interest evidenced thereby in distributions required to be made on
the related Class, that percentage interest being (a) set forth on the face of that Security or
Pooling REMIC Interest or (b) equal to the percentage obtained by dividing the denomination of
that Security or Pooling REMIC Interest, as applicable, by the aggregate of the denominations of
all Securities or Pooling REMIC Interests, as applicable, of the related Class.
Periodic Rate Cap: With respect to a Trust MBS representing a Ginnie Mae II MBS Certificate
backed by adjustable rate Mortgage Loans, the maximum permissible annual adjustment, upward
or downward, in the Certificate Rate.
Permitted Transferee: Any person that acquires an Ownership Interest through a Transfer that is
not considered null and void by the Trustee under the Trust Agreement.
Permitted Underlying Certificate: As to any Callable Trust, any previously issued certificate
that has not been designated as an Increased Minimum Denomination Class, which directly or
indirectly represents “regular interests” in a REMIC and evidences a direct or indirect beneficial
ownership interest in a separate pool of Ginnie Mae Certificates.
Person: Any individual, corporation, partnership, limited liability company, joint venture, trust
(including any beneficiary thereof), unincorporated organization or government or agency or
political division thereof.
Plan: An employee benefit plan subject to ERISA or Code section 4975.
Plan Asset Regulations: The Department of Labor regulations set forth in 29 C.F.R. section
2510.3-101, as modified by ERISA Section 3(42) and as amended from time to time.
Plan Investor: Any of the following: (a) a “benefit plan investor” that is described in or subject
to the Plan Asset Regulations; (b) a plan or arrangement that is subject to Code Section 4975; (c)
a “governmental plan” as defined in Section 3(32) of ERISA; (d) any plan or arrangement that is
subject to any federal, state, or local law that is substantially similar to the Plan Asset
Regulations, Code Section 4975, or ERISA Section 3(32); (e) a person acting on behalf of or
utilizing the assets of any of the foregoing; and (f) an insurance company that is considered to be
a Plan Investor pursuant to the following sentence. An insurance company is a Plan Investor
I-18-24
unless all funds used by the insurance company in acquiring a Security were held by the
insurance company in its general account, the insurance company will hold the Security in its
general account, and the insurance company reasonably believes that its general account and the
Security do not and will not constitute “plan assets” for purposes of ERISA and the Plan Asset
Regulations.
Pool Information Date: For each Series or Callable Series, the date, specified in the Sponsor
Agreement, by which the Sponsor creates a list of the actual Trust Assets to be transferred to the
Trust, Callable Trust or SMBS Trust on the Closing Date.
Pool Wire Date: For each Series or Callable Series, the date, specified in the Sponsor
Agreement, on which the Sponsor is required to transfer the Trust Assets to one or more
Depository Accounts.
Pooling Portion: With respect to each Trust REMIC Account, (i) in the case of a Double
REMIC Series in respect of a single Pooling REMIC, the Segregated Portion of such Trust
REMIC Account that relates to the Pooling REMIC and (ii) in the case of a Double REMIC
Series in respect of more than one Pooling REMIC, the Segregated Portion of each such Trust
REMIC Account that relates to a particular Pooling REMIC.
Pooling REMIC: In the case of a Double REMIC Series, the Trust REMIC that holds the Trust
Assets and the Pooling Portion of each Trust REMIC Account. In the case of multiple Pooling
REMICs, a Trust REMIC that holds specified Trust Assets and the Segregated Portion of each
such Trust REMIC Account.
Pooling REMIC Interest: Each of the Pooling REMIC Regular Interests and each Pooling
REMIC Residual Interest.
Pooling REMIC Regular Interest: Each of the Regular Interests in a Pooling REMIC.
Pooling REMIC Residual Interest: The Residual Interest in a Pooling REMIC.
Pooling REMIC Subaccounts: In the case of a Double REMIC Series, the accounts established
by the Trustee for tax purposes that represent the Pooling REMIC Regular Interests.
Prepayment Penalty: With respect to a Mortgage Loan in respect of any multifamily property or
nursing facility, a fee, equal to a specified percentage of the principal amount of the Mortgage
Loan, that is required by the terms of the Mortgage Loan to be paid in connection with voluntary
and certain involuntary prepayments.
Prepayment Penalty End Date: With respect to any multifamily Mortgage Loan, the date as of
which any such Mortgage Loan would no longer be subject to the payment of any Prepayment
Penalties.
Prime Rate: With respect to the securities of any Series, the prime lending rate of major banks
as published in The Wall Street Journal or, if not available from The Wall Street Journal, as
determined by the Trustee in accordance with the Trust Agreement.
I-18-25
Prime Rate Class: A Class bearing interest at a rate determined by reference to the Prime Rate.
Principal Distribution Amount: With respect to each Series other than any Multifamily Series
(or if the Series is segregated into Security Groups, each Security Group) and each Distribution
Date, the sum of (I) with respect to each Trust MBS (other than HECM MBS) the amount by
which (a) the product of (i) the original principal amount of that Trust MBS and (ii) the
Certificate Factor or Calculated Certificate Factor, as applicable, for the preceding Distribution
Date exceeds (b) the product of (i) the original principal amount of that Trust MBS and (ii) the
Certificate Factor or Calculated Certificate Factor, as applicable, for the current Distribution
Date; (II) with respect to each HECM MBS, the amount described in the related Trust
Agreement; and (III) with respect to each Underlying Certificate or Underlying SMBS Security
(or Underlying Callable Security), the amount by which (a) the product of (i) the original
principal amount of that Underlying Certificate or Underlying SMBS Security (or Underlying
Callable Security) and (ii) the Underlying Certificate Factor (or Certificate Factor) for the
preceding Distribution Date exceeds (b) the product of (i) the original principal amount of the
Underlying Certificate or Underlying SMBS Security (or Underlying Callable Security) and
(ii) the Underlying Certificate Factor (or Certificate Factor) for the current Distribution Date;
provided however, that the amount calculated pursuant to clause (III) is subject to adjustment
pursuant to the applicable Trust Agreement or SMBS Trust Agreement in the event that
Underlying Certificate Factors (or Certificate Factors) are unavailable in respect of any
Distribution Date. (For the first Distribution Date, the product in clause (I)(a), (II) or (III)(a)
above shall be the principal amount of the Trust Asset as of the Closing Date.) The sum of the
amounts so calculated for each Trust Asset conveyed to a Trust for a Series (or, if the Series is
segregated into Security Groups, for each Trust Asset included in the related Trust Asset Group)
is the Principal Distribution Amount for that Series (or Security Group(s)).
With respect to each Callable Series and each Distribution Date and, in the case of a Callable
Series that has more than one Security Group, each such Security Group, the amount by which
(a) the product of (i) the original principal amount of the related Trust MBS and (ii) the
Certificate Factor for the preceding Distribution Date exceeds (b) the product of (i) the original
principal amount of the related Trust MBS and (ii) the Certificate Factor for the current
Distribution Date; provided however, that (i) such amount shall be reduced by the principal
portion of any related Trustee Fee; and (ii) such amount is subject to adjustment pursuant to
Section 3.04 of the Standard Trust Provisions for Callable Trusts in the event that Certificate
Factors are unavailable in respect of any Distribution Date. For the first Distribution Date, the
product in clause (a) above shall be the principal amount of the related Trust MBS as of the
Closing Date.
With respect to each Multifamily Series (or if the Series is segregated into Security Groups, each
Security Group) and each Distribution Date, the sum of (I) with respect to each Ginnie Mae
Multifamily Certificate (other than any Ginnie Mae Project Loan Certificate issued as a result of
a conversion of the Ginnie Mae Construction Loan Certificate since the preceding Distribution
Date), the amount by which (a) the product of (i) the original principal amount of that Ginnie
Mae Multifamily Certificate and (ii) the Certificate Factor, Corrected Certificate Factor or
Calculated Certificate Factor, as applicable, for the preceding Distribution Date exceeds (b) the
product of (i) the original principal amount of the Ginnie Mae Multifamily Certificate and (ii) the
Certificate Factor, Corrected Certificate Factor or Calculated Certificate Factor, as applicable, for
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the current Distribution Date; (II) with respect to each Ginnie Mae Project Loan Certificate
issued as a result of a conversion of a Ginnie Mae Construction Loan Certificate since the
preceding Distribution Date, the sum of (1) the amount by which (a) the product of (i) the
original principal amount of the Ginnie Mae Project Loan Certificate and (ii) 1.00 exceeds (b)
the product of (i) the original principal amount of the Ginnie Mae Project Loan Certificate and
(ii) the Certificate Factor, Corrected Certificate Factor or Calculated Certificate Factor, as
applicable, for the current Distribution Date and (2) any amounts received by the Trust from the
Ginnie Mae Issuer from the related P&I Custodial Account prior to the issuance of the Ginnie
Mae Project Loan Certificate; (III) with respect to each Ginnie Mae Construction Loan
Certificate that has been liquidated since the preceding Distribution Date, any proceeds received
by the Trust from the Ginnie Mae Issuer with respect to any liquidation, exclusive of any
amounts distributed pursuant to (I) above; (IV) with respect to each Underlying Certificate (or
Underlying Callable Security), the amount by which (a) the product of (i) the original principal
amount of that Underlying Certificate (or Underlying Callable Security) and (ii) the Underlying
Certificate Factor (or Certificate Factor) for the preceding Distribution Date exceeds (b) the
product of (i) the original principal amount of the Underlying Certificate (or Underlying Callable
Security) and (ii) the Underlying Certificate Factor (or Certificate Factor) for the current
Distribution Date; provided however, that the amount calculated pursuant to clause (IV) is
subject to adjustment pursuant to the applicable Trust Agreement in the event that Underlying
Certificate Factors (or Certificate Factors) are unavailable in respect of any Distribution Date.
(For the first Distribution Date, the product in clause (I)(a) and (IV)(a) above shall be the
principal amount of the Ginnie Mae Multifamily Certificate as of the Closing Date.) The sum of
the amounts so calculated for each Ginnie Mae Multifamily Certificate conveyed to a Trust for a
Series (or, if the Series is segregated into Security Groups, for each Ginnie Mae Multifamily
Certificate included in the related Trust Asset Group) is the Principal Distribution Amount for
that Series (or Security Group(s)).
When preceded by a group designation (e.g., the “Group 2 Principal Distribution Amount”), such
amount for the specified Trust Asset Group.
Principal Only Class: A Class with a fixed Interest Rate of zero.
Principal Only Security: A Security of a Principal Only Class.
Principal Type: With respect to a Security, the category of its principal allocation, as identified
in Appendix I of the Base Offering Circular, Multifamily Base Offering Circular or SMBS Base
Offering Circular, as applicable.
Print Date: The date in any month on which the Offering Circular Supplement, or in the case of
Callable Series, the Offering Circular, is finalized and dated.
RD: United States Department of Agriculture, Rural Development.
RD Loans: Residential mortgage loans insured by RD.
Record Date: For each Security with respect to each Distribution Date, unless otherwise
specified in the related Trust Agreement, MX Trust Agreement, Callable Trust Agreement or
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SMBS Trust Agreement, as applicable, the last Business Day of the month immediately
preceding the month in which that Distribution Date occurs.
Redemption Amount: With respect to a Class of Callable Class Securities that is being
redeemed, the sum of (i) the outstanding principal balance of the Trust Assets underlying such
Callable Class, based on the Certificate Factors published for such Trust Assets for the month
prior to the month of redemption, multiplied by the Redemption Price Percentage, and (ii) an
amount equal to the interest that would be payable on such Callable Class for the period from the
first day of the month of redemption to the Redemption Date, calculated on the basis of its
Interest Rate and the Class Factor published in the month preceding redemption. If specified in
the related Callable Trust Agreement, the interest included in the Redemption Amount will be
adjusted to reflect an increase or decrease in the Interest Rate on the Callable Class that is
scheduled to occur in the month in which the Redemption Date occurs.
Redemption Date: The Distribution Date on or after the Initial Redemption Date and on or prior
to any applicable Final Redemption Date (which Final Redemption Date may coincide with the
Initial Redemption Date) on which a Class of Callable Class Securities is redeemed.
Redemption Price: With respect to a Class of Callable Class Securities that is being redeemed,
the sum of (a) 100% of the outstanding principal balance of such Callable Class; (b) a premium
(if any) equal to the product of (i) the excess of the Redemption Price Percentage for such Class
of Callable Class Securities over 100% and (ii) the principal balance of such Class determined on
the basis of the Class Factor for such Class that would have been published in the month of
redemption were no redemption to occur, (c) accrued interest at the Interest Rate borne by such
Callable Class for the Accrual Period preceding the Redemption Date, based on its outstanding
principal balance; and (d) additional accrued interest at such Interest Rate for the period from the
first day of the month of redemption to the Redemption Date, calculated on a reduced principal
balance determined on the basis of the Class Factor for such Callable Class that would have been
published in the month of redemption were no redemption to occur. If specified in the related
Trust Agreement, the interest included in the Redemption Price will be adjusted to reflect an
increase or decrease in the Interest Rate on the Callable Class that is scheduled to occur in the
month in which the Redemption Date occurs.
Redemption Price Percentage: With respect to a Class of Callable Class Securities, the
redemption price percentage for such Class specified on the front cover of the related Offering
Circular.
Reference Banks: The four leading banks engaged in transactions in Eurodollar deposits in the
international Eurocurrency market (a) with an established place of business in London, (b) whose
quotations appear on the Reuters Screen LIBO Page on the Floating Rate Adjustment Date in
question and (c) which have been designated as such by the Trustee and are able and willing to
provide those quotations to the Trustee on each Floating Rate Adjustment Date. If any
Reference Bank designated by the Trustee should be removed from the Reuters Screen LIBO
Page or in any other way fails to meet the qualifications of a Reference Bank, the Trustee may, in
its sole discretion, designate an alternative Reference Bank.
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Register: The register maintained by the Registrar for the Holders with respect to each Trust,
Callable Trust, MX Trust and SMBS Trust.
Registrar: With respect to each Series or Callable Series, the Trustee or any successor registrar
appointed pursuant to the related Trust Agreement, Callable Trust Agreement, MX Trust
Agreement or SMBS Trust Agreement, as applicable.
Regular Class: A Class of Regular Securities.
Regular Holder: A Holder of a Regular Security.
Regular Interest: An interest in a Trust REMIC that is designated as a “regular interest” under
the REMIC Provisions. In the case of a Double REMIC Series, the Regular Interests in the
Pooling REMIC will be the Pooling REMIC Subaccounts.
Regular Security: Any Security that is a Regular Interest in a Trust REMIC.
REMIC: A real estate mortgage investment conduit within the meaning of section 860D (a) of
the Code.
REMIC Provisions: Provisions of the United States federal income tax law relating to REMICs,
which appear at sections 860A through 860G of Subchapter M of Chapter 1 of Subtitle A of the
Code, and related sections, and regulations and administrative pronouncements promulgated
thereunder, as the foregoing may be in effect from time to time.
REMIC Relay File: With respect to each Series, the collateral-specific and Class-specific
information described in the document entitled “Transaction Information Internet Posting -- eAccess,” which is included in the Guide, and posted on e-Access after the Offering Circular
Supplement is printed.
REMIC Security: A Security issued in respect of a Trust REMIC.
REMIC Series: A series of Ginnie Mae REMIC Securities issued pursuant to a Trust
Agreement and having the numerical or other designation specified in the related Trust
Agreement.
REMIC Standard Trust Provisions: With respect to each Ginnie Mae REMIC Trust, the
standard trust provisions in effect as of the date of the Trust Agreement and which are
incorporated therein by reference.
REMIC Trust: A Ginnie Mae REMIC Trust.
Reserve Interest Rate: With respect to each Trust, the rate per annum that the related Trustee
determines to be either (a) the arithmetic mean (rounding such arithmetic mean upwards, if
necessary, to the nearest whole multiple of 1/16%) of the Eurodollar lending rates of the
applicable maturity that the New York City banks selected by the Trustee are quoting, on the
relevant Floating Rate Adjustment Date, to the principal London offices of leading banks in the
London interbank market or (b) in the event that the Trustee can determine no such arithmetic
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mean, the lowest Eurodollar lending rate of the applicable maturity that the New York City
banks selected by the Trustee are quoting on that Floating Rate Adjustment Date to leading
European banks.
Residual Class: A Class representing the entire Residual Interest in one or more Trust REMICs.
Residual Holder: A Holder of a Residual Security.
Residual Interest: An interest in a Trust REMIC that is designated in the Trust Agreement as a
“residual interest” under the REMIC Provisions.
Residual Security: Any Security that represents a Residual Interest in one or more Trust
REMICs.
Responsible Officer: With respect to the Trustee or Paying Agent, any Senior Vice President,
any Vice President, any Assistant Vice President, any Assistant Treasurer, any Trust Officer, or
any Assistant Secretary in the Corporate Trust Office of the Trustee or Paying Agent or any other
officer of the Trustee or Paying Agent, as applicable, customarily performing functions similar to
those performed by the persons who at the time shall be those officers, and also to whom, with
respect to a particular corporate trust matter, that matter is referred because of his or her
knowledge of and familiarity with the particular subject.
Reuters Screen LIBO Page: The display designated as page “LIBO” on the Reuters Monitor
Money Rates Service (or such other page as may replace the LIBO page on that service for the
purpose of displaying London interbank offered quotations of major banks).
Scheduled Class: A Class that is designed to receive distributions of principal using a
predetermined schedule but that fits neither the definition of a PAC Class nor the definition of a
TAC Class.
Scheduled Component: A Component that is designed to receive distributions of principal using
a predetermined schedule but that fits neither the definition of a PAC Component nor the
definition of a TAC Component.
Scheduled Principal Balance: For any PAC, Scheduled or TAC Class or Component and any
Distribution Date, an amount indicated for such Distribution Date on the related Final Schedule.
Securities Structure: The structure of a particular Series or Callable Series, including, as
applicable, the designation, Original Class Principal Balance or original Class Notional Balance,
Interest Rate and Class Type of each Class, the priority of distributions among the Classes and
any call rights related to a Class.
Security: A Ginnie Mae REMIC Security, an MX Security, a Modifiable Security, a Callable
Class Security, a Call Class Security or an SMBS Security, as applicable.
Security Group: One of two or more groups into which the Securities of a Series or Callable
Series may be segregated as described in the related Trust Agreement, Callable Trust Agreement,
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MX Trust Agreement or SMBS Trust Agreement and Offering Circular Supplement and
Offering Circular, as applicable.
Segregated Portion: With respect to each Trust Account and Trust REMIC Account, as
applicable, and each Callable Trust, MX Trust, SMBS Trust and Trust REMIC, a separately
identified subaccount of such Trust Account or Trust REMIC Account established by the Trustee
for the purpose of accounting for all assets in, all funds in, all deposits to, and all withdrawals
from, such Trust Account or Trust REMIC Account with respect to the related Callable Trust,
MX Trust, SMBS Trust or Trust REMIC.
Sequential Pay Class: A Class that receives distributions of principal in a prescribed sequence,
that do not have predetermined schedules and that generally are designed to receive distributions
of principal continuously from the first Distribution Date on which they receive principal until
they are retired. Sequential Pay Classes may receive principal distributions concurrently with
one or more other Sequential Pay Classes.
Series: A series of Securities issued pursuant to the terms of a Trust Agreement and, if
applicable, MX Trust Agreement and having the numerical or other designation specified in the
related Trust Agreement, any related MX Trust Agreement and any related SMBS Trust
Agreement.
Series Factor: With respect to each Series or Callable Series, a number truncated to eight
decimal places calculated by the Trustee and published or otherwise made available to investors
on or about one Business Day preceding each Distribution Date that, when multiplied by the
Original Class Principal Balance (or original Class Notional Balance) of any Class, determines
the Class Principal Balance (or Class Notional Balance), after giving effect to any distribution of
principal to be made on the Securities on that Distribution Date.
Servicing Fee Margin: With respect to any HECM MBS, a rate specified in the related HECM
MBS Prospectus Supplement.
Single REMIC Series: A Series issued in respect of a Ginnie Mae REMIC Trust that establishes
one or more single-tier Trust REMICs.
SMBS Security: A Ginnie Mae Guaranteed Stripped Mortgage-Backed Security.
SMBS Standard Sponsor Provisions: With respect to each SMBS Trust, the standard sponsor
provisions in effect as of the date of the Sponsor Agreement and which are incorporated therein
by reference.
SMBS Standard Trust Provisions: With respect to each SMBS Trust, the standard trust
provisions in effect as of the date of the SMBS Trust Agreement and which are incorporated
therein by reference.
SMBS Trust: A Ginnie Mae SMBS Trust.
SMBS Trust Agreement: An agreement between the Sponsor and the Trustee that identifies and
establishes the SMBS Trust as a “grantor trust” for United States federal income tax purposes.
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Each SMBS Trust Agreement incorporates the related SMBS Standard Trust Provisions by
reference and may modify, amend or supplement the conditions of such SMBS Standard Trust
Provisions in any respect.
Special Class: A Class with an Interest Type or a Principal Type not otherwise described in
Appendix 1 of the Base Offering Circular. The particular payment characteristics of any such
Class will be specified in the related Offering Circular Supplement.
Special Tax Consent: The written consent of the Holder of a Residual Security to any tax (or
risk thereof) arising out of a proposed transaction or activity that may be imposed upon that
Holder or that may affect adversely the value of that Holder’s Residual Security.
Special Tax Opinion: With respect to a Trust, an Opinion of Counsel that a proposed
transaction or activity will not (a) affect adversely the status of any related Trust REMIC as a
REMIC or (b) result in the imposition of any United States federal or applicable state tax upon
the Trust or any related Trust REMIC or Asset Pool.
Sponsor: With respect to any Trust, Callable Trust, MX Trust or SMBS Trust, the Person,
identified in the related Trust Agreement, Callable Trust Agreement, MX Trust Agreement or
SMBS Trust Agreement, as applicable, who establishes the Trust by (a) executing such Trust
Agreement, Callable Trust Agreement, MX Trust Agreement or SMBS Trust Agreement, as
applicable, and (b) depositing the Trust Assets in the Trust, MX Trust, Callable Trust or SMBS
Trust, as applicable, in exchange for the Securities.
Sponsor Agreement: An agreement, which incorporates by reference the related Standard
Sponsor Provisions, pursuant to which, among other things, the Sponsor agrees, subject to
certain conditions, to convey the Trust Assets to the Trust, Callable Trust or SMBS Trust, as
applicable, and to purchase the Securities from the Trust, Callable Trust or SMBS Trust, as
applicable, and Ginnie Mae agrees, subject to certain conditions, to guarantee the related
Securities.
Sponsor Certification: A certification provided by the Sponsor that certifies that (i) the fair
market value of each Participation in the pool of Participations underlying any HECM MBS
contributed to any Trust REMIC is equal to or greater than the outstanding principal amount of
such Participation, and (ii) the aggregate issue price of the Regular Securities issued by such
Trust REMIC is equal to or greater than the aggregate principal balance of the HECM MBS
contributed to any such Trust REMIC.
Standard Sponsor Provisions: With respect to each Series or Callable Series, the applicable
Standard Sponsor Provisions in effect as of the date of the related Sponsor Agreement.
Standard Trust Provisions: The REMIC Standard Trust Provisions, Callable Standard Trust
Provisions, MX Standard Trust Provisions or SMBS Standard Trust Provisions, as the context
requires.
Startup Day: With respect to a Trust REMIC, the first date on which the Regular Interests and
the Residual Interest in respect of such Trust REMIC are issued or such other date designated in
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the Trust Agreement as the startup day of the REMIC in accordance with Treasury Regulations
Sections 1.860G-1(a)(4) and 1.860G-2(k).
Sticky Jump Class: A Class for which the principal distribution priorities change permanently
upon the occurrence of one or more “trigger” events. A Sticky Jump Class “jumps” to its new
priority on the first distribution Date when the trigger condition is met and retains (“sticks” to)
that priority until retired.
Strip Class: A Class that receives a constant proportion, or “strip,” of the principal payments on
the underlying Trust Assets.
Structural Excess: As of any Distribution Date, (i) in the case of a Trust REMIC that issues a
Single REMIC Series, the excess of (a) any amounts that would have been received on the Trust
Assets included in such Trust REMIC for the current period based on the Structural Excess
Assumptions over (b) amounts then due on the related Regular Securities, the allocable portion
of the Trustee Fee then due, and the allocable portion of any other unpaid related administrative
expenses of the Trust; and (ii) in the case of one or more Pooling REMICs that relate to a Double
REMIC Series, the excess of (a) any amounts that would have been received, on the portion of
the Trust Assets held by each such Pooling REMIC, for the current period based on the
Structural Excess Assumptions over (b) amounts then due on the related Pooling REMIC
Regular Interests, the allocable portion of the Trustee Fee then due, and the allocable portion of
any other unpaid related administrative expenses of the Trust.
Structural Excess Assumptions: The assumptions in respect of a Distribution Date that (a) no
defaults or late payments occur on the Trust Assets and (b) the amount of principal received on
the Trust Assets in the Accrual Period related to a Distribution Date is equal to the aggregate
amount of principal to be distributed to Holders on such Distribution Date.
Structured Collateral Class: A Class that is designed to receive payments based on distributions
of Underlying Certificates.
Structuring Range: With respect to a PAC Class or Component or group of PAC Classes or
Components or a Scheduled Class or Component or group of Scheduled Classes or Components,
the range of constant prepayment rates that was used to calculate its Scheduled Principal
Balances.
Structuring Rate: With respect to a TAC Class or Component or group of TAC Classes or
Components, the constant prepayment rate that was used to calculate its Scheduled Principal
Balances.
Supplemental Statement: A statement posted on e-Access showing any characteristics of the
Securities that differ significantly from those shown in the Offering Circular.
Support Class: A Class that receives distributions of principal on any Distribution Date only if
scheduled payments have been made on specified PAC, TAC and/or Scheduled Classes.
I-18-33
TAC Class: A Class that is designed to receive distributions of principal using a predetermined
schedule derived by assuming a single constant prepayment rate for the Mortgage Loans related
to the Trust Assets.
TAC Component: A Component that is designed to receive distributions of principal using a
predetermined schedule derived by assuming a single constant prepayment rate for the Mortgage
Loans related to the Trust Assets.
Tax Administrator: With respect to a Trust, Callable Trust, MX Trust or SMBS Trust, the
Person designated in the Trust Agreement, MX Trust Agreement, Callable Trust Agreement or
SMBS Trust Agreement, as applicable, perform certain tax administrative functions for the
Trust, MX Trust, Callable Trust or SMBS Trust, as applicable.
Tax Matters Person: The Person or Persons designated from time to time in the Trust
Agreement to act as tax matters person (within the meaning of the REMIC Provisions) of a Trust
REMIC.
Termination Account: With respect to each Trust or Callable Trust, an Eligible Account
established under the Trust Agreement or Callable Trust Agreement into which amounts are
deposited upon the termination of the Trust.
Termination Date: A date, if any, specified in the Trust Agreement or SMBS Trust Agreement
for a Series, on which the Trust will terminate.
Termination Price: The Aggregate Remaining Balance as of the Termination Date, plus thirty
days of accrued interest on the outstanding Trust Assets.
Terms Sheet: With respect to each Series or Callable Series, the portion of the Offering Circular
summarizing the basic terms of the transaction.
Toggle Class: A Class whose interest rate will change significantly at specified levels of the
applicable index.
Transaction Fee: With respect to a Callable Series, the fee, if any, required to be paid to the
Trustee in connection with an exchange of the Callable Class and related Call Class Securities
for the related Trust Assets, as specified in the related Callable Trust Agreement.
Transfer: Any direct or indirect transfer, sale or other form of assignment of any Ownership
Interest.
Transfer Affidavit: An affidavit, in the form provided in the REMIC Standard Trust Provisions,
required in connection with any Transfer from the related Transferor.
Transferee: Any Person who is acquiring an Ownership Interest.
Transferor: Any Person who is disposing of an Ownership Interest.
Treasury: The United States Treasury Department.
I-18-34
Treasury Index: Either (i) the auction average (investment) yield on three-month or six-month
U.S. Treasury bills or (ii) the weekly average yield on U.S. Treasury securities adjusted to a
constant maturity of one, three, five, seven or ten years or to some other constant maturity, in
each case as specified in the related Trust Agreement.
Treasury Index Class: A Class bearing interest at a rate determined by reference to the
applicable Treasury Index.
Treasury Regulations: The regulations, including proposed regulations and temporary
regulations, promulgated under the Code from time to time.
Trust: A Ginnie Mae REMIC Trust.
Trust Accounts: Any one or more of the following accounts established in accordance with the
Trust Agreement, Callable Trust Agreement, MX Trust Agreement or SMBS Trust Agreement,
as applicable: the Trustee ABA Account, the Trustee Limited Purpose Account, the Trustee
Issuer Account, the Book-Entry Depository Account, the Trust Asset Depository Account, the
Collection Account, the Variance Account and/or the Termination Account.
Trust Agreement: An agreement between the Sponsor and the Trustee that identifies and
establishes the Trust with respect to which an election will be made to treat the assets of such
Trust as one or more REMICs and the particular Securities (and the Pooling REMIC Interests, if
any) issued in respect of that Trust. Each Trust Agreement incorporates the related REMIC
Standard Trust Provisions by reference and may modify, amend or supplement the conditions of
such REMIC Standard Trust Provisions in any respect.
Trust Asset: As to any Trust, any MX Trust, any Callable Trust or any SMBS Trust, any Trust
MBS, Underlying Certificate, Underlying Callable Security or Underlying SMBS Security
conveyed thereto by, or on behalf of, the related Sponsor on the related Closing Date and any
Ginnie Mae Project Loan Certificate that may result from the conversion of any Ginnie Mae
Construction Loan Certificate included in the Trust.
Trust Asset Depository: Any depository institution acceptable to Ginnie Mae at which a Trust
Asset Depository Account is established.
Trust Asset Depository Account: With respect to each Trust, SMBS Trust or Callable Trust, to
the extent required by the related Trust Agreement, SMBS Trust Agreement or Callable Trust
Agreement, a limited purpose account maintained by the Trustee at one or more Trust Asset
Depositories, which account shall be credited with all distributions in respect of Trust Assets
(other than Trust Assets maintained through the book-entry system of the Federal Reserve Bank
of New York) held in the related Trust Asset Depositary.
Trust Asset Group or Subgroup: One of two or more groups or subgroups into which the Trust
Assets conveyed to a Trust or Callable Trust may be segregated as described in the related Trust
Agreement or Callable Trust Agreement and Offering Circular Supplement or Offering Circular,
as applicable. Each Trust Asset Group or Subgroup will be identified by numerical designation.
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Trust Asset Payment Date: A Ginnie Mae Certificate Payment Date, Underlying Callable
Security Payment Date or Underlying Certificate Payment Date, as the context requires.
Trust Counsel: With respect to each Series or Callable Series, the law firm, designated in the
Sponsor Agreement as counsel to the related Ginnie Mae REMIC Trust, Callable Trust, MX
Trust and SMBS Trust, as applicable, responsible for preparing the Offering Circular and
Closing Documents, for coordinating preclosing and closing and for providing certain Opinions
of Counsel.
Trust Fund: The corpus of the Trust, MX Trust, Callable Trust or SMBS Trust, as the case may
be, established by a Trust Agreement, MX Trust Agreement, Callable Trust Agreement or SMBS
Trust Agreement, as applicable, as further described in the Trust Agreement, MX Trust
Agreement, Callable Trust Agreement or SMBS Trust Agreement, as applicable.
Trust MBS: As to any Trust, Callable Trust or SMBS Trust, any Ginnie Mae Certificates
conveyed thereto by the related Sponsor.
Trust REMIC: Any REMIC formed from an Asset Pool of a Trust.
Trust REMIC Account: Each of the Trustee ABA Account, the Trustee Limited Purpose
Account, the Trustee Issuer Account, the Book-Entry Depository Account, the Collection
Account, and the Trust Asset Depository Account, if any.
Trustee: The Person identified in the Trust Agreement, Callable Trust Agreement, MX Trust
Agreement or SMBS Trust Agreement, if applicable, as trustee for a trust.
Trustee ABA Account: An account maintained by the Trustee at any U.S. Federal Reserve
Bank, which account shall, among other things, be credited with all distributions on the Trust
Assets maintained through the book-entry system of the Book-Entry Depository on the Ginnie
Mae Certificate Payment Date or the Underlying Certificate Payment Date or Underlying
Callable Security Payment Date or Underlying SMBS Security Payment Date, as applicable.
Trustee Fee: For each Series or Callable Series, with respect to each Distribution Date in each
month, the fee payable to the Trustee, as provided in the related Trust Agreement, Callable Trust
Agreement or SMBS Trust Agreement.
Trustee Fee Rate: The per annum fee rate, if any, designated in the Trust Agreement, Callable
Trust Agreement or SMBS Trust Agreement, at which the Trustee Fee accrues.
Trustee Issuer Account: With respect to each Trustee, an account maintained at the Book-Entry
Depository against which the Securities to be issued at closing to the Sponsor are debited. The
Trustee Issuer Account is a subaccount of the Trustee ABA Account.
Trustee Limited Purpose Account: A limited purpose account maintained at the Book-Entry
Depository in which the Trust Assets underlying each Ginnie Mae REMIC Trust, SMBS Trust or
Callable Trust will be held prior to and after the Closing Date. The Trustee Limited Purpose
Account is a subaccount of the Trustee ABA Account.
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Trustee’s Receipt Schedule A: With respect to any Series backed by Ginnie Mae Multifamily
Certificates or HECM MBS, the statement that will be attached to the Accountant’s AgreedUpon Procedures Report as of the Closing Date as Schedule A. The Trustee’s Receipt Schedule
A separately identifies the Trust Assets in each Trust Asset Group and Subgroup.
Uncertificated Securities: Any REMIC Security deposited by the Sponsor into an MX Trust.
Undeposited Ginnie Mae Construction Loan Certificate: Each Ginnie Mae Construction Loan
Certificate issued in connection with the same multifamily project as any Deposited Ginnie Mae
Construction Loan Certificate that either is not delivered by the Sponsor to the Trust on the
Closing Date or is purchased by the Contracted Security Purchaser after the date of any related
Waiver Agreement.
Underlying Callable Security: As to any Ginnie Mae REMIC Trust, any Callable Class Security
conveyed thereto by the related Sponsor.
Underlying Callable Security Payment Date: For any Underlying Callable Security, the day of
each month on which payment is required to be made to the Holder of that Underlying Callable
Security.
Underlying Callable Series: A Series of Ginnie Mae Guaranteed Pass-Through Securities
issued pursuant to a Callable Trust Agreement and having the numerical or other designation
specified in such Callable Trust Agreement.
Underlying Certificate: As to any Trust, Callable Trust or SMBS Trust, any previously issued
certificates, which directly or indirectly represent “regular interests” in a REMIC and evidence a
direct or indirect beneficial ownership interest in a separate pool of Ginnie Mae Certificates.
Underlying Certificate Disclosure Documents: The prospectus, offering circular or other
disclosure document pursuant to which an Underlying Certificate was offered.
Underlying Certificate Factor: With respect to each Underlying Certificate, the factor provided
by the related issuer, information agent or trustee for such Underlying Certificate.
Underlying Certificate Payment Date: With respect to an Underlying Certificate, the day of
each month on which payment is required to be made to the holder of such Underlying
Certificate.
Underlying REMIC Certificate: As to any MX Trust, each Ginnie Mae REMIC Security
conveyed thereto by the related Sponsor.
Underlying Series: As to each Underlying Certificate, the related Series of certificates.
Underlying SMBS Security: As to any SMBS Trust, any previously issued SMBS Security.
Underlying SMBS Security Disclosure Document: The prospectus, offering circular or other
disclosure document pursuant to which an Underlying SMBS Security was offered.
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Underlying SMBS Security Payment Date: With respect to an Underlying SMBS Security, the
day of each month on which distributions are required to be made to the holder of such
Underlying SMBS Security.
Underlying Trust: As to any Underlying Series, the related segregated Trust or Callable Trust.
U.S. Person: A Person that is (i) a citizen or resident of the United States, (ii) a corporation that
is organized under the laws of the United States, any state thereof or the District of Columbia,
including an entity treated as a corporation for United States federal income tax purposes, (iii) a
partnership, including any entity treated as a partnership for United States federal income tax
purposes (other than a partnership, that is not treated as a United States person under any
applicable Treasury Regulations) organized under the laws of the United States, any state thereof
or the District of Columbia, none of the interests of which are owned, directly or indirectly
through one or more pass-through entities, by any person that is not a U.S. Person within the
meaning of this paragraph, (iv) an estate that is subject to United States federal income taxation
regardless of the source of its income, (v) a trust if a court within the United States is able to
exercise primary supervision over the administration of such trust and one or more United States
persons have the authority to control all substantial decisions of the trust (or to the extent
provided in the applicable Treasury Regulations, certain trusts in existence on August 20, 1996
that are eligible to be treated as United States persons), or (vi) a foreign person who would be
subject to United States federal income taxation on a net basis on income derived from the
Residual Securities. The term “United States person” shall have the meaning ascribed to it in
Section 7701 of the Code.
VA: The United States Department of Veterans Affairs.
VA Loans: Residential mortgage loans made to veteran borrowers under one of VA’s loan
guaranty programs.
Variable Rate Class: A Class with an Interest Rate that varies on a basis other than an index.
Variance Account: With respect to a Trust, MX Trust, Callable Trust or SMBS Trust, as
applicable, an Eligible Account maintained by the Trustee in accordance with the Trust
Agreement, MX Trust Agreement, Callable Trust Agreement and SMBS Trust Agreement, the
owner of which solely for United States federal income tax purposes (and not for any other
purpose) is Ginnie Mae and which account, with respect to a Trust REMIC is an Outside Reserve
Fund.
Voting Rights: The voting rights of the Securities.
Waiver Agreement: Each agreement executed by a Contracted Security Purchaser dated not
later than the Print Date that is substantially in the form attached as Exhibit 2 to the Form of
REMIC Trust Agreement in the Guide.
Weighted Average Certificate Rate: For any Distribution Date, the per annum rate of interest
equal to the average, expressed as a percentage, of the Certificate Rates of some or all Trust
MBS in a Series (or designated Trust Asset Group or Groups) weighted on the basis of the
respective current principal balances of such Trust MBS immediately following the applicable
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Ginnie Mae Certificate Payment Date in the month preceding the month of that Distribution
Date. Such average interest rate may be subject to certain additions, subtractions, multiples,
caps, floors and governors.
Weighted Average Coupon: With respect to a Series (or, if the Trust MBS are segregated into
Trust Asset Groups, the Trust MBS in a designated Trust Asset Group) and for any Distribution
Date, the weighted average of the Mortgage Rates of the Mortgage Loans or Participation
Interest Rates of the Participations underlying the Trust MBS, weighted on the basis of the
respective current principal balances of those Mortgage Loans or Participations immediately
following the applicable Ginnie Mae Certificate Payment Date in the month preceding the month
of that Distribution Date.
Weighted Average Coupon Class: A Class whose Interest Rate is (a) based on a Weighted
Average Certificate Rate or Weighted Average Coupon Rate, or (b) determined by aggregating
the accrued interest on the related Trust Assets, or if an MX Class, the related REMIC Securities,
expressed as a percentage of the current principal balance or notional balance of such Class, in
each case as described in the related Offering Circular Supplement.
Weighted Average Coupon Rate: For any Trust REMIC and any Distribution Date, the per
annum rate of interest equal to the average, expressed as a percentage, of the interest rates on
some or all of the Trust REMIC’s “qualified mortgages” (as that term is defined in the REMIC
Provisions), weighted on the basis of respective current principal balances of such qualified
mortgages after giving effect to all payments of principal in the month preceding the month of
that Distribution Date. Such average interest rate may be subject to certain additions,
subtractions, multipliers, caps, floors, and governors, as permitted under the REMIC Provisions.
Weighted Average Mortgage Interest Rate: With respect to a Series (or, if the Trust MBS are
segregated into Trust Asset Groups, the Trust MBS in a designated Trust Asset Group), and for
any Distribution Date, the average of the Mortgage Rates of the Mortgage Loans underlying the
Trust MBS, weighted on the basis of the respective current principal balances of those Mortgage
Loans immediately following the applicable Ginnie Mae Certificate Payment Date in the month
preceding the month of that Distribution Date.
With respect to designated Ginnie Mae Multifamily Certificates and a Cut-off Date, the per
annum rate of interest equal to the average, expressed as a percentage of the Mortgage Rates of
all the Mortgage Loans underlying the Ginnie Mae Multifamily Certificates, weighted on the
basis of the respective current principal balances of those Mortgage Loans after giving effect to
all payments of principal due on or before the Cut-off Date.
Weighted Average Life: With respect to any Class, the average amount of time (in years) that
will elapse from the date of its issuance until each dollar of principal has been repaid to the
investor, determined by (a) multiplying the amount of the net reduction, if any, of the Class
Principal Balance (or Class Notional Balance) of such Class from one Distribution Date to the
next Distribution Date by the number of years from the Closing Date to such next Distribution
Date, (b) summing the results and (c) dividing the sum by the aggregate amount of the net
reductions of the Class Principal Balance (or Class Notional Balance) of such Class referred to in
clause (a).
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Weighted Average Loan Age: With respect to a Series (or, if the Trust MBS are segregated into
Trust Asset Groups, the Trust MBS in a designated Trust Asset Group), and for any Distribution
Date, the average loan age (in months) of the Mortgage Loans underlying the Trust MBS,
weighted on the basis of the respective current principal balances of those Mortgage Loans
immediately following the applicable Ginnie Mae Certificate Payment Date in the month
preceding the month of that Distribution Date.
Weighted Average Net Certificate Rate: With respect to a Series (or, if the Ginnie Mae
Multifamily Certificates are segregated into Trust Asset Groups, the Ginnie Mae Multifamily
Certificates in a designated Trust Asset Group), for any Distribution Date, the per annum rate of
interest equal to the average, expressed as a percentage, of the Net Certificate Rates of some or
all Ginnie Mae Multifamily Certificates in a designated Trust Asset Group or Groups, weighted
on the basis of the respective current principal balances of those Ginnie Mae Multifamily
Certificates immediately following the applicable Ginnie Mae Certificate Payment Date in the
month preceding the month of that Distribution Date.
Weighted Average Original Term to Maturity: With respect to designated Ginnie Mae
Multifamily Certificates and a Cut-off Date, the average, expressed in months, of the original
terms to maturity of all the Mortgage Loans underlying the Ginnie Mae Multifamily Certificates,
weighted on the basis of the respective current principal balances of those Mortgage Loans after
giving effect to all payments of principal due on or before the Cut-off Date.
Weighted Average Period From Issuance: With respect to designated Ginnie Mae Multifamily
Certificates and a Cut-off Date, the average, expressed in months, of the period from issuance, as
of the Cut-off Date, of the Mortgage Loans underlying the Ginnie Mae Multifamily Certificates,
weighted on the basis of the respective current principal balances of those Mortgage Loans after
giving effect to all payments of principal due on or before the Cut-off Date.
Weighted Average Remaining Lockout Period: With respect to designated Ginnie Mae
Multifamily Certificates and a Cut-off Date, the average, expressed in months, of the remaining
lockout periods, as of the Cut-off Date, of all the Mortgage Loans underlying the Ginnie Mae
Multifamily Certificates, weighted on the basis of the respective current principal balances of
those Mortgage Loans after giving effect to all payments of principal due on or before the Cutoff Date.
Weighted Average Remaining Prepayment Penalty Period: With respect to designated Ginnie
Mae Multifamily Certificates and a Cut-off Date, the average, expressed in months, of the
remaining periods during which Prepayment Penalties will be payable, as of the related Cut-off
Date, of all the Mortgage Loans underlying the Ginnie Mae Multifamily Certificates, weighted
on the basis of the respective current principal balances of those Mortgage Loans after giving
effect to all payments of principal due on or before the related Cut-off Date.
Weighted Average Remaining Term to Maturity: With respect to a Series (or, if the Trust MBS
are segregated into Trust Asset Groups, the Trust MBS in a designated Trust Asset Group), and
for any Distribution Date, the average of the remaining terms to maturity of the Mortgage Loans
underlying the Trust MBS, weighted on the basis of the respective current principal balances of
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those Mortgage Loans immediately following the applicable Ginnie Mae Certificate Payment
Date in the month preceding the month of that Distribution Date.
With respect to any Trust MBS, for any Distribution Date, the average of the remaining terms to
maturity of the Mortgage Loans underlying that Trust MBS, weighted on the basis of the
respective current principal balances of those Mortgage Loans immediately following the
applicable Ginnie Mae Certificate Payment Date in the month preceding the month of that
Distribution Date.
With respect to designated Ginnie Mae Multifamily Certificates and a Cut-off Date, the average,
expressed in months, of the remaining terms to maturity, as of the Cut-off Date, of all the
Mortgage Loans underlying the Ginnie Mae Multifamily Certificates, weighted on the basis of
the respective current principal balances of those Mortgage Loans after giving effect to all
payments of principal due on or before the Cut-off Date.
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[Office of Management & Budget publication number 2503-0030]
| File Type | application/pdf |
| File Title | Microsoft Word - 36468513_9.doc |
| Author | 09314 |
| File Modified | 2013-12-24 |
| File Created | 2013-12-18 |