EXHIBIT 4.1
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ASSET BACKED FUNDING CORPORATION,
DEPOSITOR
HOMEQ SERVICING CORPORATION,
SERVICER
AND
JPMORGAN CHASE BANK, N.A.,
TRUSTEE
POOLING AND SERVICING AGREEMENT
DATED AS OF APRIL 1, 2005
FIRST FRANKLIN MORTGAGE LOAN TRUST 2005-FF5
ASSET-BACKED CERTIFICATES, SERIES 2005-FF5
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TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS
5
Section 1.01 Defined
Terms................................................5
Section 1.02
Accounting..................................................58
Section 1.03 Rights of the NIMS
Insurer..................................58
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; ORIGINAL ISSUANCE OF
CERTIFICATES
59
Section 2.01 Conveyance of Mortgage
Loans................................59
Section 2.02 Acceptance by
Trustee.......................................61
Section 2.03 Repurchase or Substitution of Mortgage Loans by the
Originator or the Seller....................................62
Section 2.04 Execution of Yield Maintenance
Agreements...................66
Section 2.05 Representations, Warranties and Covenants of the
Servicer...66
Section 2.06 Representations and Warranties of the
Depositor.............68
Section 2.07 Issuance of Certificates and the Uncertificated
Regular
Interests...................................................70
ARTICLE III ADMINISTRATION AND SERVICING OF THE TRUST FUND
71
Section 3.01 Servicer to Act as
Servicer.................................71
Section 3.02 Collection of Mortgage Loan
Payments........................73
Section 3.03 Realization Upon Defaulted Mortgage
Loans...................73
Section 3.04 Collection Accounts, Distribution Account and Reserve
Accounts....................................................74
Section 3.05 Permitted Withdrawals From the Collection
Accounts..........79
Section 3.06 Establishment of Escrow Accounts; Deposits in Escrow
Accounts....................................................80
Section 3.07 Permitted Withdrawals From Escrow
Account...................80
Section 3.08 Payment of Taxes, Insurance and Other Charges;
Collections
Thereunder..................................................81
Section 3.09 Transfer of
Accounts........................................82
Section 3.10 Maintenance of Hazard
Insurance.............................82
Section 3.11 Maintenance of Mortgage Impairment Insurance
Policy.........83
Section 3.12 Fidelity Bond, Errors and Omissions
Insurance...............83
Section 3.13 Title, Management and Disposition of REO
Property...........84
Section 3.14 Due-on-Sale Clauses; Assumption and Substitution
Agreements.86
Section 3.15 Notification of
Adjustments.................................87
Section 3.16 Optional Purchases of Mortgage Loans by
Servicer............87
Section 3.17 Trustee to Cooperate; Release of
Files......................87
Section 3.18 Servicing
Compensation......................................89
Section 3.19 Annual Statement as to
Compliance...........................89
Section 3.20 Annual Independent Certified Public Accountants'
Reports....89
Section 3.21 Access to Certain Documentation and Information
Regarding
the Mortgage Loans..........................................90
Section 3.22 Duties of Credit Risk
Manager...............................90
Section 3.23 Obligations of the Servicer in Respect of Compensating
Interest....................................................91
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Section 3.24 Obligations of the Servicer in Respect of Mortgage
Interest
Rates and Monthly Payments..................................91
Section 3.25 Investment of Funds in the Collection
Accounts..............91
Section 3.26 Liability of Servicer;
Indemnification......................92
Section 3.27 Reports of Foreclosure and Abandonment of Mortgaged
Properties..................................................93
Section 3.28 Protection of
Assets........................................93
Section 3.29 Limitation of Liability of the Credit Risk
Manager..........94
Section 3.30 No Personal
Solicitation....................................94
Section 3.31 Periodic
Filings............................................94
Section 3.32 Credit Reporting; Gramm-Leach-Bliley
Act....................97
ARTICLE IV FLOW OF FUNDS
97
Section 4.01 Interest
Distributions......................................97
Section 4.02 Distributions of Principal and Monthly Excess Cashflow
Amounts.....................................................99
Section 4.03 Allocation of
Losses.......................................106
Section 4.04 Method of
Distribution.....................................106
Section 4.05 Distributions on Book-Entry
Certificates...................107
Section 4.06
Statements.................................................107
Section 4.07 Remittance Reports;
Advances...............................110
Section 4.08 REMIC Distributions and Allocation of
Losses...............111
ARTICLE V THE CERTIFICATES
116
Section 5.01 The
Certificates...........................................116
Section 5.02 Registration of Transfer and Exchange of
Certificates......116
Section 5.03 Mutilated, Destroyed, Lost or Stolen
Certificates..........121
Section 5.04 Persons Deemed
Owners......................................121
Section 5.05 Appointment of Paying
Agent................................122
ARTICLE VI THE SERVICER AND THE DEPOSITOR
122
Section 6.01 Liability of the Servicer and the
Depositor................122
Section 6.02 Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer or the Depositor..............122
Section 6.03 Limitation on Liability of the Servicer and
Others.........123
Section 6.04 Servicer Not to
Resign.....................................123
Section 6.05 Delegation of
Duties.......................................124
ARTICLE VII DEFAULT
126
Section 7.01 Servicer Events of
Termination.............................126
Section 7.02 Trustee to Act; Appointment of
Successor...................128
Section 7.03 Waiver of
Defaults.........................................129
Section 7.04 Notification to
Certificateholders.........................129
Section 7.05 Survivability of Servicer
Liabilities......................130
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ARTICLE VIII THE TRUSTEE
130
Section 8.01 Duties of
Trustee..........................................130
Section 8.02 Certain Matters Affecting the
Trustee......................132
Section 8.03 Trustee Not Liable for Certificates or Mortgage
Loans......133
Section 8.04 Trustee May Own
Certificates...............................134
Section 8.05 Trustee Fees and
Expenses..................................134
Section 8.06 Eligibility Requirements for
Trustee.......................134
Section 8.07 Resignation or Removal of
Trustee..........................135
Section 8.08 Successor
Trustee..........................................136
Section 8.09 Merger or Consolidation of
Trustee.........................136
Section 8.10 Appointment of Co-Trustee or Separate
Trustee..............136
Section 8.11 Limitation of
Liability....................................138
Section 8.12 Trustee May Enforce Claims Without Possession of
Certificates...............................................138
Section 8.13 Suits for
Enforcement......................................138
Section 8.14 Waiver of Bond
Requirement.................................138
Section 8.15 Waiver of Inventory, Accounting and Appraisal
Requirement..139
ARTICLE IX REMIC AND GRANTOR TRUST ADMINISTRATION
139
Section 9.01 REMIC
Administration.......................................139
Section 9.02 Prohibited Transactions and
Activities.....................141
Section 9.03 Indemnification with Respect to Certain Taxes and Loss
of
REMIC Status...............................................141
Section 9.04 REO
Property...............................................142
Section 9.05 Grantor Trust
Administration...............................143
ARTICLE X TERMINATION
143
Section 10.01
Termination...............................................143
Section 10.02 Additional Termination
Requirements.......................145
ARTICLE XI MISCELLANEOUS PROVISIONS
146
Section 11.01
Amendment.................................................146
Section 11.02 Recordation of Agreement;
Counterparts....................147
Section 11.03 Limitation on Rights of
Certificateholders................147
Section 11.04 Governing Law;
Jurisdiction...............................148
Section 11.05
Notices...................................................148
Section 11.06 Severability of
Provisions................................149
Section 11.07 Article and Section
References............................149
Section 11.08 Notice to the Rating Agencies and the NIMS
Insurer........149
Section 11.09 Further
Assurances........................................150
Section 11.10 Third Party
Beneficiary...................................150
Section 11.11 Acts of
Certificateholders................................150
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EXHIBITS:
Exhibit A-1
Form of Class A-1 Certificate
Exhibit A-2
Form of Class A-2A Certificate
Exhibit A-3
Form of Class A-2B Certificate
Exhibit A-4
Form of Class A-2C Certificate
Exhibit B-1
Form of Class M-1 Certificate
Exhibit B-2
Form of Class M-2 Certificate
Exhibit B-3
Form of Class M-3 Certificate
Exhibit B-4
Form of Class M-4 Certificate
Exhibit B-5
Form of Class M-5 Certificate
Exhibit B-6
Form of Class M-6 Certificate
Exhibit B-7
Form of Class M-7 Certificate
Exhibit B-8
Form of Class M-8 Certificate
Exhibit B-9
Form of Class M-9 Certificate
Exhibit B-10
Form of Class M-10 Certificate
Exhibit B-11
Form of Class B Certificate
Exhibit C-1
Form of Class CE Certificate
Exhibit C-2
Form of Class P Certificate
Exhibit C-3
Form of Class R Certificate
Exhibit D-1
Group 1 Mortgage Loan Schedule
Exhibit D-2
Group 2 Mortgage Loan Schedule
Exhibit E
Form of Request for Release of Documents
Exhibit F-1
Form of Trustee's Initial Certification
Exhibit F-2
Form of Trustee's Final Certification
Exhibit F-3
Form of Receipt of Mortgage Note
Exhibit G
Mortgage Loan Purchase Agreement
Exhibit H
Form of Lost Note Affidavit
Exhibit I
Form of ERISA Representation
Exhibit J
Form of Investment Letter
Exhibit K
Form of Class R Certificate Transfer Affidavit
Exhibit L
Form of Transferor Certificate
Exhibit M
Monthly Information Delivered by Servicer
Exhibit N-1
Form of Yield Maintenance Agreement relating to the Class
A-1 Certificates
Exhibit N-2
Form of Yield Maintenance Agreement relating to the Class
A-2A, Class A-2B and Class A-2C Certificates
Exhibit N-3
Form of Yield Maintenance Agreement relating to the Class M
and Class B Certificates
Exhibit O
Form of Certification
Exhibit P-1
Form of Certification to be Provided by the Trustee to the
Depositor
Exhibit P-2
Form of Certification to be Provided by the Servicer to the
Depositor
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ASSET BACKED FUNDING CORPORATION, as depositor (the "Depositor"),
HOMEQ
SERVICING CORPORATION, as servicer (the "Servicer"), and JPMORGAN
CHASE BANK,
N.A., as trustee (the "Trustee"), are entering into this Pooling
and Servicing
Agreement, dated as of April 1, 2005 (the "Agreement").
PRELIMINARY STATEMENT
The Depositor intends to sell pass-through certificates
(collectively,
the "Certificates"), to be issued hereunder in multiple Classes,
which in the
aggregate will evidence the entire beneficial ownership interest in
the Trust
Fund created hereunder. The Certificates will consist of eighteen
Classes of
Certificates, designated as (i) the Class A-1, Class A-2A, Class
A-2B and Class
A-2C Certificates, (ii) the Class M-1, Class M-2, Class M-3, Class
M-4, Class
M-5, Class M-6, Class M-7, Class M-8, Class M-9 and Class M-10
Certificates,
(iii) the Class B Certificates, (iv) the Class CE Certificates, (v)
the Class P
Certificates and (vi) the Class R Certificate.
REMIC 1
As provided herein, the Trustee will make an election to treat the
segregated pool of assets consisting of the Mortgage Loans and
certain other
related assets subject to this Agreement (but exclusive of the
Yield Maintenance
Agreements, the Reserve Accounts, the Cap Carryover Amounts, the
Originator
Prepayment Charge Payment Amounts and the Servicer Prepayment
Charge Payment
Amounts) as a real estate investment conduit (a "REMIC") for
federal income tax
purposes, and such segregated pool of assets will be designated as
"REMIC 1."
The Class R-1 Interest will represent the sole class of "residual
interests" in
REMIC 1 for purposes of the REMIC Provisions. The following table
irrevocably
sets forth the designation, the Uncertificated REMIC 1 Pass-Through
Rate, the
initial Uncertificated Principal Balance, and solely for purposes
of satisfying
Treasury Regulations Section 1.860G-1(a)(4)(iii), the "latest
possible maturity
date" for each of the REMIC 1 Regular Interests. None of the REMIC
1 Regular
Interests will be certificated.
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Uncertificated
Initial
REMIC Pass-Through
Uncertificated
Latest Possible
Designation
Rate
Balance
Maturity Date (1)
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LT1AA
Variable(2)
377,854,812.87
May 25, 2035
--------------------------------------------------------------------------------
LT1A1
Variable(2)
1,470,560.00
May 25, 2035
--------------------------------------------------------------------------------
LT1A2A
Variable(2)
559,225.00
May 25, 2035
--------------------------------------------------------------------------------
LT1A2B
Variable(2)
952,380.00
May 25, 2035
--------------------------------------------------------------------------------
LT1A2C
Variable(2)
127,425.00
May 25, 2035
--------------------------------------------------------------------------------
LT1M1
Variable(2)
192,780.00
May 25, 2035
--------------------------------------------------------------------------------
LT1M2
Variable(2)
144,590.00
May 25, 2035
--------------------------------------------------------------------------------
LT1M3
Variable(2)
50,125.00
May 25, 2035
--------------------------------------------------------------------------------
LT1M4
Variable(2)
82,895.00
May 25, 2035
--------------------------------------------------------------------------------
LT1M5
Variable(2)
52,050.00
May 25, 2035
--------------------------------------------------------------------------------
LT1M6
Variable(2)
34,700.00
May 25, 2035
--------------------------------------------------------------------------------
LT1M7
Variable(2)
55,910.00
May 25, 2035
--------------------------------------------------------------------------------
LT1M8
Variable(2)
19,275.00
May 25, 2035
--------------------------------------------------------------------------------
LT1M9
Variable(2)
34,705.00
May 25, 2035
--------------------------------------------------------------------------------
LT1M10
Variable(2)
25,060.00
May 25, 2035
--------------------------------------------------------------------------------
LT1B
Variable(2)
32,775.00
May 25, 2035
--------------------------------------------------------------------------------
LT1ZZ
Variable(2)
3,876,867.71
May 25, 2035
--------------------------------------------------------------------------------
LT1SUB
Variable(2)
7,056.50
May 25, 2035
--------------------------------------------------------------------------------
LT1GRP
Variable(2)
36,467.70
May 25, 2035
--------------------------------------------------------------------------------
LT2SUB
Variable(2)
7,864.94
May 25, 2035
--------------------------------------------------------------------------------
LT2GRP
Variable(2)
40,645.54
May 25, 2035
--------------------------------------------------------------------------------
LT1XX
Variable(2)
385,474,100.91
May 25, 2035
--------------------------------------------------------------------------------
LT1P
Variable(2)
100.00
May 25, 2035
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(1)
Solely for purposes of Treasury Regulations Section
1.860G-1(a)(4)(iii), the Distribution Date in the month following
the
maturity date for the Mortgage Loan with the latest maturity date
has
been designated as the "latest possible maturity date" for each
REMIC 1
Regular Interest.
(2)
Calculated in accordance with the definition of "Uncertificated
REMIC 1
Pass-Through Rate" herein.
The foregoing REMIC structure is intended to cause all the cash
from
the Mortgage Loans to flow through REMIC 2 as cash flow on a
Regular
Certificate, without creating any shortfall, actual or potential
(other than for
losses), to any REMIC Regular Certificate. To the extent that the
structure is
believed to diverge from such intention, the party identifying such
ambiguity or
drafting error shall notify the other parties hereto, and the
parties hereto
shall attempt to resolve such ambiguity or drafting error in
accordance with
Section 11.01 herein.
-2-
REMIC 2
As provided herein, the Trustee shall make an election to treat the
segregated pool of assets consisting of the REMIC 1 Regular
Interests as a REMIC
for federal income tax purposes, and such segregated pool of assets
will be
designated as "REMIC 2." The Class R-2 Interest represents the sole
class of
"residual interests" in REMIC 2 for purposes of the REMIC
Provisions.
The following table sets forth (or describes) the Class
designation,
Certificate Interest Rate and Original Class Certificate Principal
Balance for
each Class of Certificates comprising the interests in the Trust
Fund created
hereunder:
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Original Class
Certificate
Certificate
Assumed Final
Class
Principal Balance
Interest Rate
Maturity Dates (18)
--------------------------------------------------------------------------------
A-1
$294,112,000
(1)
March 25, 2035
--------------------------------------------------------------------------------
A-2A
$111,845,000
(2)
March 25, 2023
--------------------------------------------------------------------------------
A-2B
$190,476,000
(3)
February 25, 2034
--------------------------------------------------------------------------------
A-2C
$25,485,000
(4)
March 25, 2035
--------------------------------------------------------------------------------
M-1
$38,556,000
(5)
February 25, 2035
--------------------------------------------------------------------------------
M-2
$28,918,000
(6)
January 25, 2035
--------------------------------------------------------------------------------
M-3
$10,025,000
(7)
January 25, 2035
--------------------------------------------------------------------------------
M-4
$16,579,000
(8)
December 25, 2034
--------------------------------------------------------------------------------
M-5
$10,410,000
(9)
November 25, 2034
--------------------------------------------------------------------------------
M-6
$ 6,940,000
(10)
October 25, 2034
--------------------------------------------------------------------------------
M-7
$11,182,000
(11)
September 25, 2034
--------------------------------------------------------------------------------
M-8
$ 3,855,000
(12)
June 25, 2034
--------------------------------------------------------------------------------
M-9
$ 6,941,000
(13)
May 25, 2034
--------------------------------------------------------------------------------
M-10
$ 5,012,000
(14)
November 25, 2033
--------------------------------------------------------------------------------
B
$ 6,555,000
(15)
March 25, 2033
--------------------------------------------------------------------------------
CE
(16)
(16)
N/A
--------------------------------------------------------------------------------
P(17)
$100.00
N/A
N/A
--------------------------------------------------------------------------------
R
N/A
N/A
N/A
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(1)
Interest will accrue on the Class A-1 Certificates during each
Interest
Accrual Period at a rate equal to the lesser of: (i) the Class A-1
Pass-Through Rate and (ii) the Group 1 Cap for such Distribution
Date.
(2)
Interest will accrue on the Class A-2A Certificates during each
Interest
Accrual Period at a rate equal to the lesser of: (i) the Class A-2A
Pass-Through Rate and (ii) the Group 2 Cap for such Distribution
Date.
(3)
Interest will accrue on the Class A-2B Certificates during each
Interest
Accrual Period at a rate equal to the lesser of: (i) the Class A-2B
Pass-Through Rate and (ii) the Group 2 Cap for such Distribution
Date.
(4)
Interest will accrue on the Class A-2C Certificates during each
Interest
Accrual Period at a rate equal to the lesser of: (i) the Class A-2C
Pass-Through Rate and (ii) the Group 2 Cap for such Distribution
Date.
(5)
Interest will accrue on the Class M-1 Certificates during each
Interest
Accrual Period at a rate equal to the lesser of: (i) the Class M-1
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(6)
Interest will accrue on the Class M-2 Certificates during each
Interest
Accrual Period at a rate equal to the lesser of: (i) the Class M-2
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(7)
Interest will accrue on the Class M-3 Certificates during each
Interest
Accrual Period at a rate equal to the lesser of: (i) the Class M-3
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(8)
Interest will accrue on the Class M-4 Certificates during each
Interest
Accrual Period at a rate equal to the lesser of: (i) the Class M-4
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
-3-
(9)
Interest will accrue on the Class M-5 Certificates during each
Interest
Accrual Period at a rate equal to the lesser of: (i) the Class M-5
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(10)
Interest will accrue on the Class M-6 Certificates during each
Interest
Accrual Period at a rate equal to the lesser of: (i) the Class M-6
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(11)
Interest will accrue on the Class M-7 Certificates during each
Interest
Accrual Period at a rate equal to the lesser of: (i) the Class M-7
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(12)
Interest will accrue on the Class M-8 Certificates during each
Interest
Accrual Period at a rate equal to the lesser of: (i) the Class M-8
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(13)
Interest will accrue on the Class M-9 Certificates during each
Interest
Accrual Period at a rate equal to the lesser of: (i) the Class M-9
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(14)
Interest will accrue on the Class M-10 Certificates during each
Interest
Accrual Period at a rate equal to the lesser of: (i) the Class M-10
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(15)
Interest will accrue on the Class B Certificates during each
Interest
Accrual Period at a rate equal to the lesser of: (i) the Class B
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(16)
Solely for REMIC purposes, the Class CE Certificates (i) will have
an
Original Class Certificate Principal Balance equal to the Initial
Overcollateralization Amount and (ii) will bear interest at its
Pass-Through Rate on the Notional Amount of the Class CE
Certificates.
(17)
The Class P Certificate will not bear interest.
(18)
Solely for purposes of Treasury Regulations Section
1.860G-1(a)(4)(iii),
May 25, 2035, which is the Distribution Date in the month following
the
maturity date for the Mortgage Loan with the latest maturity date,
has
been designated as the "latest possible maturity date" for each
Class of
Certificates.
As of the Cut-off Date, the Group 1 Mortgage Loans had an aggregate
scheduled Principal Balance equal to $364,677,019.09 and the Group
2 Mortgage
Loans had an aggregate scheduled Principal Balance equal to
$406,455,352.07.
-4-
ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms.
Whenever used in this Agreement or in the Preliminary Statement,
the
following words and phrases, unless the context otherwise requires,
shall have
the meanings specified in this Article. Interest on all Classes of
REMIC 1
Regular Interests will be calculated on the basis of a 360-day year
consisting
of twelve 30-day months. Interest on all Regular Certificates will
be calculated
on the basis of the actual number of days in the related Interest
Accrual Period
and a 360-day year.
"1933 Act":
The Securities Act of 1933, as amended.
"60+ Day Delinquent Loan": Each Mortgage Loan (including each
Mortgage Loan in foreclosure and each Mortgage Loan for which the
Mortgagor has
filed for bankruptcy after the Closing Date) with respect to which
any portion
of a Monthly Payment is, as of the last day of the prior Collection
Period, two
months or more past due and each Mortgage Loan relating to an REO
Property.
"Account": Any of the Collection Account, the Distribution Account,
the Class A-1 Reserve Account, the Class A-2A, Class A-2B and Class
A-2C Reserve
Account, the Class M and Class B Reserve Account or the Escrow
Account.
"Accrued Certificate Interest": With respect to each Distribution
Date and each Class of Class A, Class M and Class B Certificates,
an amount
equal to the interest accrued at the Certificate Interest Rate
described
opposite such Class in the table in the Preliminary Statement
during the related
Interest Accrual Period on the Certificate Principal Balance of
such Class of
Certificates, reduced by such Class' Interest Percentage of
Prepayment Interest
Shortfalls (not covered by Compensating Interest) and Relief Act
Interest
Shortfalls for such Distribution Date allocated to such class
pursuant to
Section 4.01.
"Adjustable-Rate Mortgage Loan": A Mortgage Loan which has a rate
at
which interest accrues that adjusts based on the Index plus a
related Gross
Margin, as set forth and subject to the limitations in the related
Mortgage
Note.
"Adjustment Date": With respect to each Adjustable-Rate Mortgage
Loan, each adjustment date on which the Mortgage Interest Rate of
such
Adjustable-Rate Mortgage Loan changes pursuant to the related
Mortgage Note. The
first Adjustment Date following the Cut-off Date as to each
Adjustable-Rate
Mortgage Loan is set forth in the Mortgage Loan Schedules.
"Advance": As to any Mortgage Loan, any advance made by the
Servicer
in respect of any Distribution Date pursuant to Section 4.07.
"Adverse REMIC Event": As defined in Section 9.01(f) hereof.
-5-
"Affiliate": With respect to any Person, any other Person
controlling, controlled by or under common control with such
Person. For
purposes of this definition, "control" means the power to direct
the management
and policies of a Person, directly or indirectly, whether through
ownership of
voting securities, by contract or otherwise and "controlling" and
"controlled"
shall have meanings correlative to the foregoing.
"Aggregate Overcollateralization Release Amount": With respect to
any Distribution Date, the lesser of (i) the Principal Remittance
Amount and
(ii) the Overcollateralization Release Amount.
"Agreement": This Pooling and Servicing Agreement and all
amendments
and supplements hereto.
"Applicable Regulations": As to any Mortgage Loan, all federal,
state and local laws, statutes, rules and regulations applicable
thereto.
"Applied Realized Loss Amount": With respect to each Distribution
Date, the excess, if any, of (a) the aggregate of the Certificate
Principal
Balances of the Class A, Class M, Class B and Class P Certificates
(after giving
effect to the distribution of the Principal Distribution Amount on
such
Distribution Date and any increase in any Certificate Principal
Balance as a
result of Subsequent Recoveries) over (b) the Pool Balance as of
the end of the
related Collection Period.
"Assignment": An assignment of Mortgage, notice of transfer or
equivalent instrument, in recordable form, which is sufficient
under the laws of
the jurisdiction wherein the related Mortgaged Property is located
to reflect or
record the sale of the Mortgage.
"Assignment, Assumption and Recognition Agreement": The Assignment,
Assumption and Recognition Agreement, dated April 28, 2005, among
the Depositor,
the Seller and the Originator.
"Assumed Final Maturity Date": As to each Class of Certificates,
the
date set forth as such in the Preliminary Statement.
"Available Funds": As to any Distribution Date, an amount equal to
the excess of (i) the sum of (a) the aggregate of the Monthly
Payments due
during the related Collection Period and received on or prior to
the related
Determination Date by the Servicer, (b) Liquidation Proceeds,
Insurance
Proceeds, Condemnation Proceeds, Principal Prepayments,
Substitution
Adjustments, the Purchase Price for any repurchased Mortgage Loan,
the
Termination Price with respect to the termination of the Trust
pursuant to
Section 10.01 hereof and other unscheduled recoveries of principal
and interest
(excluding Prepayment Charges, Originator Prepayment Charge Payment
Amounts,
Servicer Prepayment Charge Payment Amounts and Prepayment Interest
Excess) in
respect of the Mortgage Loans during the related Prepayment Period,
(c) the
aggregate of any amounts received in respect of an REO Property
deposited in the
Collection Account for such Distribution Date, (d) any Compensating
Interest for
such Distribution Date, (e) the aggregate of any Advances made by
the Servicer
for such Distribution Date and (f) any Reimbursement Amount or
Subsequent
Recovery deposited into the Collection Account during the related
Prepayment
Period over (ii) the sum of (a) amounts reimbursable or payable to
the
-6-
Servicer pursuant to Sections 3.05 or 6.03, (b) amounts
reimbursable or payable
to the Trustee pursuant to Section 8.05 or Section 9.01(c), (c)
Stayed Funds,
(d) the Servicing Fee and (e) amounts deposited in the Collection
Account or the
Distribution Account, as the case may be, in error.
"Balloon Mortgage Loan": Each of the Mortgage Loans having an
original term to maturity that is shorter than the related
amortization term.
"Bankruptcy Code": Title 11 of the United States Code, as amended.
"Book-Entry Certificates": Any of the Certificates that shall be
registered in the name of the Depository or its nominee, the
ownership of which
is reflected on the books of the Depository or on the books of a
Person
maintaining an account with the Depository (directly, as a
"Depository
Participant," or indirectly, as an indirect participant in
accordance with the
rules of the Depository and as described in Section 5.02 hereof).
On the Closing
Date, the Class A-1, Class A-2A, Class A-2B, Class A-2C, Class M-1,
Class M-2,
Class M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8,
Class M-9,
Class M-10 and Class B Certificates shall be Book-Entry
Certificates.
"Business Day": Any day other than a Saturday, a Sunday or a day on
which banking institutions in the State of New York, the State of
California,
the State of New Jersey, the city in which the offices of the
Servicer are
located or the city in which the Corporate Trust Office of the
Trustee is
located are authorized or obligated by law or executive order to be
closed.
"Cap": Any of the Group 1 Cap, the Group 2 Cap or the Pool Cap.
"Cap Carryover Amount": If on any Distribution Date, the Accrued
Certificate Interest for any Class of Class A, Class M or Class B
Certificates
is based upon a Cap, the excess of (i) the amount of interest such
Class of
Certificates would have been entitled to receive on such
Distribution Date based
on the related Pass-Through Rate, over (ii) the amount of interest
such Class of
Certificates received on such Distribution Date based on the
related Cap,
together with the unpaid portion of any such excess from prior
Distribution
Dates (and interest accrued thereon at the then applicable
Pass-Through Rate on
such Class of Certificates).
"Certificate":
Any Regular Certificate or Class R Certificate.
"Certificate Custodian": Initially, JPMorgan Chase Bank, N.A.;
thereafter any other Certificate Custodian acceptable to the
Depository and
selected by the Trustee.
"Certificate Interest Rate": With respect to each Distribution Date
during the Interest Accrual Period and (a) each Class of Class A,
Class M and
Class B Certificates, a per annum rate equal to the lesser of (i)
the related
Pass-Through Rate and (ii) the applicable Cap for such Distribution
Date and (b)
the Class CE Certificates, the related Pass-Through Rate.
"Certificate Owner": With respect to each Book-Entry Certificate,
any beneficial owner thereof.
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"Certificate Principal Balance": With respect to any Class of
Certificates (other than the Class CE and Class R Certificates) and
any
Distribution Date, the Original Class Certificate Principal Balance
(a) reduced
by the sum of (i) all amounts actually distributed in respect of
principal of
such Class on all prior Distribution Dates and (ii) Applied
Realized Loss
Amounts allocated thereto for previous Distribution Dates and (b)
increased by
any Subsequent Recoveries allocated to such Class for previous
Distribution
Dates. The Class R Certificates do not have a Certificate Principal
Balance.
With respect to the Class CE Certificate and any Distribution Date,
the excess,
if any, of the then aggregate Uncertificated Principal Balances of
the REMIC 1
Regular Interests over the aggregate Certificate Principal Balance
of the Class
A Certificates, the Class M Certificates, the Class B Certificates
and the Class
P Certificates then outstanding. With respect to any Certificate
(other than a
Class R Certificate) of a Class and any Distribution Date, the
portion of the
Certificate Principal Balance of such Class represented by such
Certificate
equal to the product of the Percentage Interest evidenced by such
Certificate
and the Certificate Principal Balance of such Class.
"Certificate Register" and "Certificate Registrar": The register
maintained and registrar appointed pursuant to Section 5.02 hereof.
"Certificateholder" or "Holder": The Person in whose name a
Certificate is registered in the Certificate Register, except that
a
Disqualified Organization or non-U.S. Person shall not be a Holder
of the Class
R Certificate for any purpose hereof.
"Certification": As defined in Section 3.31(b) hereof.
"Class": Collectively, Certificates or REMIC 1 Regular Interests
which have the same priority of payment and bear the same class
designation and
the form of which is identical except for variation in the
Percentage Interest
evidenced thereby.
"Class A Certificate": Any one of the Certificates with an "A"
designated on the face thereof substantially in the form annexed
hereto as
Exhibits A-1, A-2, A-3 and A-4, executed by the Trustee on behalf
of the Trust
and authenticated and delivered by the Certificate Registrar,
representing the
right to distributions as set forth herein and therein and
representing a
regular interest in REMIC 2 for purposes of the REMIC Provisions.
"Class A Certificateholders": Collectively, the Holders of the
Class
A Certificates.
"Class A-1 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date, 0.220% per annum, and (ii)
following the
Optional Termination Date, 0.440% per annum.
"Class A-1 Pass-Through Rate": For each Distribution Date, a rate
per annum equal to the lesser of (a) One-Month LIBOR as of the
related LIBOR
Determination Date, plus the Class A-1 Certificate Margin and (b)
the Group 1
Maximum Rate Cap.
"Class A-1 Reserve Account": The trust account created and
maintained by the Trustee pursuant to Section 3.04(g) which shall
be entitled
"Class A-1 Reserve Account, JPMorgan Chase Bank, N.A., as Trustee,
in trust for
registered Holders of the Class A-1
-8-
Certificates of the First Franklin Mortgage Loan Trust 2005-FF5
Trust,
Asset-Backed Certificates, Series 2005-FF5" and which must be an
Eligible
Account. Amounts on deposit in the Class A-1 Reserve Account shall
not be
invested. The Class A-1 Reserve Account shall not be an asset of
any REMIC
formed under this Agreement.
"Class A-1 Yield Maintenance Agreement": The interest rate cap
agreement between the Trustee, on behalf of the Trust, and the
Yield Maintenance
Agreement Provider substantially in the form attached hereto as
Exhibit N-1. The
Class A-1 Yield Maintenance Agreement shall not be an asset of any
REMIC formed
under this Agreement.
"Class A-1 Yield Maintenance Agreement Payment": On each
Distribution Date through the Distribution Date in September 2008,
the amount
equal to the product of (a) the excess of the lesser of (i)
One-Month LIBOR and
(ii) the applicable ceiling rate over the applicable strike rate
for such
Distribution Date, in each case as set forth on the schedule
attached to the
confirmation to the Class A-1 Yield Maintenance Agreement for such
Distribution
Date, (b) the lesser of (y) the cap notional amount as set forth on
the schedule
attached to the confirmation to the Class A-1 Yield Maintenance
Agreement for
such Distribution Date and (z) the aggregate principal balance of
the Class A-1
Certificates immediately prior to such Distribution Date and (c) a
fraction, the
numerator of which is the actual number of days elapsed since the
previous
Distribution Date (or the Closing Date, in the case of the first
Distribution
Date) to but excluding the current Distribution Date and the
denominator of
which is 360.
"Class A-2A Certificate Margin": For each Distribution Date (i) on
or prior to the Optional Termination Date, 0.080% per annum, and
(ii) following
the Optional Termination Date, 0.160% per annum.
"Class A-2A, Class A-2B and Class A-2C Cap Amount": With respect to
each Distribution Date and each Class of Class A-2A, Class A-2B and
Class A-2C
Certificates with unpaid Cap Carryover Amounts, the product of (i)
the Class
A-2A, Class A-2B and Class A-2C Yield Maintenance Agreement Payment
for such
Distribution Date and (ii) a fraction, the numerator of which is
the Certificate
Principal Balance of such Class immediately prior to such
Distribution Date and
the denominator of which is the aggregate Certificate Principal
Balance of the
Class A-2A, Class A-2B and Class A-2C Certificates immediately
prior to such
Distribution Date.
"Class A-2A, Class A-2B and Class A-2C Reserve Account": The trust
account created and maintained by the Trustee pursuant to Section
3.04(g) which
shall be entitled "Class A-2A, Class A-2B and Class A-2C Reserve
Account,
JPMorgan Chase Bank, N.A., as Trustee, in trust for registered
Holders of the
Class A-2A, Class A-2B and Class A-2C Certificates of the First
Franklin
Mortgage Loan Trust 2005-FF5 Trust, Asset-Backed Certificates,
Series 2005-FF5"
and which must be an Eligible Account. Amounts on deposit in the
Class A-2A,
Class A-2B and Class A-2C Reserve Account shall not be invested.
The Class A-2A,
Class A-2B and Class A-2C Reserve Account shall not be an asset of
any REMIC
formed under this Agreement.
"Class A-2A, Class A-2B and Class A-2C Yield Maintenance
Agreement":
The interest rate cap agreement between the Trustee, on behalf of
the Trust, and
the Yield
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Maintenance Agreement Provider substantially in the form attached
hereto as
Exhibit N-2. The Class A-2A, Class A-2B and Class A-2C Yield
Maintenance
Agreement shall not be an asset of any REMIC formed under this
Agreement.
"Class A-2A, Class A-2B and Class A-2C Yield Maintenance Agreement
Payment": On each Distribution Date through the Distribution Date
in September
2008, the amount equal to the product of (a) the excess of the
lesser of (i)
One-Month LIBOR and (ii) the applicable ceiling rate over the
applicable strike
rate for such Distribution Date, in each case as set forth on the
schedule
attached to the confirmation to the Class A-2A, Class A-2B and
Class A-2C Yield
Maintenance Agreement for such Distribution Date, (b) the lesser of
(y) the cap
notional amount as set forth on the schedule attached to the
confirmation to the
Class A-2A, Class A-2B and Class A-2C Yield Maintenance Agreement
for such
Distribution Date and (z) the aggregate principal balance of the
related
Certificates immediately prior to such Distribution Date and (c) a
fraction, the
numerator of which is the actual number of days elapsed since the
previous
Distribution Date (or the Closing Date, in the case of the first
Distribution
Date) to but excluding the current Distribution Date and the
denominator of
which is 360.
"Class A-2A Pass-Through Rate": For each Distribution Date, a rate
per annum equal to the lesser of (a) One-Month LIBOR as of the
related LIBOR
Determination Date, plus the Class A-2A Certificate Margin and (b)
the Group 2
Maximum Rate Cap.
"Class A-2B Certificate Margin": For each Distribution Date (i) on
or prior to the Optional Termination Date, 0.230% per annum, and
(ii) following
the Optional Termination Date, 0.460% per annum.
"Class A-2B Pass-Through Rate": For each Distribution Date, a rate
per annum equal to the lesser of (a) One-Month LIBOR as of the
related LIBOR
Determination Date, plus the Class A-2B Certificate Margin and (b)
the Group 2
Maximum Rate Cap.
"Class A-2C Certificate Margin": For each Distribution Date (i) on
or prior to the Optional Termination Date, 0.350% per annum, and
(ii) following
the Optional Termination Date, 0.700% per annum.
"Class A-2C Pass-Through Rate": For each Distribution Date, a rate
per annum equal to the lesser of (a) One-Month LIBOR as of the
related LIBOR
Determination Date, plus the Class A-2C Certificate Margin and (b)
the Group 2
Maximum Rate Cap.
"Class B Certificate": Any of the Certificates with a "B"
designated
on the face thereof substantially in the form annexed hereto as
Exhibit B-11
executed by the Trustee on behalf of the Trust and authenticated
and delivered
by the Certificate Registrar, representing the right to
distributions as set
forth herein and therein.
"Class B Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 3.500% per annum, and (ii)
following the
Optional Termination Date, 5.250% per annum.
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"Class B Pass-Through Rate": For each Distribution Date, the lesser
of (a) One-Month LIBOR as of the related LIBOR Determination Date,
plus the
Class B Certificate Margin and (b) the Pool Maximum Rate Cap.
"Class B Principal Distribution Amount": As of any Distribution
Date
on or after the Stepdown Date and as long as a Trigger Event is not
in effect,
the excess of (x) the sum of (i) the sum of the Certificate
Principal Balances
of the Class A Certificates (after taking into account the payment
of the Senior
Principal Distribution Amount on such Distribution Date), (ii) the
Certificate
Principal Balance of the Class M-1 Certificates (after taking into
account the
payment of the Class M-1 Principal Distribution Amount on such
Distribution
Date), (iii) the Certificate Principal Balance of the Class M-2
Certificates
(after taking into account the payment of the Class M-2 Principal
Distribution
Amount on such Distribution Date), (iv) the Certificate Principal
Balance of the
Class M-3 Certificates (after taking into account the payment of
the Class M-3
Principal Distribution Amount on such Distribution Date), (v) the
Certificate
Principal Balance of the Class M-4 Certificates (after taking into
account the
payment of the Class M-4 Principal Distribution Amount on such
Distribution
Date), (vi) the Certificate Principal Balance of the Class M-5
Certificates
(after taking into account the payment of the Class M-5 Principal
Distribution
Amount on such Distribution Date), (vii) the Certificate Principal
Balance of
the Class M-6 Certificates (after taking into account the payment
of the Class
M-6 Principal Distribution Amount on such Distribution Date),
(viii) the
Certificate Principal Balance of the Class M-7 Certificates (after
taking into
account the payment of the Class M-7 Principal Distribution Amount
on such
Distribution Date), (ix) the Certificate Principal Balance of the
Class M-8
Certificates (after taking into account the payment of the Class
M-8 Principal
Distribution Amount on such Distribution Date), (x) the Certificate
Principal
Balance of the Class M-9 Certificates (after taking into account
the payment of
the Class M-9 Principal Distribution Amount on such Distribution
Date), (xi) the
Certificate Principal Balance of the Class M-10 Certificates (after
taking into
account the payment of the Class M-10 Principal Distribution Amount
on such
Distribution Date) and (xii) the Certificate Principal Balance of
the Class B
Certificates immediately prior to such Distribution Date over (y)
the lesser of
(A) the product of (i) 98.90% and (ii) the Pool Balance as of the
last day of
the related Collection Period and (B) the Pool Balance as of the
last day of the
related Collection Period minus the product of 0.50% and the Pool
Balance as of
the Cut-off Date.
"Class B Realized Loss Amortization Amount": As to the Class B
Certificates and as of any Distribution Date, the lesser of (x) the
aggregate
Unpaid Realized Loss Amount for the Class B Certificates as of such
Distribution
Date and (y) the excess of (i) the Monthly Excess Cashflow Amount
over (ii) the
sum of the amounts described in Section 4.02(b)(i) through (xxxiv)
hereof, in
each case for such Distribution Date.
"Class CE Certificates": Any one of the Class CE Certificates as
designated on the face thereof substantially in the form annexed
hereto as
Exhibit C-1, executed by the Trustee on behalf of the Trust and
authenticated
and delivered by the Certificate Registrar, representing the right
to
distributions as set forth herein and therein and representing a
regular
interest in REMIC 2 for purposes of the REMIC Provisions.
"Class CE Distributable Amount": With respect to any Distribution
Date, the sum of (i) the interest accrued on such Class CE
Certificate at its
Pass-Through Rate calculated
-11-
on its Notional Amount less the amount (without duplication) of Cap
Carryover
Amounts paid pursuant to Section 4.02(b)(xxxvi), (ii) any remaining
Aggregate
Overcollateralization Release Amounts, (iii) the aggregate of
amounts remaining
in the Class A-1 Reserve Account after the distributions in Section
3.04(g)(i)(A), as specified in Section 3.04(g)(i)(D), (iv) the
aggregate of
amounts remaining in the Class A-2A, Class A-2B and Class A-2C
Reserve Account
after the distributions in Section 3.04(g)(i)(B), as specified in
Section
3.04(g)(i)(D) and (v) the aggregate of amounts remaining in the
Class M and
Class B Reserve Account after the distributions in Section
3.04(g)(i)(C), as
specified in Section 3.04(g)(i)(D).
"Class M Certificate": Any one of the Certificates with an "M"
designated on the face thereof substantially in the form annexed
hereto as
Exhibit B-1, Exhibit B-2, Exhibit B-3, Exhibit B-4, Exhibit B-5,
Exhibit B-6,
Exhibit B-7, Exhibit B-8, Exhibit B-9 and Exhibit B-10, executed by
the Trustee
on behalf of the Trust and authenticated and delivered by the
Certificate
Registrar, representing the right to distributions as set forth
herein and
therein and representing a regular interest in REMIC 2 for purposes
of the REMIC
Provisions.
"Class M Certificateholders": Collectively, the Holders of the
Class
M Certificates.
"Class M-1 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date, 0.450% per annum, and (ii)
following the
Optional Termination Date, 0.675% per annum.
"Class M-1 Pass-Through Rate": For each Distribution Date, the
lesser of (a) One-Month LIBOR as of the related LIBOR Determination
Date, plus
the Class M-1 Certificate Margin and (b) the Pool Maximum Rate Cap.
"Class M-1 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Certificate
Principal
Balances of the Class A Certificates (after taking into account the
payment of
the Senior Principal Distribution Amount on such Distribution Date)
and (ii) the
Certificate Principal Balance of the Class M-1 Certificates
immediately prior to
such Distribution Date over (y) the lesser of (A) the product of
(i) 71.30% and
(ii) the Pool Balance as of the last day of the related Collection
Period and
(B) the Pool Balance as of the last day of the related Collection
Period minus
the product of 0.50% and the Pool Balance as of the Cut-off Date.
"Class M-1 Realized Loss Amortization Amount": As to the Class M-1
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-1 Certificates as of such
Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over
(ii) the sum
of the amounts described in Section 4.02(b)(i) through (iv) hereof,
in each case
for such Distribution Date.
"Class M-2 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date, 0.490% per annum, and (ii)
following the
Optional Termination Date, 0.735% per annum.
-12-
"Class M-2 Pass-Through Rate": For each Distribution Date, the
lesser of (a) One-Month LIBOR as of the related LIBOR Determination
Date, plus
the Class M-2 Certificate Margin and (b) the Pool Maximum Rate Cap.
"Class M-2 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Certificate
Principal
Balances of the Class A Certificates (after taking into account the
payment of
the Senior Principal Distribution Amount on such Distribution
Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after
taking into
account the payment of the Class M-1 Principal Distribution Amount
on such
Distribution Date) and (iii) the Certificate Principal Balance of
the Class M-2
Certificates immediately prior to such Distribution Date over (y)
the lesser of
(A) the product of (i) 78.80% and (ii) the Pool Balance as of the
last day of
the related Collection Period and (B) the Pool Balance as of the
last day of the
related Collection Period minus the product of 0.50% and the Pool
Balance as of
the Cut-off Date.
"Class M-2 Realized Loss Amortization Amount": As to the Class M-2
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-2 Certificates as of such
Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over
(ii) the sum
of the amounts described in Section 4.02(b)(i) through (vii)
hereof, in each
case for such Distribution Date.
"Class M-3 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date, 0.520% per annum, and (ii)
following the
Optional Termination Date, 0.780% per annum.
"Class M-3 Pass-Through Rate": For each Distribution Date, the
lesser of (a) One-Month LIBOR as of the related LIBOR Determination
Date, plus
the Class M-3 Certificate Margin and (b) the Pool Maximum Rate Cap.
"Class M-3 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Certificate
Principal
Balances of the Class A Certificates (after taking into account the
payment of
the Senior Principal Distribution Amount on such Distribution
Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after
taking into
account the payment of the Class M-1 Principal Distribution Amount
on such
Distribution Date), (iii) the Certificate Principal Balance of the
Class M-2
Certificates (after taking into account the payment of the Class
M-2 Principal
Distribution Amount on such Distribution Date), and (iv) the
Certificate
Principal Balance of the Class M-3 Certificates immediately prior
to such
Distribution Date over (y) the lesser of (A) the product of (i)
81.40% and (ii)
the Pool Balance as of the last day of the related Collection
Period and (B) the
Pool Balance as of the last day of the related Collection Period
minus the
product of 0.50% and the Pool Balance as of the Cut-off Date.
"Class M-3 Realized Loss Amortization Amount": As to the Class M-3
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-3 Certificates as of such
Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over
(ii) the sum
of the amounts described in Section 4.02(b)(i) through (x) hereof,
in each case
for such Distribution Date.
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"Class M-4 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date, 0.650% per annum, and (ii)
following the
Optional Termination Date, 0.975% per annum.
"Class M-4 Pass-Through Rate": For each Distribution Date, the
lesser of (a) One-Month LIBOR as of the related LIBOR Determination
Date, plus
the Class M-4 Certificate Margin and (b) the Pool Maximum Rate Cap.
"Class M-4 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Certificate
Principal
Balances of the Class A Certificates (after taking into account the
payment of
the Senior Principal Distribution Amount on such Distribution
Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after
taking into
account the payment of the Class M-1 Principal Distribution Amount
on such
Distribution Date), (iii) the Certificate Principal Balance of the
Class M-2
Certificates (after taking into account the payment of the Class
M-2 Principal
Distribution Amount on such Distribution Date), (iv) the
Certificate Principal
Balance of the Class M-3 Certificates (after taking into account
the payment of
the Class M-3 Principal Distribution Amount on such Distribution
Date) and (v)
the Certificate Principal Balance of the Class M-4 Certificates
immediately
prior to such Distribution Date over (y) the lesser of (A) the
product of (i)
85.70% and (ii) the Pool Balance as of the last day of the related
Collection
Period and (B) the Pool Balance as of the last day of the related
Collection
Period minus the product of 0.50% and the Pool Balance as of the
Cut-off Date.
"Class M-4 Realized Loss Amortization Amount": As to the Class M-4
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-4 Certificates as of such
Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over
(ii) the sum
of the amounts described in Section 4.02(b)(i) through (xiii)
hereof, in each
case for such Distribution Date.
"Class M-5 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date, 0.800% per annum, and (ii)
following the
Optional Termination Date, 1.200% per annum.
"Class M-5 Pass-Through Rate": For each Distribution Date, the
lesser of (a) One-Month LIBOR as of the related LIBOR Determination
Date, plus
the Class M-5 Certificate Margin and (b) the Pool Maximum Rate Cap.
"Class M-5 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Certificate
Principal
Balances of the Class A Certificates (after taking into account the
payment of
the Senior Principal Distribution Amount on such Distribution
Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after
taking into
account the payment of the Class M-1 Principal Distribution Amount
on such
Distribution Date), (iii) the Certificate Principal Balance of the
Class M-2
Certificates (after taking into account the payment of the Class
M-2 Principal
Distribution Amount on such Distribution Date), (iv) the
Certificate Principal
Balance of the Class M-3 Certificates (after taking into account
the payment of
the Class M-3 Principal Distribution Amount on such Distribution
Date), (v) the
Certificate Principal
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Balance of the Class M-4 Certificates (after taking into account
the payment of
the Class M-4 Principal Distribution Amount on such Distribution
Date) and (vi)
the Certificate Principal Balance of the Class M-5 Certificates
immediately
prior to such Distribution Date over (y) the lesser of (A) the
product of (i)
88.40% and (ii) the Pool Balance as of the last day of the related
Collection
Period and (B) the Pool Balance as of the last day of the related
Collection
Period minus the product of 0.50% and the Pool Balance as of the
Cut-off Date.
"Class M-5 Realized Loss Amortization Amount": As to the Class M-5
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-5 Certificates as of such
Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over
(ii) the sum
of the amounts described in Section 4.02(b)(i) through (xvi)
hereof, in each
case for such Distribution Date.
"Class M-6 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date, 1.250% per annum, and (ii)
following the
Optional Termination Date, 1.875% per annum.
"Class M-6 Pass-Through Rate": For each Distribution Date, the
lesser of (a) One-Month LIBOR as of the related LIBOR Determination
Date, plus
the Class M-6 Certificate Margin and (b) the Pool Maximum Rate Cap.
"Class M-6 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Certificate
Principal
Balances of the Class A Certificates (after taking into account the
payment of
the Senior Principal Distribution Amount on such Distribution
Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after
taking into
account the payment of the Class M-1 Principal Distribution Amount
on such
Distribution Date), (iii) the Certificate Principal Balance of the
Class M-2
Certificates (after taking into account the payment of the Class
M-2 Principal
Distribution Amount on such Distribution Date), (iv) the
Certificate Principal
Balance of the Class M-3 Certificates (after taking into account
the payment of
the Class M-3 Principal Distribution Amount on such Distribution
Date), (v) the
Certificate Principal Balance of the Class M-4 Certificates (after
taking into
account the payment of the Class M-4 Principal Distribution Amount
on such
Distribution Date), (vi) the Certificate Principal Balance of the
Class M-5
Certificates (after taking into account the payment of the Class
M-5 Principal
Distribution Amount on such Distribution Date) and (vii) the
Certificate
Principal Balance of the Class M-6 Certificates immediately prior
to such
Distribution Date over (y) the lesser of (A) the product of (i)
90.20% and (ii)
the Pool Balance as of the last day of the related Collection
Period and (B) the
Pool Balance as of the last day of the related Collection Period
minus the
product of 0.50% and the Pool Balance as of the Cut-off Date.
"Class M-6 Realized Loss Amortization Amount": As to the Class M-6
Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid
Realized Loss Amount for the Class M-6 Certificates as of such
Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over
(ii) the sum
of the amounts described in Section 4.02(b)(i) through (xix)
hereof, in each
case for such Distribution Date.
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"Class M-7 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date, 1.750% per annum, and (ii)
following the
Optional Termination Date, 2.625% per annum.
"Class M-7 Pass-Through Rate": For each Distribution Date, the
lesser of (a) One-Month LIBOR as of the related LIBOR Determination
Date, plus
the Class M-7 Certificate Margin and (b) the Pool Maximum Rate Cap.
"Class M-7 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Certificate
Principal
Balances of the Class A Certificates (after taking into account the
payment of
the Senior Principal Distribution Amount on such Distribution
Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after
taking into
account the payment of the Class M-1 Principal Distribution Amount
on such
Distribution Date), (iii) the Certificate Principal Balance of the
Class M-2
Certificates (after taking into account the payment of the Class
M-2 Principal
Distribution Amount on such Distribution Date), (iv) the
Certificate Principal
Balance of the Class M-3 Certificates (after taking into account
the payment of
the Class M-3 Principal Distribution Amount on such Distribution
Date), (v) the
Certificate Principal Balance of the Class M-4 Certificates (after
taking into
account the payment of the Class M-4 Principal Distribution Amount
on such
Distribution Date), (vi) the Certificate Principal Balance of the
Class M-5
Certificates (after taking into account the payment of the Class
M-5 Principal
Distribution Amount on such Distribution Date), (vii) the
Certificate Principal
Balance of the Class M-6 Certificates (after taking into account
the payment of
the Class M-6 Principal Distribution Amount on such Distribution
Date) and
(viii) the Certificate Principal Balance of the Class M-7
Certificates
immediately prior to such Distribution Date over (y) the lesser of
(A) the
product of (i) 93.10% and (ii) the Pool Balance as of the last day
of the
related Collection Period and (B) the Pool Balance as of the last
day of the
related Collection Period minus the product of 0.50% and the Pool
Balance as of
the Cut-off Date.
"Class M-7 Realized Loss Amortization Amount": As to the Class M-7
Certificates and as of any Distribution Date, the lesser of (x) the
aggregate
Unpaid Realized Loss Amount for the Class M-7 Certificates as of
such
Distribution Date and (y) the excess of (i) the Monthly Excess
Cashflow Amount
over (ii) the sum of the amounts described in Section 4.02(b)(i)
through (xxii)
hereof, in each case for such Distribution Date.
"Class M-8 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date, 3.000% per annum, and (ii)
following the
Optional Termination Date, 4.500% per annum.
"Class M-8 Pass-Through Rate": For each Distribution Date, the
lesser of (a) One-Month LIBOR as of the related LIBOR Determination
Date, plus
the Class M-8 Certificate Margin and (b) the Pool Maximum Rate Cap.
"Class M-8 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Certificate
Principal
Balances of the Class A Certificates (after taking into account the
payment of
the Senior Principal Distribution Amount on such Distribution
Date),
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(ii) the Certificate Principal Balance of the Class M-1
Certificates (after
taking into account the payment of the Class M-1 Principal
Distribution Amount
on such Distribution Date), (iii) the Certificate Principal Balance
of the Class
M-2 Certificates (after taking into account the payment of the
Class M-2
Principal Distribution Amount on such Distribution Date), (iv) the
Certificate
Principal Balance of the Class M-3 Certificates (after taking into
account the
payment of the Class M-3 Principal Distribution Amount on such
Distribution
Date), (v) the Certificate Principal Balance of the Class M-4
Certificates
(after taking into account the payment of the Class M-4 Principal
Distribution
Amount on such Distribution Date), (vi) the Certificate Principal
Balance of the
Class M-5 Certificates (after taking into account the payment of
the Class M-5
Principal Distribution Amount on such Distribution Date), (vii) the
Certificate
Principal Balance of the Class M-6 Certificates (after taking into
account the
payment of the Class M-6 Principal Distribution Amount on such
Distribution
Date), (viii) the Certificate Principal Balance of the Class M-7
Certificates
(after taking into account the payment of the Class M-7 Principal
Distribution
Amount on such Distribution Date) and (ix) the Certificate
Principal Balance of
the Class M-8 Certificates immediately prior to such Distribution
Date over (y)
the lesser of (A) the product of (i) 94.10% and (ii) the Pool
Balance as of the
last day of the related Collection Period and (B) the Pool Balance
as of the
last day of the related Collection Period minus the product of
0.50% and the
Pool Balance as of the Cut-off Date.
"Class M-8 Realized Loss Amortization Amount": As to the Class M-8
Certificates and as of any Distribution Date, the lesser of (x) the
aggregate
Unpaid Realized Loss Amount for the Class M-8 Certificates as of
such
Distribution Date and (y) the excess of (i) the Monthly Excess
Cashflow Amount
over (ii) the sum of the amounts described in Section 4.02(b)(i)
through (xxv)
hereof, in each case for such Distribution Date.
"Class M-9 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date, 3.500% per annum, and (ii)
following the
Optional Termination Date, 5.250% per annum.
"Class M-9 Pass-Through Rate": For each Distribution Date, the
lesser of (a) One-Month LIBOR as of the related LIBOR Determination
Date, plus
the Class M-9 Certificate Margin and (b) the Pool Maximum Rate Cap.
"Class M-9 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Certificate
Principal
Balances of the Class A Certificates (after taking into account the
payment of
the Senior Principal Distribution Amount on such Distribution
Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after
taking into
account the payment of the Class M-1 Principal Distribution Amount
on such
Distribution Date), (iii) the Certificate Principal Balance of the
Class M-2
Certificates (after taking into account the payment of the Class
M-2 Principal
Distribution Amount on such Distribution Date), (iv) the
Certificate Principal
Balance of the Class M-3 Certificates (after taking into account
the payment of
the Class M-3 Principal Distribution Amount on such Distribution
Date), (v) the
Certificate Principal Balance of the Class M-4 Certificates (after
taking into
account the payment of the Class M-4 Principal Distribution Amount
on such
Distribution Date), (vi) the Certificate Principal Balance of the
Class M-5
Certificates (after taking into account the payment of the Class
M-5 Principal
Distribution Amount on such Distribution Date), (vii) the
Certificate Principal
Balance of the
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Class M-6 Certificates (after taking into account the payment of
the Class M-6
Principal Distribution Amount on such Distribution Date), (viii)
the Certificate
Principal Balance of the Class M-7 Certificates (after taking into
account the
payment of the Class M-7 Principal Distribution Amount on such
Distribution
Date), (ix) the Certificate Principal Balance of the Class M-8
Certificates
(after taking into account the payment of the Class M-8 Principal
Distribution
Amount on such Distribution Date) and (x) the Certificate Principal
Balance of
the Class M-9 Certificates immediately prior to such Distribution
Date over (y)
the lesser of (A) the product of (i) 95.90% and (ii) the Pool
Balance as of the
last day of the related Collection Period and (B) the Pool Balance
as of the
last day of the related Collection Period minus the product of
0.50% and the
Pool Balance as of the Cut-off Date.
"Class M-9 Realized Loss Amortization Amount": As to the Class M-9
Certificates and as of any Distribution Date, the lesser of (x) the
aggregate
Unpaid Realized Loss Amount for the Class M-9 Certificates as of
such
Distribution Date and (y) the excess of (i) the Monthly Excess
Cashflow Amount
over (ii) the sum of the amounts described in Section 4.02(b)(i)
through
(xxviii) hereof, in each case for such Distribution Date.
"Class M-10 Certificate Margin": For each Distribution Date (i) on
or prior to the Optional Termination Date, 3.500% per annum, and
(ii) following
the Optional Termination Date, 5.250% per annum.
"Class M-10 Pass-Through Rate": For each Distribution Date, the
lesser of (a) One-Month LIBOR as of the related LIBOR Determination
Date, plus
the Class M-10 Certificate Margin and (b) the Pool Maximum Rate
Cap.
"Class M-10 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event
is not in
effect, the excess of (x) the sum of (i) the sum of the Certificate
Principal
Balances of the Class A Certificates (after taking into account the
payment of
the Senior Principal Distribution Amount on such Distribution
Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after
taking into
account the payment of the Class M-1 Principal Distribution Amount
on such
Distribution Date), (iii) the Certificate Principal Balance of the
Class M-2
Certificates (after taking into account the payment of the Class
M-2 Principal
Distribution Amount on such Distribution Date), (iv) the
Certificate Principal
Balance of the Class M-3 Certificates (after taking into account
the payment of
the Class M-3 Principal Distribution Amount on such Distribution
Date), (v) the
Certificate Principal Balance of the Class M-4 Certificates (after
taking into
account the payment of the Class M-4 Principal Distribution Amount
on such
Distribution Date), (vi) the Certificate Principal Balance of the
Class M-5
Certificates (after taking into account the payment of the Class
M-5 Principal
Distribution Amount on such Distribution Date), (vii) the
Certificate Principal
Balance of the Class M-6 Certificates (after taking into account
the payment of
the Class M-6 Principal Distribution Amount on such Distribution
Date), (viii)
the Certificate Principal Balance of the Class M-7 Certificates
(after taking
into account the payment of the Class M-7 Principal Distribution
Amount on such
Distribution Date), (ix) the Certificate Principal Balance of the
Class M-8
Certificates (after taking into account the payment of the Class
M-8 Principal
Distribution Amount on such Distribution Date), (x) the Certificate
Principal
Balance of the Class M-9 Certificates (after taking into account
the payment of
the Class M-9 Principal Distribution Amount on such Distribution
Date) and (xi)
the Certificate Principal Balance of the
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Class M-10 Certificates immediately prior to such Distribution Date
over (y) the
lesser of (A) the product of (i) 97.20% and (ii) the Pool Balance
as of the last
day of the related Collection Period and (B) the Pool Balance as of
the last day
of the related Collection Period minus the product of 0.50% and the
Pool Balance
as of the Cut-off Date.
"Class M-10 Realized Loss Amortization Amount": As to the Class
M-10
Certificates and as of any Distribution Date, the lesser of (x) the
aggregate
Unpaid Realized Loss Amount for the Class M-10 Certificates as of
such
Distribution Date and (y) the excess of (i) the Monthly Excess
Cashflow Amount
over (ii) the sum of the amounts described in Section 4.02(b)(i)
through (xxxi)
hereof, in each case for such Distribution Date.
"Class M and Class B Cap Amount": With respect to each Distribution
Date and each Class of Class M and the Class B Certificates, the
product of (i)
the Class M and Class B Yield Maintenance Agreement Payment for
such
Distribution Date and (ii) a fraction, the numerator of which is
the Certificate
Principal Balance of such Class immediately prior to such
Distribution Date and
the denominator of which is the aggregate Certificate Principal
Balance of the
Class M and Class B Certificates immediately prior to such
Distribution Date.
"Class M and Class B Reserve Account": The trust account created
and maintained by the Trustee pursuant to Section 3.04(g) which
shall be
entitled "Class M and Class B Reserve Account, JPMorgan Chase Bank,
N.A., as
Trustee, in trust for registered Holders of the Class M and Class B
Certificates
of the First Franklin Mortgage Loan Trust 2005-FF5 Trust,
Asset-Backed
Certificates, Series 2005-FF5" and which must be an Eligible
Account. Amounts on
deposit in the Class M and Class B Reserve Account shall not be
invested. The
Class M and Class B Reserve Account shall not be an asset of any
REMIC formed
under this Agreement.
"Class M and Class B Yield Maintenance Agreement": The interest
rate
cap agreement between the Trustee, on behalf of the Trust, and the
Yield
Maintenance Agreement Provider substantially in the form attached
hereto as
Exhibit N-3. The Class M and Class B Yield Maintenance Agreement
shall not be an
asset of any REMIC formed under this Agreement.
"Class M and Class B Yield Maintenance Agreement Payment": On each
Distribution Date through the Distribution Date in September 2008,
the amount
equal to the product of (a) the excess of the lesser of (i)
One-Month LIBOR and
(ii) the applicable ceiling rate over the applicable strike rate
for such
Distribution Date, in each case as set forth on the schedule
attached to the
confirmation to the Class M and Class B Yield Maintenance Agreement
for such
Distribution Date, (b) the lesser of (y) the cap notional amount as
set forth on
the schedule attached to the confirmation to the Class M and Class
B Yield
Maintenance Agreement for such Distribution Date and (z) the
aggregate principal
balance of the related Certificates immediately prior to such
Distribution Date
and (c) a fraction, the numerator of which is the actual number of
days elapsed
since the previous Distribution Date (or the Closing Date, in the
case of the
first Distribution Date) to but excluding the current Distribution
Date and the
denominator of which is 360.
"Class P Certificate": Any one of the Certificates with a "P"
designated on the face thereof substantially in the form annexed
hereto as
Exhibit C-2, executed by the Trustee on
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behalf of the Trust and authenticated and delivered by the
Certificate
Registrar, representing the right to distributions as set forth
herein and
therein and representing a regular interest in REMIC 2 for purposes
of the REMIC
Provisions.
"Class R Certificate": The Class R Certificate executed by the
Trustee on behalf of the Trust, and authenticated and delivered by
the
Certificate Registrar, substantially in the form annexed hereto as
Exhibit C-3
and evidencing the ownership of the Residual Interest in each of
REMIC 1 and
REMIC 2. The Class R Certificate represents the ownership of the
Class R-1
Interest and the Class R-2 Interest.
"Class R-1 Interest": The uncertificated residual interest in REMIC
1 for purposes of the REMIC Provisions.
"Class R-2 Interest": The uncertificated residual interest in REMIC
2 for purposes of the REMIC Provisions.
"Closing Date": April 28, 2005.
"Code": The Internal Revenue Code of 1986, as it may be amended
from
time to time.
"Collection Accounts": The account or accounts created and
maintained by the Servicer pursuant to Section 3.04, which shall be
entitled
"Collection Account, HomEq Servicing Corporation, as Servicer for
the Trust
under the Pooling and Servicing Agreement dated as of April 1,
2005, among Asset
Backed Funding Corporation, as Depositor, HomEq Servicing
Corporation, as
Servicer, and JPMorgan Chase Bank, N.A., as Trustee, in trust for
registered
Holders of First Franklin Mortgage Loan Trust 2005-FF5,
Asset-Backed
Certificates, Series 2005-FF5."
"Collection Period": With respect to any Distribution Date, the
period from the second day of the calendar month preceding the
month in which
such Distribution Date occurs through the first day of the month in
which such
Distribution Date occurs.
"Compensating Interest": As defined in Section 3.23 hereof.
"Condemnation Proceeds": All awards or settlements in respect of a
taking of a Mortgaged Property by exercise of the power of eminent
domain or
condemnation.
"Corporate Trust Office": The principal corporate trust office of
the Trustee at which at any particular time its corporate trust
business in
connection with this Agreement shall be administered, which office
at the date
of the execution of this instrument is located at (i) solely for
purposes of
Certificate surrender, transfer or exchange, 2001 Bryan Street,
10th Floor,
Dallas, Texas 75201, Attention: Institutional Trust Services- First
Franklin
Mortgage Loan Trust 2005-FF5, or (ii) for all other purposes, 4 New
York Plaza,
6th Floor, New York, New York 10004-2477, Attention: Institutional
Trust
Services/Global Debt--First Franklin Mortgage Loan Trust 2005-FF5
or at such
other address as the Trustee may designate from time to time by
notice to the
Certificateholders, the Depositor and the Servicer.
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"Corresponding Classes": With respect to REMIC 1 and REMIC 2, the
following Classes shall be Corresponding Classes:
--------------------------------------------------------------------------------
CORRESPONDING REMIC 1 CLASSES
CORRESPONDING REMIC 2 CLASSES
--------------------------------------------------------------------------------
LT1A1
Class A-1 Certificates
--------------------------------------------------------------------------------
LT1A2A
Class A-2A Certificates
--------------------------------------------------------------------------------
LT1A2B
Class A-2B Certificates
--------------------------------------------------------------------------------
LT1A2C
Class A-2C Certificates
--------------------------------------------------------------------------------
LT1M1
Class M-1 Certificates
--------------------------------------------------------------------------------
LT1M2
Class M-2 Certificates
--------------------------------------------------------------------------------
LT1M3
Class M-3 Certificates
--------------------------------------------------------------------------------
LT1M4
Class M-4 Certificates
--------------------------------------------------------------------------------
LT1M5
Class M-5 Certificates
--------------------------------------------------------------------------------
LT1M6
Class M-6 Certificates
--------------------------------------------------------------------------------
LT1M7
Class M-7 Certificates
--------------------------------------------------------------------------------
LT1M8
Class M-8 Certificates
--------------------------------------------------------------------------------
LT1M9
Class M-9 Certificates
--------------------------------------------------------------------------------
LT1M10
Class M-10 Certificates
--------------------------------------------------------------------------------
LT1B
Class B Certificates
--------------------------------------------------------------------------------
LT1P
Class P Certificate
--------------------------------------------------------------------------------
"Credit Risk
Management
Agreement":
The Credit Risk
Management
Agreement between the Servicer and the Credit Risk Manager dated as
of April 28,
2005.
"Credit Risk Manager": The Murrayhill Company, a Colorado
corporation.
"Credit Risk Manager Fee": The fee payable to the Credit Risk
Manager on each Distribution Date for its services as Credit Risk
Manager, in an
amount equal to the product of (i) one-twelfth of the Credit Risk
Manager Fee
Rate and (ii) the Pool Balance as of the opening of business on the
first day of
the related Collection Period.
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"Credit Risk Manager Fee Rate": With respect to any Distribution
Date, 0.015% per annum.
"Cut-off Date": April 1, 2005.
"Cut-off Date Aggregate Principal Balance": The aggregate of the
Cut-off Date Principal Balances of the Mortgage Loans.
"Cut-off Date Principal Balance": With respect to any Mortgage
Loan,
the unpaid principal balance thereof as of the Cut-off Date after
application of
funds received or advanced on or before such date (or as of the
applicable date
of substitution with respect to an Eligible Substitute Mortgage
Loan).
"Debt Service Reduction": With respect to any Mortgage Loan, a
reduction in the scheduled Monthly Payment for such Mortgage Loan
by a court of
competent jurisdiction in a proceeding under the Bankruptcy Code,
except such a
reduction resulting from a Deficient Valuation.
"Defective Mortgage Loan": A Mortgage Loan replaced or to be
replaced by one or more Eligible Substitute Mortgage Loans.
"Deficient Valuation": With respect to any Mortgage Loan, a
valuation of the related Mortgaged Property by a court of competent
jurisdiction
in an amount less than the then outstanding principal balance of
the Mortgage
Loan, which valuation results from a proceeding initiated under the
Bankruptcy
Code.
"Definitive Certificates": As defined in Section 5.02(c) hereof.
"Delinquent": Any Mortgage Loan with respect to which the Monthly
Payment due on a Due Date is not made by the close of business on
the next
scheduled Due Date for such Mortgage Loan.
"Depositor": Asset Backed Funding Corporation, a Delaware
corporation, or any successor in interest.
"Depository": The initial depository shall be The Depository Trust
Company, whose nominee is Cede & Co., or any other organization
registered as a
"clearing agency" pursuant to Section 17A of the Exchange Act. The
Depository
shall initially be the registered Holder of the Book-Entry
Certificates. The
Depository shall at all times be a "clearing corporation" as
defined in Section
8-102(3) of the Uniform Commercial Code of the State of New York.
"Depository Participant": A broker, dealer, bank or other financial
institution or other person for whom from time to time a Depository
effects
book-entry transfers and pledges of securities deposited with the
Depository.
-22-
"Determination Date": With respect to any Distribution Date, the
15th day of the calendar month in which such Distribution Date
occurs or, if
such 15th day is not a Business Day, the Business Day immediately
preceding such
15th day.
"Directly Operate": With respect to any REO Property, the
furnishing
or rendering of services to the tenants thereof, the management or
operation of
such REO Property, the holding of such REO Property primarily for
sale to
customers, the performance of any construction work thereon or any
use of such
REO Property in a trade or business conducted by the Trust other
than through an
Independent Contractor; provided, however, that the Trustee (or the
Servicer
under this Agreement) shall not be considered to Directly Operate
an REO
Property solely because the Trustee (or the Servicer under this
Agreement)
establishes rental terms, chooses tenants, enters into or renews
leases, deals
with taxes and insurance, or makes decisions as to repairs or
capital
expenditures with respect to such REO Property.
"Disqualified Organization": A "disqualified organization" under
Section 860E of the Code, which as of the Closing Date is any of:
(i) the United
States, any state or political subdivision thereof, any possession
of the United
States, any foreign government, any international organization, or
any agency or
instrumentality of any of the foregoing, (ii) any organization
(other than a
cooperative described in Section 521 of the Code) which is exempt
from the tax
imposed by Chapter 1 of the Code unless such organization is
subject to the tax
imposed by Section 511 of the Code, (iii) any organization
described in Section
1381(a)(2)(C) of the Code, or (iv) any other Person so designated
by the Trustee
based upon an Opinion of Counsel provided by nationally recognized
counsel to
the Trustee that the holding of an ownership interest in the Class
R Certificate
by such Person may cause the Trust Fund or any Person having an
ownership
interest in any Class of Certificates (other than such Person) to
incur
liability for any federal tax imposed under the Code that would not
otherwise be
imposed but for the transfer of an ownership interest in the Class
R Certificate
to such Person. A corporation will not be treated as an
instrumentality of the
United States or of any state or political subdivision thereof if
all of its
activities are subject to tax and a majority of its board of
directors is not
selected by a governmental unit. The term "United States," "state"
and
"international organization" shall have the meanings set forth in
Section 7701
of the Code.
"Distribution Account": The trust account or accounts created and
maintained by the Trustee pursuant to Section 3.04(b) which shall
be entitled
"Distribution Account, JPMorgan Chase Bank, N.A., as Trustee, in
trust for the
registered Holders of First Franklin Mortgage Loan Trust 2005-FF5,
Asset-Backed
Certificates, Series 2005-FF5" and which must be an Eligible
Account.
"Distribution Date": The 25th day of any calendar month, or if such
25th day is not a Business Day, the Business Day immediately
following such 25th
day, commencing in May 2005.
"Distribution Date Statement": As defined in Section 4.06(a)
hereof.
"Due Date": With respect to each Mortgage Loan and any Distribution
Date, the day of the calendar month in which such Distribution Date
occurs on
which the Monthly Payment for such Mortgage Loan was due, exclusive
of any grace
period.
-23-
"Eligible Account": Any of (i) an account or accounts maintained
with a federal or state chartered depository institution or trust
company the
short-term unsecured debt obligations of which (or, in the case of
a depository
institution or trust company that is the principal subsidiary of a
holding
company, the short-term unsecured debt obligations of such holding
company) are
rated "A-1+" by S&P and "F-1+" by Fitch (or comparable ratings
if S&P and Fitch
are not the Rating Agencies) by each of the Rating Agencies at the
time any
amounts are held on deposit therein, (ii) an account or accounts
the deposits in
which are fully insured by the FDIC, (iii) a trust account or
accounts
maintained with the trust department of a federal or state
chartered depository
institution, national banking association or trust company acting
in its
fiduciary capacity or (iv) an account otherwise acceptable to each
Rating Agency
without reduction or withdrawal of their then current ratings of
the
Certificates as evidenced by a letter from each Rating Agency to
the Trustee and
the NIMS Insurer. Eligible Accounts may bear interest.
"Eligible Investments": Any one or more of the following
obligations
or securities acquired at a purchase price of not greater than par,
regardless
of whether issued or managed by the Depositor, the Servicer, the
NIMS Insurer,
the Trustee or any of their respective Affiliates or for which an
Affiliate of
the Trustee serves as an advisor:
(i) direct obligations of, or obligations fully guaranteed as to
timely payment of principal and interest by, the United States or
any
agency or instrumentality thereof, provided such obligations are
backed by
the full faith and credit of the United States;
(ii) (A) demand and time deposits in, certificates of deposit of,
bankers' acceptances issued by or federal funds sold by any
depository
institution or trust company (including the Trustee or its agents
acting
in their respective commercial capacities) incorporated under the
laws of
the United States of America or any state thereof and subject to
supervision and examination by federal and/or state authorities, so
long
as, at the time of such investment or contractual commitment
providing for
such investment, such depository institution or trust company or
its
ultimate parent has a short-term uninsured debt rating in one of
the two
highest available rating categories of S&P and the highest
available
rating category of Fitch and provided that each such investment has
an
original maturity of no more than 365 days and (B) any other demand
or
time deposit or deposit which is fully insured by the FDIC;
(iii) repurchase obligations with a term not to exceed 30 days with
respect to any security described in clause (i) above and entered
into
with a depository institution or trust company (acting as
principal) rated
"A" or higher by S&P and "A+" or higher by Fitch, provided,
however, that
collateral transferred pursuant to such repurchase obligation must
be of
the type described in clause (i) above and must (A) be valued daily
at
current market prices plus accrued interest or (B) pursuant to such
valuation, be equal, at all times, to 105% of the cash transferred
by the
Trustee in exchange for such collateral and (C) be delivered to the
Trustee or, if the Trustee is supplying the collateral, an agent
for the
Trustee, in such a manner as to accomplish perfection of a security
interest in the collateral by possession of certificated
securities;
-24-
(iv) securities bearing interest or sold at a discount that are
issued by any corporation incorporated under the laws of the United
States
of America or any State thereof and that are rated by each Rating
Agency
in its highest long-term unsecured rating categories at the time of
such
investment or contractual commitment providing for such investment;
(v) commercial paper (including both non-interest-bearing discount
obligations and interest-bearing obligations payable on demand or
on a
specified date not more than 30 days after the date of acquisition
thereof) that is rated by each Rating Agency in its highest
short-term
unsecured debt rating available at the time of such investment;
(vi) units of money market funds registered under the Investment
Company Act of 1940 (including funds managed or advised by the
Trustee or
affiliates thereof) that, if rated by each Rating Agency, are rated
in its
highest rating category (if so rated by such Rating Agency); and
(vii) if previously confirmed in writing to the Trustee and
consented to by the NIMS Insurer, any other demand, money market or
time
deposit, or any other obligation, security or investment, as may be
acceptable to the Rating Agencies in writing as an eligible
investment of
funds backing securities having ratings equivalent to its highest
initial
rating of the Senior Certificates;
provided, that no instrument described hereunder shall evidence
either the right
to receive (a) only interest with respect to the obligations
underlying such
instrument or (b) both principal and interest payments derived from
obligations
underlying such instrument and the interest and principal payments
with respect
to such instrument provide a yield to maturity at par greater than
120% of the
yield to maturity at par of the underlying obligations.
"Eligible Substitute Mortgage Loan": A mortgage loan substituted
for
a Defective Mortgage Loan pursuant to the terms of this Agreement
which must, on
the date of such substitution, (i) have an outstanding Principal
Balance, after
application of all scheduled payments of principal and interest due
during or
prior to the month of substitution, not in excess of the
outstanding principal
balance of the Defective Mortgage Loan as of the Due Date in the
calendar month
during which the substitution occurs, (ii) have a Mortgage Interest
Rate, with
respect to a Fixed-Rate Mortgage Loan, not less than the Mortgage
Interest Rate
of the Defective Mortgage Loan and not more than 2% in excess of
the Mortgage
Interest Rate of such Defective Mortgage Loan, (iii) have the same
Due Date as
the Defective Mortgage Loan, (iv) if an Adjustable-Rate Mortgage
Loan, have a
Maximum Mortgage Interest Rate not less than the Maximum Mortgage
Interest Rate
for the Defective Mortgage Loan, (v) if an Adjustable-Rate Mortgage
Loan, have a
Minimum Mortgage Interest Rate not less than the Minimum Mortgage
Interest Rate
of the Defective Mortgage Loan, (vi) if an Adjustable-Rate Mortgage
Loan, have a
Gross Margin equal to or greater than the Gross Margin of the
Defective Mortgage
Loan, (vii) if an Adjustable-Rate Mortgage Loan, have the same
Index as the
Defective Mortgage Loan, (viii) if an Adjustable-Rate Mortgage
Loan, have a next
Adjustment Date not more than two months later than the next
Adjustment Date on
the Defective Mortgage Loan, (ix) have a remaining term to maturity
not greater
than (and not more than one year less than) that of the
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Defective Mortgage Loan, (x) be current as of the date of
substitution, (xi)
have a Loan-to-Value Ratio as of the date of substitution equal to
or lower than
the Loan-to-Value Ratio of the Defective Mortgage Loan as of such
date, (xii)
have a risk grading at least equal to the risk grading assigned on
the Defective
Mortgage Loan, (xiii) have been underwritten or reunderwritten in
accordance
with the same underwriting criteria and guidelines as the Defective
Mortgage
Loan, (xiv) have the same lien priority as the Defective Mortgage
Loan, (xv)
have a Prepayment Charge at least equal in amount and duration of
that of the
Defective Mortgage Loan, (xvi) not be a Balloon Mortgage Loan if
the related
Mortgage Loan was not a Balloon Mortgage Loan (and if such related
Mortgage Loan
is a Balloon Mortgage Loan, such Eligible Substitute Mortgage Loan
shall have an
original maturity of not less than the original maturity of such
related
Mortgage Loan), and (xvii) conform to each representation and
warranty set forth
in Section 3.02 of the Originator Mortgage Loan Purchase Agreement
and Section
3.01 of the Mortgage Loan Purchase Agreement applicable to the
Defective
Mortgage Loan. In the event that one or more mortgage loans are
substituted for
one or more Defective Mortgage Loans, the amounts described in
clause (i) hereof
shall be determined on the basis of aggregate principal balance,
the risk
gradings described in clause (xii) hereof shall be satisfied as to
each such
mortgage loan, the terms described in clause (ix) hereof shall be
determined on
the basis of weighted average remaining term to maturity, the
Loan-to-Value
Ratios described in clause (xi) hereof shall be satisfied as to
each such
mortgage loan and, except to the extent otherwise provided in this
sentence, the
representations and warranties described in clause (xvii) hereof
must be
satisfied as to each Eligible Substitute Mortgage Loan or in the
aggregate, as
the case may be. Any Defective Mortgage Loan that is a Group 1
Mortgage Loan or
Group 2 Mortgage Loan must be replaced by an Eligible Substitute
Mortgage Loan
that will be a Group 1 or Group 2 Mortgage Loan, as applicable.
"ERISA": The Employee Retirement Income Security Act of 1974, as
amended.
"ERISA-Restricted Certificates": Any of the Class M, Class B, Class
CE, Class P and Class R Certificates, and any Class of Certificates
that no
longer satisfies the applicable rating as required by Prohibited
Transaction
Exemption 2002-41, 67 Fed. Reg. 54487 (August 22, 2002) for
transactions with
mortgage loans with loan-to-value ratios in excess of 100%.
"Escrow Account": The account or accounts created and maintained
pursuant to Section 3.06.
"Escrow Payments": The amounts constituting ground rents, taxes,
assessments, water rates, mortgage insurance premiums, fire and
hazard insurance
premiums and other payments required to be escrowed by the
Mortgagor with the
mortgagee pursuant to any Mortgage Loan.
"Estate in Real Property": A fee simple estate in a parcel of real
property.
"Exchange Act": The Securities Exchange Act of 1934, as amended.
"Expense Fee Rate": The sum of (i) the Servicing Fee Rate, (ii) the
Credit Risk Manager Fee Rate and (iii) the Trustee Fee Rate.
"Extended Period": As defined in Section 9.04(b).
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"Extra Principal Distribution Amount": As of any Distribution Date,
the lesser of (x) the Monthly Excess Interest Amount for such
Distribution Date
and (y) the Overcollateralization Deficiency for such Distribution
Date.
"FDIC": Federal Deposit Insurance Corporation or any successor
thereto.
"Fidelity Bond": Shall have the meaning assigned thereto in Section
3.12.
"Final Recovery Determination": With respect to any defaulted
Mortgage Loan or any REO Property (other than a Mortgage Loan or
REO Property
(i) purchased by the Originator or the Seller pursuant to or as
contemplated by
Section 2.03, (ii) purchased by the Servicer pursuant to Section
3.16 or (iii)
purchased by the NIMS Insurer, the Majority Class CE
Certificateholders or the
Servicer pursuant to Section 10.01), a determination made by the
Servicer that
all Insurance Proceeds, Condemnation Proceeds, Liquidation Proceeds
and other
payments or recoveries which the Servicer, in its reasonable good
faith
judgment, expects to be finally recoverable in respect thereof have
been so
recovered. The Servicer shall maintain records, prepared by a
Servicing Officer,
of each Final Recovery Determination made thereby.
"Fitch": Fitch Ratings and its successors, and if such company
shall
for any reason no longer perform the functions of a securities
rating agency,
"Fitch" shall be deemed to refer to any other "nationally
recognized statistical
rating organization" as set forth on the most current list of such
organizations
released by the Securities and Exchange Commission.
"Fixed-Rate Mortgage Loan": A Mortgage Loan which has a constant
annual rate at which interest accrues in accordance with the
provisions of the
related Mortgage Note.
"Foreclosure Price": The amount reasonably expected to be received
from the sale of the related Mortgaged Property net of any expenses
associated
with foreclosure proceedings.
"Form 10-K": As defined in Section 3.31(a) hereof.
"Grantor Trust": That portion of the Trust exclusive of REMIC 1 and
REMIC 2 consisting of (a) any Originator Prepayment Charge Payment
Amounts and
any Servicer Prepayment Charge Payment Amounts and the right of the
Class P
Certificateholders to receive such Originator Prepayment Charge
Payment Amounts
and Servicer Prepayment Charge Payment Amounts, (b) the right of
the Class A,
Class M and Class B Certificates to receive Cap Carryover Amounts,
(c) each
Yield Maintenance Agreement, the Reserve Accounts and the
beneficial interest of
the Class CE Certificates with respect thereto and (d) the
obligation of the
Class CE Certificates to pay Cap Carryover Amounts.
"Gross Margin": With respect to each Adjustable-Rate Mortgage Loan,
the fixed percentage set forth in the related Mortgage Note that is
added to the
Index on each Adjustment Date in accordance with the terms of the
related
Mortgage Note used to determine the Mortgage Interest Rate for such
Adjustable-Rate Mortgage Loan.
"Group 1 Cap": As of any Distribution Date and the Class A-1
Certificates, a per annum rate, adjusted by multiplying such rate
by a fraction
equal to 30 over the actual number of
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days in the related Interest Accrual Period, equal to the Weighted
Average Net
Mortgage Interest Rate for the Group 1 Mortgage Loans. For federal
income tax
purposes, the economic equivalent of such rate shall be expressed
as the
weighted average of the REMIC 1 Remittance Rate on REMIC 1 Regular
Interest
LT1GRP, weighted on the basis of the Uncertificated Balance of such
REMIC 1
Regular Interest.
"Group 1 Interest Remittance Amount": As of any Distribution Date,
the sum, without duplication, of (i) all interest due and collected
or advanced
with respect to the related Collection Period on the Group 1
Mortgage Loans
received by the Servicer on or prior to the Determination Date for
such
Distribution Date (less the Servicing Fee, amounts available for
reimbursement
of Advances and Servicing Advances pursuant to Section 3.05 and
expenses
reimbursable pursuant to Section 6.03), (ii) all Compensating
Interest paid by
the Servicer on the related Distribution Date with respect to such
Mortgage
Loans, (iii) the portion of any payment in connection with any
Principal
Prepayment (other than any Prepayment Interest Excess),
substitution, Purchase
Price, Termination Price, Insurance Proceeds or Net Liquidation
Proceeds
relating to interest with respect to such Mortgage Loans received
during the
related Prepayment Period and (iv) the portion of any Reimbursement
Amount
relating to interest with respect to such Mortgage Loans received
during the
related Prepayment Period.
"Group 1 Maximum Net Rate": The weighted average of the Net Maximum
Mortgage Interest Rates of the Mortgage Loans in Loan Group 1,
weighted on the
basis of the Principal Balances of the Group 1 Mortgage Loans as of
the first
day of the related Collection Period.
"Group 1 Maximum Rate Cap": With respect to any Distribution Date
and for the Class A-1 Certificates, a per annum rate equal to (i)
on or prior to
the Distribution Date in September 2008, the greater of (a) the
Group 1 Maximum
Net Rate (subject to adjustment based on the actual number of days
elapsed in
the related Interest Accrual Period and (b) 10% and (ii) after the
Distribution
Date in September 2008, the Group 1 Maximum Net Rate (subject to
adjustment
based on the actual number of days elapsed in the related Interest
Accrual
Period.
"Group 1 Mortgage Loan": Each Mortgage Loan listed on the Mortgage
Loan Schedule attached as Exhibit D-1 hereto. Each Group 1 Mortgage
Loan had, as
of the Cut-off Date, a Principal Balance that conforms to Fannie
Mae guidelines.
"Group 1 Principal Percentage": With respect to any Distribution
Date and the Class A-1 Certificates, the percentage equivalent to a
fraction,
the numerator of which is the Principal Remittance Amount allocable
to the Group
1 Mortgage Loans for such Distribution Date and the denominator of
which is the
Principal Remittance Amount allocable to the Mortgage Loans for
such
Distribution Date.
"Group 1 Senior Principal Distribution Amount": With respect to any
Distribution Date (i) before the Stepdown Date or as to which a
Trigger Event is
in effect, the Group 1 Principal Percentage of the Principal
Distribution Amount
and (ii) on or after the Stepdown Date and as long as a Trigger
Event is not in
effect, the excess of (a) the Certificate Principal Balance of the
Class A-1
Certificates immediately prior to such Distribution Date over (b)
the lesser of
(1) the product of (y) approximately 61.30% and (z) the aggregate
Principal
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Balance of the Group 1 Mortgage Loans as of the last day of the
related
Collection Period and (2) the amount by which the aggregate
Principal Balance of
the Group 1 Mortgage Loans as of the last day of the related
Collection Period
exceeds the product of (y) 0.50% and (z) the aggregate Principal
Balance of the
Group 1 Mortgage Loans on the Cut-off Date.
"Group 2 Cap": As of any Distribution Date and the Class A-2A,
Class
A-2B and Class A-2C Certificates, a per annum rate, adjusted by
multiplying such
rate by a fraction equal to 30 over the actual number of days in
the related
Interest Accrual Period, equal to the Weighted Average Net Mortgage
Interest
Rate for the Group 2 Mortgage Loans. For federal income tax
purposes, the
economic equivalent of such rate shall be expressed as the weighted
average of
the REMIC 1 Remittance Rate on REMIC 1 Regular Interest LT2GRP,
weighted on the
basis of the Uncertificated Balance of such REMIC 1 Regular
Interest.
"Group 2 Interest Remittance Amount": As of any Distribution Date,
the sum, without duplication, of (i) all interest due and collected
or advanced
with respect to the related Collection Period on the Group 2
Mortgage Loans
received by the Servicer on or prior to the Determination Date for
such
Distribution Date (less the Servicing Fee, amounts available for
reimbursement
of Advances and Servicing Advances pursuant to Section 3.05 and
expenses
reimbursable pursuant to Section 6.03), (ii) all Compensating
Interest paid by
the Servicer on the related Distribution Date with respect to such
Mortgage
Loans, (iii) the portion of any payment in connection with any
Principal
Prepayment (other than any Prepayment Interest Excess),
substitution, Purchase
Price, Termination Price, Insurance Proceeds or Net Liquidation
Proceeds
relating to interest with respect to such Mortgage Loans received
during the
related Prepayment Period and (iv) the portion of any Reimbursement
Amount
relating to interest with respect to such Mortgage Loans received
during the
related Prepayment Period.
"Group 2 Maximum Net Rate": The weighted average of the Net Maximum
Mortgage Interest Rates of the Mortgage Loans in Loan Group 2,
weighted on the
basis of the Principal Balances of the Group 2 Mortgage Loans as of
the first
day of the related Collection Period.
"Group 2 Maximum Rate Cap": With respect to any Distribution Date
and for the Class A-2A, Class A-2B and Class A-2C Certificates, a
per annum rate
equal to (i) on or prior to the Distribution Date in September
2008, the greater
of (a) the Group 2 Maximum Net Rate (subject to adjustment based on
the actual
number of days elapsed in the related Interest Accrual Period and
(b) 10% and
(ii) after the Distribution Date in September 2008, the Group 2
Maximum Net Rate
(subject to adjustment based on the actual number of days elapsed
in the related
Interest Accrual Period.
"Group 2 Mortgage Loan": Each Mortgage Loan listed on the Mortgage
Loan Schedule attached as Exhibit D-2 hereto. Each Group 2 Mortgage
Loan had, as
of the Cut-off Date, a Principal Balance that may or may not
conform to Fannie
Mae guidelines.
"Group 2 Principal Percentage": With respect to any Distribution
Date and the Class A-2A, Class A-2B and Class A-2C Certificates,
the percentage
equivalent to a fraction, the numerator of which is the Principal
Remittance
Amount allocable to the Group 2 Mortgage
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Loans for such Distribution Date and the denominator of which is
the Principal
Remittance Amount allocable to the Mortgage Loans for such
Distribution Date.
"Group 2 Senior Principal Distribution Amount": With respect to any
Distribution Date (i) before the Stepdown Date or as to which a
Trigger Event is
in effect, the Group 2 Principal Percentage of the Principal
Distribution Amount
and (ii) on or after the Stepdown Date and as long as a Trigger
Event is not in
effect, the excess of (a) the aggregate Certificate Principal
Balance of the
Class A-2A, Class A-2B and Class A-2C Certificates immediately
prior to such
Distribution Date over (b) the lesser of (1) the product of (y)
approximately
61.30% and (z) the aggregate Principal Balance of the Group 2
Mortgage Loans as
of the last day of the related Collection Period and (2) the amount
by which the
aggregate Principal Balance of the Group 2 Mortgage Loans as of the
last day of
the related Collection Period exceeds the product of (y) 0.50% and
(z) the
aggregate Principal Balance of the Group 2 Mortgage Loans on the
Cut-off Date.
"Group Subordinate Amount": For any Distribution Date and (i) the
Group 1 Mortgage Loans, an amount equal to the excess of the
aggregate Principal
Balance of the Group 1 Mortgage Loans as of the first day of the
related
Collection Period over the Certificate Principal Balance of the
Class A-1
Certificates immediately prior to such Distribution Date and (ii)
the Group 2
Mortgage Loans, an amount equal to the excess of the aggregate
Principal Balance
of the Group 2 Mortgage Loans as of the first day of the related
Collection
Period over the aggregate Certificate Principal Balance of the
Class A-2A, Class
A-2B and Class A-2C Certificates immediately prior to such
Distribution Date.
"Indenture": An indenture relating to the issuance of net interest
margin notes secured by the Class CE Certificates and the Class P
Certificates,
which may or may not be guaranteed by the NIMS Insurer.
"Independent": When used with respect to any specified Person, any
such Person who (i) is in fact independent of the Depositor, the
Servicer and
their respective Affiliates, (ii) does not have any direct
financial interest in
or any material indirect financial interest in the Depositor or the
Servicer or
any Affiliate thereof, and (iii) is not connected with the
Depositor or the
Servicer or any Affiliate thereof as an officer, employee,
promoter,
underwriter, trustee, partner, director or Person performing
similar functions;
provided, however, that a Person shall not fail to be Independent
of the
Depositor or the Servicer or any Affiliate thereof merely because
such Person is
the beneficial owner of 1% or less of any class of securities
issued by the
Depositor or the Servicer or any Affiliate thereof, as the case may
be.
"Independent Contractor": Either (i) any Person (other than the
Servicer) that would be an "independent contractor" with respect to
the Trust
Fund within the meaning of Section 856(d)(3) of the Code if the
Trust Fund were
a real estate investment trust (except that the ownership tests set
forth in
that section shall be considered to be met by any Person that owns,
directly or
indirectly, 35 percent or more of any Class of Certificates), so
long as the
Trust Fund does not receive or derive any income from such Person
and provided
that the relationship between such Person and the Trust Fund is at
arm's length,
all within the meaning of Treasury Regulations Section
1.856-4(b)(5), or (ii)
any other Person (including the Servicer) if the Trustee has
received an Opinion
of Counsel, which Opinion of Counsel shall be an expense of the
Trust
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Fund, to the effect that the taking of any action in respect of any
REO Property
by such Person, subject to any conditions therein specified, that
is otherwise
herein contemplated to be taken by an Independent Contractor will
not cause such
REO Property to cease to qualify as "foreclosure property" within
the meaning of
Section 860G(a)(8) of the Code (determined without regard to the
exception
applicable for purposes of Section 860D(a) of the Code), or cause
any income
realized in respect of such REO Property to fail to qualify as
Rents from Real
Property.
"Index": With respect to each Adjustable-Rate Mortgage Loan and
with
respect to each related Adjustment Date, the index as specified in
the related
Mortgage Note.
"Initial Certificate Principal Balance": With respect to any
Certificate of a Class other than a Class CE or Class R
Certificate, the amount
designated "Initial Certificate Principal Balance" on the face
thereof.
"Initial Overcollateralization Amount":
$4,241,271.16
"Insurance Proceeds": Proceeds of any title policy, hazard policy
or
other insurance policy covering a Mortgage Loan, to the extent such
proceeds are
not to be applied to the restoration of the related Mortgaged
Property or
released to the Mortgagor in accordance with the procedures that
the Servicer
would follow in servicing mortgage loans held for its own account,
subject to
the terms and conditions of the related Mortgage Note and Mortgage.
"Interest Accrual Period": With respect to any Distribution Date
and
each Class of Class A, Class M and Class B Certificates, the period
from the
preceding Distribution Date (or, in the case of the first
Distribution Date, the
period from the Closing Date) to the day prior to the current
Distribution Date
.
"Interest Carry Forward Amount": For any Class of Class A, Class M
and Class B Certificates and any Distribution Date, the sum of (a)
the excess,
if any, of the Accrued Certificate Interest and any Interest Carry
Forward
Amount for the prior Distribution Date, over the amount in respect
of interest
actually distributed on such Class on such prior Distribution Date
and (b)
interest on such excess at the applicable Certificate Interest Rate
for the
actual number of days elapsed on the basis of a 360-day year since
the prior
Distribution Date.
"Interest Percentage": With respect to any Class of Class A, Class
M
and Class B Certificates and any Distribution Date, the ratio
(expressed as a
decimal carried to six places) of the Accrued Certificate Interest
for such
Class to the sum of the Accrued Certificate Interest for all
Classes of Class A,
Class M and Class B Certificates, in each case with respect to such
Distribution
Date, without regard to Prepayment Interest Shortfalls (not covered
by
Compensating Interest payments) and Relief Act Interest Shortfalls.
"Interest Remittance Amount": As of any Distribution Date, the sum
of the Group 1 Interest Remittance Amount and the Group 2 Interest
Remittance
Amount.
"Late Collections": With respect to any Mortgage Loan, all amounts
received subsequent to the Determination Date immediately following
any related
Collection Period, whether as late payments of Monthly Payments or
as Insurance
Proceeds, Condemnation Proceeds, Liquidation Proceeds or otherwise,
which
represent late payments or collections of
-31-
principal and/or interest due (without regard to any acceleration
of payments
under the related Mortgage and Mortgage Note) but delinquent on a
contractual
basis for such Collection Period and not previously recovered.
"LIBOR Business Day": Any day on which banks in London, England and
The City of New York are open and conducting transactions in
foreign currency
and exchange.
"LIBOR Determination Date": With respect to the Class A, Class M
and
Class B Certificates, (i) for the first Distribution Date, the
second LIBOR
Business Day preceding the Closing Date and (ii) for each
subsequent
Distribution Date, the second LIBOR Business Day prior to the
immediately
preceding Distribution Date.
"Liquidated Mortgage Loan": As to any Distribution Date, any
Mortgage Loan in respect of which the Servicer has determined, in
accordance
with the servicing procedures specified herein, as of the end of
the related
Prepayment Period, that all Liquidation Proceeds, Condemnation
Proceeds and
Insurance Proceeds which it expects to recover with respect to the
liquidation
of the Mortgage Loan or disposition of the related REO Property
have been
recovered.
"Liquidation Proceeds": The amount (other than amounts received in
respect of the rental of any REO Property prior to REO Disposition)
received by
the Servicer in connection with (i) the taking of all or a part of
a Mortgaged
Property by exercise of the power of eminent domain or condemnation
or (ii) the
liquidation of a defaulted Mortgage Loan by means of a trustee's
sale,
foreclosure sale or otherwise.
"Liquidation Report": The report with respect to a Liquidated
Mortgage Loan in such form as is agreed to by the Servicer and the
Trustee
listing (i) the sale price of the related Mortgaged Property or
amount of the
REO Disposition, (ii) the amount of any Realized Loss (or gain)
with respect to
such Liquidated Mortgage Loan, (iii) the expenses relating to the
liquidation of
such Liquidated Mortgage Loan and (iv) such other information as is
agreed to by
the Servicer and the Trustee.
"Loan Group": Either of Loan Group 1 or Loan Group 2.
"Loan Group 1": The Group 1 Mortgage Loans.
"Loan Group 2": The Group 2 Mortgage Loans.
"Loan-to-Value Ratio": For any Mortgage Loan, the fraction,
expressed as a percentage, the numerator of which is the Principal
Balance of
the Mortgage Loan at origination the denominator of which is the
Value of the
related Mortgaged Property.
"Losses": As defined in Section 9.03.
"Lost Note Affidavit": With respect to any Mortgage Loan as to
which
the original Mortgage Note has been permanently lost or destroyed
and has not
been replaced, an affidavit from the Seller certifying that the
original
Mortgage Note has been lost, misplaced or destroyed (together with
a copy of the
related Mortgage Note and indemnifying the Trust against
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any loss, cost or liability resulting from the failure to deliver
the original
Mortgage Note) in the form of Exhibit H hereto.
"Majority Certificateholders": The Holders of Certificates
evidencing at least 51% of the Voting Rights.
"Majority Class CE Certificateholders": The Holders of Class CE
Certificates evidencing at least a 51% Percentage Interest in the
Class CE
Certificates.
"Marker Rate": With respect to the Class CE Certificates and any
Distribution Date, a per annum rate equal to two (2) times the
weighted average
of the Uncertificated REMIC 1 Pass-Through Rates for REMIC 1
Regular Interest
LT1A1, REMIC 1 Regular Interest LT1A2A, REMIC 1 Regular Interest
LT1A2B, REMIC 1
Regular Interest LT1A2C, REMIC 1 Regular Interest LT1M1, REMIC 1
Regular
Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1 Regular
Interest LT1M4,
REMIC 1 Regular Interest LT1M5, REMIC 1 Regular Interest LT1M6,
REMIC 1 Regular
Interest LT1M7, REMIC 1 Regular Interest LT1M8, REMIC 1 Regular
Interest LT1M9,
REMIC 1 Regular Interest LT1M10, REMIC 1 Regular Interest LT1B and
REMIC 1
Regular Interest LT1ZZ, (i) with the rate on each such REMIC 1
Regular Interest
(other than REMIC 1 Regular Interest LT1ZZ) subject to a cap equal
to the
Pass-Through Rate of its Corresponding Class (taking into account
in determining
any such Pass-through Rate the imposition of the Group 1 Cap, the
Group 2 Cap or
the Pool Cap, as applicable, as described in footnotes (1) through
(15) to the
table in the Preliminary Statement relating to the Certificates)
for the
purposes of this calculation and (ii) with the rate on REMIC 1
Regular Interest
LT1ZZ subject to a cap of zero for the purpose of this calculation;
provided,
however, that for this purpose, calculations of the Uncertificated
REMIC 1
Pass-Through Rate and the related caps with respect to each such
REMIC 1 Regular
Interest (other than REMIC 1 Regular Interest LT1ZZ) shall be
multiplied by a
fraction, the numerator of which is the actual number of days in
the Interest
Accrual Period and the denominator of which is 30.
"Maximum LT1ZZ Uncertificated Accrued Interest Deferral Amount":
With respect to any Distribution Date, the excess of (a) accrued
interest at the
Uncertificated REMIC 1 Pass-Through Rate applicable to REMIC 1
Regular Interest
LT1ZZ for such Distribution Date on a balance equal to the
Uncertificated
Principal Balance of REMIC 1 Regular Interest LT1ZZ minus the REMIC
1
Overcollateralized Amount, in each case for such Distribution Date,
over (b)
Uncertificated Accrued Interest on REMIC 1 Regular Interest LT1A1,
REMIC 1
Regular Interest LT1A2A, REMIC 1 Regular Interest LT1A2B, REMIC 1
Regular
Interest LT1A2C, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular
Interest LT1M2,
REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1M4,
REMIC 1 Regular
Interest LT1M5, REMIC 1 Regular Interest LT1M6, REMIC 1 Regular
Interest LT1M7,
REMIC 1 Regular Interest LT1M8, REMIC 1 Regular Interest LT1M9,
REMIC 1 Regular
Interest LT1M10 and REMIC 1 Regular Interest LT1B, each subject to
a cap equal
to the Pass-Through Rate of the related Corresponding Class for the
purpose of
this calculation (taking into account in determining any such
Pass-Through Rate
the imposition of the Group 1 Cap, Group 2 Cap or the Pool Cap, as
applicable,
as described in footnotes (1) through (15) to the table in the
Preliminary
Statement relating to the Certificates); provided, however, that
for this
purpose, calculations of the Uncertificated REMIC 1 Pass-Through
Rate and the
related caps with respect to Uncertificated Accrued Interest on
REMIC 1 Regular
Interest LT1A1, REMIC 1 Regular Interest LT1A2A, REMIC 1 Regular
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Interest LT1A2B, REMIC 1 Regular Interest LT1A2C, REMIC 1 Regular
Interest
LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest
LT1M3, REMIC 1
Regular Interest LT1M4, REMIC 1 Regular Interest LT1M5, REMIC 1
Regular Interest
LT1M6, REMIC 1 Regular Interest LT1M7, REMIC 1 Regular Interest
LT1M8, REMIC 1
Regular Interest LT1M9, REMIC 1 Regular Interest LT1M10 and REMIC 1
Regular
Interest LT1B, shall be multiplied by a fraction, the numerator of
which is the
actual number of days in the Interest Accrual Period and the
denominator of
which is 30.
"Maximum Mortgage Interest Rate": With respect to each
Adjustable-Rate Mortgage Loan, the percentage set forth in the
related Mortgage
Note as the maximum Mortgage Interest Rate thereunder.
"MERS": Mortgage Electronic Registration Systems, Inc., a Delaware
corporation, or any successor to it.
"Minimum Mortgage Interest Rate": With respect to each
Adjustable-Rate Mortgage Loan, the percentage set forth in the
related Mortgage
Note as the minimum Mortgage Interest Rate thereunder.
"Monthly Excess Cashflow Amount": The sum of the Monthly Excess
Interest Amount, the Overcollateralization Release Amount and
(without
duplication) any portion of the Principal Distribution Amount
remaining after
principal distributions on the Class A, Class M and Class B
Certificates.
"Monthly Excess Interest Amount": With respect to each Distribution
Date, the amount, if any, by which the Interest Remittance Amount
for such
Distribution Date exceeds the aggregate amount distributed on such
Distribution
Date pursuant to paragraphs (i) through (xvi) under Section 4.01.
"Monthly Form 8-K": As defined in Section 3.31(a) hereof.
"Monthly Payment": With respect to any Mortgage Loan, the scheduled
monthly payment of principal and interest on such Mortgage Loan
which is payable
by the related Mortgagor from time to time under the related
Mortgage Note,
determined: (a) after giving effect to (i) any Deficient Valuation
and/or Debt
Service Reduction with respect to such Mortgage Loan and (ii) any
reduction in
the amount of interest collectible from the related Mortgagor
pursuant to the
Relief Act or similar state laws; (b) without giving effect to any
extension
granted or agreed to by the Servicer pursuant to Section 3.01; and
(c) on the
assumption that all other amounts, if any, due under such Mortgage
Loan are paid
when due.
"Mortgage": The mortgage, deed of trust or other instrument
creating
a first lien on, or first priority security interest in, a
Mortgaged Property
securing a Mortgage Note.
"Mortgage File": The mortgage documents listed in Section 2.01
pertaining to a particular Mortgage Loan and any additional
documents required
to be added to the Mortgage File pursuant to this Agreement.
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"Mortgage Interest Rate": With respect to each Mortgage Loan, the
annual rate at which interest accrues on such Mortgage Loan from
time to time in
accordance with the provisions of the related Mortgage Note, which
rate (i) in
the case of each Fixed-Rate Mortgage Loan shall remain constant at
the rate set
forth in the Mortgage Loan Schedules as the Mortgage Interest Rate
in effect
immediately following the Cut-off Date and (ii) in the case of each
Adjustable-Rate Mortgage Loan (A) as of any date of determination
until the
first Adjustment Date following the Cut-off Date shall be the rate
set forth in
the Mortgage Loan Schedules as the Mortgage Interest Rate in effect
immediately
following the Cut-off Date and (B) as of any date of determination
thereafter
shall be the rate as adjusted on the most recent Adjustment Date,
to equal the
sum, rounded as provided in the Mortgage Note, of the Index,
determined as set
forth in the related Mortgage Note, plus the related Gross Margin
subject to the
limitations set forth in the related Mortgage Note. With respect to
each
Mortgage Loan that becomes an REO Property, as of any date of
determination, the
annual rate determined in accordance with the immediately preceding
sentence as
of the date such Mortgage Loan became an REO Property.
"Mortgage Loan": Each mortgage loan transferred and assigned to the
Trustee pursuant to Section 2.01 or Section 2.03(d) as from time to
time held as
a part of the Trust Fund, the Mortgage Loans so held being
identified in the
Mortgage Loan Schedules.
"Mortgage Loan Purchase Agreement": The agreement between the
Seller
and the Depositor, dated as of April 28, 2005, regarding the
transfer of the
Mortgage Loans by the Seller to or at the direction of the
Depositor.
"Mortgage Loan Schedule": As of any date with respect to the
Mortgage Loans, the lists of such Mortgage Loans included in the
Trust Fund on
such date, separately identifying the Group 1 Mortgage Loans and
the Group 2
Mortgage Loans, attached hereto as Exhibits D-1 and D-2,
respectively. The
Mortgage Loan Schedules shall set forth the following information
with respect
to each Mortgage Loan:
(1)
the Mortgage Loan identifying number;
(2)
the state and zip code of the Mortgaged Property;
(3)
the type of Residential Dwelling constituting the Mortgaged
Property;
(4)
the occupancy status of the Mortgaged Property at origination;
(5)
the original months to maturity;
(6)
the date of origination;
(7)
the first payment date;
(8)
the stated maturity date;
(9)
the stated remaining months to maturity;
(10)
the original principal amount of the Mortgage Loan;
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(11)
the Principal Balance of each Mortgage Loan as of the Cut-off
Date;
(12)
the Mortgage Interest Rate of the Mortgage Loan as of the
Cut-off Date;
(13)
the current principal and interest payment of the Mortgage
Loan as of the Cut-off Date;
(14)
the contractual interest paid to date of the Mortgage Loan;
(15)
the Loan-to-Value Ratio at origination and as of the Cut-off
Date;
(16)
a code indicating the loan performance status of the Mortgage
Loan as of the Cut-off Date;
(17)
a code indicating whether the Mortgage Loan is an
Adjustable-Rate Mortgage Loan or a Fixed-Rate Mortgage Loan;
(18)
for each Adjustable-Rate Mortgage Loan, a code indicating the
Index that is associated with such Mortgage Loan;
(19)
for each Adjustable-Rate Mortgage Loan, the Gross Margin;
(20)
for each Adjustable-Rate Mortgage Loan, the Periodic Rate Cap;
(21)
for each Adjustable-Rate Mortgage Loan, the Minimum Mortgage
Interest Rate;
(22)
for each Adjustable-Rate Mortgage Loan, the Maximum Mortgage
Interest Rate;
(23)
a code indicating whether the Mortgage Loan has a Prepayment
Charge and the type of Prepayment Charge and the term;
(24)
for each Adjustable-Rate Mortgage Loan, the first Adjustment
Date immediately following the Cut-off Date;
(25)
for each Adjustable-Rate Mortgage Loan, the rate adjustment
frequency;
(26)
for each Adjustable-Rate Mortgage Loan, the payment adjustment
frequency;
(27)
the purpose of the Mortgage Loan; and
(28)
a code indicating whether the Mortgage Loan has an
interest-only period and the term of such interest-only
period.
The Mortgage Loan Schedules shall set forth the following
information, as of the Cut-off Date, with respect to the Mortgage
Loans in the
aggregate: (1) the number of Mortgage Loans; (2) the aggregate
outstanding
principal balance of the Mortgage Loans; (3) the weighted
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average Mortgage Interest Rate of the Mortgage Loans; and (4) the
weighted
average months to maturity of the Mortgage Loans. The Mortgage Loan
Schedules
shall be amended from time to time in accordance with the
provisions of this
Agreement and a copy of such amended Mortgage Loan Schedules shall
be furnished
by the Servicer to the NIMS Insurer. With respect to any Eligible
Substitute
Mortgage Loan, Cut-off Date shall refer to the applicable date of
substitution.
"Mortgage Note": The original executed note or other evidence of
indebtedness evidencing the indebtedness of a Mortgagor under a
Mortgage Loan.
"Mortgage Pool": The pool of Mortgage Loans, identified on the
Mortgage Loan Schedules from time to time, and any REO Properties
acquired in
respect thereof.
"Mortgaged Property": The underlying property securing a Mortgage
Loan, including any REO Property, consisting of an Estate in Real
Property
improved by a Residential Dwelling.
"Mortgagor": The obligor on a Mortgage Note.
"Net Liquidation Proceeds": With respect to any Liquidated Mortgage
Loan or any other disposition of related Mortgaged Property
(including REO
Property) the related Liquidation Proceeds net of unreimbursed
Advances,
unreimbursed Servicing Advances, Servicing Fees and any other
accrued and unpaid
servicing fees received and retained in connection with the
liquidation of such
Mortgage Loan or Mortgaged Property.
"Net Maximum Mortgage Interest Rate": With respect to any
Adjustable-Rate Mortgage Loan, the applicable Maximum Mortgage
Interest Rate
minus the Expense Fee Rate.
"Net Mortgage Interest Rate": With respect to any Mortgage Loan,
the
Mortgage Interest Rate borne by such Mortgage Loan minus the
Expense Fee Rate.
"New Lease": Any lease of REO Property entered into on behalf of
the
Trust, including any lease renewed or extended on behalf of the
Trust if the
Trust has the right to renegotiate the terms of such lease.
"NIMS Insurer": Any insurer that is guaranteeing certain payments
under notes secured by collateral which includes all or a portion
of the Class
CE, Class P and Class R Certificates.
"Nonrecoverable Advance": Any Advance or Servicing Advance
previously made or proposed to be made in respect of a Mortgage
Loan that, in
the good faith business judgment of the Servicer, will not or, in
the case of a
proposed Advance or Servicing Advance, would not be ultimately
recoverable from
Late Collections on such Mortgage Loan as provided herein.
"Notional Amount": With respect to the Class CE Certificates, a
notional amount equal to the aggregate principal balance of the
REMIC 1 Regular
Interests other than REMIC 1 Regular Interest LT1P.
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"Offered Certificates": The Class A-1, Class A-2A, Class A-2B,
Class
A-2C, Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class
M-6, Class
M-7, Class M-8, Class M-9 and Class M-10 Certificates.
"Officers' Certificate": A certificate signed by the Chairman of
the
Board, the Vice Chairman of the Board, the President, a vice
president (however
denominated) or a principal, and by the Treasurer, the Secretary,
or one of the
assistant treasurers or assistant secretaries of the Servicer, the
Seller or the
Depositor, as applicable.
"One-Month LIBOR": With respect to each Interest Accrual Period,
the
rate determined by the Trustee on the related LIBOR Determination
Date on the
basis of the offered rate for one-month United States dollar
deposits, as such
rate appears on the Telerate Page 3750, as of 11:00 a.m. (London
time) on such
LIBOR Determination Date. If no such quotations are available on an
LIBOR
Determination Date, One-Month LIBOR for the related Interest
Accrual Period will
be established by the Trustee as follows:
(i) If on such LIBOR Determination Date two or more Reference Banks
provide such offered quotations, One-Month LIBOR for the related
Interest
Accrual Period shall be the arithmetic mean of such offered
quotations
(rounded upwards if necessary to the nearest whole multiple of
0.001%);
(ii) If on such LIBOR Determination Date fewer than two Reference
Banks provide such offered quotations, One-Month LIBOR for the
related
Interest Accrual Period shall be the arithmetic mean of the rates
quoted
by one or more major banks in New York City, selected by the
Trustee after
consultation with the Depositor and the NIMS Insurer, as of 11:00
A.M.,
New York City time, on such date for loans in U.S. Dollars to
leading
European banks for a period of one month in amounts approximately
equal to
the aggregate Certificate Principal Balance of the Class A, Class M
and
Class B Certificates; and
(iii) If no such quotations can be obtained, One-Month LIBOR for
the
related Interest Accrual Period shall be One-Month LIBOR for the
prior
Distribution Date.
The establishment of One-Month LIBOR on each LIBOR Determination
Date by the Trustee and the Trustee's calculation of the rate of
interest
applicable to the Class A, Class M and Class B Certificates for the
related
Interest Accrual Period shall (in the absence of manifest error) be
final and
binding.
"Opinion of Counsel": A written opinion of counsel, who may,
without
limitation, be a salaried counsel for the Depositor or the Servicer
except that
any opinion of counsel relating to (a) the qualification of any
REMIC as a REMIC
or (b) compliance with the REMIC Provisions must be an opinion of
Independent
counsel.
"Optional Termination Date": The first Distribution Date on which
the NIMS Insurer, if there is a NIMS Insurer, the Majority Class CE
Certificateholders or, if such Majority Class CE Certificateholder
is the Seller
or is an affiliate of the Seller, the Servicer, may opt to
terminate the
Mortgage Pool pursuant to Section 10.01.
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"Original Class Certificate Principal Balance": With respect to
each
Class of Certificates, the Certificate Principal Balance thereof on
the Closing
Date, as set forth opposite such Class in the Preliminary
Statement, except with
respect to (i) the Class R Certificates, which have an Original
Class
Certificate Principal Balance of zero and (ii) the Class CE
Certificates, which,
solely for REMIC purposes, have an Original Class Certificate
Principal Balance
equal to the Initial Overcollateralization Amount.
"Originator": First Franklin Financial Corporation and its
successors.
"Originator Mortgage Loan Purchase Agreement": The Flow Sale and
Interim Servicing Agreement, dated as of March 1, 2005, by and
between the
Seller, as purchaser, and First Franklin Financial Corporation, as
seller.
"Originator Prepayment Charge Payment Amount": The amount payable
by
the Originator pursuant to Section 4.21 of the Originator Mortgage
Loan Purchase
Agreement in respect of certain Prepayment Charges that are not
collected from
the related Mortgagor, which amounts shall not be part of any REMIC
formed
hereunder.
"Overcollateralization Amount": As of any Distribution Date, the
excess, if any, of (x) the Pool Balance as of the last day of the
related
Collection Period over (y) the aggregate Certificate Principal
Balance of the
Class A, Class M, Class B and Class P Certificates (after taking
into account
all distributions of principal on such Distribution Date and the
increase of any
Certificate Principal Balance as a result of Subsequent
Recoveries).
"Overcollateralization Deficiency": As of any Distribution Date,
the
excess, if any, of (x) the Targeted Overcollateralization Amount
for such
Distribution Date over (y) the Overcollateralization Amount for
such
Distribution Date, calculated for this purpose after taking into
account the
reduction on such Distribution Date of the Certificate Principal
Balances of all
Classes of Class A, Class M, Class B and Class P Certificates
resulting from the
distribution of the Principal Distribution Amount (but not the
Extra Principal
Distribution Amount) on such Distribution Date, but prior to taking
into account
any Applied Realized Loss Amount on such Distribution Date.
"Overcollateralization Release Amount": With respect to any
Distribution Date after the Stepdown Date on which a Trigger Event
is not in
effect, the lesser of (x) the Principal Remittance Amount for such
Distribution
Date and (y) the excess, if any, of (i) the Overcollateralization
Amount for
such Distribution Date, assuming that 100% of the Principal
Remittance Amount is
applied as a principal payment on the Class A, Class M and Class B
Certificates
on such Distribution Date, over (ii) the Targeted
Overcollateralization Amount
for such Distribution Date. With respect to any Distribution Date
on which a
Trigger Event is in effect, the Overcollateralization Release
Amount will be
zero.
"Ownership Interest": As to any Certificate, any ownership or
security interest in such Certificate, including any interest in
such
Certificate as the Holder thereof and any other interest therein,
whether direct
or indirect, legal or beneficial, as owner or as pledgee.
"Pass-Through Rate": Any of the Class A-1 Pass-Through Rate, the
Class A-2A Pass-Through Rate, the Class A-2B Pass-Through Rate, the
Class A-2C
Pass-Through Rate, the
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Class M-1 Pass-Through Rate, the Class M-2 Pass-Through Rate, the
Class M-3
Pass-Through Rate, the Class M-4 Pass-Through Rate, the Class M-5
Pass-Through
Rate, the Class M-6 Pass-Through Rate, the Class M-7 Pass-Through
Rate, the
Class M-8 Pass-Through Rate, the Class M-9 Pass-Through Rate, the
Class M-10
Pass-Through Rate and the Class B Pass-Through Rate; and in the
case of any
REMIC 1 Regular Interest, the Uncertificated REMIC 1 Pass-Through
Rate.
With respect to the Class CE Certificates and any Distribution
Date,
a per annum rate equal to the percentage equivalent of a fraction,
the numerator
of which is the sum of the amounts calculated pursuant to clauses
(A) through
(R) below, and the denominator of which is the aggregate of the
Uncertificated
Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC 1
Regular Interest
LT1A1, REMIC 1 Regular Interest LT1A2A, REMIC 1 Regular Interest
LT1A2B, REMIC 1
Regular Interest LT1A2C, REMIC 1 Regular Interest LT1M1, REMIC 1
Regular
Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1 Regular
Interest LT1M4,
REMIC 1 Regular Interest LT1M5, REMIC 1 Regular Interest LT1M6,
REMIC 1 Regular
Interest LT1M7, REMIC 1 Regular Interest LT1M8, REMIC 1 Regular
Interest LT1M9,
REMIC 1 Regular Interest LT1M10, REMIC 1 Regular Interest LT1B and
REMIC 1
Regular Interest LT1ZZ. For purposes of calculating the
Pass-Through Rate for
the Class CE Certificates, the numerator is equal to the sum of the
following
components:
(A) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1AA minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AA;
(B) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1A1 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1A1;
(C) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1A2A minus the Marker Rate, applied to an amount equal
to the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1A2A;
(D) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1A2B minus the Marker Rate, applied to an amount equal
to the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1A2B;
(E) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1A2C minus the Marker Rate, applied to an amount equal
to the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1A2C;
(F) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M1 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M1;
(G) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M2 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M2;
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(H) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M3 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M3;
(I) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M4 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M4;
(J) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M5 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M5;
(K) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M6 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M6;
(L) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M7 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M7;
(M) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M8 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M8;
(N) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M9 minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M9;
(O) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M10 minus the Marker Rate, applied to an amount equal
to the
Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1M10;
(P) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1B minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1B;
(Q) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1ZZ minus the Marker Rate, applied to an amount equal to
the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1ZZ;
and
(R) 100% of the Interest on REMIC 1 Regular Interest LT1P.
"Paying Agent": Any paying agent appointed pursuant to Section
5.05.
"Percentage Interest": With respect to any Certificate (other than
a
Class CE or Class R Certificate), a fraction, expressed as a
percentage, the
numerator of which is the Initial Certificate Principal Balance, as
the case may
be, represented by such Certificate and the denominator of which is
the Original
Class Certificate Principal Balance of the related Class.
-41-
With respect to a Class CE Certificate, the portion of the Class
evidenced
thereby, expressed as a percentage, as stated on the face of such
Certificate;
provided, however, that the sum of all such percentages for each
such Class
totals 100%. With respect to the Class R Certificate, 100%.
"Periodic Rate Cap": With respect to each Adjustable-Rate Mortgage
Loan and any Adjustment Date therefor, the fixed percentage set
forth in the
related Mortgage Note, which is the maximum amount by which the
Mortgage
Interest Rate for such Mortgage Loan may increase or decrease
(without regard to
the Maximum Mortgage Interest Rate or the Minimum Mortgage Interest
Rate) on
such Adjustment Date from the Mortgage Interest Rate in effect
immediately prior
to such Adjustment Date.
"Permitted Transferee": Any transferee of a Class R Certificate
other than a Disqualified Organization, a non-U.S. Person or a U.S.
Person with
respect to whom income on the Class R Certificate is attributable
to a foreign
permanent establishment or fixed base, within the meaning of an
applicable
income tax treaty, of such Person or any other U.S. Person.
"Person": Any individual, corporation, partnership, joint venture,
association, joint stock company, trust, limited liability company,
unincorporated organization or government or any agency or
political subdivision
thereof.
"Pool Balance": As of any date of determination, the aggregate
Principal Balance of the Mortgage Loans.
"Pool Cap": As of any Distribution Date and for the Class M and
Class B Certificates, a per annum rate, adjusted by multiplying
such rate by a
fraction equal to 30 over the actual number of days in the related
Interest
Accrual Period, equal to the weighted average of the Group 1 Cap
and the Group 2
Cap, weighted on the basis of the related Group Subordinate Amount.
For federal
income tax purposes, the economic equivalent of such rate shall be
expressed as
the weighted average of the REMIC 1 Remittance Rate on (a) REMIC 1
Regular
Interest LT1SUB, subject to a cap and floor equal to the Weighted
Average Net
Mortgage Interest Rates of the Group 1 Mortgage Loans and (b) REMIC
1 Regular
Interest LT2SUB, subject to a cap and floor equal to the Weighted
Average Net
Mortgage Interest Rates of the Group 2 Mortgage Loans, weighted on
the basis of
the Uncertificated Balance of each such REMIC 1 Regular Interest.
"Pool Maximum Net Rate": The weighted average of the Group 1
Maximum
Net Rate and the Group 2 Maximum Net Rate, weighted on the basis of
the related
Group Subordinate Amount.
"Pool Maximum Rate Cap": With respect to any Distribution Date and
for the Class M and Class B Certificates, a per annum rate (not
less than zero)
equal to (i) on or prior to the Distribution Date in September
2008, the greater
of (a) the Pool Maximum Net Rate (subject to adjustments based on
the actual
number of days elapsed in the related Interest Accrual Period) and
(b) 10% and
(ii) after the Distribution Date in September 2008, the Pool
Maximum Net Rate
(subject to adjustments based on the actual number of days elapsed
in the
related Interest Accrual Period).
-42-
"Prepayment Charge": With respect to any Prepayment Period, any
prepayment premium, penalty or charge collected by the Servicer
from a Mortgagor
in connection with any voluntary Principal Prepayment in full
pursuant to the
terms of the related Mortgage Note as from time to time held as a
part of the
Trust Fund, the Prepayment Charges so held being identified in the
Mortgage Loan
Schedules (other than any Originator Prepayment Charge Payment
Amount or
Servicer Prepayment Charge Payment Amount).
"Prepayment Interest Excess": With respect to any Distribution
Date,
for each Mortgage Loan that was the subject of a Principal
Prepayment in full
during the portion of the related Prepayment Period beginning on
the first day
of the calendar month in which such Distribution Date occurs
through the
Determination Date of the calendar month in which such Distribution
Date occurs,
an amount equal to interest (to the extent received) at the
applicable Mortgage
Interest Rate (net of the Servicing Fee Rate) on the amount of such
Principal
Prepayment for the number of days commencing on the first day of
the calendar
month in which such Distribution Date occurs and ending on the date
on which
such prepayment is so applied.
"Prepayment Interest Shortfall": With respect to any Distribution
Date, for each Mortgage Loan that was the subject of a Principal
Prepayment in
full during the portion of the related Prepayment Period occurring
in the prior
calendar month that was applied by the Servicer to reduce the
outstanding
Principal Balance of such Mortgage Loan on a date preceding the
related Due
Date, an amount equal to interest at the applicable Mortgage
Interest Rate (net
of the Servicing Fee Rate) on the amount of such Principal
Prepayment for the
number of days commencing on the date on which the Principal
Prepayment is
applied and ending on the last day of the related calendar month in
which such
Principal Prepayment was received.
"Prepayment Period": With respect to any Distribution Date and a
Mortgage Loan (other than with respect to voluntary Principal
Prepayments in
part), the period commencing on the day after the Determination
Date in the
calendar month preceding the calendar month in which such
Distribution Date
occurs (or, in the case of the first Distribution Date, on April 1,
2005) and
ending on the Determination Date in the calendar month in which
such
Distribution Date occurs.
"Principal Balance": As to any Mortgage Loan and any day, other
than
a Liquidated Mortgage Loan, the related Cut-off Date Principal
Balance, minus
the sum of (i) all collections and other amounts credited against
the principal
balance of any such Mortgage Loan, (ii) the principal portion of
Advances, (iii)
any Deficient Valuation and (iv) any principal reduction resulting
from a
Servicer Modification. For purposes of this definition, a
Liquidated Mortgage
Loan shall be deemed to have a Principal Balance equal to the
Principal Balance
of the related Mortgage Loan as of the final recovery of related
Liquidation
Proceeds and a Principal Balance of zero thereafter. As to any REO
Property and
any day, the Principal Balance of the related Mortgage Loan
immediately prior to
such Mortgage Loan becoming REO Property minus any REO Principal
Amortization
received with respect thereto on or prior to such day.
"Principal Distribution Amount": As to any Distribution Date, the
sum of the Group 1 Principal Distribution Amount and the Group 2
Principal
Distribution Amount.
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"Principal Prepayment": Any payment of principal made by the
Mortgagor on a Mortgage Loan which is received in advance of its
scheduled Due
Date and which is not accompanied by an amount of interest
representing the full
amount of scheduled interest due on any Due Date in any month or
months
subsequent to the month of prepayment.
"Principal Remittance Amount": With respect to any Distribution
Date, to the extent of funds available therefor, the amount equal
to the sum
(less amounts available for reimbursement of Advances and Servicing
Advances
pursuant to Section 3.05 and expenses reimbursable pursuant to
Section 6.03) of:
(i) each payment of principal on a Mortgage Loan due during the
related
Collection Period and received by the Servicer on or prior to the
related
Determination Date, and any Advances with respect thereto, (ii) all
full and
partial Principal Prepayments of Mortgage Loans received by the
Servicer during
the related Prepayment Period, (iii) Insurance Proceeds, Subsequent
Recoveries
and Net Liquidation Proceeds allocable to principal actually
collected by the
Servicer during the related Prepayment Period with respect to the
Mortgage
Loans, (iv) the portion of the Purchase Price allocable to
principal of all
repurchased Mortgage Loans with respect to such Prepayment Period,
(v) any
Substitution Adjustment Amounts received during the related
Prepayment Period
with respect to Mortgage Loans and (vi) on the Distribution Date on
which the
Trust is to be terminated in accordance with Section 10.01 hereof,
that portion
of the Termination Price in respect of principal.
"Private Certificates": Any of the Class B, Class CE, Class P and
Class R Certificates.
"Private Placement Memorandum": That certain Private Placement
Memorandum dated April 28, 2005 relating to the private offering of
the Class B
Certificates.
"Prospectus Supplement": That certain Prospectus Supplement dated
April 26, 2005 relating to the public offering of the Offered
Certificates.
"Purchase Price": With respect to any Mortgage Loan or REO Property
to be purchased pursuant to or as contemplated by Section 2.03 or
10.01, an
amount equal to the sum of (i) 100% of the Principal Balance
thereof as of the
date of purchase (or such other price as provided in Section
10.01), (ii) in the
case of (x) a Mortgage Loan, accrued interest on such Principal
Balance at the
applicable Mortgage Interest Rate in effect from time to time from
the Due Date
as to which interest was last covered by a payment by the Mortgagor
or an
Advance by the Servicer, which payment or Advance had as of the
date of purchase
been distributed pursuant to Section 4.01, through the end of the
calendar month
in which the purchase is to be effected, and (y) an REO Property,
accrued
interest at the applicable Mortgage Interest Rate on its fair
market value,
determined in good faith by the Servicer, (iii) any unreimbursed
Servicing
Advances and Advances and any unpaid Servicing Fees allocable to
such Mortgage
Loan or REO Property, (iv) any amounts previously withdrawn from
the Collection
Account in respect of such Mortgage Loan or REO Property pursuant
to Section
3.13, (v) in the case of a Mortgage Loan required to be purchased
pursuant to
Section 2.03, expenses reasonably incurred or to be incurred by the
Servicer or
the Trustee in respect of the breach or defect giving rise to the
purchase
obligation, and (vi) any costs and damages incurred by the Trust in
connection
with any violation by such Mortgage Loan of any predatory or
abusive lending
law.
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"Rating Agency or Rating Agencies": Fitch and S&P, or their
respective successors. If such agencies or their successors are no
longer in
existence, "Rating Agencies" shall be such nationally recognized
statistical
rating organizations as set forth on the most current list of such
organizations
released by the Securities and Exchange Commission and designated
by the
Depositor, notice of which designation shall be given to the
Trustee and the
Servicer.
"Realized Loss": With respect to a Liquidated Mortgage Loan, the
amount by which the remaining unpaid principal balance of the
Mortgage Loan
exceeds the amount of Net Liquidation Proceeds applied to the
principal balance
of the related Mortgage Loan. With respect to any Mortgage Loan, a
Deficient
Valuation or a reduction in the Principal Balance thereof resulting
from a
Servicer Modification.
"Realized Loss Amortization Amount": Any of the Class M-1 Realized
Loss Amortization Amount, the Class M-2 Realized Loss Amortization
Amount, the
Class M-3 Realized Loss Amortization Amount, the Class M-4 Realized
Loss
Amortization Amount, the Class M-5 Realized Loss Amortization
Amount, the Class
M-6 Realized Loss Amortization Amount, the Class M-7 Realized Loss
Amortization
Amount, the Class M-8 Realized Loss Amortization Amount, the Class
M-9 Realized
Loss Amortization Amount, the Class M-10 Realized Loss Amortization
Amount and
the Class B Realized Loss Amortization Amount.
"Record Date": With respect to all of the Certificates (other than
the Class CE, Class P and Class R Certificates), the Business Day
immediately
preceding such Distribution Date; provided, however, that if any
such
Certificate becomes a Definitive Certificate, the Record Date for
such
Certificate shall be the last Business Day of the month immediately
preceding
the month in which the related Distribution Date occurs. With
respect to the
Class CE, Class P and Class R Certificates, the last Business Day
of the month
immediately preceding the month in which the related Distribution
Date occurs.
"Reference Banks": Those banks (i) with an established place of
business in London, England, (ii) not controlling, under the
control of or under
common control with the Depositor or the Trustee, (iii) whose
quotations appear
on the Telerate Page 3750 on the relevant LIBOR Determination Date
and (iv)
which have been designated as such by the Trustee; provided,
however, that if
fewer than two of such banks provide a One-Month LIBOR rate, then
any leading
banks selected by the Trustee which are engaged in transactions in
United States
dollar deposits in the international Eurocurrency market.
"Regular Certificate": Any of the Class A Certificates, Class M
Certificates, Class B Certificates, Class CE Certificates and the
Class P
Certificates.
"Reimbursement Amount": With respect to any Mortgage Loan, any
costs
or damages incurred by the Trust in connection with a breach of (i)
the
Originator's representation set forth in Section 3.02(i) of the
Originator
Mortgage Loan Purchase Agreement and (ii) the Seller's
representations set forth
in Sections 3.01(i), 3.01(ii) and 3.01(iii) of the Mortgage Loan
Purchase
Agreement.
"Related Documents": With respect to any Mortgage Loan, the related
Mortgage Notes, Mortgages and other related documents.
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"Relief Act": The Servicemembers Civil Relief Act, as it may be
amended from time to time.
"Relief Act Interest Shortfall": With respect to any Distribution
Date, for any Mortgage Loan with respect to which there has been a
reduction in
the amount of interest collectible thereon for the most recently
ended
Collection Period as a result of the application of the Relief Act
or similar
state or local laws, the amount by which (i) interest collectible
on such
Mortgage Loan during such Collection Period is less than (ii) one
month's
interest on the Principal Balance of such Mortgage Loan at the
Mortgage Interest
Rate for such Mortgage Loan before giving effect to the application
of the
Relief Act or similar state or local laws.
"REMIC": A "real estate mortgage investment conduit" within the
meaning of Section 860D of the Code.
"REMIC 1 Interest Loss Allocation Amount": With respect to any
Distribution Date, an amount equal to (a) the product of (i) 50% of
the sum of
the aggregate Principal Balance of the Mortgage Loans and related
REO Properties
then outstanding and (ii) the Uncertificated REMIC 1 Pass-Through
Rate for REMIC
1 Regular Interest LT1AA minus the Marker Rate, divided by (b) 12.
"REMIC 1 Marker Allocation Percentage": 50% of any amount payable
from or loss attributable to the Mortgage Loans, which shall be
allocated to
REMIC 1 Regular Interest LT1AA, REMIC 1 Regular Interest LT1A1,
REMIC 1 Regular
Interest LT1A2A, REMIC 1 Regular Interest LT1A2B, REMIC 1 Regular
Interest
LT1A2C, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest
LT1M2, REMIC 1
Regular Interest LT1M3, REMIC 1 Regular Interest LT1M4, REMIC 1
Regular Interest
LT1M5, REMIC 1 Regular Interest LT1M6, REMIC 1 Regular Interest
LT1M7, REMIC 1
Regular Interest LT1M8, REMIC 1 Regular Interest LT1M9, REMIC 1
Regular Interest
LT1M10, REMIC 1 Regular Interest LT1B and REMIC 1 Regular Interest
LT1ZZ.
"REMIC
1
Overcollateralization
Target
Amount":
0.50%
of
the
Targeted Overcollateralization Amount.
"REMIC 1 Overcollateralized Amount": With respect to any date of
determination, (i) 0.50% the aggregate Uncertificated Principal
Balances of the
REMIC 1 Regular Interests minus (ii) the aggregate of the
Uncertificated
Principal Balances of REMIC 1 Regular Interest LT1A1, REMIC 1
Regular Interest
LT1A2A, REMIC 1 Regular Interest LT1A2B, REMIC 1 Regular Interest
LT1A2C, REMIC
1 Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1
Regular
Interest LT1M3, REMIC 1 Regular Interest LT1M4, REMIC 1 Regular
Interest LT1M5,
REMIC 1 Regular Interest LT1M6, REMIC 1 Regular Interest LT1M7,
REMIC 1 Regular
Interest LT1M8, REMIC 1 Regular Interest LT1M9, REMIC 1 Regular
Interest LT1M10,
REMIC 1 Regular Interest LT1B and REMIC 1 Regular Interest LT1P, in
each case as
of such date of determination.
"REMIC 1 Principal Loss Allocation Amount": With respect to any
Distribution Date, an amount equal to (a) the product of (i) 50% of
the
aggregate Principal Balance of the Mortgage Loans and related REO
Properties
then outstanding and (ii) 1 minus a fraction, the
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numerator of which is two times the aggregate of the Uncertificated
Principal
Balances of REMIC 1 Regular Interest LT1A1, REMIC 1 Regular
Interest LT1A2A,
REMIC 1 Regular Interest LT1A2B, REMIC 1 Regular Interest LT1A2C,
REMIC 1
Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1
Regular Interest
LT1M3, REMIC 1 Regular Interest LT1M4, REMIC 1 Regular Interest
LT1M5, REMIC 1
Regular Interest LT1M6, REMIC 1 Regular Interest LT1M7, REMIC 1
Regular Interest
LT1M8, REMIC 1 Regular Interest LT1M9, REMIC 1 Regular Interest
LT1M10 and REMIC
1 Regular Interest LT1B and the denominator of which is the
aggregate of the
Uncertificated Principal Balances of REMIC 1 Regular Interest
LT1A1, REMIC 1
Regular Interest LT1A2A, REMIC 1 Regular Interest LT1A2B, REMIC 1
Regular
Interest LT1A2C, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular
Interest LT1M2,
REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1M4,
REMIC 1 Regular
Interest LT1M5, REMIC 1 Regular Interest LT1M6, REMIC 1 Regular
Interest LT1M7,
REMIC 1 Regular Interest LT1M8, REMIC 1 Regular Interest LT1M9,
REMIC 1 Regular
Interest LT1M10, REMIC 1 Regular Interest LT1B and REMIC 1 Regular
Interest
LT1ZZ.
"REMIC 1 Regular Interest LT1A1": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1A1 shall accrue interest at
the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1A2A": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1A2A shall accrue interest
at the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1A2B": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1A2B shall accrue interest
at the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1A2C": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1A2C shall accrue interest
at the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
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"REMIC 1 Regular Interest LT1AA": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1AA shall accrue interest at
the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1M1": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1M1 shall accrue interest at
the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1M2": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1M2 shall accrue interest at
the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1M3": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1M3 shall accrue interest at
the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1M4": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1M4 shall accrue interest at
the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1M5": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1M5 shall accrue interest at
the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
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"REMIC 1 Regular Interest LT1M6": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1M6 shall accrue interest at
the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1M7": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1M7 shall accrue interest at
the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1M8": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1M8 shall accrue interest at
the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1M9": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1M9 shall accrue interest at
the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1M10": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1M10 shall accrue interest
at the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1B": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1B shall accrue interest at
the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
-49-
"REMIC 1 Regular Interest LT1SUB": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1SUB shall accrue interest
at the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1GRP": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1GRP shall accrue interest
at the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interest LT2SUB": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT2SUB shall accrue interest
at the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interest LT2GRP": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT2GRP shall accrue interest
at the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1P": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1P shall accrue interest at
the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1XX": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1XX shall accrue interest at
the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
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"REMIC 1 Regular Interest LT1ZZ": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued
hereunder and
designated as a regular interest in REMIC 1 for purposes of the
REMIC
Provisions. REMIC 1 Regular Interest LT1ZZ shall accrue interest at
the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to
time, and shall
be entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal
Balance as set forth in the Preliminary Statement hereto.
"REMIC 1 Regular Interests": REMIC 1 Regular Interest LT1AA, REMIC
1
Regular Interest LT1A1, REMIC 1 Regular Interest LT1A2A, REMIC 1
Regular
Interest LT1A2B, REMIC 1 Regular Interest LT1A2C, REMIC 1 Regular
Interest
LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest
LT1M3, REMIC 1
Regular Interest LT1M4, REMIC 1 Regular Interest LT1M5, REMIC 1
Regular Interest
LT1M6, REMIC 1 Regular Interest LT1M7, REMIC 1 Regular Interest
LT1M8, REMIC 1
Regular Interest LT1M9, REMIC 1 Regular Interest LT1M10, REMIC 1
Regular
Interest LT1B, REMIC 1 Regular Interest LT1SUB, REMIC 1 Regular
Interest LT1GRP,
REMIC 1 Regular Interest LT2SUB, REMIC 1 Regular Interest LT2GRP,
REMIC 1
Regular Interest LT1XX, REMIC 1 Regular Interest LT1P and REMIC 1
Regular
Interest LT1ZZ.
"REMIC 1 Sub WAC Allocation Percentage": 50% of any amount payable
from or loss attributable to the Mortgage Loans, which shall be
allocated to
REMIC 1 Regular Interest LT1SUB, REMIC 1 Regular Interest LT1GRP,
REMIC 1
Regular Interest LT2SUB, REMIC 1 Regular Interest LT2GRP and REMIC
1 Regular
Interest LT1XX.
"REMIC 1 Subordinated Balance Ratio": The ratio among the
Uncertificated Principal Balances of each REMIC 1 Regular Interest
ending with
the designation "SUB," equal to the ratio among, with respect to
each such REMIC
1 Regular Interest, the excess of (x) the aggregate Principal
Balance of the
Mortgage Loans in the related Loan Group over (y) the current
Certificate
Principal Balance of the Class A Certificates in the related Loan
Group.
"REMIC Provisions": Provisions of the federal income tax law
relating to real estate mortgage investment conduits which appear
at Section
860A through 860G of Subchapter M of Chapter 1 of the Code, and
related
provisions, and regulations and rulings promulgated thereunder, as
the foregoing
may be in effect from time to time.
"Remittance Report": A report prepared by the Servicer and
delivered
to the Trustee and the NIMS Insurer pursuant to Section 4.07,
containing the
information attached hereto as Exhibit M.
"Rents from Real Property": With respect to any REO Property, gross
income of the character described in Section 856(d) of the Code.
"REO Disposition": The sale or other disposition of an REO Property
on behalf of the Trust.
"REO Imputed Interest": As to any REO Property, for any Collection
Period, an amount equivalent to interest (at the Net Mortgage
Interest Rate that
would have been applicable
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to the related Mortgage Loan had it been outstanding) for such
Collection Period
on the unpaid Principal Balance of the Mortgage Loan as of the date
of
acquisition.
"REO Principal Amortization": With respect to any REO Property, for
any calendar month, the aggregate of all amounts received in
respect of such REO
Property during such calendar month, whether in the form of rental
income, sale
proceeds (including, without limitation, that portion of the
Termination Price
paid in connection with a purchase of all of the Mortgage Loans and
REO
Properties pursuant to Section 10.01 that is allocable to such REO
Property) or
otherwise, net of any portion of such amounts (i) payable pursuant
to Section
3.13 in respect of the proper operation, management and maintenance
of such REO
Property or (ii) payable or reimbursable to the Servicer pursuant
to Section
3.13 for unpaid Servicing Fees in respect of the related Mortgage
Loan and
unreimbursed Servicing Advances and Advances in respect of such REO
Property or
the related Mortgage Loan.
"REO Property": A Mortgaged Property acquired by the Servicer on
behalf of the Trust through foreclosure or deed-in-lieu of
foreclosure, as
described in Section 3.13.
"Request for Release": A release signed by a Servicing Officer, in
the form of Exhibit E attached hereto.
"Reserve Account": Any of (i) the Class A-1 Reserve Account, (ii)
the Class A-2A, Class A-2B and Class A-2C Reserve Account or (iii)
the Class M
and Class B Reserve Account.
"Residential Dwelling": Any one of the following: (i) a detached
one-family dwelling, (ii) a detached two- to four-family dwelling,
(iii) a
one-family dwelling unit in a condominium project, (iv) a
manufactured home, or
(v) a one-family dwelling in a planned unit development or a
townhouse, none of
which is a co-operative or mobile home.
"Residual Interest": The sole Class of "residual interests" in each
REMIC within the meaning of Section 860G(a)(2) of the Code.
"Responsible Officer": When used with respect to the Trustee, any
officer assigned to the Corporate Trust Division (or any successor
thereto),
including any Vice President, Assistant Vice President, Trust
Officer, any
Assistant Secretary, any trust officer or any other officer of the
Trustee
customarily performing functions similar to those performed by any
of the above
designated officers and in each case having direct responsibility
for the
administration of this Agreement.
"S&P": Standard & Poor's, a division of The McGraw-Hill
Companies,
Inc., and its successors, and if such company shall for any reason
no longer
perform the functions of a securities rating agency, "S&P"
shall be deemed to
refer to any other "nationally recognized statistical rating
organization" as
set forth on the most current list of such organizations released
by the
Securities and Exchange Commission.
"Seller": Bank of America, National Association, or its successor
in
interest, in its capacity as seller under the Mortgage Loan
Purchase Agreement.
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"Senior Certificates": The Class A-1, Class A-2A, Class A-2B and
Class A-2C Certificates.
"Senior Enhancement Percentage": For any Distribution Date, the
percentage obtained by dividing (x) the sum of (i) the aggregate
Certificate
Principal Balance of the Class M and Class B Certificates and (ii)
the
Overcollateralization Amount, in each case before taking into
account payments
of principal on the Mortgage Loans and the distribution of the
Principal
Distribution Amount on such Distribution Date by (y) the Pool
Balance as of the
last day of the related Collection Period.
"Senior Principal Distribution Amount": For any Distribution Date
on
or after the Stepdown Date and as long as a Trigger Event is not in
effect, the
sum of the Group 1 Senior Principal Distribution Amount and the
Group 2 Senior
Principal Distribution Amount.
"Senior Specified Enhancement Percentage": On any date of
determination thereof, 38.70%.
"Servicer": HomEq Servicing Corporation, a New Jersey corporation,
or any successor servicer appointed as herein provided, in its
capacity as
Servicer hereunder.
"Servicer Event of Termination": One or more of the events
described
in Section 7.01.
"Servicer Modification": A modification to the terms of a Mortgage
Loan, in accordance with the terms of Section 3.01, as to which the
Mortgagor is
in default or as to which, in the judgment of the Servicer, default
is
reasonably foreseeable.
"Servicer Prepayment Charge Payment Amount": The amount payable by
the Servicer in respect of any waived Prepayment Charges pursuant
to Section
3.01, which amount shall be equal to the difference between the
amount of
Prepayment Charge due by a Mortgagor before any waiver and the
actual amount of
the Prepayment Charge that was paid by the Mortgagor, which amounts
shall not be
a part of any REMIC formed hereunder.
"Servicer Remittance Date": With respect to any Distribution Date,
one Business Day prior to such Distribution Date.
"Servicing Advances": All customary, reasonable and necessary "out
of pocket" costs and expenses incurred by the Servicer (including
reasonable
attorneys' fees and disbursements) in the performance of its
servicing
obligations, including, but not limited to, the cost of (i) the
preservation,
restoration, inspection and protection of the Mortgaged Property,
(ii) any
enforcement or judicial proceedings, including foreclosures, (iii)
the
management and liquidation of the REO Property and (iv) compliance
with the
obligations under Section 3.08.
"Servicing Fee": With respect to each Mortgage Loan (including each
REO Property) and for any calendar month, an amount equal to one
month's
interest (or in the event of any payment of interest which
accompanies a
Principal Prepayment in full made by the Mortgagor during such
calendar month,
interest for the number of days covered by such payment of
interest) at the
Servicing Fee Rate on the same principal amount on which interest
on such
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Mortgage Loan accrues for such calendar month. The Servicing Fee
shall be
payable monthly and shall be prorated on a per diem basis for any
portion of a
month during which such Mortgage Loan is serviced hereunder.
"Servicing Fee Rate": With respect to each Mortgage Loan, 0.50% per
annum.
"Servicing Officer": Any representative or officer of the Servicer
involved in, or responsible for, the administration and servicing
of Mortgage
Loans, whose name and specimen signature appear on a list of
servicing officers
furnished by the Servicer to the Trustee and the Depositor on the
Closing Date,
as such list may from time to time be amended.
"Servicing Standard":
The standards set forth in Section 3.01.
"Similar Law":
As defined in Section 5.02(d) hereof.
"Startup Day":
As defined in Section 9.01(b) hereof.
"Stayed Funds": Any payment required to be made under the terms of
the Certificates and this Agreement but which is not remitted by
the Servicer
because the Servicer is the subject of a proceeding under the
Bankruptcy Code
and the making of such remittance is prohibited by Section 362 of
the Bankruptcy
Code.
"Stepdown Date": The earlier to occur of (i) the Distribution Date
on which the aggregate Certificate Principal Balance of the Class A
Certificates
is reduced to zero and (ii) the later to occur of (x) the
Distribution Date in
May 2008 and (y) the first Distribution Date on which the Senior
Enhancement
Percentage is greater than or equal to the Senior Specified
Enhancement
Percentage.
"Subordinated Certificates": The Class M-1, Class M-2, Class M-3,
Class M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9,
Class M-10,
Class B, Class CE and Class R Certificates.
"Subordination Depletion Date": The Distribution Date on which the
aggregate Certificate Principal Balance of the Class M and Class B
Certificates
is reduced to zero.
"Subsequent Recovery": Any amount (net of reimbursable expenses)
received on a Mortgage Loan subsequent to such Mortgage Loan being
determined to
be a Liquidated Mortgage Loan that resulted in a Realized Loss in a
prior month.
"Substitution Adjustment":
As defined in Section 2.03(c) hereof.
"Targeted Overcollateralization Amount": As of any Distribution
Date, (x) prior to the Stepdown Date, 0.55% of the Pool Balance as
of the
Cut-off Date and (y) on and after the Stepdown Date, (i) if a
Trigger Event has
not occurred, the greater of (A) 1.10% of the Pool Balance as of
the last day of
the related Collection Period and (B) 0.50% of the Pool Balance as
of the
Cut-off Date and (ii) if a Trigger Event has occurred, the Targeted
Overcollateralization Amount for the immediately preceding
Distribution Date.
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"Tax Matters Person": The tax matters person appointed pursuant to
Section 9.01(e) hereof.
"Tax Returns": The federal income tax returns on Internal Revenue
Service Form 1066, U.S. Real Estate Mortgage Investment Conduit
Income Tax
Return, including Schedule Q thereto, Quarterly Notice to Residual
Interest
Holders of the REMIC Taxable Income or Net Loss Allocation, or any
successor
forms, to be filed on behalf of the Trust for each of the two
REMICs created
pursuant to this Agreement under the REMIC Provisions, together
with any and all
other information reports or returns that may be required to be
furnished to the
Certificateholders or filed with the Internal Revenue Service or
any other
governmental taxing authority under any applicable provisions of
federal, state
or local tax laws.
"Telerate Page 3750": The display page currently so designated on
the Moneyline Telerate Service (or such other page as may replace
the Telerate
Page 3750 page on that service for the purpose of displaying London
interbank
offered rates of major banks).
"Termination Price": As defined in Section 10.01(a) hereof.
"Trigger Event": With respect to any Distribution Date, if (i) the
three-month rolling average of 60+ Day Delinquent Loans equals or
exceeds 40.00%
of the Senior Enhancement Percentage or (ii) the aggregate amount
of Realized
Losses incurred since the Cut-off Date through the last day of the
related
Collection Period (reduced by the aggregate amount of Subsequent
Recoveries
received since the Cut-off Date through the last day of the related
Collection
Period) divided by the Cut-off Date Aggregate Principal Balance
exceeds the
applicable percentages set forth below with respect to such
Distribution Date:
DISTRIBUTION DATE OCCURRING IN
PERCENTAGE
------------------------------
----------
May 2008 through April 2009
4.25% for the first month, plus
an additional 1/12th of 1.50%
for each month thereafter
May 2009 through April 2010
5.75% for the first month, plus
an additional 1/12th of 1.00%
for each month thereafter
May 2010 through April 2011
6.75% for the first month, plus
an additional 1/12th of 0.25%
for each month thereafter
May 2011 and thereafter
7.00%
"Trust": First Franklin Mortgage Loan Trust 2005-FF5, the trust
created hereunder.
"Trust Fund": The segregated pool of assets subject hereto,
constituting the primary trust created hereby and to be
administered hereunder,
with respect to a portion of which two REMIC elections are to be
made, such
entire Trust Fund consisting of: (i) such Mortgage Loans as from
time to time
are subject to this Agreement, together with the Mortgage Files
relating
thereto, and together with all collections thereon and proceeds
thereof (other
than scheduled payments due on the Mortgage Loans prior to the
Cut-off Date),
(ii) any REO
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Property, together with all collections thereon and proceeds
thereof, (iii) the
Trustee's rights with respect to the Mortgage Loans under all
insurance policies
required to be maintained pursuant to this Agreement and any
proceeds thereof,
(iv) the Depositor's rights under the Originator Mortgage Loan
Purchase
Agreement, the Assignment, Assumption and Recognition Agreement and
the Mortgage
Loan Purchase Agreement (including any security interest created
thereby), (v)
the Trustee's rights under each Yield Maintenance Agreement and
(vi) the
Collection Accounts, the Distribution Account and the Reserve
Accounts and such
assets that are deposited therein from time to time and any
investments thereof,
together with any and all income, proceeds and payments with
respect thereto.
"Trustee": JPMorgan Chase Bank, N.A., a banking association
organized under the laws of the United States, or any successor
Trustee
appointed as herein provided.
"Trustee Fee": With respect to any Distribution Date, the product
of
(x) one-twelfth of the Trustee Fee Rate and (y) the aggregate of
the Principal
Balances of all Mortgage Loans as of the opening of business on the
first day of
the related Collection Period.
"Trustee Fee Rate": With respect to any Distribution Date, 0.001%
per annum.
"Uncertificated Accrued Interest": With respect to each REMIC 1
Regular Interest on each Distribution Date, an amount equal to one
month's
interest at the related Uncertificated REMIC 1 Pass-Through Rate on
the
Uncertificated Principal Balance of such REMIC 1 Regular Interest.
In each case,
Uncertificated Accrued Interest will be reduced by any Prepayment
Interest
Shortfalls and Relief Act Interest Shortfalls (allocated to such
REMIC 1 Regular
Interests based on their respective entitlements to interest
irrespective of any
Prepayment Interest Shortfalls and Relief Act Interest Shortfalls
for such
Distribution Date).
"Uncertificated Principal Balance": The amount of any REMIC 1
Regular Interest outstanding as of any date of determination. As of
the Closing
Date, the Uncertificated Principal Balance of each REMIC 1 Regular
Interest
shall equal the amount set forth in the Preliminary Statement
hereto as its
initial uncertificated balance. On each Distribution Date, the
Uncertificated
Principal Balance of each REMIC 1 Regular Interest shall be reduced
by all
distributions of principal made on such REMIC 1 Regular Interest on
such
Distribution Date pursuant to Section 4.08 and, if and to the
extent necessary
and appropriate, shall be further reduced on such Distribution Date
by Realized
Losses as provided in Section 4.08(b) or increased by Subsequent
Recoveries
through Available Funds. The Uncertificated Balance of REMIC 1
Regular Interest
LT1ZZ shall be increased by interest deferrals as provided in
Section
4.08(a)(i). The Uncertificated Balance of each REMIC 1 Regular
Interest shall
never be less than zero.
"Uncertificated REMIC 1 Pass-Through Rate": With respect to REMIC 1
Regular Interest LT1AA, REMIC 1 Regular Interest LT1A1, REMIC 1
Regular Interest
LT1A2A, REMIC 1 Regular Interest LT1A2B, REMIC 1 Regular Interest
LT1A2C, REMIC
1 Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1
Regular
Interest LT1M3, REMIC 1 Regular Interest LT1M4, REMIC 1 Regular
Interest LT1M5,
REMIC 1 Regular Interest LT1M6, REMIC 1 Regular Interest LT1M7,
REMIC 1 Regular
Interest LT1M8, REMIC 1 Regular Interest LT1M9, REMIC 1 Regular
Interest LT1M10,
REMIC 1 Regular Interest
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LT1B, REMIC 1 Regular Interest LT1SUB, REMIC 1 Regular Interest
LT2SUB, REMIC 1
Regular Interest LTXX, REMIC 1 Regular Interest LT1P and REMIC 1
Regular
Interest LT1ZZ, the Weighted Average Net Mortgage Rate of the
Mortgage Loans.
With respect to REMIC 1 Regular Interest LT1GRP, the Weighted
Average Net
Mortgage Rate of the Group 1 Mortgage Loans. With respect REMIC 1
Regular
Interest LT2GRP, the Weighted Average Net Mortgage Rate of the
Group 2 Mortgage
Loans.
"United States Person" or "U.S. Person": (i) A citizen or resident
of the United States, (ii) a corporation, partnership or other
entity treated as
a corporation or partnership for United States federal income tax
purposes
organized in or under the laws of the United States or any state
thereof or the
District of Columbia (unless, in the case of a partnership,
Treasury Regulations
provide otherwise), (iii) an estate the income of which is
includible in gross
income for United States tax purposes, regardless of its source, or
(iv) a trust
if a court within the United States is able to exercise primary
supervision over
the administration of the trust and one or more United States
persons have
authority to control all substantial decisions of the trust.
Notwithstanding the
preceding sentence, to the extent provided in Treasury Regulations,
certain
Trusts in existence on August 20, 1996, and treated as United
States persons
prior to such date, that elect to continue to be treated as United
States
persons will also be a U.S. Person; provided, that for purposes of
the
definition of a "Permitted Transferee," a U.S. Person shall not
include any
person whose income is attributable to a foreign permanent
establishment or
fixed base, within the meaning of an applicable income tax treaty,
of such
Person or any other U.S. Person.
"Unpaid Realized Loss Amount": For any of the Class M and Class B
Certificates and as to any Distribution Date, the excess of (x) the
aggregate
Applied Realized Loss Amounts allocated to such Class for all prior
Distribution
Dates over (y) the sum of (a) the cumulative amount of any
Subsequent Recoveries
allocated to such Class and (b) the aggregate Realized Loss
Amortization Amounts
with respect to such Class for all prior Distribution Dates.
"Value": With respect to any Mortgaged Property, the lesser of (a)
an amount determined by an appraisal done at origination of the
Mortgage Loan
and (b) the purchase price paid for the related Mortgaged Property
by the
Mortgagor with the proceeds of the Mortgage Loan; provided,
however, that in the
case of a refinanced Mortgage Loan, the value of the Mortgaged
Property is based
solely upon clause (a) above.
"Voting Rights": The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. The Voting
Rights allocated
among Holders of the Class A, Class M and Class B Certificates
shall be 98%, and
shall be allocated among each such Class according to the fraction,
expressed as
a percentage, the numerator of which is the aggregate Certificate
Principal
Balance of all the Certificates of such Class then outstanding and
the
denominator of which is the aggregate Certificate Principal Balance
of all the
Class A, Class M and Class B Certificates then outstanding. The
Voting Rights
allocated to each such Class of Certificates shall be allocated
among all
holders of each such Class in proportion to the outstanding
Certificate
Principal Balance of such Certificates; provided, however, that any
Certificate
registered in the name of the Servicer, the Depositor or the
Trustee or any of
their respective affiliates shall not be included in the
calculation of Voting
Rights; provided that only such Certificates as are known by a
Responsible
Officer of the Trustee to be so registered will be
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so excluded. One percent of all the Voting Rights will be allocated
to the
Holders of each of the Class CE and Class P Certificates. The Class
R
Certificates shall have no Voting Rights.
"Weighted Average Net Mortgage Rate": The weighted average (based
on
Principal Balance as of the first day of the related Collection
Period or, in
the case of the first Distribution Date, the Cut-off Date) of the
Net Mortgage
Interest Rates of the Mortgage Loans, the Group 1 Mortgage Loans or
the Group 2
Mortgage Loans or the Group Subordinate Amounts, as applicable,
expressed for
each such Mortgage Loan as an annual rate and calculated on the
basis of twelve
months consisting of 30 days each and a 360-day year.
"Written Order to Authenticate": A written order by which the
Depositor directs the Trustee to execute, authenticate and deliver
the
Certificates.
"Yield Maintenance Agreement": Any of (i) the Class A-1Yield
Maintenance Agreement, (ii) the Class A-2A, Class A-2B and Class
A-2C Yield
Maintenance Agreement or (iii) the Class M and Class B Yield
Maintenance
Agreement.
"Yield Maintenance Agreement Payment": Any of (i) the Class A-1
Yield Maintenance Agreement Payment, (ii) the Class A-2A, Class
A-2B and Class
A-2C Yield Maintenance Agreement Payment or (iii) the Class M and
Class B Yield
Maintenance Agreement Payment.
"Yield Maintenance Agreement Provider": Barclays Bank PLC and any
successors thereto.
Section 1.02 Accounting.
Unless otherwise specified herein, for the purpose of any
definition
or calculation, whenever amounts are required to be netted,
subtracted or added
or any distributions are taken into account such definition or
calculation and
any related definitions or calculations shall be determined without
duplication
of such functions.
Section 1.03 Rights of the NIMS Insurer.
Each of the rights of the NIMS Insurer set forth in this Agreement
shall exist so long as (i) the NIMS Insurer has undertaken to
guarantee certain
payments of notes issued pursuant to the Indenture and (ii) any
series of notes
issued pursuant to the Indenture remains outstanding or the NIMS
Insurer is owed
amounts in respect of its guarantee of payment on such notes;
provided, however,
the NIMS Insurer shall not have any rights hereunder (except
pursuant to Section
11.01 in the case of clause (ii) below) during the period of time,
if any, that
(i) the NIMS Insurer has not undertaken to guarantee certain
payments of notes
issued pursuant to the Indenture or (ii) any default has occurred
and is
continuing under the insurance policy issued by the NIMS Insurer
with respect to
such notes.
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ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01 Conveyance of Mortgage Loans.
The Depositor, concurrently with the execution and delivery hereof,
does hereby transfer, assign, set over and otherwise convey to the
Trustee, on
behalf of the Trust, without recourse for the benefit of the
Certificateholders
all of the right, title and interest of the Depositor, including
any security
interest therein for the benefit of the Depositor, in and to (i)
each Mortgage
Loan identified on the Mortgage Loan Schedules, including the
related Cut-off
Date Principal Balance, all interest accruing thereon after the
Cut-off Date and
all collections in respect of interest and principal due after the
Cut-off Date;
(ii) property which secured each such Mortgage Loan and which has
been acquired
by foreclosure or deed in lieu of foreclosure; (iii) its interest
in any
insurance policies in respect of the Mortgage Loans; (iv) all other
assets
included or to be included in the Trust Fund; (v) all proceeds of
any of the
foregoing; and (vi) the rights of the Depositor under the
Originator Mortgage
Loan Purchase Agreement, the Assignment, Assumption and Recognition
Agreement
and the Mortgage Loan Purchase Agreement. Such assignment includes
all interest
and principal due to the Depositor or the Servicer after the
Cut-off Date with
respect to the Mortgage Loans.
In connection with such transfer and assignment, the Depositor does
hereby deliver to, and deposit with the Trustee, or its designated
agent, the
following documents or instruments with respect to each Mortgage
Loan (a
"Mortgage File") so transferred and assigned:
(a)
the original Mortgage Note including any riders thereto, endorsed
either
(A) in blank or (B) in the following form: "Pay to the order of
JPMorgan
Chase Bank, N.A., as Trustee under the Pooling and Servicing
Agreement,
dated as of April 1, 2005, among Asset Backed Funding Corporation,
HomEq
Servicing Corporation and JPMorgan Chase Bank, N.A., First Franklin
Mortgage Loan Trust 2005-FF5, Asset-Backed Certificates, Series
2005-FF5, without recourse," or with respect to any lost Mortgage
Note,
an original Lost Note Affidavit, together with a copy of the
related
Mortgage Note;
(b)
the original Mortgage with evidence of recording thereon including
any
riders thereto, and the original recorded power of attorney, if the
Mortgage was executed pursuant to a power of attorney, with
evidence of
recording thereon or, if such Mortgage or power of attorney has
been
submitted for recording but has not been returned from the
applicable
public recording office, has been lost or is not otherwise
available, a
copy of such Mortgage or power of attorney, as the case may be,
certified to be a true and complete copy of the original submitted
for
recording;
(c)
except with respect to each MERS Mortgage Loan, an original
Assignment,
in form and substance acceptable for recording. The Mortgage shall
be
assigned either (A) in blank or (B) to "JPMorgan Chase Bank, N.A.,
as
Trustee under the Pooling and Servicing Agreement, dated as of
April 1,
2005, among Asset Backed Funding Corporation,
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HomEq Servicing Corporation, First Franklin Mortgage Loan Trust
2005-FF5, Asset-Backed Certificates, Series 2005-FF5, without
recourse";
(d)
the originals of all intervening Assignments (if any) evidencing a
complete chain of assignment from the applicable originator to the
last
endorsee with evidence of recording thereon, or if any such
intervening
assignment has not been returned from the applicable recording
office or
has been lost or if such public recording office retains the
original
recorded Assignments, the Servicer shall deliver or cause to be
delivered to the Trustee, a photocopy of such intervening
assignment,
together with (A) in the case of a delay caused by the public
recording
office, an Officers' Certificate of the Servicer (or certified by
the
title company, escrow agent, or closing attorney) stating that such
intervening Assignment has been dispatched to the appropriate
public
recording office for recordation and that such original recorded
intervening Assignment or a copy of such intervening Assignment
certified by the appropriate public recording office to be a true
and
complete copy of the original recorded intervening assignment of
mortgage will be promptly delivered to the Trustee upon receipt
thereof
by the Servicer; or (B) in the case of an intervening assignment
where a
public recording office retains the original recorded intervening
assignment or in the case where an intervening assignment is lost
after
recordation in a public recording office, a copy of such
intervening
assignment certified by such public recording office to be a true
and
complete copy of the original recorded intervening assignment;
(e)
the original or a certified copy of lender's title insurance
policy; and
(f)
the original or copies of each assumption, modification, written
assurance or substitution agreement, if any.
The Trustee agrees to execute and deliver to the Depositor on or
prior to the Closing Date an acknowledgment of receipt of the
original Mortgage
Notes (with any exceptions noted), substantially in the form
attached as Exhibit
F-3 hereto.
If any of the documents referred to in Section 2.01(b), (c) or (d)
above has as of the Closing Date been submitted for recording but
either (x) has
not been returned from the applicable public recording office or
(y) has been
lost or such public recording office has retained the original of
such document,
the obligations of the Depositor to deliver such documents shall be
deemed to be
satisfied upon (1) delivery to the Trustee no later than the
Closing Date, of a
copy of each such document certified by the Seller in the case of
(x) above or
the applicable public recording office in the case of (y) above to
be a true and
complete copy of the original that was submitted for recording and
(2) if such
copy is certified by the Seller, delivery to the Trustee, promptly
upon receipt
thereof of either the original or a copy of such document certified
by the
applicable public recording office to be a true and complete copy
of the
original. If the original lender's title insurance policy was not
delivered
pursuant to Section 2.01(e) above, the Seller shall deliver or
cause to be
delivered to the Trustee, a written commitment or interim binder or
preliminary
report of title issued by the title insurance or escrow company,
with the
original to be delivered to the Trustee, promptly upon receipt
thereof. The
Depositor shall deliver or cause to be delivered to the Trustee
promptly upon
receipt thereof any other documents constituting a part of a
Mortgage File
received with respect to any
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Mortgage Loan, including, but not limited to, any original
documents evidencing
an assumption or modification of any Mortgage Loan.
Upon discovery or receipt of notice of any materially defective
document in, or that a document is missing from, a Mortgage File,
the Seller
shall have 120 days to cure such defect or 150 days following the
Closing Date,
in the case of missing Mortgages or Assignments or deliver such
missing document
to the Trustee. If the Seller does not cure such defect or deliver
such missing
document within such time period, the Seller shall either
repurchase or
substitute for such Mortgage Loan in accordance with Section 2.03.
The Depositor herewith delivers to the Trustee executed copies of
the Originator Mortgage Loan Purchase Agreement, the Assignment,
Assumption and
Recognition Agreement and the Mortgage Loan Purchase Agreement.
It is agreed and understood by the parties hereto that it is not
intended that any mortgage loan be included in the Trust that is a
"High-Cost
Home Loan" as defined in any of (i) the New Jersey Home Ownership
Act effective
November 27, 2003, (ii) the New Mexico Home Loan Protection Act
effective
January 1, 2004, (iii) the Massachusetts Predatory Home Loan
Practices Act
effective November 7, 2004 or (iv) the Indiana Home Loan Practices
Act,
effective January 1, 2005.
Section 2.02 Acceptance by Trustee.
The Trustee acknowledges the receipt of, subject to the provisions
of Section 2.01 and subject to the review described below and any
exceptions
noted on the exception report described in the next paragraph
below, the
documents referred to in Section 2.01 above and all other assets
included in the
definition of "Trust Fund" and declares that it holds and will hold
such
documents and the other documents delivered to it constituting a
Mortgage File,
and that it holds or will hold all such assets and such other
assets included in
the definition of "Trust Fund" in trust for the exclusive use and
benefit of all
present and future Certificateholders.
The Trustee reviewed, for the benefit of the Certificateholders,
each Mortgage File prior to the Closing Date (or, with respect to
any document
delivered after the Startup Day, within 60 days of receipt and with
respect to
any Qualified Substitute Mortgage, within 60 days after the
assignment thereof)
and will certify in substantially the form attached hereto as
Exhibit F-1 that,
as to each Mortgage Loan listed in the Mortgage Loan Schedules
(other than any
Mortgage Loan paid in full or any Mortgage Loan specifically
identified in the
exception report annexed thereto as not being covered by such
certification),
(i) all documents required to be delivered to it pursuant to
Section 2.01 of
this Agreement are in its possession, (ii) such documents have been
reviewed by
it and have not been mutilated, damaged or torn and relate to such
Mortgage Loan
and (iii) based on its examination and only as to the foregoing,
the information
set forth in the Mortgage Loan Schedules that corresponds to items
(1), (2),
(3), (10) and (23) of the Mortgage Loan Schedules accurately
reflects
information set forth in the Mortgage File. It is herein
acknowledged that, in
conducting such review, the Trustee is under no duty or obligation
to inspect,
review or examine any such documents, instruments, certificates or
other papers
to determine that they are genuine, enforceable, or appropriate for
the
represented
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purpose or that they have actually been recorded or that they are
other than
what they purport to be on their face.
Prior to the first anniversary date of this Agreement the Trustee
shall deliver to the Depositor, the Servicer and the NIMS Insurer a
final
certification in the form annexed hereto as Exhibit F-2 evidencing
the
completeness of the Mortgage Files, with any applicable exceptions
noted
thereon.
If in the process of reviewing the Mortgage Files and making or
preparing, as the case may be, the certifications referred to
above, the Trustee
finds any document or documents constituting a part of a Mortgage
File to be
missing or defective in any material respect, at the conclusion of
its review
the Trustee shall so notify the Seller, the Depositor, the NIMS
Insurer and the
Servicer. In addition, upon the discovery by the Originator, the
Seller, the
Depositor, the NIMS Insurer, the Trustee or the Servicer (or upon
receipt by the
Trustee of written notification of such breach) of a breach of any
of the
representations and warranties made by the Originator in the
Originator Mortgage
Loan Purchase Agreement or the Seller in the Mortgage Loan Purchase
Agreement in
respect of any Mortgage Loan which materially adversely affects
such Mortgage
Loan or the interests of the related Certificateholders in such
Mortgage Loan,
the party discovering such breach shall give prompt written notice
to the other
parties.
The Depositor and the Trustee intend that the assignment and
transfer herein contemplated constitute a sale of the Mortgage
Loans and the
Related Documents, conveying good title thereto free and clear of
any liens and
encumbrances, from the Depositor to the Trustee and that such
property not be
part of the Depositor's estate or property of the Depositor in the
event of any
insolvency by the Depositor. In the event that such conveyance is
deemed to be,
or to be made as security for, a loan, the parties intend that the
Depositor
shall be deemed to have granted and does hereby grant to the
Trustee, on behalf
of the Trust, a first priority perfected security interest in all
of the
Depositor's right, title and interest in and to the Mortgage Loans
and the
Related Documents, and that this Agreement shall constitute a
security agreement
under applicable law.
Section 2.03 Repurchase or Substitution of Mortgage Loans by the
Originator or the Seller.
(a) Upon discovery or receipt of written notice of any materially
defective document in, or that a document is missing from, a
Mortgage File or
that any document in a Mortgage File is materially inconsistent
with the
Mortgage Loan Schedules or of the breach by the Originator or the
Seller of any
representation or warranty under the Originator Mortgage Loan
Purchase Agreement
or the Mortgage Loan Purchase Agreement, as applicable, in respect
of any
Mortgage Loan which materially adversely affects the value of such
Mortgage
Loan, Prepayment Charge or the interest therein of the
Certificateholders, the
Trustee shall promptly notify the Originator or the Seller, as the
case may be,
the Servicer and the NIMS Insurer of such defect, missing document
or breach and
request that, in the case of a defective or missing document, the
Seller cure
such defect or deliver such missing document within 120 days from
the date the
Seller was notified of such missing document or defect or, in the
case of a
breach of a representation or warranty, request the Originator or
the Seller, as
applicable, cure such breach within 90 days from the date the
Originator or the
Seller, as the case may be, was notified of
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such breach. If the Seller does not deliver such missing document
or cure such
defect or if the Originator or the Seller, as applicable, does not
cure such
breach in all material respects during such period, the Trustee
shall enforce
the Originator's or the Seller's obligation, as the case may be,
under the
Originator Mortgage Loan Purchase Agreement or the Mortgage Loan
Purchase
Agreement, as applicable, and cause the Originator or the Seller,
as applicable,
to repurchase such Mortgage Loan from the Trust Fund at the
Purchase Price on or
prior to the Determination Date following the expiration of such
period (subject
to Section 2.03(d)). The Purchase Price for the repurchased
Mortgage Loan shall
be deposited in the Collection Account, and the Trustee, upon
receipt of written
notice from the Servicer of such deposit, shall release to the
Originator or the
Seller, as applicable, the related Mortgage File and shall execute
and deliver
such instruments of transfer or assignment, in each case without
recourse, as
the Originator or the Seller, as applicable, shall furnish to it
and as shall be
necessary to vest in the Originator or the Seller, as the case may
be, any
Mortgage Loan released pursuant hereto and the Trustee shall have
no further
responsibility with regard to such Mortgage File. In lieu of
repurchasing any
such Mortgage Loan as provided above, the Originator or the Seller,
as the case
may be, may cause such Mortgage Loan to be removed from the Trust
Fund (in which
case it shall become a Defective Mortgage Loan) and substitute one
or more
Eligible Substitute Mortgage Loans in the manner and subject to the
limitations
set forth in Section 2.03(c); provided, however, the Originator or
the Seller,
as applicable, may not substitute an Eligible Substitute Mortgage
Loan for any
Deleted Mortgage Loan that violates any predatory or abusive
lending law.
With respect to the representations and warranties set forth in the
Originator Mortgage Loan Purchase Agreement and the Mortgage Loan
Purchase
Agreement that are made to the best of the Originator's or the
Seller's
knowledge, as applicable, or as to which the Originator or the
Seller, as the
case may be, has no knowledge, if it is discovered by the
Depositor, the
Servicer, the NIMS Insurer or the Trustee that the substance of
such
representation and warranty is inaccurate and such inaccuracy
materially and
adversely affects the value of the related Mortgage Loan,
Prepayment Charge or
the interest therein of the Certificateholders then,
notwithstanding the
Originator's or the Seller's lack of knowledge with respect to the
substance of
such representation and warranty being inaccurate at the time the
representation
or warranty was made, such inaccuracy shall be deemed a breach of
the applicable
representation or warranty.
It is understood and agreed that the representations and warranties
set forth in the Originator Mortgage Loan Purchase Agreement and
the Mortgage
Loan Purchase Agreement shall survive delivery of the Mortgage
Files to the
Trustee and the Closing Date and shall inure to the benefit of the
Certificateholders notwithstanding any restrictive or qualified
endorsement or
assignment. It is understood and agreed that the obligations of the
Originator
and the Seller set forth in this Section 2.03(a) to cure,
substitute for or
repurchase a Mortgage Loan pursuant to the Originator Mortgage Loan
Purchase
Agreement or the Mortgage Loan Purchase Agreement, as applicable,
and to pay the
Reimbursement Amount constitute the sole remedies available to the
Certificateholders and to the Trustee on their behalf respecting a
breach of the
representations and warranties contained in the Originator Mortgage
Loan
Purchase Agreement and the Mortgage Loan Purchase Agreement.
The representations and warranties of the Originator with respect
to
the Mortgage Loans in the Originator Mortgage Loan Purchase
Agreement, which
have been assigned to the
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Trustee hereunder, were made as of the dates specified in the
Originator
Mortgage Loan Purchase Agreement. To the extent that any fact,
condition or
event with respect to a Mortgage Loan constitutes a breach of both
(i) a
representation or warranty of the Originator under the Originator
Mortgage Loan
Purchase Agreement and (ii) a representation or warranty of the
Seller under the
Mortgage Loan Purchase Agreement (other than Seller's
representations with
respect to predatory and abusive lending laws in Sections 3.01(i),
3.01(ii) and
3.01(iii) of the Mortgage Loan Purchase Agreement), the only right
or remedy of
the Trustee or of any Certificateholder shall be the Trustee's
right to enforce
the obligations of the Originator under any applicable
representation or
warranty made by it. The Trustee acknowledges that the Seller shall
have no
obligation or liability with respect to any breach of a
representation or
warranty made by it with respect to the Mortgage Loans (except as
otherwise set
forth in this paragraph) if the fact, condition or event
constituting such
breach also constitutes a breach of a representation or warranty
made by the
Originator in the Originator Mortgage Loan Purchase Agreement,
without regard to
whether the Originator fulfills its contractual obligations in
respect of such
representation or warranty. In addition, to the extent that any
fact, condition
or event with respect to a Mortgage Loan constitutes a breach of
both (x) the
Originator's representation with respect to predatory and abusive
lending laws
in Section 3.02(i), (tt) and (ggg) of the Originator Mortgage Loan
Purchase
Agreement and (y) the Seller's representation with respect to
predatory and
abusive lending laws in Section 3.01(i), 3.01(ii) or 3.01(iii) of
the Mortgage
Loan Purchase Agreement, the Originator shall be obligated to pay
the
Reimbursement Amount relating to such Mortgage Loan, and, to the
extent the
Originator fails to do so, the Trustee shall be entitled to enforce
the Seller's
obligation to pay such Reimbursement Amount. In any event, the
Reimbursement
Amount shall be delivered to the Servicer for deposit into the
Collection
Account within ten (10) days from the date the Seller was notified
by the
Trustee of the Reimbursement Amount.
(b) Within 90 days of the earlier of discovery by the Servicer or
receipt of notice by the Servicer of the breach of any
representation, warranty
or covenant of the Servicer set forth in Section 2.05 which
materially and
adversely affects the interests of the Certificateholders in any
Mortgage Loan,
the Servicer shall cure such breach in all material respects.
(c) Any substitution of Eligible Substitute Mortgage Loans for
Defective Mortgage Loans made pursuant to Section 2.03(a) must be
effected prior
to the last Business Day that is within two years after the Closing
Date. As to
any Defective Mortgage Loan for which the Originator or the Seller
substitutes
an Eligible Substitute Mortgage Loan or Loans, such substitution
shall be
effected by the Originator or the Seller, as applicable, delivering
to the
Trustee for such Eligible Substitute Mortgage Loan or Loans, the
Mortgage Note,
the Mortgage, the Assignment to the Trustee, and such other
documents and
agreements, with all necessary endorsements thereon, as are
required by Section
2.01, together with an Officers' Certificate providing that each
such Eligible
Substitute Mortgage Loan satisfies the definition thereof and
specifying the
Substitution Adjustment (as described below), if any, in connection
with such
substitution. The Trustee shall acknowledge receipt for such
Eligible Substitute
Mortgage Loan or Loans and, within ten (10) Business Days
thereafter, shall
review such documents as specified in Section 2.02 and deliver to
the Servicer
and the NIMS Insurer, with respect to such Eligible Substitute
Mortgage Loan or
Loans, a certification substantially in the form attached hereto as
Exhibit F-1,
with any applicable exceptions noted thereon. Within one year of
the date of
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substitution, the Trustee shall deliver to the Servicer and the
NIMS Insurer a
certification substantially in the form of Exhibit F-2 hereto with
respect to
such Eligible Substitute Mortgage Loan or Loans, with any
applicable exceptions
noted thereon. Monthly Payments due with respect to Eligible
Substitute Mortgage
Loans in the month of substitution are not part of the Trust Fund
and will be
retained by the Originator or the Seller, as applicable. For the
month of
substitution, distributions to Certificateholders will reflect the
collections
and recoveries in respect of such Defective Mortgage Loan in the
Collection
Period or Prepayment Period, as applicable, preceding the date of
substitution
and the Depositor, the Originator or the Seller, as the case may
be, shall
thereafter be entitled to retain all amounts subsequently received
in respect of
such Defective Mortgage Loan. The Depositor shall give or cause to
be given
written notice to the Certificateholders and the NIMS Insurer that
such
substitution has taken place, shall amend the Mortgage Loan
Schedules to reflect
the removal of such Defective Mortgage Loan from the terms of this
Agreement and
the substitution of the Eligible Substitute Mortgage Loan or Loans
and shall
deliver a copy of such amended Mortgage Loan Schedules to the
Trustee, the
Servicer and the NIMS Insurer. Upon such substitution, such
Eligible Substitute
Mortgage Loan or Loans shall constitute part of the Mortgage Pool
and shall be
subject in all respects to the terms of this Agreement and, in the
case of a
substitution effected by the Originator or the Seller, the
Originator Mortgage
Loan Purchase Agreement or the Mortgage Loan Purchase Agreement, as
the case may
be, including, in the case of a substitution effected by the
Originator or the
Seller, all applicable representations and warranties thereof
included in the
Originator Mortgage Loan Purchase Agreement or the Mortgage Loan
Purchase
Agreement, as the case may be, as of the date of substitution.
For any month in which the Originator or the Seller substitutes one
or more Eligible Substitute Mortgage Loans for one or more
Defective Mortgage
Loans, the Servicer will determine the amount (the "Substitution
Adjustment"),
if any, by which the aggregate Purchase Price of all such Defective
Mortgage
Loans exceeds the aggregate, as to each such Eligible Substitute
Mortgage Loan,
of the principal balance thereof as of the date of substitution,
together with
one month's interest on such principal balance at the applicable
Net Mortgage
Interest Rate. On the date of such substitution, the Originator or
the Seller,
as the case may be, will deliver or cause to be delivered to the
Servicer for
deposit in the Collection Account an amount equal to the
Substitution
Adjustment, if any, and the Trustee, upon receipt of the related
Eligible
Substitute Mortgage Loan or Loans and notice by the Servicer of
such deposit,
shall release to the Originator or the Seller, as applicable, the
related
Mortgage File or Files and shall execute and deliver such
instruments of
transfer or assignment, in each case without recourse, as the
Originator or the
Seller, as the case may be, shall deliver to it and as shall be
necessary to
vest therein any Defective Mortgage Loan released pursuant hereto.
In addition,
in connection with the substitution of one or more Eligible
Substitute Mortgage
Loans for one or more Defective Mortgage Loans, in the event the
Trust incurs
costs or damages arising in connection with a breach of the
Originator's
representations with respect to predatory or abusive lending laws
set forth in
Section 3.02(i), (tt) and (ggg) of the Originator Mortgage Loan
Purchase
Agreement, the Seller shall be required to reimburse the Trust for
the
Reimbursement Amount pursuant to the Mortgage Loan Purchase
Agreement to the
extent that the Originator fails to do so.
In addition, the Originator or the Seller, as applicable, shall
obtain at its own expense and deliver to the Trustee and the NIMS
Insurer an
Opinion of Counsel to the effect that such substitution will not
cause an
Adverse REMIC Event. If such Opinion of Counsel can not
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be delivered, then such substitution may only be effected at such
time as the
required Opinion of Counsel can be given.
(d) Upon discovery by the Originator, the Seller, the Servicer, the
NIMS Insurer or the Trustee that any Mortgage Loan does not
constitute a
"qualified mortgage" within the meaning of Section 860G(a)(3) of
the Code, the
party discovering such fact shall within two Business Days give
written notice
thereof to the other parties. In connection therewith, the
Originator or the
Seller, as applicable, shall repurchase or, subject to the
limitations set forth
in Section 2.03(c), substitute one or more Eligible Substitute
Mortgage Loans
for the affected Mortgage Loan within 90 days of the earlier of
discovery or
receipt of such notice with respect to such affected Mortgage Loan.
In addition,
upon discovery that a Mortgage Loan is defective in a manner that
would cause it
to be a "defective obligation" within the meaning of Treasury
Regulations
relating to REMICs, the Originator or the Seller, as the case may
be, shall cure
the defect or make the required purchase or substitution no later
than 90 days
after the discovery of the defect. Any such repurchase or
substitution shall be
made in the same manner as set forth in Section 2.03(a). The
Trustee shall
reconvey to the Originator or the Seller, as applicable, the
Mortgage Loan to be
released pursuant hereto in the same manner, and on the same terms
and
conditions, as it would a Mortgage Loan repurchased for breach of a
representation or warranty.
Section 2.04 Execution of Yield Maintenance Agreements.
The Depositor hereby directs the Trustee to enter into and execute
the Class A-1 Yield Maintenance Agreement, the Class A-2A, Class
A-2B and Class
A-2C Yield Maintenance Agreement and the Class M and Class B Yield
Maintenance
Agreement on the Closing Date on behalf of the Trust for the
benefit of the
Holders of (i) the Class A-1 Certificates, (ii) the Class A-2A,
Class A-2B and
Class A-2C Certificates and (iii) the Class M and Class B
Certificates,
respectively. The Depositor, the Servicer and the Holders of the
Class A-1
Certificates, the Class A-2A, Class A-2B and Class A-2C
Certificates and the
Class M and Class B Certificates (by their acceptance of such
Certificates)
acknowledge that JPMorgan Chase Bank, N.A. is entering into each
respective
Yield Maintenance Agreement solely in its capacity as Trustee of
the Trust Fund
and not in its individual capacity.
Section 2.05 Representations, Warranties and Covenants of the
Servicer.
The Servicer hereby represents, warrants and covenants to the
Trustee, for the benefit of each of the Trustee and the
Certificateholders and
to the Depositor and the NIMS Insurer that as of the Closing Date
or as of such
date specifically provided herein:
(i) The Servicer is a corporation duly organized, validly existing
and in good standing under the laws of the State of New Jersey and
has all
licenses necessary to carry on its business as now being conducted,
except
for such licenses, certificates and permits the absence of which,
individually or in the aggregate, would not have a material adverse
effect
on the ability of the Servicer to conduct its business as it is
presently
conducted, and is licensed, qualified and in good standing in each
state
where a Mortgaged Property is located if the laws of such state
require
licensing or qualification in order to conduct business of the type
conducted by the Servicer or to ensure the enforceability or
validity of
each Mortgage Loan; the Servicer has the power and authority to
execute
and deliver
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this Agreement and to perform in accordance herewith; the
execution,
delivery and performance of this Agreement (including all
instruments of
transfer to be delivered pursuant to this Agreement) by the
Servicer and
the consummation of the transactions contemplated hereby have been
duly
and validly authorized; and all requisite action has been taken by
the
Servicer to make this Agreement valid and binding upon the Servicer
in
accordance with its terms;
(ii) The consummation of the transactions contemplated by this
Agreement are in the ordinary course of business of the Servicer
and will
not result in the breach of any term or provision of the
organizational
documents of the Servicer or result in the breach of any term or
provision
of, or conflict with or constitute a default under or result in the
acceleration of any obligation under, any agreement, indenture or
loan or
credit agreement or other instrument to which the Servicer or its
property
is subject, or result in the violation of any law, rule,
regulation,
order, judgment or decree to which the Servicer or its property is
subject;
(iii) The Servicer is an approved seller/servicer of conventional
residential mortgage loans for Fannie Mae or Freddie Mac, with the
facilities, procedures, and experienced personnel necessary for the
sound
servicing of mortgage loans of the same type as the Mortgage Loans.
The
Servicer is a HUD approved mortgagee pursuant to Section 203 of the
National Housing Act and is in good standing to sell mortgage loans
to and
service mortgage loans for Fannie Mae or Freddie Mac, and no event
has
occurred, including but not limited to a change in insurance
coverage,
which would make the Servicer unable to comply with Fannie Mae or
Freddie
Mac eligibility requirements or which would require notification to
either
Fannie Mae or Freddie Mac;
(iv) This Agreement, and all documents and instruments contemplated
hereby which are executed and delivered by the Servicer, constitute
and
will constitute valid, legal and binding obligations of the
Servicer,
enforceable in accordance with their respective terms, except as
the
enforcement thereof may be limited by applicable bankruptcy,
insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement
of creditors' rights generally (whether considered in a proceeding
at law
or in equity);
(v) The Servicer does not believe, nor does it have any reason or
cause to believe, that it cannot perform each and every covenant
contained
in this Agreement;
(vi) There is no action, suit, proceeding or investigation pending
or, to its knowledge, threatened against the Servicer that, either
individually or in the aggregate, may result in any material
adverse
change in the business, operations, financial condition, properties
or
assets of the Servicer, or in any material impairment of the right
or
ability of the Servicer to carry on its business substantially as
now
conducted, or in any material liability on the part of the
Servicer, or
that would draw into question the validity or enforceability of
this
Agreement or of any action taken or to be taken in connection with
the
obligations of the Servicer contemplated herein, or that would be
likely
to impair materially the ability of the Servicer to perform under
the
terms of this Agreement;
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(vii) No consent, approval or order of any court or governmental
agency or body is required for the execution, delivery and
performance by
the Servicer of or compliance by the Servicer with this Agreement
or the
consummation of the transactions contemplated by this Agreement,
except
for such consents, approvals, authorizations and orders, if any,
that have
been obtained;
(viii)No information in this Agreement provided by the Servicer nor
any information, certificate of an officer, statement furnished in
writing
or report delivered to the Trustee by the Servicer in connection
with the
transactions contemplated hereby contains or will contain any
untrue
statement of a material fact or omits or will omit to state a
material
fact necessary in order to make the statements contained therein,
in light
of the circumstances under which they were made, not misleading;
(ix) The Servicer has fully furnished, and shall continue to fully
furnish for so long as it is servicing the Mortgage Loans
hereunder, in
accordance with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information on the Mortgagor
credit
files to Equifax, Experian and Trans Union Credit Information
Company on a
monthly basis;
(x) The Servicer is a member of MERS in good standing; and
(xi) The Servicer acknowledges and agrees that the Servicing Fee
represents reasonable compensation for performing such services and
that
the entire Servicing Fee shall be treated by the Servicer, for
accounting
and tax purposes, as compensation for the servicing and
administration of
the Mortgage Loans pursuant to this Agreement.
It is understood and agreed that the representations, warranties
and
covenants set forth in this Section 2.05 shall survive delivery of
the Mortgage
Files to the Trustee and shall inure to the benefit of the Trustee,
the
Depositor, the NIMS Insurer and the Certificateholders. Upon
discovery by any of
the Depositor, the Servicer, the NIMS Insurer or the Trustee of a
breach of any
of the foregoing representations, warranties and covenants which
materially and
adversely affects the value of any Mortgage Loan, Prepayment Charge
or the
interests therein of the Certificateholders, the party discovering
such breach
shall give prompt written notice (but in no event later than two
Business Days
following such discovery) to the other parties hereto.
Section 2.06 Representations and Warranties of the Depositor.
The Depositor represents and warrants to the Trust and the Trustee
on behalf of the Certificateholders and to the Servicer and the
NIMS Insurer as
follows:
(i) This agreement constitutes a legal, valid and binding
obligation
of the Depositor, enforceable against the Depositor in accordance
with its
terms, except as enforceability may be limited by applicable
bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect affecting the enforcement of creditors' rights
in
general and except as such enforceability may be limited by general
principles of equity (whether considered in a proceeding at law or
in
equity);
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(ii) Immediately prior to the sale and assignment by the Depositor
to the Trustee on behalf of the Trust of each Mortgage Loan, the
Depositor
had good and marketable title to each Mortgage Loan (insofar as
such title
was conveyed to it by the Seller) subject to no prior lien, claim,
participation interest, mortgage, security interest, pledge, charge
or
other encumbrance or other interest of any nature;
(iii) As of the Closing Date, the Depositor has transferred all
right, title interest in the Mortgage Loans to the Trustee on
behalf of
the Trust;
(iv) The Depositor has not transferred the Mortgage Loans to the
Trustee on behalf of the Trust with any intent to hinder, delay or
defraud
any of its creditors;
(v) The Depositor has been duly incorporated and is validly
existing
as a corporation in good standing under the laws of the State of
Delaware,
with full corporate power and authority to own its assets and
conduct its
business as presently being conducted;
(vi) The Depositor is not in violation of its certificate of
incorporation or by-laws or in default in the performance or
observance of
any material obligation, agreement, covenant or condition contained
in any
contract, indenture, mortgage, loan agreement, note, lease or other
instrument to which the Depositor is a party or by which it or its
properties may be bound, which default might result in any material
adverse changes in the financial condition, earnings, affairs or
business
of the Depositor or which might materially and adversely affect the
properties or assets, taken as a whole, of the Depositor;
(vii) The execution, delivery and performance of this Agreement by
the Depositor, and the consummation of the transactions
contemplated
thereby, do not and will not result in a material breach or
violation of
any of the terms or provisions of, or, to the knowledge of the
Depositor,
constitute a default under, any indenture, mortgage, deed of trust,
loan
agreement or other agreement or instrument to which the Depositor
is a
party or by which the Depositor is bound or to which any of the
property
or assets of the Depositor is subject, nor will such actions result
in any
violation of the provisions of the certificate of incorporation or
by-laws
of the Depositor or, to the best of the Depositor's knowledge
without
independent investigation, any statute or any order, rule or
regulation of
any court or governmental agency or body having jurisdiction over
the
Depositor or any of its properties or assets (except for such
conflicts,
breaches, violations and defaults as would not have a material
adverse
effect on the ability of the Depositor to perform its obligations
under
this Agreement);
(viii) To the best of the Depositor's knowledge without any
independent investigation, no consent, approval, authorization,
order,
registration or qualification of or with any court or governmental
agency
or body of the United States or any other jurisdiction is required
for the
issuance of the Certificates, or the consummation by the Depositor
of the
other transactions contemplated by this Agreement, except such
consents,
approvals, authorizations, registrations or qualifications as (a)
may be
required under State securities or Blue Sky laws, (b) have been
previously
obtained or (c) the
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failure of which to obtain would not have a material adverse effect
on the
performance by the Depositor of its obligations under, or the
validity or
enforceability of, this Agreement; and
(ix) There are no actions, proceedings or investigations pending
before or, to the Depositor's knowledge, threatened by any court,
administrative agency or other tribunal to which the Depositor is a
party
or of which any of its properties is the subject: (a) which if
determined
adversely to the Depositor would have a material adverse effect on
the
business, results of operations or financial condition of the
Depositor;
(b) asserting the invalidity of this Agreement or the Certificates;
(c)
seeking to prevent the issuance of the Certificates or the
consummation by
the Depositor of any of the transactions contemplated by this
Agreement,
as the case may be; (d) which might materially and adversely affect
the
performance by the Depositor of its obligations under, or the
validity or
enforceability of, this Agreement.
Section 2.07 Issuance of Certificates and the Uncertificated
Regular
Interests.
The Trustee acknowledges the assignment to it of the Mortgage Loans
and the delivery to it of the Mortgage Files, subject to the
provisions of
Sections 2.01 and 2.02, and the Trustee acknowledges the assignment
to it of all
other assets included in the Trust Fund, receipt of which is hereby
acknowledged. Concurrently with such assignment and delivery and in
exchange
therefor, the Trustee, pursuant to the Written Order to
Authenticate executed by
an officer of the Depositor, has executed, and the Certificate
Registrar has
authenticated and delivered to or upon the order of the Depositor,
the
Certificates (other than the Class CE, Class P and Class R
Certificates) in
minimum dollar denominations of $25,000 and integral dollar
multiples of $1 in
excess thereof or in the case of the Class P Certificates, in
minimum
denominations of $20 and integral multiples of $20 in excess
thereof. The Class
CE Certificates are issuable only in minimum Percentage Interests
of 10%. The
Class R Certificate is issuable only as a single certificate. The
Trustee
acknowledges the issuance of the uncertificated REMIC 1 Regular
Interests and
declares that it hold such regular interests as assets of REMIC 2.
The Trustee
acknowledges the obligation of the Class CE Certificates to pay Cap
Carryover
Amounts, and declares that it hold the same as assets of the
Grantor Trust on
behalf of the Holders of the Class A-1, Class A-2A, Class A-2B,
Class A-2C,
Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6,
Class M-7,
Class M-8, Class M-9, Class M-10 and Class B Certificates,
respectively, which
shall be treated as beneficially owning the right to receive the
Cap Carryover
Amounts from the Grantor Trust. In addition to the assets described
in the
preceding sentence, the assets of the Grantor Trust shall also
include (i) any
Originator Prepayment Charge Payment Amounts, any Servicer
Prepayment Charge
Payment Amounts and the beneficial interest of the Class P
Certificates with
respect thereto and (ii) the Yield Maintenance Agreements, the
Reserve Accounts
and the beneficial interest of the Class CE Certificates with
respect thereto,
subject to the obligation to pay Cap Carryover Amounts. The
interests evidenced
by the Certificates constitute the entire beneficial ownership
interest in the
Trust Fund.
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ARTICLE III
ADMINISTRATION AND SERVICING
OF THE TRUST FUND
Section 3.01 Servicer to Act as Servicer.
From and after the Servicing Transfer Date, the Servicer, as
independent contract servicer, shall service and administer the
Mortgage Loans
on behalf of the Trust and in the best interests of and for the
benefit of the
Certificateholders in accordance with this Agreement and the normal
and usual
standards of practice of prudent mortgage servicers servicing
similar mortgage
loans and, to the extent consistent with such terms, in the same
manner in which
it services and administers similar mortgage loans for its own
portfolio, and
shall have full power and authority, acting alone, to do or cause
to be done any
and all things in connection with such servicing and administration
which the
Servicer may deem necessary or desirable and consistent with the
terms of this
Agreement (the "Servicing Standard").
Consistent with the terms of this Agreement, the Servicer may
waive,
modify or vary any term of any Mortgage Loan or consent to the
postponement of
strict compliance with any such term or in any manner grant
indulgence to any
Mortgagor if in the Servicer's reasonable and prudent determination
such waiver,
modification, postponement or indulgence is not materially adverse
to the
Certificateholders; provided, however, that the Servicer shall not
make future
advances and, except as set forth in the following sentence or
Section 3.03, the
Servicer shall not permit any modification with respect to any
Mortgage Loan
that would (i) change the Mortgage Interest Rate, defer or forgive
the payment
thereof of any principal or interest payments, reduce the
outstanding principal
amount (except for actual payments of principal) or extend the
final maturity
date with respect to such Mortgage Loan or (ii) cause an Adverse
REMIC Event.
Notwithstanding anything to the contrary contained in this
Agreement, in the
event that any Mortgage Loan is in default or, if such default is
reasonably
foreseeable, the Servicer, consistent with the standards set forth
in this
Section 3.01, may also waive, modify or vary any term of such
Mortgage Loan
(including modifications that would change the Mortgage Rate,
forgive the
payment of principal or interest, extend the final maturity date of
such
Mortgage Loan (including modifications that would change the
Mortgage Rate,
forgive the payment of principal or interest, extend the final
maturity date of
such Mortgage Loan or waive, in whole or in part, a Prepayment
Charge)), accept
payment from the related Mortgagor of an amount less than the
unpaid Principal
Balance in final satisfaction of such Mortgage Loan, or consent to
the
postponement of strict compliance with any such term or otherwise
grant
indulgence to any Mortgagor (any and all such waivers,
modifications, variances,
forgiveness of principal or interest, postponements, or indulgences
collectively
referred to herein as "forbearance"); provided, however, that the
final maturity
date of any Mortgage Loan may not be extended beyond the Assumed
Final
Distribution Date. The Servicer's analysis supporting any
forbearance and the
conclusion that any forbearance meets the standards of this Section
3.01 shall
be reflected in writing in the Servicing File. Notwithstanding the
foregoing,
the Servicer shall not permit any modification with respect to any
Mortgage Loan
that would both (x) effect an exchange or reissuance of such
Mortgage Loan under
Section 1.860G-2(b) of the Treasury Regulations and (y) cause an
Adverse REMIC
Event. The NIMS Insurer's prior written consent shall be required
for any
modification, waiver or amendment if the aggregate number of
outstanding
Mortgage Loans which have been modified, waived or amended exceeds
5% of the
number of Mortgage Loans as of the Cut-off Date. Without limiting
the generality
of the
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foregoing, the Servicer shall continue, and is hereby authorized
and
empowered to execute and deliver on behalf of itself, and the
Trustee, all
instruments of satisfaction or cancellation, or of partial or full
release,
discharge and all other comparable instruments, with respect to the
Mortgage
Loans and with respect to the Mortgaged Property. The Servicer
shall make all
required Servicing Advances and shall service and administer the
Mortgage Loans
in accordance with Applicable Regulations, and shall provide to the
Mortgagor
any reports required to be provided to them thereby. The Trustee
shall execute
and deliver to the Servicer within at least fifteen (15) Business
Days of
receipt, upon request, any powers of attorney furnished to it by
the Servicer
empowering the Servicer to execute and deliver instruments of
satisfaction or
cancellation, or of partial or full release or discharge, and to
foreclose upon
or otherwise liquidate any Mortgaged Property, and to appeal,
prosecute or
defend in any court action relating to the Mortgage Loans or the
Mortgaged
Properties, in accordance with this Agreement, and the Trustee
shall execute and
deliver such other documents as the Servicer may request, necessary
or
appropriate to enable the Servicer to service and administer the
Mortgage Loans
and carry out its duties hereunder, in each case in accordance with
Servicing
Standard (and the Trustee shall have no liability for misuse of any
such powers
of attorney by the Servicer). Notwithstanding anything contained
herein to the
contrary, the Servicer shall not without the Trustee's written
consent: (i)
initiate any action, suit or proceeding solely under the Trustee's
name without
indicating the Servicer's representative capacity or (ii) take any
action with
the intent to cause, and which results in, the Trustee being
registered to do
business in any state.
In servicing and administering the Mortgage Loans, the Servicer
shall employ procedures including collection procedures and
exercise the same
care that it customarily employs and exercises in servicing and
administering
mortgage loans for its own account giving due consideration to
accepted mortgage
servicing practices of prudent lending institutions and the
Certificateholders'
reliance on the Servicer.
The Servicer shall give prompt notice to the Trustee of any action,
of which the Servicer has actual knowledge, to (i) assert a claim
against the
Trust Fund or (ii) assert jurisdiction over the Trust Fund.
Notwithstanding anything in this Agreement to the contrary, in the
event of a voluntary Principal Prepayment in full of a Mortgage
Loan, the
Servicer may not waive any Prepayment Charge or portion thereof
required by the
terms of the related Mortgage Note unless (i)(a) the Servicer
determines that
such waiver is standard and customary in servicing similar mortgage
loans, (b)
such waiver relates to a default or a reasonably foreseeable
default and (c)
would, in the reasonable judgment of the Servicer, maximize
recovery of
Liquidation Proceeds for such Mortgage Loan, taking into account
the value of
such Prepayment Charge; (ii) the enforceability thereof is limited
(1) by
bankruptcy, insolvency, moratorium, receivership, or other similar
law relating
to creditors' rights generally or (2) due to acceleration in
connection with a
foreclosure or other involuntary payment; (iii) such Prepayment
Charge is not
permitted to be collected by Applicable Regulations; or (iv) the
collection of
such Prepayment Charge would be considered "predatory" pursuant to
written
guidance published or issued by any applicable federal, state or
local
regulatory authority acting in its official capacity and having
jurisdiction
over such matters. If the Servicer has waived or does not collect
all or a
portion of a Prepayment Charge relating to a voluntary Principal
Prepayment in
full due to any action or omission of the Servicer, other than as
provided
above, the Servicer shall, on the date on which the Principal
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Prepayment in full is remitted to the Trustee, deliver to the
Trustee the
Servicer Prepayment Charge Amount with respect to such Mortgage
Loan for
distribution in accordance with the terms of this Agreement.
In the event that a Prepayment Charge due with respect to any
Mortgage Loan is not timely received by the Servicer, the Servicer
shall use
commercially reasonable efforts to determine whether the Originator
is obligated
to pay a related Originator Prepayment Charge Payment Amount, and
if the
Servicer determines that a Originator Prepayment Charge Payment
Amount is due,
the Servicer shall promptly notify the Originator, and the Servicer
shall
enforce the Originator's obligations to pay in a timely manner any
such
Originator Prepayment Charge Payment Amounts and, to the extent
that such
amounts are received by the Servicer, shall cause such amounts to
be deposited
into the Collection Account within one Business Day of receipt.
Section 3.02 Collection of Mortgage Loan Payments.
Continuously from the date hereof until the principal and interest
on all Mortgage Loans are paid in full or as long as the Mortgage
Loan remains
subject to this Agreement, the Servicer will diligently collect all
payments due
under each Mortgage Loan when the same shall become due and payable
and shall,
to the extent such procedures shall be consistent with this
Agreement and
Applicable Regulations, follow such collection procedures as it
follows with
respect to mortgage loans comparable to the Mortgage Loans and held
for its own
account. Further, the Servicer will take special care in
ascertaining and
estimating on escrowed Mortgage Loans annual ground rents, taxes,
assessments,
water rates, fire and hazard insurance premiums, mortgage insurance
premiums,
and all other charges that, as provided in the Mortgage, will
become due and
payable to that end that the installments payable by the Mortgagors
will be
sufficient to pay such charges as and when they become due and
payable.
Section 3.03 Realization Upon Defaulted Mortgage Loans.
In the event that any payment due under any Mortgage Loan is not
paid when the same becomes due and payable, or in the event the
Mortgagor fails
to perform any other covenant or obligation under the Mortgage Loan
and such
failure continues beyond any applicable grace period, the Servicer
shall take
such action as it shall deem to be in the best interest of the
Certificateholders. With respect to any defaulted Mortgage Loan,
the Servicer
shall have the right to review the status of the related
forbearance plan and,
subject to the second paragraph of Section 3.01, may modify such
forbearance
plan; including extending the Mortgage Loan repayment date for a
period of one
year or reducing the Mortgage Interest Rate up to 50 basis points.
In connection with a foreclosure or other conversion, the Servicer
shall exercise such rights and powers vested in it hereunder and
use the same
degree of care and skill in its exercise as prudent mortgage
servicers would
exercise or use under the circumstances in the conduct of their own
affairs and
consistent with Applicable Regulations and the Servicing Standard,
including,
without limitation, advancing funds for the payment of taxes and
insurance
premiums.
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Notwithstanding the foregoing provisions of this Section 3.03, with
respect to any Mortgage Loan as to which the Servicer has received
actual notice
of, or has actual knowledge of, the presence of any toxic or
hazardous substance
on the related Mortgaged Property, the Servicer shall not either
(i) obtain
title to such Mortgaged Property as a result of or in lieu of
foreclosure or
otherwise, or (ii) otherwise acquire possession of, or take any
other action
with respect to, such Mortgaged Property if, as a result of any
such action, the
Trust would be considered to hold title to, to be a
mortgagee-in-possession of,
or to be an owner or operator of such Mortgaged Property within the
meaning of
the Comprehensive Environmental Response, Compensation and
Liability Act of
1980, as amended from time to time, or any comparable law, unless
the Servicer
has received the prior written consent of the NIMS Insurer and has
received a
prudent report prepared by a Person who regularly conducts
environmental audits
using customary industry standards, that:
A. such Mortgaged Property is in compliance with applicable
environmental laws or, if not, that it would be in the best
economic interest of
the Certificateholders to take such actions as are necessary to
bring the
Mortgaged Property into compliance therewith; and
B. there are no circumstances present at such Mortgaged Property
relating to the use, management or disposal of any hazardous
substances,
hazardous materials, hazardous wastes, or petroleum-based materials
for which
investigation, testing, monitoring, containment, clean-up or
remediation could
be required under any federal, state or local law or regulation, or
that if any
such materials are present for which such action could be required,
that it
would be in the best economic interest of the Certificateholders to
take such
actions with respect to the affected Mortgaged Property.
The cost of the environmental audit report contemplated by this
Section 3.03 shall be advanced by the Servicer, subject to the
Servicer's right
to be reimbursed therefor from the Collection Account as provided
in Section
3.05(a)(iv).
If the Servicer determines, as described above, that it is in the
best economic interest of the Certificateholders to take such
actions as are
necessary to bring any such Mortgaged Property into compliance with
applicable
environmental laws, or to take such action with respect to the
containment,
clean-up or remediation of hazardous substances, hazardous
materials, hazardous
wastes, or petroleum-based materials affecting any such Mortgaged
Property, then
the Servicer shall take such action as it deems to be in the best
economic
interest of the Certificateholders. The cost of any such
compliance,
containment, clean-up or remediation shall be advanced by the
Servicer, subject
to the Servicer's right to be reimbursed therefor from the
Collection Account as
provided in Section 3.05(a).
Section 3.04 Collection Accounts, Distribution Account and Reserve
Accounts.
(a) The Servicer shall segregate and hold all funds collected and
received
pursuant to each Mortgage Loan separate and apart from any of its
own funds and
general assets and shall establish and maintain certain Collection
Accounts.
Each Collection Account shall be an Eligible Account.
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The Servicer shall deposit or cause to be deposited on a daily
basis
and in no event more than two Business Days after receipt thereof
in the
clearing account (which must be an Eligible Account) in which it
customarily
deposits payments and collections on mortgage loans in connection
with its
mortgage loan servicing activities, and shall thereafter deposit in
the
Collection Account, in no event more than two Business Days after
deposit of
such funds in the clearing account, and retain therein, the
following payments
and collections received or made by it after the Cut-off Date with
respect to
the Mortgage Loans (other than in respect of principal and interest
due on or
before the Cut-off Date):
(i) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans;
(ii) all payments on account of interest on the Mortgage Loans,
adjusted to the Mortgage Interest Rate less the Servicing Fee Rate
and any
Prepayment Interest Excess;
(iii) all Liquidation Proceeds and any Subsequent Recoveries;
(iv) all Insurance Proceeds including amounts required to be
deposited pursuant to Section 3.10, other than proceeds to be held
in the
Escrow Account and applied to the restoration or repair of the
Mortgaged
Property or released to the Mortgagor in accordance with the
Servicer's
normal servicing procedures, the loan documents or applicable law;
(v) all Condemnation Proceeds affecting any Mortgaged Property
which
are not released to the Mortgagor in accordance with the Servicer's
normal
servicing procedures, the loan documents or applicable law;
(vi) any amounts required to be deposited by the Servicer in
connection with any REO Property pursuant to Section 3.13;
(vii) all Prepayment Charges collected by the Servicer in
connection
with the voluntary Principal Prepayment in full of any Mortgage
Loan, all
Originator Prepayment Charge Payment Amounts paid by the Originator
and
all Servicer Prepayment Charge Payment Amounts required to be paid
by the
Servicer pursuant to Section 3.01 in connection with any such
Principal
Prepayment; and
(viii) all amounts required to be deposited by the Servicer
pursuant
to Section 2.03.
Any interest paid on funds deposited in the Collection Accounts,
subject to Section 3.25, shall accrue to the benefit of the
Servicer and the
Servicer shall be entitled to retain and withdraw such interest
from the
Collection Accounts pursuant to Section 3.05(a)(v) and
3.05(b)(iii), as
applicable. The foregoing requirements for deposit into the
Collection Account
shall be exclusive, it being understood and agreed that, without
limiting the
generality of the foregoing, payments in the nature of late payment
charges, bad
check fees, prepayment charges that are not Prepayment Charges,
Originator
Prepayment Charge Payment Amounts or Servicer Prepayment Charge
Payment Amounts,
assumption fees and other similar fees need not be
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deposited by the Servicer into the Collection Account. Amounts
deposited in the
Collection Accounts in error may be withdrawn by the Servicer at
any time.
(b) On behalf of the Trust Fund, the Trustee shall establish and
maintain one or more accounts (such account or accounts, the
"Distribution
Account"), held in trust for the benefit of the Certificateholders.
On behalf of
the Trust Fund, the Servicer shall deliver to the Trustee in
immediately
available funds for deposit in the Distribution Account by 1:00
p.m. New York
time on the Servicer Remittance Date, (i) that portion of the
Available Funds
(calculated without regard to the references in the definition
thereof to
amounts that may be deposited to the Distribution Account from a
different
source as provided herein) then on deposit in the Collection
Accounts and (ii)
the amount of all Prepayment Charges collected by the Servicer, all
Originator
Prepayment Charge Payment Amounts required to be paid by the
Originator and all
Servicer Prepayment Charge Payment Amounts required to be paid by
the Servicer
in connection with the voluntary Principal Prepayment in full of
any of the
Mortgage Loans then on deposit in the Collection Account (other
than any such
Prepayment Charges received and Servicer Prepayment Charge Payment
Amounts and
Originator Prepayment Charge Payment Amounts paid after the related
Prepayment
Period). Amounts in the Distribution Account shall be deemed to be
held on
behalf of the related REMICs and the Grantor Trust in accordance
with the REMIC
distributions set forth in Section 4.08. The Trustee shall be
entitled to
withdraw from the Distribution Account any amounts owing to it
pursuant to
Section 8.05 and Section 9.01(c) prior to the distribution of any
amounts on
deposit to the Certificateholders; provided, however, in the case
of amounts
owing to it other than the Trustee Fee, the Trustee shall provide
the Depositor,
the NIMS Insurer and the Servicer with a written account of such
amounts five
Business Days prior to withdrawing such funds and, provided
further, that the
Trustee shall not be entitled to withdraw such amounts for funds on
deposit in
the Distribution Account representing Prepayment Charges,
Originator Prepayment
Charge Payment Amounts and Servicer Prepayment Charge Payment
Amounts. In
connection with any failure by the Servicer to make any remittance
required to
be made by the Servicer to the Trustee for deposit in the
Distribution Account
on the day and by the time such remittance is required to be made
under the
terms of this Section 3.04(b) (without giving effect to any grace
or cure
period), the Servicer shall pay to the Trustee for the account of
the Trustee
interest at the prime rate of United States money center commercial
banks as
published in The Wall Street Journal on any amount not timely
remitted from and
including the day such remittance was required to be made to, but
not including,
the day on which such remittance was actually made.
(c) Funds on deposit in the Collection Accounts may be invested in
Eligible Investments in accordance with the provisions set forth in
Section
3.25. The Servicer shall give notice to the Trustee and the NIMS
Insurer of the
location of the Collection Accounts maintained by it when
established and prior
to any change thereof. The Trustee shall give notice to the
Servicer, the NIMS
Insurer and the Depositor of the location of the Distribution
Account when
established and prior to any change thereof.
(d) In the event the Servicer shall deliver to the Trustee for
deposit in the Distribution Account any amount not required to be
deposited
therein, it may at any time request that the Trustee withdraw such
amount from
the Distribution Account and remit to the Servicer any such amount,
any
provision herein to the contrary notwithstanding. In addition, the
Servicer
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shall deliver to the Trustee from time to time for deposit, and the
Trustee
shall so deposit, in the Distribution Account in respect of REMIC
1:
(i) any Advances, as required pursuant to Section 4.07;
(ii) any Stayed Funds, as soon as permitted by the federal
bankruptcy court having jurisdiction in such matters;
(iii) any amounts required to be delivered by the Servicer to the
Trustee for deposit in the Distribution Account pursuant to
Sections 2.03,
3.04, 3.13, 3.15, 3.16, 3.23, 3.24, 4.07 or 10.01; and
(iv) any amounts required to be deposited by the Servicer pursuant
to Section 3.11 in connection with the deductible clause in any
blanket
hazard insurance policy, such deposit being made from the
Servicer's own
funds, without reimbursement therefor.
(e) Promptly upon receipt of any Stayed Funds, whether from the
Servicer, a trustee in bankruptcy, or federal bankruptcy court or
other source,
the Trustee shall notify the Servicer of such receipt and deposit
such funds in
the Distribution Account, subject to withdrawal thereof as
permitted hereunder.
In addition, the Trustee shall deposit in the Distribution Account
any amounts
required to be deposited pursuant to Section 3.25(b) in connection
with losses
realized on Eligible Investments with respect to funds held in the
Distribution
Account.
(f) Any Originator Prepayment Charge Payment Amounts and Servicer
Prepayment Charge Payment Amounts deposited pursuant to Section
3.04(a)(vii)
shall not be assets of any REMIC created hereunder, but shall be
considered
assets of the Grantor Trust held by the Trustee for the benefit of
the Class P
Certificateholders.
(g) (i) The Trustee shall establish and maintain the Class A-1
Reserve Account, held in trust for the benefit of the Holders of
the Class A-1
Certificates. The Trustee shall deposit in the Class A-1 Reserve
Account on the
date received by it, any Class A-1 Yield Maintenance Agreement
Payment received
from the Yield Maintenance Agreement Provider for the related
Distribution Date.
The Trustee shall establish and maintain the Class A-2A, Class A-2B
and
Class A-2C Reserve Account, held in trust for the benefit of the
Holders of the
Class A-2A, Class A-2B and Class A-2C Certificates. The Trustee
shall deposit in
the Class A-2A, Class A-2B and Class A-2C Reserve Account on the
date received
by it, any Class A-2A, Class A-2B and Class A-2C Yield Maintenance
Agreement
Payment received from the Yield Maintenance Agreement Provider for
the related
Distribution Date.
The Trustee shall establish and maintain the Class M and Class B
Reserve
Account, held in trust for the benefit of the Holders of the Class
M and Class B
Certificates. The Trustee shall deposit in the Class M and Class B
Reserve
Account on the date received by it, any Class M and Class B Yield
Maintenance
Agreement Payment received from the Yield Maintenance Agreement
Provider for the
related Distribution Date.
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On each Distribution Date, the Trustee shall withdraw from the
Class A-1
Reserve Account any Class A-1 Yield Maintenance Agreement Payment,
shall
withdraw from the Class A-2A, Class A-2B and Class A-2C Reserve
Account any
Class A-2A, Class A-2B and Class A-2C Yield Maintenance Agreement
Payment and
shall withdraw from the Class M and Class B Reserve Account any
Class M and
Class B Yield Maintenance Agreement Payment and apply them in the
following
order of priority:
(A) to the Class A-1 Certificates from the Class A-1 Reserve
Account, any remaining unpaid Cap Carryover Amounts for such
Distribution Date
(after distributions to the Class A-1 Certificates pursuant to
Section
4.02(b)(xxxvi) hereof), distributed based on the unpaid Cap
Carryover Amount for
such Class;
(B) to the Class A-2A, Class A-2B and Class A-2C Certificates from
the Class A-2A, Class A-2B and Class A-2C Reserve Account,
(1) in each case only up to the Class A-2A, Class A-2B and
Class A-2C Cap Amount, any remaining unpaid Cap Carryover Amounts
for such Classes for such Distribution Date (after distributions to
the Class A-2A, Class A-2B and Class A-2C Certificates pursuant to
Section 4.02(b)(xxxvi) hereof), distributed pro rata, to each of
the
Class A-2A, Class A-2B and Class A-2C Certificates; and
(2) any remaining unpaid Cap Carryover Amounts for such
Classes for such Distribution Date (after distributions to the
Class
A-2A, Class A-2B and Class A-2C Certificates pursuant to Section
4.02(b)(xxxvi) hereof and clause (B)(1) above) distributed pro
rata,
to each of the Class A-2A, Class A-2B and Class A-2C Certificates
based on the unpaid Cap Carryover Amount for such class;
(C) to the Class M and Class B Certificates from the Class M and
Class B Reserve Account,
(1) in each case only up to the Class M and Class B Cap
Amount, any remaining unpaid Cap Carryover Amounts for such Classes
for such Distribution Date (after distributions to the Class M and
Class B Certificates pursuant to Section 4.02(b)(xxxvi) hereof),
distributed sequentially, to the Class M-1, Class M-2, Class M-3,
Class M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9,
Class M-10 and Class B Certificates, in that order; and
(2) any remaining unpaid Cap Carryover Amounts for such
Classes for such Distribution Date (after distributions to the
Class
M and Class B Certificates pursuant to Section 4.02(b)(xxxvi)
hereof
and clause (C)(1) above) distributed sequentially, to the Class
M-1,
Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7,
Class M-8, Class M-9, Class M-10 and Class B Certificates, in that
order; and
(D) to the Class CE Certificates, any remaining amount on deposit
in
the Reserve Accounts.
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(ii) The Trustee shall account for each Reserve Account as an asset
of a grantor trust under subpart E, part I of subchapter J of the
Code and
not an asset of any REMIC created pursuant to this Agreement. The
beneficial owner of each Reserve Account is the Class CE
Certificateholder. For all federal tax purposes, amounts
transferred or
reimbursed by REMIC 2 to either Reserve Account shall be treated as
distributions by the Trustee to the Class CE Certificateholder.
(iii) Any Cap Carryover Amounts paid by the Trustee pursuant to
this
Section 3.04(g) to the Class A, Class M and Class B Certificates,
shall be
accounted for by the Trustee as amounts paid first to the Class CE
Certificates and then to the respective Class or Classes of the
Class A,
Class M and Class B Certificates from the Grantor Trust. In
addition, the
Trustee shall account for the related Class A, Class M and Class B
Certificates' rights to receive payments of Cap Carryover Amounts
as
rights in limited recourse interest rate cap contracts written by
the
Class CE Certificates in favor of the related Classes of Class A,
Class M
and Class B Certificates.
(iv) For federal tax return and information reporting, the right of
the Holders of the Class A, Class M and Class B Certificates to
receive
payments under the Class A-1 Yield Maintenance Agreement, the Class
A-2A,
Class A-2B and Class A-2C Yield Maintenance Agreement and the Class
M and
Class B Yield Maintenance Agreement in respect of any related Yield
Maintenance Agreement Payments shall be assigned a value of zero.
Section 3.05 Permitted Withdrawals From the Collection Accounts.
The Servicer may, from time to time, withdraw from the Collection
Account
for the following purposes:
(a) to remit to the Trustee for deposit in the Distribution Account
the amounts required to be so remitted pursuant to Section 3.04(b)
or permitted
to be so remitted pursuant to the first sentence of Section
3.04(d);
(b) to reimburse itself for (i) any unreimbursed Advances to the
extent of amounts received which represent Late Collections (net of
the related
Servicing Fees) of Monthly Payments, Liquidation Proceeds and
Insurance Proceeds
on Mortgage Loans with respect to which such Advances were made in
accordance
with the provisions of Section 4.07, (ii) any unreimbursed Advances
that are
Nonrecoverable Advances, or (iii) subject to Section 4.07(b), any
unreimbursed
Advances to the extent of funds held in the Collection Account for
future
distribution that were not included in Available Funds for the
preceding
Distribution Date;
(c) to reimburse itself for (i) any unpaid Servicing Fees, (ii) any
unreimbursed Servicing Advances with respect to each Mortgage Loan,
but only to
the extent of any Late Collections, Liquidation Proceeds, Insurance
Proceeds and
condemnation proceeds received with respect to such Mortgage Loan,
or (c) any
Servicing Advances that are Nonrecoverable Advances;
(d) to reimburse itself for any amounts paid or expenses incurred
pursuant to Section 3.03 (and not otherwise previously reimbursed);
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(e) to pay to itself as servicing compensation (a) any interest
earned on funds in the Collection Account (all such interest to be
withdrawn
monthly not later than each Servicer Remittance Date), and (b) the
Servicing Fee
from that portion of any payment or recovery as to interest to a
particular
Mortgage Loan to the extent not retained pursuant to Section
3.04(a)(ii);
(f) to pay or reimburse itself for any amounts payable or paid
pursuant to Section 6.03 (and not otherwise previously reimbursed);
(g) to pay to itself any Prepayment Interest Excess on the related
Mortgage Loans to the extent not retained pursuant to Section
3.04(a)(ii); and
(h) to clear and terminate the Collection Account upon the
termination of this Agreement.
The foregoing requirements for withdrawal from each of the
Collection Accounts shall be exclusive. In the event the Servicer
shall deposit
in either Collection Account any amount not required to be
deposited therein, it
may at any time withdraw such amount from such Collection Account,
any provision
herein to the contrary notwithstanding.
Section 3.06 Establishment of Escrow Accounts; Deposits in Escrow
Accounts.
The Servicer shall segregate and hold all funds collected and
received pursuant to each Mortgage Loan which constitute Escrow
Payments
separate and apart from any of its own funds and general assets and
shall
establish and maintain one or more Escrow Accounts, in the form of
time deposit
or demand accounts. A copy of such letter agreement shall be
furnished to the
Trustee upon request. The Escrow Account shall be an Eligible
Account.
The Servicer shall deposit or cause to be deposited on a daily
basis
and in no event more than two Business Days after receipt thereof
in the
clearing account (which must be an Eligible Account) in which it
customarily
deposits payments and collections on mortgage loans in connection
with its
mortgage loan servicing activities, and shall thereafter deposit in
the Escrow
Account or Accounts, in no event more than two Business Days after
deposit of
such funds in the clearing account, and retain therein, (i) all
Escrow Payments
collected on account of the Mortgage Loans, for the purpose of
effecting timely
payment of any such items as required under the terms of this
Agreement, and
(ii) all Insurance Proceeds which are to be applied to the
restoration or repair
of any Mortgaged Property. The Servicer shall make withdrawals
therefrom only to
effect such payments as are required under this Agreement, and for
such other
purposes as shall be set forth in, or in accordance with, Section
3.07. The
Servicer shall be entitled to retain any interest paid on funds
deposited in the
Escrow Account by the depository institution other than interest on
escrowed
funds required by law to be paid to the Mortgagor and, to the
extent required by
the related Mortgage Loan or Applicable Regulations, the Servicer
shall pay
interest on escrowed funds to the Mortgagor notwithstanding that
the Escrow
Account is non-interest bearing or that interest paid thereon is
insufficient
for such purposes.
Section 3.07 Permitted Withdrawals From Escrow Account.
Withdrawals from the Escrow Account may be made by the Servicer (i)
to effect timely payments of ground rents, taxes, assessments,
water rates,
fire, flood and hazard insurance
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premiums and comparable items in a manner and at a time that
assures that the
lien priority of the Mortgage is not jeopardized (or, with respect
to the
payment of taxes, in a manner and at a time that avoids the loss of
the
Mortgaged Property due to a tax sale or the foreclosure as a result
of a tax
lien), (ii) to reimburse the Servicer for any Servicing Advance
made by the
Servicer with respect to a related Mortgage Loan but only from
amounts received
on the related Mortgage Loan which represent late payments or Late
Collections
of Escrow Payments thereunder with respect to taxes and assessments
and with
respect to hazard insurance, (iii) to refund to the Mortgagor any
funds as may
be determined to be overages, (iv) for transfer to the Collection
Account in
accordance with the terms of this Agreement, (v) for application to
restoration
or repair of the Mortgaged Property, (vi) to pay to the Servicer,
or to the
Mortgagor to the extent required by the related Mortgage Loan or
Applicable
Regulations, any interest paid on the funds deposited in the Escrow
Account,
(vii) to clear and terminate the Escrow Account on the termination
of this
Agreement, or (viii) to transfer to the Collection Account any
insurance
proceeds. As part of its servicing duties, the Servicer shall pay
to the
Mortgagor interest on funds in the Escrow Account, to the extent
required by the
related Mortgage Loan or Applicable Regulations, and to the extent
that interest
earned on funds in the Escrow Account is insufficient, shall pay
such interest
from its own funds, without any reimbursement therefor.
In the event the Servicer shall deposit in the Escrow Account any
amount not required to be deposited therein, it may at any time
withdraw such
amount from the Escrow Account, any provision herein to the
contrary
notwithstanding.
Section 3.08 Payment of Taxes, Insurance and Other Charges;
Collections Thereunder.
With respect to each Mortgage Loan that provides for Escrow
Payments, the Servicer shall maintain accurate records reflecting
the status of
ground rents, taxes, assessments, water rates and other charges
which are or may
become a lien upon the Mortgaged Property and the status of fire,
flood and
hazard insurance coverage and shall obtain, from time to time, all
bills for the
payment of such charges (including renewal premiums) and shall
effect payment of
taxes, assessments, hazard insurance premiums, and comparable items
in a manner
and at a time that assures that the lien priority of the Mortgage
is not
jeopardized (or, with respect to the payment of taxes, in a manner
and at a time
that avoids the loss of the Mortgaged Property due to a tax sale or
the
foreclosure as a result of a tax lien). To the extent that a
Mortgage does not
provide for Escrow Payments, the Servicer (i) shall determine
whether any such
payments are made by the Mortgagor in a manner and at a time that
is necessary
to avoid the loss of the Mortgaged Property due to a tax sale or
the foreclosure
as a result of a tax lien and (ii) shall ensure that all insurance
required to
be maintained on the Mortgaged Property pursuant to this Agreement
is
maintained. If any such payment has not been made and the Servicer
receives
notice of a tax lien with respect to the Mortgage Loan being
imposed, the
Servicer will, promptly and to the extent required to avoid loss of
the
Mortgaged Property, advance or cause to be advanced funds necessary
to discharge
such lien on the Mortgaged Property. The Servicer assumes full
responsibility
for the payment of all such bills and shall effect payments of all
such bills
irrespective of the Mortgagor's faithful performance in the payment
of same or
the making of the Escrow Payments and shall make Servicing Advances
from its own
funds to effect such payments.
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Section 3.09 Transfer of Accounts.
The Servicer may transfer the Collection Accounts and the Escrow
Account to a different depository institution from time to time.
Upon such
transfer, the Servicer shall deliver to the Trustee, the NIMS
Insurer and the
Depositor, a certification or letter agreement, as the case may be,
as required
pursuant to Sections 3.04 and 3.06.
Section 3.10 Maintenance of Hazard Insurance.
The Servicer shall cause to be maintained for each Mortgage Loan
fire and hazard insurance with extended coverage as is customary in
the area
where the Mortgaged Property is located in an amount which is at
least equal to
the lesser of (i) the amount necessary to fully compensate for any
damage or
loss to the improvements which are a part of such property on a
replacement cost
basis or (ii) the Principal Balance of the Mortgage Loan, in each
case in an
amount not less than such amount as is necessary to prevent the
Mortgagor and/or
the Mortgagee from becoming a co-insurer. If the Mortgaged Property
is in an
area identified in the Federal Register by the Flood Emergency
Management Agency
as having special flood hazards and flood insurance has been made
available, the
Servicer will cause to be maintained a flood insurance policy
meeting the
requirements of the current guidelines of the Federal Insurance
Administration
with a generally acceptable insurance carrier, in an amount
representing
coverage not less than the least of (i) the Principal Balance of
the Mortgage
Loan, (ii) the maximum insurable value of the improvements securing
such
Mortgage Loan or (iii) the maximum amount of insurance which is
available under
the National Flood Insurance Act of 1968, as amended. The Servicer
shall also
maintain on the REO Properties for the benefit of the
Certificateholders, (x)
fire and hazard insurance with extended coverage in an amount which
is at least
equal to the lesser of (i) 100% of the maximum insurable value of
the
improvements securing the Mortgage Loan and (ii) the outstanding
Principal
Balance of the Mortgage Loan at the time it became an REO Property,
(y) public
liability insurance and, (z) to the extent required and available
under the
National Flood Insurance Act of 1968, as amended, flood insurance
in an amount
as provided above. Any amounts collected by the Servicer under any
such policies
other than amounts to be deposited in the Escrow Account and
applied to the
restoration or repair of the Mortgaged Property or REO Property, or
released to
the Mortgagor in accordance with the Servicer's normal servicing
procedures,
shall be deposited in the Collection Account, subject to withdrawal
pursuant to
Section 3.05(a). It is understood and agreed that no earthquake or
other
additional insurance is required to be maintained by the Servicer
or the
Mortgagor or maintained on property acquired in respect of the
Mortgage Loan,
other than pursuant to such Applicable Regulations as shall at any
time be in
force and as shall require such additional insurance. All such
policies shall be
endorsed with standard mortgagee clauses with loss payable to the
Servicer and
shall provide for at least thirty days prior written notice of any
cancellation,
reduction in the amount of or material change in coverage to the
Servicer. The
Servicer shall not interfere with the Mortgagor's freedom of choice
in selecting
either his insurance carrier or agent, provided, however, that the
Servicer
shall not accept any such insurance policies from insurance
companies unless
such companies currently reflect a general policy rating of A:X or
better in
Best's Key Rating Guide and are licensed to do business in the
state wherein the
property subject to the policy is located.
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Section 3.11 Maintenance of Mortgage Impairment Insurance Policy.
In the event that the Servicer shall obtain and maintain a blanket
policy issued by an insurer acceptable to Fannie Mae and Freddie
Mac and that
has a general policy rating of A:X or better in Best's Key Rating
Guide insuring
against hazard losses on all of the Mortgage Loans, then, to the
extent such
policy provides coverage in an amount equal to the amount required
pursuant to
Section 3.10 and otherwise complies with all other requirements of
Section 3.10,
it shall conclusively be deemed to have satisfied its obligations
as set forth
in Section 3.10, it being understood and agreed that such policy
may contain a
deductible clause, in which case the Servicer shall, in the event
that there
shall not have been maintained on the related Mortgaged Property or
REO Property
a policy complying with Section 3.10, and there shall have been a
loss which
would have been covered by such policy, deliver to the Trustee for
deposit in
the Distribution Account the amount not otherwise payable under the
blanket
policy because of such deductible clause, which amount shall not be
reimbursable
to the Servicer from the Trust Fund. In connection with its
activities as
servicer of the Mortgage Loans, the Servicer agrees to prepare and
present, on
behalf of the Trustee, claims under any such blanket policy in a
timely fashion
in accordance with the terms of such policy. Upon request of the
Trustee, the
Servicer shall cause to be delivered to the Trustee a certified
true copy of
such policy and a statement from the insurer thereunder that such
policy shall
in no event be terminated or materially modified without thirty
days prior
written notice to the Trustee.
Section 3.12 Fidelity Bond, Errors and Omissions Insurance.
The Servicer shall maintain, at its own expense, a blanket fidelity
bond (the "Fidelity Bond") and an errors and omissions insurance
policy, with
broad coverage with financially responsible companies on all
officers, employees
or other persons acting in any capacity with regard to the Mortgage
Loans to
handle funds, money, documents and papers relating to the Mortgage
Loans. The
Fidelity Bond and errors and omissions insurance shall be in the
form of the
Mortgage Banker's Blanket Bond and shall protect and insure the
Servicer against
losses, including forgery, theft, embezzlement, fraud, errors and
omissions and
negligent acts of such persons. Such Fidelity Bond shall also
protect and insure
the Servicer against losses in connection with the failure to
maintain any
insurance policies required pursuant to this Agreement and the
release or
satisfaction of a Mortgage Loan without having obtained payment in
full of the
indebtedness secured thereby. No provision of this Section 3.12
requiring the
Fidelity Bond and errors and omissions insurance shall diminish or
relieve the
Servicer from its duties and obligations as set forth in this
Agreement. The
minimum coverage under any such bond and insurance policy shall be
at least
equal to the corresponding amounts required by Fannie Mae in the
Fannie Mae MBS
Selling and Servicing Guide or by Freddie Mac in the Freddie Mac
Servicer's
Guide, unless the Servicer has obtained a waiver of such
requirements from
Fannie Mae or Freddie Mac. Upon request of the Trustee or the NIMS
Insurer, the
Servicer shall cause to be delivered to the requesting party a
certified true
copy of the Fidelity Bond and errors and omissions insurance policy
and a
statement from the surety and the insurer that such Fidelity Bond
and errors and
omissions insurance policy shall in no event be terminated or
materially
modified without thirty days' prior written notice to the Trustee.
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Section 3.13 Title, Management and Disposition of REO Property.
(a) In the event that title to a Mortgaged Property is acquired in
foreclosure or by deed in lieu of foreclosure, the deed or
certificate of sale
shall be taken (pursuant to a limited power of attorney to be
provided by the
Trustee to the Servicer) in the name of the Trustee or its nominee,
on behalf of
the Certificateholders, or in the event the Trustee is not
authorized or
permitted to hold title to real property in the state where the REO
Property is
located, or would be adversely affected under the "doing business"
or tax laws
of such state by so holding title, the deed or certificate of sale
shall be
taken in the name of such Person or Persons as shall be consistent
with an
Opinion of Counsel obtained by the Servicer from an attorney duly
licensed to
practice law in the state where the REO Property is located. Any
Person or
Persons holding such title other than the Trustee shall acknowledge
in writing
that such title is being held as nominee for the benefit of the
Trustee.
(b) In the event that the Trust Fund acquires any REO Property as
aforesaid or otherwise in connection with a default or imminent
default on a
Mortgage Loan, the Servicer shall dispose of such REO Property
before the end of
the third taxable year beginning after the year of its acquisition
by the Trust
Fund for purposes of Section 860G(a)(8) of the Code unless the
Servicer has
received a grant of extension from the Internal Revenue Service of
the
above-mentioned grace period such that the holding by the Trust
Fund of such REO
Property subsequent to such period will not: (i) result in the
imposition of any
tax on "prohibited transactions" as defined in Section 860F of the
Code; (ii)
cause any REO Property to fail to qualify as "foreclosure property"
within the
meaning of Section 860G(a)(8) of the Code; or (iii) cause any REMIC
constituting
any part of the Trust Fund to fail to qualify as a REMIC at any
time that any
Certificates are outstanding, in which case the Trust Fund may
continue to hold
such REO Property.
Subject to compliance with applicable laws and regulations as shall
at any time be in force, and notwithstanding any other provisions
of this
Agreement, no REO Property acquired by the Trust Fund shall be
rented (or
allowed to continue to be rented) or otherwise used by or on behalf
of the Trust
Fund in such a manner or pursuant to any terms that would: (i)
cause such REO
Property to fail to qualify as "foreclosure property" within the
meaning of
Section 860G(a)(8) of the Code; or (ii) subject any REMIC
constituting part of
the Trust Fund to the imposition of any federal or state income
taxes on the
income earned from such REO Property, including any taxes imposed
by reason of
Sections 860F or 860G(c) of the Code, unless the Servicer has
agreed to
indemnify and hold harmless the Trust Fund with respect to the
imposition of any
such taxes.
The Servicer shall manage, conserve, protect and operate each REO
Property for the Certificateholders and the Trust Fund solely for
the purpose of
its prompt disposition and sale in a manner which does not cause
such REO
Property to fail to qualify as "foreclosure property" within the
meaning of
Section 860G(a)(8) of the Code or result in the receipt by the
related REMIC of
any "income from non-permitted assets" within the meaning of
Section
860F(a)(2)(B) of the Code, or any "net income from foreclosure
property" which
is subject to taxation under the REMIC Provisions. The Servicer
shall cause each
REO Property to be inspected promptly upon the acquisition of title
thereto and
shall cause each REO Property to be inspected at least annually
thereafter. The
Servicer shall make or cause to be made a written or electronic
report of
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each such inspection. Such reports shall be retained in the
Mortgage File and
copies thereof shall be forwarded by the Servicer to the Trustee
upon request.
The Servicer shall attempt to sell the same (and may temporarily
rent the same)
on such terms and conditions as the Servicer deems to be in the
best interest of
the Certificateholders and the Trust Fund.
With respect to each REO Property, the Servicer shall account
separately for each REO Property with respect to all funds
collected and
received in connection with the operation of such REO Property.
The income earned from the management of any REO Properties, net of
reimbursement to the Servicer for expenses incurred (including any
property or
other taxes) in connection with such management and net of
unreimbursed
Servicing Fees, Advances and Servicing Advances related thereto,
shall be
applied to the payment of principal of and interest on the related
defaulted
Mortgage Loans (with interest accruing as though such Mortgage
Loans were still
current) and all such income shall be deemed, for all purposes in
this
Agreement, to be payments on account of principal and interest on
the related
Mortgage Notes and shall be deposited into the Collection Account.
To the extent
the net income received during any calendar month is in excess of
the amount on
a daily basis, within two Business Days of receipt attributable to
amortizing
principal and accrued interest at the related Mortgage Rate on the
related
Mortgage Loan for such calendar month, such excess shall be
considered to be a
partial prepayment of principal of the related Mortgage Loan.
The proceeds from any liquidation of a Mortgage Loan, as well as
any
income from an REO Property, will be applied in the following order
of priority:
first, to reimburse the Servicer for any related unreimbursed
Servicing Advances
and Servicing Fees; second, to reimburse the Servicer for any
related
unreimbursed Advances; third, to reimburse the Certificate Account
for any
Nonrecoverable Advances (or portions thereof) that were previously
withdrawn by
the Servicer pursuant to Section 3.05(a)(ii)(b) and 3.05(a)(iii)(c)
that related
to such Mortgage Loan; fourth, to accrued and unpaid interest (to
the extent no
Advance has been made for such amount or any such Advance has been
reimbursed)
on the Mortgage Loan or related REO Property, at the Mortgage Rate
(net of the
Servicing Fee) to the Due Date occurring in the month in which such
amounts are
required to be distributed; and fifth, as a recovery of principal
of the
Mortgage Loan.
The Servicer shall furnish to the Trustee, on each Servicer
Remittance Date, an operating statement for each REO Property
covering the
operation of each REO Property for the previous month. Such
operating statement
shall be accompanied by such other information as the Trustee shall
reasonably
request.
The Servicer shall use its best efforts to dispose of the REO
Property as promptly as is practically consistent with protecting
the
Certificateholders' interests.
Each REO Disposition shall be carried out by the Servicer at such
price and upon such terms and conditions as the Servicer deems to
be in the best
interest of the Certificateholders. If as of the date title to any
REO Property
was acquired by the Servicer there were outstanding unreimbursed
Servicing
Advances, Servicing Fees and Advances with respect to the REO
Property, the
Servicer, upon an REO Disposition of such REO Property, shall be
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entitled to reimbursement for any related unreimbursed Servicing
Advances,
Servicing Fees and Advances from proceeds received in connection
with such REO
Disposition. The proceeds from the REO Disposition, net of any
payment to the
Servicer as provided above, shall be deposited in the Collection
Account for
transfer to the Distribution Account on the succeeding Servicer
Remittance Date
in accordance with Section 3.04(a)(vi).
Any REO Disposition shall be for cash only (unless changes in the
REMIC Provisions made subsequent to the Startup Day allow a sale
for other
consideration and an Opinion of Counsel is obtained by the Servicer
to the
effect that such sale shall not cause any REMIC constituting part
of the Trust
Fund to fail to qualify as a REMIC).
Section 3.14 Due-on-Sale Clauses; Assumption and Substitution
Agreements.
When a Mortgaged Property has been or is about to be conveyed by
the
Mortgagor, the Servicer shall, to the extent it has knowledge of
such conveyance
or prospective conveyance, exercise its rights to accelerate the
maturity of the
related Mortgage Loan under any "due-on-sale" clause contained in
the related
Mortgage or Mortgage Note; provided, however, that the Servicer
shall not
exercise any such right if the "due-on-sale" clause, in the
reasonable belief of
the Servicer, is not enforceable under applicable law. An Opinion
of Counsel of
the Servicer (the costs of which shall constitute a reimbursable
Servicing
Advance) delivered to the Trustee, the Depositor and the NIMS
Insurer shall
conclusively establish the reasonableness of the Servicer's belief
that any
"due-on-sale" clause is not enforceable under applicable law. In
such event, the
Servicer shall make reasonable efforts to enter into an assumption
and
modification agreement with the Person to whom such property has
been or is
about to be conveyed, pursuant to which such Person becomes liable
under the
Mortgage Note and, unless prohibited by applicable law or the
Mortgage, the
Mortgagor remains liable thereon. If the foregoing is not permitted
under
applicable law, the Servicer is authorized to enter into a
substitution of
liability agreement with such Person, pursuant to which the
original Mortgagor
is released from liability and such Person is substituted as
Mortgagor and
becomes liable under the Note; provided that no such substitution
will be
permitted unless such person satisfies the underwriting criteria of
the Servicer
and has a credit score at least equal to that of the original
Mortgagor. The
Mortgage Loan, as assumed, shall conform in all respects to the
requirements,
representations and warranties of this Agreement. The Servicer
shall not take or
enter into any assumption and modification agreement, however,
unless (to the
extent practicable under the circumstances) it shall have received
confirmation,
in writing, of the continued effectiveness of any applicable hazard
insurance
policy. The Servicer shall notify the Trustee that any such
assumption or
substitution agreement has been completed by forwarding to the
Trustee the
original copy of such assumption or substitution agreement
(indicating the
Mortgage File to which it relates) which copy shall be added by the
Trustee to
the related Mortgage File and which shall, for all purposes, be
considered a
part of such Mortgage File to the same extent as all other
documents and
instruments constituting a part thereof. The Servicer shall be
responsible for
recording any such assumption or substitution agreements. In
connection with any
such assumption or substitution agreement, the Monthly Payment on
the related
Mortgage Loan shall not be changed but shall remain as in effect
immediately
prior to the assumption or substitution, the stated maturity or
outstanding
principal amount of such Mortgage Loan shall not be changed nor
shall any
required monthly payments of principal or interest be deferred or
forgiven. Any
fee collected by the Servicer for consenting to any such conveyance
or entering
into an
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assumption or substitution agreement shall be retained by or paid
to the
Servicer as additional servicing compensation.
Notwithstanding the foregoing paragraph or any other provision of
this Agreement, the Servicer shall not be deemed to be in default,
breach or any
other violation of its obligations hereunder by reason of any
assumption of a
Mortgage Loan by operation of law or any assumption which the
Servicer may be
restricted by law from preventing, for any reason whatsoever. For
purposes of
this Section 3.14, the term "assumption" is deemed to include a
sale of the
Mortgaged Property subject to the Mortgage that is not accompanied
by an
assumption or substitution of liability agreement.
Section 3.15 Notification of Adjustments.
On each Adjustment Date, the Servicer shall make Mortgage Interest
Rate adjustments for each Adjustable-Rate Mortgage Loan in
compliance with the
requirements of the related Mortgage and Mortgage Note and
Applicable
Regulations. The Servicer shall execute and deliver the notices
required by each
Mortgage and Mortgage Note and Applicable Regulations regarding
Mortgage
Interest Rate adjustments. Upon the discovery by the Servicer or
the Trustee
that the Servicer has failed to adjust or has incorrectly adjusted
a Mortgage
Interest Rate or a Monthly Payment pursuant to the terms of the
related Mortgage
Note and Mortgage, the Servicer shall deliver to the Trustee for
deposit in the
Distribution Account from its own funds the amount of any interest
loss caused
thereby without reimbursement therefor; provided, however, the
Servicer shall be
held harmless with respect to any Mortgage Interest Rate
adjustments made by any
servicer prior to the Servicer.
Section 3.16 Optional Purchases of Mortgage Loans by Servicer.
The Servicer may, at its option, or, shall, at the direction of the
NIMS Insurer (which shall be at the expense of the NIMS Insurer),
purchase a
Mortgage Loan or REO Property which becomes 90 or more days
Delinquent or for
which the Servicer has accepted a deed in lieu of foreclosure.
Prior to purchase
pursuant to this Section 3.16, the Servicer shall be required to
continue to
make Advances pursuant to Section 4.07. The Servicer shall not use
any procedure
in selecting Mortgage Loans to be purchased which is materially
adverse to the
interests of the Certificateholders. The Servicer shall purchase
such Delinquent
Mortgage Loan or REO Property at a price equal to the Purchase
Price. The
Servicer will not be entitled to any Servicing Fee with respect to
any such
purchased Mortgage Loan. Any such purchase of a Mortgage Loan or
REO Property
pursuant to this Section 3.16 shall be accomplished by delivery to
the Trustee
for deposit in the Distribution Account of the amount of the
Purchase Price. The
Trustee shall immediately effectuate the conveyance of such
delinquent Mortgage
Loan or REO Property to the Servicer to the extent necessary,
including the
prompt delivery of all documentation to the Servicer.
Section 3.17 Trustee to Cooperate; Release of Files.
(a) Upon the payment in full of any Mortgage Loan (including any
liquidation of such Mortgage Loan through foreclosure or otherwise,
or the
receipt by the Servicer of a notification that payment in full will
be escrowed
in a manner customary for such purposes), the
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Servicer shall deliver to the Trustee, in written form (with two
executed
copies) or electronic form, of a completed "Request for Release" in
the form of
Exhibit E. Upon receipt of such Request for Release of Documents,
the Trustee
shall promptly release the related Mortgage File within three (3)
Business Days
via overnight mail delivery (at the expense of the Servicer), in
trust, to (i)
the Servicer, or (ii) such other party identified in the related
Request for
Release. Upon any such payment in full, or the receipt of such
notification that
such funds have been placed in escrow, the Trustee hereby
authorizes and
empowers the Servicer to execute an instrument of satisfaction (or
Assignment
without recourse) regarding the Mortgaged Property relating to such
Mortgage,
which instrument of satisfaction or Assignment shall be delivered
to the Person
or Persons entitled thereto against receipt therefor of payment in
full, it
being understood and agreed that no expense incurred in connection
with such
instrument of satisfaction or assignment, as the case may be, shall
be
chargeable to the Collection Accounts. In lieu of executing any
such
satisfaction or assignment, as the case may be, the Servicer may
prepare and
submit to the Trustee a satisfaction (or assignment without
recourse, if
requested by the Person or Persons entitled thereto) in form for
execution by
the Trustee with all requisite information completed by the
Servicer; in such
event, the Trustee shall execute and acknowledge such satisfaction
or
assignment, as the case may be, and deliver the same with the
related Mortgage
File, as aforesaid.
(b) From time to time and as appropriate in the servicing of any
Mortgage Loan, including, without limitation, foreclosure or other
comparable
conversion of a Mortgage Loan or collection under any insurance
policy relating
to a Mortgage Loan, the Trustee shall (except in the case of the
payment or
liquidation pursuant to which the related Mortgage File is released
to an escrow
agent or an employee, agent or attorney of the Trustee), upon
written request of
the Servicer and delivery to the Trustee, in written form (with two
executed
copies) or electronic form, of a "Request for Release" in the form
of Exhibit E
signed by a Servicing Officer, release the related Mortgage File to
the Servicer
within three (3) Business Days and shall execute such documents as
shall be
necessary to the prosecution of any such proceedings, including,
without
limitation, an assignment without recourse of the related Mortgage
to the
Servicer. Such receipt shall obligate the Servicer to return the
Mortgage File
to the Trustee when the need therefor by the Servicer no longer
exists unless
the Mortgage Loan shall be liquidated, in which case, upon receipt
of a Request
for Release evidencing such liquidation, the receipt shall be
released by the
Trustee to the Servicer.
(c) Subject to Section 3.01, the Servicer shall have the right to
accept applications of Mortgagors for consent to (i) partial
releases of
Mortgages, (ii) alterations, (iii) removal, demolition or division
of properties
subject to Mortgages, (iv) modifications, and (v) second mortgage
subordination
agreements. No application for approval shall be considered by the
Servicer
unless: (w) it has received an Opinion of Counsel, addressed to the
Trustee
(which opinion shall not be an expense of the Trustee or the Trust
Fund) that
such sale, disposition, substitution, acquisition or contribution
will not
affect adversely the status of any REMIC constituting part of the
Trust Fund as
a REMIC or cause any REMIC constituting part of the Trust Fund to
be subject to
a tax on "prohibited transactions" or "contributions" pursuant to
the REMIC
Provisions; (x) the provisions of the related Note and Mortgage
have been
complied with; (y) the Loan-to-Value Ratio and debt-to-income ratio
after any
release does not exceed the maximum Loan-to-Value Ratio and
debt-to-income ratio
established in accordance with the underwriting standards of the
Mortgage Loans;
and (z) the lien priority of the related Mortgage is
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not affected. Upon receipt by the Trustee of a Servicing Officer's
certificate
setting forth the action proposed to be taken in respect of a
particular
Mortgage Loan and certifying that the criteria set forth in the
immediately
preceding sentence have been satisfied, the Trustee shall execute
and deliver to
the Servicer the consent or partial release so requested by the
Servicer. A
proposed form of consent or partial release, as the case may be,
shall accompany
any Servicing Officer's certificate delivered by the Servicer
pursuant to this
paragraph.
Section 3.18 Servicing Compensation.
As compensation for its activities hereunder, the Servicer shall be
entitled to retain the amount of the Servicing Fee with respect to
each Mortgage
Loan (including REO Properties). The Servicer shall be entitled to
retain
additional servicing compensation in the form of release fees, bad
check
charges, assumption fees, modification or extension fees, late
payment charges,
prepayment charges that are not Prepayment Charges, Originator
Prepayment Charge
Payment Amounts or Servicer Prepayment Charge Payment Amounts, or
any other
service-related fees and similar items, to the extent collected
from Mortgagors.
In addition, the Servicer shall be entitled to retain or withdraw
from the
Collection Account, pursuant to Section 3.05(g), any Prepayment
Interest Excess
with respect to the Mortgage Loans as additional servicing
compensation.
The Servicer shall be required to pay all expenses incurred by it
in
connection with its servicing activities hereunder (including
payment of
premiums for any blanket policy insuring against hazard losses
pursuant to
Section 3.11 and the fees and expenses of independent accountants
and any agents
appointed by the Servicer), and shall not be entitled to
reimbursement therefor
from the Trust Fund except as specifically provided in Section
3.05(a).
Section 3.19 Annual Statement as to Compliance.
(a) Beginning in 2006, the Servicer, at its own expense, will
deliver to the Trustee, the NIMS Insurer and the Depositor, not
later than March
15th of each calendar year, a Servicing Officer's certificate
stating, as to
each signer thereof, that (i) a review of the activities of the
Servicer during
such preceding fiscal year and of performance under this Agreement
has been made
under such officers' supervision, and (ii) to the best of such
officers'
knowledge, based on such review, the Servicer has fulfilled all its
obligations
under this Agreement for such year, or, if there has been a default
in the
fulfillment of all such obligations, specifying each such default
known to such
officers and the nature and status thereof including the steps
being taken by
the Servicer to remedy such default.
(b) Delivery of such reports, information and documents to the
Trustee is for informational purposes only and their receipt of
such shall not
constitute constructive notice of any information contained therein
or
determinable, from information contained therein, including the
Servicer's
compliance with any of its covenants hereunder (as to which the
Trustee is
entitled to rely exclusively on Officers' Certificates).
Section 3.20 Annual Independent Certified Public Accountants'
Reports.
(a) Beginning in 2006, not later than March 15th of each calendar
year, the Servicer, at its expense, shall cause a nationally
recognized firm of
independent certified public
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accountants to furnish to the Trustee, the Depositor, the NIMS
Insurer and each
Rating Agency, a report stating that (i) it has obtained a letter
of
representation regarding certain matters from the management of the
Servicer
which includes an assertion that the Servicer has complied with
certain minimum
residential mortgage loan servicing standards, identified in either
the Uniform
Single Attestation Program for Mortgage Bankers established by the
Mortgage
Bankers Association of America or the Audit Program for Mortgages
serviced by
Freddie Mac, with respect to the servicing of residential mortgage
loans during
the most recently completed fiscal year and (ii) on the basis of an
examination
conducted by such firm in accordance with standards established by
the American
Institute of Certified Public Accountants, such representation is
fairly stated
in all material respects, subject to such exceptions and other
qualifications
that may be appropriate. Copies of such statement shall be provided
by the
Trustee to any Certificateholder upon request, at the Servicer's
expense,
provided that such statement is delivered by the Servicer to the
Trustee.
(b) Delivery of such reports, information and documents to the
Trustee is for informational purposes only and their receipt of
such shall not
constitute constructive notice of any information contained therein
or
determinable from information contained therein, including the
Servicer's
compliance with any of its covenants hereunder (as to which the
Trustee is
entitled to rely exclusively on Officers' Certificates).
Section 3.21 Access to Certain Documentation and Information
Regarding the Mortgage Loans.
(a) The Servicer shall provide to the Depositor, the Trustee,
Certificateholders that are federally insured savings and loan
associations, the
Office of Thrift Supervision, the Office of the Comptroller of the
Currency, the
FDIC and the supervisory agents and examiners of each of the
foregoing (which,
in the case of supervisory agents and examiners, may be required by
applicable
state and federal regulations) access to the available
documentation regarding
the Mortgage Loans, such access being afforded without charge but
only upon
reasonable advance request and during normal business hours at the
offices of
the Servicer designated by it.
(b) The Servicer shall afford the NIMS Insurer, upon reasonable
advance notice, during normal business hours, access to all records
maintained
by the Servicer in respect of its rights and obligations hereunder
and access to
officers of the Servicer responsible for such obligations. Upon
request, the
Servicer shall furnish to the NIMS Insurer its most recent publicly
available
financial statements and such other information relating to its
capacity to
perform its obligations under this Agreement.
Section 3.22 Duties of Credit Risk Manager.
For and on behalf of the Depositor, the Credit Risk Manager shall
provide reports and recommendations as to loss mitigation
activities concerning
Mortgage Loans that are past due, are in default, as to which there
has been
commencement of foreclosure, as to which there has been forbearance
in exercise
of remedies, as to which any obligor is the subject of bankruptcy,
receivership,
or an arrangement of creditors, or which have become REO
Properties. Such
reports and recommendations will be based upon information provided
pursuant to
the
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Credit Risk Management Agreement. The Credit Risk Manager shall
look solely to
the Servicer for all information and data (including loss and
delinquency
information and data) and loan-level information and data relating
to the
servicing of the Mortgage Loans. The Trustee, on behalf of the
Trust, hereby
authorizes the Servicer to provide such loan-level information and
data to the
Credit Risk Manager.
The Credit Risk Manager may be removed at any time by a vote of
Certificateholders holding Certificates evidencing at least 66 2/3%
of the
aggregate Voting Rights of the Certificates. After any such
termination, the
Credit Risk Manager shall have no further obligations hereunder,
and shall no
longer be entitled to the Credit Risk Manager Fee.
Section 3.23 Obligations of the Servicer in Respect of Compensating
Interest.
Not later than the close of business on each Servicer Remittance
Date, the Servicer shall deliver to the Trustee for deposit in the
Distribution
Account an amount ("Compensating Interest") equal to the lesser of
(A) the
aggregate of the Prepayment Interest Shortfalls on the Mortgage
Loans for the
related Distribution Date resulting from Principal Prepayments on
the Mortgage
Loans during the portion of the related Prepayment Period occurring
in the prior
calendar month and (B) its aggregate Servicing Fee received in the
related
Collection Period. The Servicer shall apply Compensating Interest
to offset any
Prepayment Interest Shortfalls on the Mortgage Loans. The Servicer
shall not
have the right to reimbursement for any amounts remitted to the
Trustee in
respect of Compensating Interest. Such amounts so remitted shall be
included in
the Available Funds and distributed therewith on the next
Distribution Date. The
Servicer shall not be obligated to pay Compensating Interest with
respect to
Relief Act Interest Shortfalls.
Section 3.24 Obligations of the Servicer in Respect of Mortgage
Interest Rates and Monthly Payments.
In the event that a shortfall in any collection on or liability
with
respect to any Mortgage Loan results from or is attributable to
adjustments to
Mortgage Interest Rates, Monthly Payments or Principal Balances
that were made
by the Servicer in a manner not consistent with the terms of the
related
Mortgage Note, Applicable Regulations and this Agreement, the
Servicer, upon
discovery or receipt of notice thereof, immediately shall deliver
to the Trustee
for deposit in the Distribution Account from its own funds the
amount of any
such shortfall and shall indemnify and hold harmless the Trust
Fund, the
Trustee, the Depositor and any successor servicer in respect of any
such
liability. Such indemnities shall survive the termination or
discharge of this
Agreement. Notwithstanding the foregoing, this Section 3.24 shall
not limit the
ability of the Servicer to seek recovery of any such amounts from
the related
Mortgagor under the terms of the related Mortgage Note, as
permitted by law.
Section 3.25 Investment of Funds in the Collection Accounts.
(a) The Servicer may direct any depository institution maintaining
one or more Collection Accounts, to invest the funds in such
Collection Account
in one or more Eligible Investments bearing interest or sold at a
discount, and
maturing, unless payable on demand, (i) no later than the Business
Day
immediately preceding the date on which such funds
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are required to be withdrawn from such account pursuant to this
Agreement, if a
Person other than the Trustee is the obligor thereon, and (ii) no
later than the
date on which such funds are required to be withdrawn from such
account pursuant
to this Agreement, if the Trustee is the obligor thereon or if such
investment
is managed or advised by the Trustee or an Affiliate of the
Trustee. All such
Eligible Investments shall be held to maturity, unless payable on
demand. Any
investment of funds in a Collection Account shall be made in the
name of the
Trustee or the Servicer, as applicable (in its capacity as such) or
in the name
of a nominee of the Trustee. The Trustee shall be entitled to sole
possession
(except with respect to investment direction of funds held in the
Collection
Accounts) over each such investment and the income thereon, and any
certificate
or other instrument evidencing any such investment shall be
delivered directly
to the Trustee or its agent, together with any document of transfer
necessary to
transfer title to such investment to the Trustee or its nominee. In
the event
amounts on deposit in a Collection Account are at any time invested
in an
Eligible Investment payable on demand, the Trustee shall at the
direction of the
Servicer:
(x)
consistent with any notice required to be given
thereunder, demand that payment thereon be made on the
last day such Eligible Investment may otherwise mature
hereunder in an amount equal to the lesser of (1) all
amounts then payable thereunder and (2) the amount
required to be withdrawn on such date; and
(y)
demand payment of all amounts due thereunder promptly
upon determination by a Responsible Officer of the
Trustee that such Eligible Investment would not
constitute an Eligible Investment in respect of funds
thereafter on deposit in such Collection Account.
(b) All income and gain realized from the investment of funds in
the
Collection Accounts shall be for the benefit of the Servicer. The
Servicer shall
deposit in the applicable Collection Account or (to the extent
funds in the
Escrow Account are invested if permitted by applicable law) the
Escrow Account,
as applicable, from its own funds the amount of any loss incurred
in respect of
any such Eligible Investment made with funds in such account
immediately upon
realization of such loss. Funds in the Distribution Account shall
remain
uninvested.
(c) Except as otherwise expressly provided in this Agreement, if
any
default occurs in the making of a payment due under any Eligible
Investment, or
if a default occurs in any other performance required under any
Eligible
Investment, the Trustee may and, subject to Section 8.01 and
Section 8.02(e),
upon the request of the NIMS Insurer or Holders of Certificates
representing
more than 50% of the Voting Rights allocated to any Class of
Certificates, shall
take such action as may be appropriate to enforce such payment or
performance,
including the institution and prosecution of appropriate
proceedings.
Section 3.26 Liability of Servicer; Indemnification.
Subject to Section 6.03, the Servicer (except the Trustee if it is
required to succeed the Servicer hereunder) indemnifies and holds
the Trustee,
the Depositor, the NIMS Insurer and the Trust Fund harmless against
any and all
claims, losses, penalties, fines,
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forfeitures, reasonable legal fees and related costs, judgments,
and any other
costs, fees and expenses that the Trustee, the Depositor, the NIMS
Insurer and
the Trust Fund may sustain in any way related to the failure of the
Servicer to
perform its duties and service the Mortgage Loans in compliance
with the
Servicing Standard. The Servicer shall immediately notify the
Trustee, the NIMS
Insurer and the Depositor if a claim is made that may result in
such claims,
losses, penalties, fines, forfeitures, legal fees or related costs,
judgments,
or any other costs, fees and expenses, and the Servicer shall
assume (with the
consent of the Trustee) the defense of any such claim and pay all
expenses in
connection therewith, including reasonable counsel fees, and
promptly pay,
discharge and satisfy any judgment or decree which may be entered
against the
Servicer, the Trustee, the Depositor, the NIMS Insurer and/or the
Trust Fund in
respect of such claim. The provisions of this Section 3.26 shall
survive the
termination of this Agreement and the payment of the outstanding
Certificates.
Section 3.27 Reports of Foreclosure and Abandonment of Mortgaged
Properties.
Beginning in 2006, the Servicer shall file the reports of
foreclosure and abandonment of any Mortgaged Property required by
Section 6050J
of the Code with the Internal Revenue Service on or before the due
date for any
such report. Not later than 90 days following the end of each
calendar year,
beginning in 2006, the Servicer will deliver an Officer's
Certificate to the
Trustee and the NIMS Insurer certifying its compliance with this
Section 3.27.
The reports from the Servicer shall be in form and substance
sufficient to meet
the reporting requirements imposed by such Section 6050J.
Section 3.28 Protection of Assets.
(a) Except for transactions and activities entered into in
connection with the securitization that is the subject of this
Agreement, the
Trust is not authorized and has no power to:
(1) borrow money or issue debt;
(2) merge with another entity, reorganize, liquidate or sell
assets;
or
(3) engage in any business or activities.
(b) Notwithstanding any prior termination of this Agreement, each
party hereto agrees that, until after one year and one day
following the payment
in full of the last of the Certificates issued hereunder, it shall
not
acquiesce, petition or otherwise invoke or cause the Depositor or
the Trust to
invoke the process of any court or government authority for the
purpose of
commencing or sustaining a case against the Depositor or the Trust
under any
federal or state bankruptcy, insolvency or similar law, or
appointing a
receiver, liquidator, assignee, trustee, custodian, sequestrator or
other
similar official of the Depositor or the Trust or any substantial
part of the
property of either, or ordering the winding up or liquidation of
the affairs of
the Depositor or the Trust.
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Section 3.29 Limitation of Liability of the Credit Risk Manager.
Neither the Credit Risk Manager, nor any of the directors,
officers,
employees or agents of the Credit Risk Manager, shall be under any
liability to
the Depositor, the Servicer, the Trustee or the Certificateholders
for any
action taken or for refraining from the taking of any action in
good faith
pursuant to this Agreement, in reliance upon information provided
by the
Servicer under the Credit Risk Management Agreement or for errors
in judgment;
provided, however, that this provision shall not protect the Credit
Risk Manager
or any such person against liability that would otherwise be
imposed by reason
of willful malfeasance, bad faith or negligence in its performance
of its duties
or by reason of reckless disregard for its obligations and duties
under this
Agreement or the applicable Credit Risk Management Agreement. The
Credit Risk
Manager and any director, officer, employee or agent of the Credit
Risk Manager
may rely in good faith on any document of any kind prima facie
properly executed
and submitted by any Person respecting any matters arising
hereunder, and may
rely in good faith upon the accuracy of information furnished by
the Servicer
pursuant to the applicable Credit Risk Management Agreement in the
performance
of its duties thereunder and hereunder.
Section 3.30 No Personal Solicitation.
From and after the Closing Date, the Servicer agrees that it will
not take any action or permit or cause any action to be taken by
any of its
agents and Affiliates, or by any independent contractors or
independent mortgage
brokerage companies on the Servicer's behalf, to personally, by
telephone, mail
or electronic mail, solicit the Mortgagor under any Mortgage Loan
for the
purpose of refinancing such Mortgage Loan or make the list of names
and
addresses of the Mortgagors available to any third party for any
solicitation
purpose; provided, that the Servicer may solicit any Mortgagor for
whom the
Servicer has received a request for verification of mortgage, a
request for
demand for payoff, a mortgagor initiated written or verbal
communication
indicating a desire to prepay the related Mortgage Loan, or the
mortgagor
initiates a title search; provided further, it is understood and
agreed that
promotions undertaken by the Servicer or any of its Affiliates
which (i) concern
optional insurance products or other additional products or (ii)
are directed to
the general public at large, including, without limitation, mass
mailings based
on commercially acquired mailing lists, newspaper, radio and
television
advertisements shall not constitute solicitation under this
Section, nor is the
Servicer prohibited from responding to unsolicited requests or
inquiries made by
a Mortgagor or an agent of a Mortgagor. Furthermore, the Servicer
shall be
permitted to include messages to all borrowers under all mortgage
loans serviced
by it in its monthly statements.
Section 3.31 Periodic Filings.
(a) The Trustee and the Servicer shall reasonably cooperate with
the
Depositor in connection with the Trust's satisfying its reporting
requirements
under the Exchange Act. Without limiting the generality of the
foregoing, the
Trustee shall prepare, or cause to be prepared, on behalf of the
Trust any
monthly Current Reports on Form 8-K (each, a "Monthly Form 8-K")
and Annual
Reports on Form 10-K (each, a "Form 10-K") customary for similar
securities as
required by the Exchange Act and the rules and regulations of the
Securities and
Exchange Commission thereunder, and the Trustee shall sign (other
than any Form
10-K) and file (via the Securities and Exchange Commission's
Electronic Data
Gathering and Retrieval
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System) such Forms on behalf of the Trust. The Depositor hereby
grants to the
Trustee a limited power of attorney to execute and file each such
document on
behalf of the Depositor. Such power of attorney shall continue
until either the
earlier of (i) receipt by the Trustee from the Depositor of written
termination
of such power of attorney and (ii) the termination of the Trust.
Notwithstanding
the foregoing, the Depositor shall sign any Form 10-K with respect
to which the
Depositor signs a Certification.
(b) Each Monthly Form 8-K shall be filed by the Trustee within 15
days after each Distribution Date, including a copy of the
Distribution Date
Statement for such Distribution Date as an exhibit thereto. Prior
to March 30th
of each year (or such earlier date as may be required by the
Exchange Act and
the rules and regulations of the Securities and Exchange
Commission), the
Trustee shall file a Form 10-K, in substance as required by
applicable law or
applicable Securities and Exchange Commission staff
interpretations. Such Form
10-K shall include as exhibits the Servicer's annual statement of
compliance
described under Section 3.19 and the accountant's report described
under Section
3.20, in each case, to the extent they have been timely delivered
to the
Trustee. If they are not so timely delivered, the Trustee shall
file an amended
Form 10-K (to the extent permissible) including such documents as
exhibits
reasonably promptly after they are delivered to the Trustee. The
Trustee shall
have no liability with respect to any failure to properly prepare
or file such
periodic reports resulting from or relating to the Trustee's
inability or
failure to obtain any information not resulting from its own
negligence, willful
misconduct or bad faith. The Form 10-K shall also include a
certification in the
form attached hereto as Exhibit O (the "Certification"), which
shall be signed
by a senior officer of the Depositor in charge of securitization.
The Depositor
shall deliver the Certification to the Trustee prior to March 15th
of each year
in which a Form 10-K is required to be filed with respect to the
Trust. The
Trustee, the Depositor and the Servicer shall reasonably cooperate
to enable the
Securities and Exchange Commission requirements with respect to the
Trust to be
met in the event that the Securities and Exchange Commission issues
additional
interpretive guidelines or promulgates rules or regulations, or in
the event of
any other change of law that would require reporting arrangements
or the
allocation of responsibilities with respect thereto, as described
in this
Section 3.31, to be conducted or allocated in a different manner.
(c) Not later than 15 calendar days prior to the latest date on
which the Form 10-K may be timely filed each year, (i) the Trustee
shall sign
and deliver to the Depositor a certification (in the form attached
hereto as
Exhibit P-1) for the benefit of the Depositor and its officers,
directors and
Affiliates (provided, however, that the Trustee shall not undertake
an analysis
of the accountant's report attached as an exhibit to the Form 10-K)
and (ii) the
Servicer shall sign and deliver to the Depositor a certification
(in the form
attached hereto as Exhibit P-2) for the benefit of the Depositor
and its
officers, directors and Affiliates. In addition, (i) the Trustee
shall also
indemnify and hold harmless the Depositor, each Person, if any, who
"controls"
the Depositor within the meaning of the 1933 Act, and its officers,
directors
and Affiliates from and against
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any losses, damages, penalties, fines, forfeitures, reasonable and
necessary
legal fees and related costs, judgments and other costs and
expenses arising out
of or based upon any inaccuracy in the certification provided by
the Trustee
pursuant to this Section 3.31(c), any breach of the Trustee's
obligations under
this Section 3.31(c) or the Trustee's negligence, bad faith or
willful
misconduct in connection therewith and (ii) the Servicer shall
indemnify and
hold harmless the Depositor, each Person, if any, who "controls"
the Depositor
within the meaning of the 1933 Act, and its officers, directors and
Affiliates
from and against any losses, damages, penalties, fines,
forfeitures, reasonable
and necessary legal fees and related costs, judgments and other
costs and
expenses arising out of or based upon any inaccuracy in the
certification
provided by the Servicer pursuant to this Section 3.31(c), any
breach of the
Servicer's obligations under this Section 3.31(c) or the Servicer's
negligence,
bad faith or willful misconduct in connection therewith. If the
indemnification
provided for herein is unavailable or insufficient to hold harmless
the
Depositor, each Person, if any, who "controls" the Depositor within
the meaning
of the 1933 Act, and its officers, directors and Affiliates, then
(i) the
Trustee agrees that it shall contribute to the amount paid or
payable by the
Depositor, its officers, directors or Affiliates as a result of the
losses,
claims, damages or liabilities of the Depositor, its officers,
directors or
Affiliates in such proportion as is appropriate to reflect the
relative fault of
the Depositor and its officers, directors and Affiliates on the one
hand and the
Trustee on the other in connection with a breach of the Trustee's
obligations
under this Section 3.31(c) or the Trustee's negligence, bad faith
or willful
misconduct in connection therewith and (ii) the Servicer agrees
that it shall
contribute to the amount paid or payable by the Depositor, its
officers,
directors or Affiliates as a result of the losses, claims, damages
or
liabilities of the Depositor, its officers, directors or Affiliates
in such
proportion as is appropriate to reflect the relative fault of the
Depositor and
its officers, directors and Affiliates on the one hand and the
Servicer on the
other in connection with a breach of the Servicer's obligations
under this
Section 3.31(c) or the Servicer's negligence, bad faith or willful
misconduct in
connection therewith. The Servicer hereby acknowledges and agrees
that the
Depositor and the Trustee are relying on the Servicer's performance
of its
obligations under Sections 3.19 and 3.20 in order to perform their
respective
obligations under this Section 3.31.
(d) Upon any filing with the Securities and Exchange Commission,
the
Trustee shall promptly deliver to the Depositor a copy of any such
executed
report, statement or information.
(e) The obligations set forth in paragraphs (a) through (d) of this
Section shall only apply with respect to periods for which the
Trustee is
obligated to file reports on Form 8-K or 10-K pursuant to paragraph
(b) of this
Section. Prior to January 30th of the first year in which the
Trustee is able to
do so, the Trustee shall prepare, execute and file with the
Securities and
Exchange Commission a Form 15 Suspension Notification with respect
to the Trust,
and thereafter there shall be no further obligations under
paragraphs (a)
through (d) of this Section commencing with the calendar year in
which the Form
15 is filed (other than the obligations to be performed in such
calendar year
that relate back to the prior calendar year).
(f) If the Securities and Exchange Commission issues additional
interpretative guidance or promulgates additional rules or
regulations, or if
other changes in applicable law occur, which would require the
reporting
arrangements, or the allocation of responsibilities with respect
thereto,
described in this Section 3.31, to be conducted differently than as
