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EXECUTION COPY
CHASE MORTGAGE FINANCE CORPORATION,
DEPOSITOR,
JPMORGAN CHASE BANK, N.A.,
SERVICER
AND
WACHOVIA BANK, N.A.,
TRUSTEE
POOLING AND SERVICING AGREEMENT
Dated as of December 1, 2005
$1,075,062,416.02
Multi-Class Mortgage Pass-Through Certificates
Series 2005-A2
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TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS................................................................................1
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; TRUST
FUND..................................................38
Section 2.01
Conveyance of Mortgage
Loans.....................................................38
Section 2.02
Acceptance by
Trustee............................................................42
Section 2.03
Trust Fund; Authentication of
Certificates.......................................43
Section 2.04
REMIC
Elections..................................................................43
Section 2.05
Permitted Activities of
Trust....................................................47
Section 2.06
Qualifying Special Purpose
Entity................................................47
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR AND THE SERVICER;
REPURCHASE OF
MORTGAGE
LOANS............................................................................47
Section 3.01
Representations and Warranties of the Depositor with respect to
the
Mortgage
Loans...................................................................47
Section 3.02
Representations and Warranties of the
Servicer...................................55
Section 3.03
Option to
Substitute.............................................................56
ARTICLE IV
THE
CERTIFICATES..........................................................................56
Section 4.01
The
Certificates.................................................................56
Section 4.02
Registration of Transfer and Exchange of
Certificates............................58
Section 4.03
Mutilated, Destroyed, Lost or Stolen
Certificates................................62
Section 4.04
Persons Deemed
Owners............................................................62
Section
4.05
Appointment of Paying Agent, Certificate Registrar and Backup
Advancer;
Certificate
Account..............................................................62
Section 4.06
Authenticating
Agents............................................................64
ARTICLE V
ADMINISTRATION AND SERVICING OF MORTGAGE
LOANS............................................64
Section 5.01
Servicer to Service Mortgage
Loans...............................................64
Section 5.02
Sub-Servicing Agreements Between Servicer and Sub-Servicers;
Enforcement
of Sub-Servicer's
Obligations....................................................65
Section 5.03
Successor
Sub-Servicers..........................................................66
Section 5.04
Liability of the
Servicer........................................................66
Section 5.05
No Contractual Relationship Between Sub-Servicer and Trustee or
Certificateholders...............................................................66
Section 5.06
Termination of Sub-Servicing
Agreement...........................................66
Section 5.07
Collection of Mortgage Loan
Payments.............................................66
Section 5.08
Establishment of Collection Account; Deposit in Collection
Account...............67
Section 5.09
Permitted Withdrawals from the Collection
Account................................68
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Section 5.10
Establishment of Escrow Account; Deposits in Escrow
Account......................69
Section 5.11 Permitted
Withdrawals from Escrow
Account........................................69
Section 5.12
Payment of Taxes, Insurance and Other
Charges....................................69
Section 5.13
Transfer of
Accounts.............................................................69
Section 5.14
[Reserved].......................................................................69
Section 5.15
Maintenance of the Primary Insurance
Policies....................................70
Section 5.16
Maintenance of Standard Hazard
Policies..........................................70
Section 5.17
[Reserved].......................................................................71
Section 5.18
[Reserved].......................................................................71
Section 5.19
Fidelity Bond and Errors and Omissions
Insurance.................................71
Section
5.20
Collections under Insurance Policies; Enforcement of Due-On-Sale
Clauses;
Assumption
Agreements............................................................71
Section 5.21
Income and Realization from Defaulted Mortgage
Loans.............................72
Section 5.22
Trustee to Cooperate; Release of Mortgage
Files..................................73
Section 5.23
Servicing and Other
Compensation.................................................74
Section 5.24
1934 Act
Reports.................................................................75
Section 5.25
Annual Statement as to
Compliance................................................75
Section 5.26
Annual Independent Public Accountants' Servicing
Report..........................76
Section 5.27
Access to Certain Documentation; Rights of the Depositor in Respect
of
the
Servicer.....................................................................76
Section 5.28
REMIC-Related
Covenants..........................................................76
ARTICLE VI
PAYMENTS TO THE
CERTIFICATEHOLDERS........................................................78
Section 6.01
Distributions....................................................................78
Section 6.02
Statements to the
Certificateholders.............................................84
Section 6.03
Advances by the
Servicer.........................................................86
Section 6.04
Allocation of Realized
Losses....................................................87
Section 6.05
Compensating Interest; Allocation of Certain Interest
Shortfalls.................88
Section 6.06
Subordination....................................................................89
ARTICLE VII
REPORTS TO BE PREPARED BY THE
SERVICER....................................................89
Section 7.01
Servicer Shall Provide Information as Reasonably
Required........................89
Section 7.02
Federal Information Returns and Reports to
Certificateholders....................89
ARTICLE VIII
THE DEPOSITOR AND THE
SERVICER............................................................90
Section 8.01
Indemnification; Third Party
Claims..............................................90
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Section 8.02
Merger or Consolidation of the Depositor or the
Servicer.........................91
Section 8.03
Limitation on Liability of the Depositor, the Servicer, the Trustee
and
Others...........................................................................91
Section 8.04
Depositor and Servicer Not to
Resign.............................................92
Section 8.05
Successor to the
Servicer........................................................92
Section 8.06
Maintenance of
Ratings...........................................................93
ARTICLE IX
DEFAULT...................................................................................93
Section 9.01
Events of
Default................................................................93
Section 9.02
Waiver of
Defaults...............................................................94
Section 9.03
Trustee to Act; Appointment of
Successor.........................................95
Section 9.04
Notification to Certificateholders and the Rating
Agencies.......................95
ARTICLE X
CONCERNING THE
TRUSTEE....................................................................95
Section 10.01
Duties of
Trustee................................................................95
Section 10.02
Certain Matters Affecting the
Trustee............................................96
Section 10.03
Trustee Not Liable for Certificates or Mortgage
Loans............................97
Section 10.04 Trustee May Own
Certificates.....................................................97
Section 10.05
Fees and
Expenses................................................................97
Section 10.06
Eligibility Requirements for
Trustee.............................................97
Section 10.07
Resignation and Removal of the
Trustee...........................................97
Section 10.08
Successor
Trustee................................................................98
Section 10.09
Merger or Consolidation of
Trustee...............................................99
Section 10.10
Appointment of Co-Trustee or Separate
Trustee....................................99
Section 10.11
Appointment of Office or
Agency.................................................100
ARTICLE XI
TERMINATION..............................................................................100
Section 11.01
Termination.....................................................................100
ARTICLE XII
MISCELLANEOUS
PROVISIONS.................................................................101
Section 12.01
Severability of
Provisions......................................................101
Section 12.02
Limitation on Rights of
Certificateholders......................................101
Section 12.03
Amendment.......................................................................102
Section 12.04
Counterparts....................................................................103
Section 12.05
Duration of
Agreement...........................................................103
Section 12.06
Governing
Law...................................................................103
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Section 12.07
Notices.........................................................................103
Section 12.08
Further
Assurances..............................................................103
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EXHIBIT A MORTGAGE
LOAN SCHEDULE
EXHIBIT B CONTENTS OF MORTGAGE FILE
EXHIBIT C FORMS OF
CLASS A CERTIFICATES
EXHIBIT D FORM OF
CLASS M CERTIFICATE
EXHIBIT E FORMS OF
CLASS B CERTIFICATES
EXHIBIT F FORM OF
CLASS A-R CERTIFICATE
EXHIBIT G FORM OF
TRUSTEE CERTIFICATION
EXHIBIT H FORM OF
INVESTMENT LETTER
EXHIBIT I FORM OF
RULE 144A INVESTMENT LETTER
EXHIBIT J FORM OF
SPECIAL SERVICING AND COLLATERAL FUND AGREEMENT
EXHIBIT K FORM OF
CLASS A-R TRANSFEREE LETTER
EXHIBIT K-1 FORM OF CLASS A-R
TRANSFEROR LETTER
EXHIBIT L REQUEST
FOR RELEASE OF DOCUMENTS
EXHIBIT M FORM OF
ERISA REPRESENTATION LETTER
EXHIBIT N FORM OF
OFFICER'S CERTIFICATE (SERVICER)
EXHIBIT O FORM OF
OFFICER'S CERTIFICATE (PAYING AGENT)
EXHIBIT P LETTER OF
REPRESENTATIONS
v
<PAGE>
This Pooling and Servicing Agreement, dated as of December 1, 2005,
is
executed among Chase Mortgage Finance Corporation, as depositor
(together with
its permitted successors and assigns, the "Depositor"), JPMorgan
Chase Bank,
N.A. ("Chase"), as servicer (together with its permitted successors
and assigns,
the "Servicer") and Wachovia Bank, N.A., as trustee (together with
its permitted
successors and assigns, the "Trustee").
In consideration of the premises and the mutual agreements
hereinafter
set forth, the Depositor, the Servicer and the Trustee agree as
follows:
ARTICLE I
DEFINITIONS
Whenever used herein, the following words and phrases, unless
the
context otherwise requires, shall have the following meanings:
ACCEPTED SERVICING PRACTICES: With respect to any Mortgage Loan,
those
mortgage servicing practices (including collection procedures) of
prudent
mortgage banking institutions which service mortgage loans of the
same type as
such Mortgage Loan in the jurisdiction where the related Mortgaged
Property (or
Underlying Mortgaged Property, in the case of a Co-op Loan) is
located, and
which are in accordance with FNMA servicing practices and
procedures for MBS
pool mortgages (as defined in the FNMA Guides including future
updates).
ADVANCE: The aggregate of the advances made by the Servicer
with
respect to a particular Distribution Date pursuant to Section
6.03.
AFFILIATE: With respect to any specified Person, any other
Person
controlling, controlled by or under common control with such
Person. For the
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 the terms
"controlling" and
"controlled" have meanings correlative to the foregoing.
AGENCY & TRUST OFFICE: The principal office of the Trustee at
which at
any particular time its corporate trust business shall be
administered, which
office at the date of execution of this instrument is located at
401 South Tryon
Street, 12th Floor NC1179, Charlotte, North Carolina
28288-1179.
AGGREGATE SUBORDINATED PERCENTAGE: With respect to any
Distribution
Date, is equal to the aggregate Principal Balance of the
Subordinated
Certificates immediately prior to such Distribution Date divided by
the
aggregate Scheduled Principal Balance of all of the Mortgage Loans
immediately
prior to such Distribution Date.
AGREEMENT: This Pooling and Servicing Agreement and all
amendments
hereof and supplements hereto.
APPRAISED VALUE: The value set forth in an appraisal or
recertification
document made in connection with the origination of the related
Mortgage Loan as
the value of the Mortgaged Property (or the related residential
dwelling unit in
the Underlying Mortgaged Property, in the case of a Co-op
Loan).
ASSIGNMENT OF MORTGAGE: An assignment of the Mortgage, notice
of
transfer (or UCC-3 assignment (or equivalent instrument) with
respect to each
Co-op Loan) or equivalent instrument, in recordable form (except in
the case of
a Co-op Loan), sufficient under the laws of the jurisdiction where
the related
Mortgaged Property (or Underlying Mortgaged Property, in the case
of a Co-op
Loan) is located to reflect of record the sale and assignment of
the Mortgage
Loan to the Trustee, which assignment, notice of transfer or
equivalent
instrument may, if permitted by law, be in the form of one or more
blanket
assignments covering Mortgages secured by Mortgaged Properties
located in the
same county.
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AUTHENTICATING AGENT: The meaning specified in Section 4.06.
AVAILABLE DISTRIBUTION AMOUNT: On any Distribution Date, an
amount
equal to the amount on deposit in the Collection Account as of the
close of
business two Business Days immediately preceding the related
Distribution Date
(but prior to making any deposits into the Certificate Account on
such date)
except:
(a) amounts received on particular Mortgage Loans as late payments
or
other recoveries of principal or interest (including any Subsequent
Recoveries,
Liquidation Proceeds, Insurance Proceeds and condemnation awards)
and respecting
which the Servicer previously made an unreimbursed Advance of such
amounts;
(b) reimbursement for Nonrecoverable Advances and other amounts
permitted to be withdrawn by the Servicer pursuant to Section 5.09
from, or not
required to be deposited in, the Collection Account;
(c) amounts representing the Servicing Fee with respect to such
Distribution Date;
(d) amounts representing all or part of a Monthly Payment due (i)
after
the related Due Period or (ii) on or prior to the Cut-off Date;
(e) all Repurchase Proceeds, Principal Prepayments, Liquidation
Proceeds, Insurance Proceeds, Subsequent Recoveries and
condemnation awards with
respect to Mortgage Loans received after the related Principal
Prepayment
Period, and all related payments of interest representing interest
for any
period of time after the last day of the related Due Period for
such Mortgage
Loans; and
(f) all income from Eligible Investments held in the Collection
Account
for the account of the Servicer.
BACKUP ADVANCER: Initially, the Paying Agent acting with respect to
the
obligation to make Advances under certain circumstances as set
forth in Section
6.03.
BANKRUPTCY AMOUNT: As of any date of determination, $283,610.15
minus
all Bankruptcy Losses on the Mortgage Loans, if any, previously
allocated to the
Certificates in accordance with Section 6.04.
BANKRUPTCY CODE: Title 11 of the United States Code, as the same
may be
amended from time to time.
BANKRUPTCY LOSS: With respect to any Mortgage Loan, a Realized
Loss
resulting from a Deficient Valuation or Debt Service Reduction.
BENEFICIAL HOLDER: A Person holding a beneficial interest in
any
Book-Entry Certificate through a Participant or an Indirect
Participant or a
Person holding a beneficial interest in any Definitive
Certificate.
2
<PAGE>
BOOK-ENTRY CERTIFICATES: The Class A Certificates (other than the
Class
A-R Certificates), Class M Certificates, Class B-1 Certificates and
Class B-2
Certificates, referred to collectively.
BUSINESS DAY: Any day other than (a) a Saturday or Sunday, (b) a
legal
holiday in the State of New York or (c) a day on which banking
institutions in
the State of New York are authorized or obligated by law or
executive order to
be closed.
CARRY-OVER SUBORDINATED PRINCIPAL AMOUNT: As of any Distribution
Date,
with respect to any Class of Subordinated Certificates, an amount,
if any, equal
to the amount of principal distributable to such Class on any prior
Distribution
Date that has not been so distributed and is not attributable to a
Realized
Loss.
CASH LIQUIDATION: Recovery of all cash proceeds by the Servicer
with
respect to the liquidation of any Mortgage Loan, including
Insurance Proceeds
and other payments or recoveries (whether made at one time or over
a period of
time) which the Servicer deems to be finally recoverable, in
connection with the
sale, assignment or satisfaction of such Mortgage Loan, trustee's
sale,
foreclosure sale or otherwise, but only if title to the related
Mortgaged
Property (or stock allocated to a dwelling unit, in the case of a
Co-op Loan)
was not acquired by foreclosure or deed in lieu of foreclosure by
the Servicer
pursuant to Section 5.21.
CERTIFICATE: Any Class A, Class M or Class B Certificate.
CERTIFICATE ACCOUNT: The account created and maintained pursuant
to
Section 4.05.
CERTIFICATEHOLDER or HOLDER: The Person in whose name a Certificate
is
registered in the Certificate Register, except that, solely for the
purposes of
giving any consent, waiver, request or demand pursuant to this
Agreement, any
Certificate registered in the name of the Depositor, the Servicer,
any
Sub-Servicer, or any of their respective Affiliates shall be
disregarded and the
undivided Percentage Interest evidenced thereby shall not be taken
into account
in determining whether the requisite amount of Percentage Interests
necessary to
effect any such consent, waiver, request or demand has been
obtained. The
Trustee and the Paying Agent shall be entitled to conclusively rely
upon the
certificate of the Depositor or the Servicer as to the
determination of which
Certificates are registered in the name of such Affiliates.
CERTIFICATE OWNER: Any Person who is the beneficial owner of a
Book-Entry Certificate registered in the name of the Depository or
its nominee.
CERTIFICATE POOL: Any of the Class 1-A Certificates, the Class
2-A
Certificates and the Class 3-A Certificates.
CERTIFICATE RATE: The per annum rate of interest borne by each
Class of
Certificates, which (i) in the case of the Class 1-A1, Class 1-A2,
Class 1-A3,
Class 1-A4, Class 1-A5, Class 1-A6 and Class A-R Certificates, the
Certificate
Rate will equal, with respect to any Distribution Date occurring
until and
including the Distribution Date in November 2010, the lesser of
5.413% and Pool
1 Net WAC and, with respect to any Distribution Date occurring in
or after
December 2010, Pool 1 Net WAC; (ii) in the case of the Class 2-A1,
Class 2-A2,
Class 2-A3 and Class 2-A4 Certificates, the Certificate Rate will
equal, with
respect to any Distribution Date occurring until and including the
Distribution
Date in November 2012, the lesser of 5.398% and Pool 2 Net WAC and,
with respect
to any Distribution Date occurring in or after December 2012, Pool
2 Net WAC;
(iii) in the case of the Class 3-A1, Class 3-A2, Class 3-A3, Class
3-A4, Class
3-A5 and Class 3-A6 Certificates, the Certificate Rate will equal,
with respect
to any Distribution Date occurring until and including the
Distribution Date in
3
<PAGE>
November 2015, the lesser of 5.471% and Pool 3 Net WAC and, with
respect to any
Distribution Date occurring in or after December 2015, Pool 3 Net
WAC; (iv) in
the case of the Class 1-AX Certificates, the Certificate Rate will
equal, with
respect to any Distribution Date occurring until and including the
Distribution
Date in November 2010, the greater of (x) the Pool 1 Net WAC minus
5.413% and
(y) zero and, with respect to any Distribution Date occurring in or
after
December 2010, zero; (v) in the case of the Class 2-AX
Certificates, the
Certificate Rate will equal, with respect to any Distribution Date
occurring
until and including the Distribution Date in November 2012, will
equal the
greater of (x) the Pool 2 Net WAC minus 5.398% and (y) zero and,
with respect to
any Distribution Date occurring in or after December 2012, zero;
(vi) in the
case of the Class 3-AX Certificates, the Certificate Rate will
equal, with
respect to any Distribution Date until and including the
Distribution Date in
November 2015, the greater of (x) the Pool 3 Net WAC minus 5.471%
and (y) zero
and, with respect to any Distribution Date occurring in or after
December 2015,
zero. With respect to any Distribution Date, the Certificate Rate
on each Class
of Subordinated Certificates shall equal the fraction, expressed as
a
percentage, (I) the numerator of which shall equal the sum of (i)
the product of
(x) the Pool 1 Net WAC and (y) the Pool 1 Subordinated Amount, (ii)
the product
of (x) the Pool 2 Net WAC and (y) the Pool 2 Subordinated Amount
and (iii) the
product of (x) the Pool 3 Net WAC and (y) the Pool 3 Subordinated
Amount and
(II) the denominator of which will equal the sum of the Pool 1
Subordinated
Amount, the Pool 2 Subordinated Amount and the Pool 3 Subordinated
Amount. For
federal income tax purposes, the Certificate Rate on each Class of
Subordinated
Certificates can be expressed as a per annum rate equal to the
weighted average
of the interest rates on the Lower-Tier REMIC Regular Interests
ending with the
designation "A" weighted on the basis of their principal amounts
immediately
prior to such Distribution Date.
CERTIFICATE REGISTER: The register maintained pursuant to Section
4.02.
CERTIFICATE REGISTRAR: The Person appointed by the Trustee as
Certificate Registrar pursuant to Section 4.05.
CHASE: JPMorgan Chase Bank, N.A., a national banking association,
or
its successor in interest.
CHF: Chase Home Finance LLC, a Delaware limited liability company,
or
its successor in interest.
CLASS: Pertaining to the Class 1-A1, Class 1-A2, Class 1-A3,
Class
1-A4, Class 1-A5, Class 1-A6, Class 1-AX, Class 2-A1, Class 2-A2,
Class 2-A3,
Class 2-A4, Class 2-AX, Class 3-A1, Class 3-A2, Class 3-A3, Class
3-A4, Class
3-A5, Class 3-A6, Class 3-AX, Class A-R, Class M, Class B-1, Class
B-2, Class
B-3, Class B-4, Class B-5 Certificates, any Lower-Tier REMIC
Interest or any
Middle-Tier REMIC Interest, as the case may be.
CLASS 1-A CERTIFICATES: The Class 1-A1, Class 1-A2, Class 1-A3,
Class
1-A4, Class 1-A5, Class 1-A6, Class 1-AX and Class A-R
Certificates, referred to
collectively.
CLASS 1-A INTEREST ACCRUAL AMOUNT: On any Distribution Date, an
amount
equal to the sum of the Class 1-A1 Interest Accrual Amount, the
Class 1-A2
Interest Accrual Amount, the Class 1-A3 Interest Accrual Amount,
the Class 1-A4
Interest Accrual Amount, the Class 1-A5 Interest Accrual Amount,
the Class 1-A6
Interest Accrual Amount, the Class 1-AX Interest Accrual Amount and
the Class
A-R Interest Accrual Amount.
CLASS 1-A INTEREST SHORTFALL: On any Distribution Date, an amount
equal
to the sum of the Class 1-A1 Shortfall, the Class 1-A2 Shortfall,
the Class 1-A3
Shortfall, the Class 1-A4 Shortfall, the Class 1-A5 Shortfall, the
Class 1-A6
Shortfall, the Class 1-AX Shortfall and the Class A-R
Shortfall.
4
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CLASS 1-A OPTIMAL PRINCIPAL AMOUNT: With respect to any
Distribution
Date, the lesser of (a) the Class 1-A Principal Balance and (b) the
sum of:
(i) the Class 1-A Percentage of the principal portion of all
Monthly Payments, whether or not received, which were due during
the
related Due Period on Pool 1 Mortgage Loans which were
outstanding
during such Due Period;
(ii) the Class 1-A Prepayment Percentage of all Principal
Prepayments made on Pool 1 Mortgage Loans during the related
Principal
Prepayment Period;
(iii) with respect to each Pool 1 Mortgage Loan not described
in
(iv) below, the Class 1-A Percentage of the principal portion of
all
Insurance Proceeds, condemnation awards and any other cash
proceeds
from a source other than the applicable Mortgagor, to the
extent
required to be deposited in the Collection Account pursuant to
Section
5.08(iv) and (v), which were received during the related
Principal
Prepayment Period with respect to any Pool 1 Mortgage Loan, net
of
related unreimbursed Servicing Advances and net of any portion
thereof
which, as to any such Mortgage Loan, constitutes Late Collections
that
have been the subject of an Advance on any prior Distribution
Date;
(iv) with respect to each Pool 1 Mortgage Loan which has become
a
Liquidated Mortgage Loan during the related Principal
Prepayment
Period, the lesser of (A) the Class 1-A Percentage of an amount
equal
to the Principal Balance of such Mortgage Loan (net of any
unreimbursed
Advances) as of the Due Date immediately preceding the date on
which
such Mortgage Loan became a Liquidated Mortgage Loan and (B) the
Class
1-A Prepayment Percentage of the Net Liquidation Proceeds with
respect
to such Mortgage Loan (net of any unreimbursed Advances);
(v) with respect to each Pool 1 Mortgage Loan repurchased
during
the related Principal Prepayment Period pursuant to Sections
2.02,
3.01, 5.01, 5.21 or 11.01, an amount equal to the Class 1-A
Prepayment
Percentage of the principal portion of the Purchase Price (net
of
amounts with respect to which a distribution of principal has
previously been made to the applicable Class A Certificateholders);
and
(vi) on or after the Credit Support Depletion Date, the excess
of
the Class 1-A Principal Balance (calculated after giving effect
to
reductions thereof on such Distribution Date with respect to
the
amounts described in (i) - (v) above) over the outstanding
principal
balance of the Pool 1 Mortgage Loans, if any, as of the
preceding
Distribution Date (giving effect to any Advances but prior to
giving
effect to any Principal Prepayments received with respect to
such
Mortgage Loans that have not been passed through to the
Certificateholders).
CLASS 1-A PERCENTAGE: As of any Distribution Date, the
percentage
obtained by dividing the Class 1-A Principal Balance by the
outstanding
principal balance of the Pool 1 Mortgage Loans, but not more than
100%.
CLASS 1-A PREPAYMENT PERCENTAGE: As of any Distribution Date up to
and
including the Distribution Date in December 2012, 100%; as of any
Distribution
Date in the first year thereafter, the Class 1-A Percentage plus
70% of the
Class 1-A Subordinated Percentage for such Distribution Date; as of
any
Distribution Date in the second year thereafter, the Class 1-A
Percentage plus
60% of the Class 1-A Subordinated Percentage for such Distribution
Date; as of
any Distribution Date in the third year thereafter, the Class 1-A
Percentage
plus 40% of the Class 1-A Subordinated Percentage for such
Distribution Date; as
of any Distribution Date in the fourth year thereafter, the Class
1-A Percentage
plus 20% of the Class 1-A Subordinated Percentage for such
Distribution Date;
and as of any Distribution Date after the fourth year thereafter,
the Class 1-A
Percentage; provided that, if any Class 1-A Percentage as of any
such
Distribution Date is greater than the Class 1-A Percentage on the
first
Distribution Date, the Class 1-A Prepayment Percentage shall be
100%; and
provided further, that whenever the Class 1-A Percentage equals 0%,
the Class
1-A Prepayment Percentage shall equal 0%; and provided further that
no reduction
of the Class 1-A Prepayment Percentage below the level in effect
for the most
5
<PAGE>
recent period shall occur with respect to any Distribution Date
unless, as of
the last day of the month preceding such Distribution Date, (i) the
aggregate
outstanding Principal Balance of Mortgage Loans with respect to all
three Pools,
each taken individually, delinquent 60 days or more (including for
this purpose
any Mortgage Loans in foreclosure and Mortgage Loans with respect
to which the
related Mortgaged Property has been acquired by the Trust Fund)
does not equal
or exceed 50% of the related Subordinated Percentage of the
outstanding
Principal Balance of the Mortgage Loans with respect to the related
Pool as of
such date and (ii) cumulative Realized Losses with respect to each
of the three
Pools do not exceed (a) 30% of the related Original Subordinated
Principal
Balance if such Distribution Date occurs in the year beginning with
and
including the seventh anniversary of the first Distribution Date,
(b) 35% of the
related Original Subordinated Principal Balance if such
Distribution Date occurs
in the year beginning with and including the eighth anniversary of
the first
Distribution Date, (c) 40% of the related Original Subordinated
Principal
Balance if such Distribution Date occurs in the year beginning with
and
including the ninth anniversary of the first Distribution Date, (d)
45% of the
related Original Subordinated Principal Balance if such
Distribution Date occurs
in the year beginning with and including the tenth anniversary of
the first
Distribution Date, and (e) 50% of the related Original Subordinated
Principal
Balance if such Distribution Date occurs in the year beginning with
and
including the eleventh anniversary of the first Distribution Date
or thereafter,
provided, notwithstanding the foregoing, if the following
conditions are met:
(i) the Aggregate Subordinated Percentage is greater than or equal
to
twice such percentage calculated as of the Closing Date;
(ii) the outstanding Principal Balance of all Mortgage Loans in
each
Pool delinquent 60 days or more (including Mortgage Loans in
foreclosure, REO
property or bankruptcy status), averaged over the preceding
six-month period, as
a percentage of the related Subordinated Amount (without giving
effect to any
payments on such Distribution Date), does not equal or exceed 50%;
and
(iii) cumulative Realized Losses with respect to the Mortgage Loans
in
each Pool do not exceed, as a percentage of the related
Subordinated Amount as
of the Closing Date plus the pro rata portion (based upon the
outstanding
Principal Balance of each outstanding Certificate Pool) of the
Subordinated
Amount for each Pool for which the related Class A Certificates
have been
reduced to zero,
(a) for any Distribution Date on or prior to the December 2008
Distribution Date, 20%, or
(b) for any Distribution Date after the December 2008
Distribution
Date, 30%, then the Class 1-A Prepayment Percentage for such
Distribution Date
will equal:
(i) for any Distribution Date on or prior to the December 2008
Distribution Date, the Class 1-A Percentage plus 50% of the Class
1-A
Subordinated Percentage, or
(ii) for any Distribution Date after the December 2008
Distribution Date, the Class 1-A Percentage.
CLASS 1-A PRINCIPAL BALANCE: As of any Distribution Date, (a) the
Class
1-A Principal Balance for the immediately preceding Distribution
Date less (b)
amounts distributed to the Class 1-A Certificateholders on such
preceding
Distribution Date allocable to principal (including the principal
portion of
Advances of the Servicer made pursuant to Section 6.03 and Realized
Losses
allocated to the Class 1-A Certificates pursuant to Section 6.04);
as adjusted
to reflect any adjustments to the Outstanding Certificate Principal
Balance of
the Class 1-A Certificates as a result of Subsequent Recoveries;
provided that
the Class 1-A Principal Balance on the first Distribution Date will
be the
Original Class 1-A Principal Balance.
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<PAGE>
CLASS 1-A PRINCIPAL PAYMENT RULES: (A) With respect to any
Distribution
Date prior to the Credit Support Depletion Date, distributions to
the Class 1-A
Certificateholders pursuant to Section 6.01(I)(b)(ii)(A) shall be
made to the
Class A-R, Class 1-A1, Class 1-A2, Class 1-A3, Class 1-A4, Class
1-A5 and Class
1-A6 Certificates, as follows:
First, to the Class A-R Certificate, until the Outstanding
Certificate
Principal Balance of such Class has been reduced to zero; and
Second, concurrently:
(I) 96.249988591%, to the Class 1-A1, Class 1-A2, Class 1-A3,
Class
1-A4 and Class 1-A5 Certificates, as follows:
(a) first, concurrently:
(i) 68.6490350843% to the Class 1-A1 and Class 1-A2
Certificates, pro rata based upon their Outstanding Certificate
Principal
Balances, until the Principal Balance of each such Class has been
reduced to
zero;
(ii) 31.3509649157% to
the Class 1-A3 Certificates, until the
Principal Balance of such Class has been reduced to zero;
(b) second, sequentially, to the Class 1-A4 and Class 1-A5
Certificates, until the Principal Balance each such Class has been
reduced to
zero; and
(II) 3.750011409% to the Class 1-A6 Certificates, until the
Principal
Balance of such Class has been reduced to zero.
(B) With respect to any Distribution Date on or after the
Credit
Support Depletion Date, distributions otherwise allocated to the
Class A
Certificateholders pursuant to Section 6.01(I)(b)(ii)(A) shall be
allocated to
the Class A Certificateholders pursuant to Section 6.01(II) and not
in
accordance with the priorities set forth above.
CLASS 1-A SUBORDINATED PERCENTAGE: As of any Distribution Date,
the
difference between 100% and the Class 1-A Percentage.
CLASS 1-A SUBORDINATED PREPAYMENT PERCENTAGE: As of any
Distribution
Date, the difference between 100% and the Class 1-A Prepayment
Percentage.
CLASS 1-AX CERTIFICATE: Any one of the Class 1-AX Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 1-AX INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the Class
1-AX Notional
Amount minus (i) any Compensating Interest Shortfall allocated to
the Class 1-AX
Certificates on such Distribution Date pursuant to Section 6.05(b),
(ii) any
Realized Loss Interest Shortfall resulting from an Excess Loss
allocated to the
Class 1-AX Certificates on such Distribution Date pursuant to
Section 6.05(c),
and (iii) any interest shortfall resulting from the Relief Act,
allocated to the
Class 1-AX Certificates on such Distribution Date pursuant to
Section 6.05(d).
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<PAGE>
CLASS 1-AX NOTIONAL AMOUNT: With respect to any Distribution
Date
prior to the Distribution Date in December 2010, an amount equal to
the Class
1-A Principal Balance; and, with respect to any Distribution Date
on and after
the Distribution Date in December 2010, an amount equal to zero.
The Class 1-AX
Notional Amount for the first Distribution Date will be
$514,945,200.
CLASS 1-AX SHORTFALL: With respect to any Distribution Date the
amount
equal to the excess, if any, of the Class 1-AX Interest Accrual
Amount over the
amount actually distributed to the Class 1-AX Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(R).
CLASS 1-A1 CERTIFICATE: Any one of the Class 1-A1 Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 1-A1 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class 1-A1 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A1
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class 1-A1
Certificates
on such Distribution Date pursuant to Section 6.05(c), and (iii)
any interest
shortfall resulting from the Relief Act allocated to the Class 1-A1
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 1-A1 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class 1-A1 Interest Accrual
Amount over the
amount actually distributed to the Class 1-A1 Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(A).
CLASS 1-A2 CERTIFICATE: Any one of the Class 1-A2 Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 1-A2 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class 1-A2 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A2
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class 1-A2
Certificates
on such Distribution Date pursuant to Section 6.05(c), and (iii)
any interest
shortfall resulting from the Relief Act allocated to the Class 1-A2
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 1-A2 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class 1-A2 Interest Accrual
Amount over the
amount actually distributed to the Class 1-A2 Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(B).
CLASS 1-A3 CERTIFICATE: Any one of the Class 1-A3 Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 1-A3 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class 1-A3 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A3
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class 1-A3
Certificates
on such Distribution Date pursuant to Section 6.05(c), and (iii)
any interest
shortfall resulting from the Relief Act allocated to the Class 1-A3
Certificates
on such Distribution Date pursuant to Section 6.05(d).
8
<PAGE>
CLASS 1-A3 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class 1-A3 Interest Accrual
Amount over the
amount actually distributed to the Class 1-A3 Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(C).
CLASS 1-A4 CERTIFICATE: Any one of the Class 1-A4 Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 1-A4 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class 1-A4 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A4
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class 1-A4
Certificates
on such Distribution Date pursuant to Section 6.05(c), and (iii)
any interest
shortfall resulting from the Relief Act allocated to the Class 1-A4
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 1-A4 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class 1-A4 Interest Accrual
Amount over the
amount actually distributed to the Class 1-A4 Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(D).
CLASS 1-A5 CERTIFICATE: Any one of the Class 1-A5 Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 1-A5 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class 1-A5 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A5
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class 1-A5
Certificates
on such Distribution Date pursuant to Section 6.05(c), and (iii)
any interest
shortfall resulting from the Relief Act allocated to the Class 1-A5
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 1-A5 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class 1-A5 Interest Accrual
Amount over the
amount actually distributed to the Class 1-A5 Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(E).
CLASS 1-A6 CERTIFICATE: Any one of the Class 1-A6 Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 1-A6 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class 1-A6 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A6
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class 1-A6
Certificates
on such Distribution Date pursuant to Section 6.05(c), and (iii)
any interest
shortfall resulting from the Relief Act allocated to the Class 1-A6
Certificates
on such Distribution Date pursuant to Section 6.05(d).
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<PAGE>
CLASS 1-A6 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class 1-A6 Interest Accrual
Amount over the
amount actually distributed to the Class 1-A6 Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(F).
CLASS 2-A CERTIFICATES: The Class 2-A1, Class 2-A2, Class 2-A3,
Class
2-A4 and Class 2-AX Certificates, referred to collectively.
CLASS 2-A INTEREST ACCRUAL AMOUNT: On any Distribution Date, an
amount
equal to the sum of the Class 2-A1 Interest Accrual Amount, the
Class 2-A2
Interest Accrual Amount, the Class 2-A3 Interest Accrual Amount,
the Class 2-A4
Interest Accrual Amount and the Class 2-AX Interest Accrual
Amount.
CLASS 2-A INTEREST SHORTFALL: On any Distribution Date, an amount
equal
to the sum of the Class 2-A1 Shortfall, the Class 2-A2 Shortfall,
the Class 2-A3
Shortfall, the Class 2-A4 Shortfall and the Class 2-AX
Shortfall.
CLASS 2-A OPTIMAL PRINCIPAL AMOUNT: With respect to any
Distribution
Date, the lesser of (a) the Class 2-A Principal Balance and (b) the
sum of:
(i) the Class 2-A Percentage of the principal portion of all
Monthly Payments, whether or not received, which were due during
the
related Due Period on the Pool 2 Mortgage Loans which were
outstanding
during such Due Period
(ii) the Class 2-A Prepayment Percentage of all Principal
Prepayments made on Pool 2 Mortgage Loans during the related
Principal
Prepayment Period;
(iii) with respect to each Pool 2 Mortgage Loan not described
in
(iv) below, the Class 2-A Percentage of the principal portion of
all
Insurance Proceeds, condemnation awards and any other cash
proceeds
from a source other than the applicable Mortgagor, to the
extent
required to be deposited in the Collection Account pursuant to
Section
5.08(iv) and (v), which were received during the related
Principal
Prepayment Period with respect to any Pool 2 Mortgage Loan, net
of
related unreimbursed Servicing Advances and net of any portion
thereof
which, as to any such Mortgage Loan, constitutes Late Collections
that
have been the subject of an Advance on any prior Distribution
Date;
(iv) with respect to each Pool 2 Mortgage Loan which has become
a
Liquidated Mortgage Loan during the related Principal
Prepayment
Period, the lesser of (A) the Class 2-A Percentage of an amount
equal
to the Principal Balance of such Mortgage Loan (net of any
unreimbursed
Advances) as of the Due Date immediately preceding the date on
which
such Mortgage Loan became a Liquidated Mortgage Loan and (B) the
Class
2-A Prepayment Percentage of the Net Liquidation Proceeds with
respect
to such Mortgage Loan (net of any unreimbursed Advances);
(v) with respect to each Pool 2 Mortgage Loan repurchased
during
the related Principal Prepayment Period pursuant to Sections
2.02,
3.01, 5.01, 5.21 or 11.01, an amount equal to the Class 2-A
Prepayment
Percentage of the principal portion of the Purchase Price (net
of
amounts with respect to which a distribution of principal has
previously been made to the applicable Class A Certificateholders);
and
(vi) on or after the Credit Support Depletion Date, the excess
of
the Class 2-A Principal Balance (calculated after giving effect
to
reductions thereof on such Distribution Date with respect to
the
amounts described in (i) - (v) above) over the outstanding
principal
balance of the Pool 2 Mortgage Loans, if any, as of the
preceding
Distribution Date (giving effect to any Advances but prior to
giving
effect to any Principal Prepayments received with respect to
such
Mortgage Loans that have not been passed through to the
Certificateholders).
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<PAGE>
CLASS 2-A PERCENTAGE: As of any Distribution Date, the
percentage
obtained by dividing the Class 2-A Principal Balance by the
outstanding
principal balance of the Mortgage Loans in Pool 2, but not more
than 100%.
CLASS 2-A PREPAYMENT PERCENTAGE: As of any Distribution Date up to
and
including the Distribution Date in December 2012, 100%; as of any
Distribution
Date in the first year thereafter, the Class 2-A Percentage plus
70% of the
Class 2-A Subordinated Percentage for such Distribution Date; as of
any
Distribution Date in the second year thereafter, the Class 2-A
Percentage plus
60% of the Class 2-A Subordinated Percentage for such Distribution
Date; as of
any Distribution Date in the third year thereafter, the Class 2-A
Percentage
plus 40% of the Class 2-A Subordinated Percentage for such
Distribution Date; as
of any Distribution Date in the fourth year thereafter, the Class
2-A Percentage
plus 20% of the Class 2-A Subordinated Percentage for such
Distribution Date;
and as of any Distribution Date after the fourth year thereafter,
the Class 2-A
Percentage; provided that, if any Class 2-A Percentage as of any
such
Distribution Date is greater than the Class 2-A Percentage on the
first
Distribution Date, the Class 2-A Prepayment Percentage shall be
100%; and
provided further, that whenever the Class 2-A Percentage equals 0%,
the Class
2-A Prepayment Percentage shall equal 0%; and provided further that
no reduction
of the Class 2-A Prepayment Percentage below the level in effect
for the most
recent period shall occur with respect to any Distribution Date
unless, as of
the last day of the month preceding such Distribution Date, (i) the
aggregate
outstanding Principal Balance of Mortgage Loans with respect to all
three Pools,
each taken individually, delinquent 60 days or more (including for
this purpose
any Mortgage Loans in foreclosure and Mortgage Loans with respect
to which the
related Mortgaged Property has been acquired by the Trust Fund)
does not equal
or exceed 50% of the related Subordinated Percentage of the
outstanding
Principal Balance of the Mortgage Loans with respect to the related
Pool as of
such date and (ii) cumulative Realized Losses with respect to each
of the three
Pools do not exceed (a) 30% of the related Original Subordinated
Principal
Balance if such Distribution Date occurs in the year beginning with
and
including the seventh anniversary of the first Distribution Date,
(b) 35% of the
related Original Subordinated Principal Balance if such
Distribution Date occurs
in the year beginning with and including the eighth anniversary of
the first
Distribution Date, (c) 40% of the related Original Subordinated
Principal
Balance if such Distribution Date occurs in the year beginning with
and
including the ninth anniversary of the first Distribution Date, (d)
45% of the
related Original Subordinated Principal Balance if such
Distribution Date occurs
in the year beginning with and including the tenth anniversary of
the first
Distribution Date, and (e) 50% of the related Original Subordinated
Principal
Balance if such Distribution Date occurs in the year beginning with
and
including the eleventh anniversary of the first Distribution Date
or thereafter,
provided, notwithstanding the foregoing, if the following
conditions are met:
(i) the Aggregate Subordinate Percentage is greater than or equal
to
twice such percentage calculated as of the Closing Date;
(ii) the outstanding Principal Balance of all Mortgage Loans in
each
Pool delinquent 60 days or more (including Mortgage Loans in
foreclosure, REO
property or bankruptcy status), averaged over the preceding
six-month period, as
a percentage of the related Subordinated Amount (without giving
effect to any
payments on such Distribution Date), does not equal or exceed 50%;
and
(iii) cumulative Realized Losses with respect to the Mortgage Loans
in
each Pool do not exceed, as a percentage of the related
Subordinated Amount as
of the Closing Date plus the pro rata portion (based upon the
outstanding
Principal Balance of each outstanding Certificate Pool) of the
Subordinated
Amount for each Pool for which the related Class A Certificates
have been
reduced to zero,
11
<PAGE>
(a) for any Distribution Date on or prior to the December 2008
Distribution Date, 20%, or
(b) for any Distribution Date after the December 2008
Distribution Date, 30%, then the Class 2-A Prepayment Percentage
for such
Distribution Date will equal:
(i) for any Distribution Date on or prior to the
December 2008 Distribution Date, the Class 2-A Percentage plus 50%
of the Class
2-A Subordinated Percentage, or
(ii) for any Distribution Date after the December
2008 Distribution Date, the Class 2-A Percentage.
CLASS 2-A PRINCIPAL BALANCE: As of any Distribution Date, (a) the
Class
2-A Principal Balance for the immediately preceding Distribution
Date less (b)
amounts distributed to the Class 2-A Certificateholders on such
preceding
Distribution Date allocable to principal (including the principal
portion of
Advances of the Servicer made pursuant to Section 6.03 and Realized
Losses
allocated to the Class 2-A Certificates pursuant to Section 6.04);
as adjusted
to reflect any adjustments to the Outstanding Certificate Principal
Balance of
the Class 2-A Certificates as a result of Subsequent Recoveries;
provided that
the Class 2-A Principal Balance on the first Distribution Date will
be the
Original Class 2-A Principal Balance.
CLASS 2-A PRINCIPAL PAYMENT RULES: (A) With respect to any
Distribution
Date prior to the Credit Support Depletion Date, distributions to
the Class 2-A
Certificateholders pursuant to Section 6.01(I)(b)(ii)(B) shall be
made to the
Class 2-A1, Class 2-A2, Class 2-A3 and Class 2-A4 Certificates, as
follows:
Concurrently:
(I) 96.2499675344%, to the Class 2-A1, Class 2-A2, and Class
2-A3
Certificates, as follows:
(a)
first, to the Class 2-A1 Certificates, until the Principal
Balance of such Class has been reduced to zero;
(b) second, to the Class 2-A2 and Class 2-A3 Certificates, pro
rata based upon their Outstanding Certificate Principal Balances,
until the
Principal Balance of each such Class has been reduced to zero;
and
(II) 3.7500324656%, to the Class 2-A4 Certificates, until the
Principal
Balance of such Class has been reduced to zero.
(B) With respect to any Distribution Date on or after the
Credit
Support Depletion Date, distributions otherwise allocated to the
Class A
Certificateholders pursuant to Section 6.01(I)(b)(ii)(B) shall be
allocated to
the Class A Certificateholders pursuant to Section 6.01(II) and not
in
accordance with the priorities set forth above.
CLASS 2-A SUBORDINATED PERCENTAGE: As of any Distribution Date,
the
difference between 100% and the Class 2-A Percentage.
CLASS 2-A SUBORDINATED PREPAYMENT PERCENTAGE: As of any
Distribution
Date, the difference between 100% and the Class 2-A Prepayment
Percentage.
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<PAGE>
CLASS 2-AX CERTIFICATE: Any one of the Class 2-AX Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 2-AX INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the Class
2-AX Notional
Amount minus (i) any Compensating Interest Shortfall allocated to
the Class 2-AX
Certificates on such Distribution Date pursuant to Section 6.05(b),
(ii) any
Realized Loss Interest Shortfall resulting from an Excess Loss
allocated to the
Class 2-AX Certificates on such Distribution Date pursuant to
Section 6.05(c),
and (iii) any interest shortfall resulting from the Relief Act,
allocated to the
Class 2-AX Certificates on such Distribution Date pursuant to
Section 6.05(d).
CLASS 2-AX NOTIONAL AMOUNT: With respect to any Distribution Date
prior
to the Distribution Date in December 2012, an amount equal to the
Class 2-A
Principal Balance; and, with respect to any Distribution Date on
and after the
Distribution Date in December 2012, an amount equal to zero. The
Class 2-AX
Notional Amount for the first Distribution Date will be
$231,014,000.
CLASS 2-AX SHORTFALL: With respect to any Distribution Date the
amount
equal to the excess, if any, of the Class 2-AX Interest Accrual
Amount over the
amount actually distributed to the Class 2-AX Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(S).
CLASS 2-A1 CERTIFICATE: Any one of the Class 2-A1 Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 2-A1 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class 2-A1 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 2-A1
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class 2-A1
Certificates
on such Distribution Date pursuant to Section 6.05(c), and (iii)
any interest
shortfall resulting from the Relief Act allocated to the Class 2-A1
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 2-A1 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class 2-A1 Interest Accrual
Amount over the
amount actually distributed to the Class 2-A1 Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(G).
CLASS 2-A2 CERTIFICATE: Any one of the Class 2-A2 Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 2-A2 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class 2-A2 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 2-A2
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class 2-A2
Certificates
on such Distribution Date pursuant to Section 6.05(c), and (iii)
any interest
shortfall resulting from the Relief Act allocated to the Class 2-A2
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 2-A2 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class 2-A2 Interest Accrual
Amount over the
amount actually distributed to the Class 2-A2 Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(H).
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<PAGE>
CLASS 2-A3 CERTIFICATE: Any one of the Class 2-A3 Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 2-A3 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class 2-A3 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 2-A3
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class 2-A3
Certificates
on such Distribution Date pursuant to Section 6.05(c), and (iii)
any interest
shortfall resulting from the Relief Act allocated to the Class 2-A3
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 2-A3 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class 2-A3 Interest Accrual
Amount over the
amount actually distributed to the Class 2-A3 Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(I).
CLASS 2-A4 CERTIFICATE: Any one of the Class 2-A4 Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 2-A4 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class 2-A4 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 2-A4
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class 2-A4
Certificates
on such Distribution Date pursuant to Section 6.05(c), and (iii)
any interest
shortfall resulting from the Relief Act allocated to the Class 2-A4
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 2-A4 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class 2-A4 Interest Accrual
Amount over the
amount actually distributed to the Class 2-A4 Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(J).
CLASS 3-A CERTIFICATES: The Class 3-A1, Class 3-A2, Class 3-A3,
Class
3-A4, Class 3-A5, Class 3-A6 and Class 3-AX Certificates, referred
to
collectively.
CLASS 3-A INTEREST ACCRUAL AMOUNT: On any Distribution Date, an
amount
equal to the sum of the Class 3-A1 Interest Accrual Amount, the
Class 3-A2
Interest Accrual Amount, the Class 3-A3 Interest Accrual Amount,
the Class 3-A4
Interest Accrual Amount, the Class 3-A5 Interest Accrual Amount,
the Class 3-A6
Interest Accrual Amount and the Class 3-AX Interest Accrual
Amount.
CLASS 3-A INTEREST SHORTFALL: On any Distribution Date, an amount
equal
to the sum of the Class 3-A1 Shortfall, the Class 3-A2 Shortfall,
the Class 3-A3
Shortfall, the Class 3-A4 Shortfall, the Class 3-A5 Shortfall, the
Class 3-A6
Shortfall and the Class 3-AX Shortfall.
CLASS 3-A OPTIMAL PRINCIPAL AMOUNT: With respect to any
Distribution
Date, the lesser of (a) the Class 3-A Principal Balance and (b) the
sum of:
(i) the Class 3-A Percentage of the principal portion of all
Monthly Payments, whether or not received, which were due during
the
related Due Period on Pool 3 Mortgage Loans which were
outstanding
during such Due Period;
(ii) the Class 3-A Prepayment Percentage of all Principal
Prepayments made on Pool 3 Mortgage Loans during the related
Principal
Prepayment Period;
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(iii) with respect to each Pool 3 Mortgage Loan not described
in
(iv) below, the Class 3-A Percentage of the principal portion of
all
Insurance Proceeds, condemnation awards and any other cash
proceeds
from a source other than the applicable Mortgagor, to the
extent
required to be deposited in the Collection Account pursuant to
Section
5.08(iv) and (v), which were received during the related
Principal
Prepayment Period with respect to any Pool 3 Mortgage Loan, net
of
related unreimbursed Servicing Advances and net of any portion
thereof
which, as to any such Mortgage Loan, constitutes Late Collections
that
have been the subject of an Advance on any prior Distribution
Date;
(iv) with respect to each Pool 3 Mortgage Loan which has become
a
Liquidated Mortgage Loan during the related Principal
Prepayment
Period, the lesser of (A) the Class 3-A Percentage of an amount
equal
to the Principal Balance of such Mortgage Loan (net of any
unreimbursed
Advances) as of the Due Date immediately preceding the date on
which
such Mortgage Loan became a Liquidated Mortgage Loan and (B) the
Class
3-A Prepayment Percentage of the Net Liquidation Proceeds with
respect
to such Mortgage Loan (net of any unreimbursed Advances);
(v) with respect to each Pool 3 Mortgage Loan repurchased
during
the related Principal Prepayment Period pursuant to Sections
2.02,
3.01, 5.01, 5.21 or 11.01, an amount equal to the Class 3-A
Prepayment
Percentage of the principal portion of the Purchase Price (net
of
amounts with respect to which a distribution of principal has
previously been made to the applicable Class A Certificateholders);
and
(vi) on or after the Credit Support Depletion Date, the excess
of
the Class 3-A Principal Balance (calculated after giving effect
to
reductions thereof on such Distribution Date with respect to
the
amounts described in (i) - (v) above) over the outstanding
principal
balance of the Pool 3 Mortgage Loans, if any, as of the
preceding
Distribution Date (giving effect to any Advances but prior to
giving
effect to any Principal Prepayments received with respect to
such
Mortgage Loans that have not been passed through to the
Certificateholders).
CLASS 3-A PERCENTAGE: As of any Distribution Date, the
percentage
obtained by dividing the Class 3-A Principal Balance by the
outstanding
principal balance of the Mortgage Loans in Pool 3, but not more
than 100%.
CLASS 3-A PREPAYMENT PERCENTAGE: As of any Distribution Date up to
and
including the Distribution Date in December 2012, 100%; as of any
Distribution
Date in the first year thereafter, the Class 3-A Percentage plus
70% of the
Class 3-A Subordinated Percentage for such Distribution Date; as of
any
Distribution Date in the second year thereafter, the Class 3-A
Percentage plus
60% of the Class 3-A Subordinated Percentage for such Distribution
Date; as of
any Distribution Date in the third year thereafter, the Class 3-A
Percentage
plus 40% of the Class 3-A Subordinated Percentage for such
Distribution Date; as
of any Distribution Date in the fourth year thereafter, the Class
3-A Percentage
plus 20% of the Class 3-A Subordinated Percentage for such
Distribution Date;
and as of any Distribution Date after the fourth year thereafter,
the Class 3-A
Percentage; provided that, if any Class 3-A Percentage as of any
such
Distribution Date is greater than the Class 3-A Percentage on the
first
Distribution Date, the Class 3-A Prepayment Percentage shall be
100%; and
provided further, that whenever the Class 3-A Percentage equals 0%,
the Class
3-A Prepayment Percentage shall equal 0%; and provided further that
no reduction
of the Class 3-A Prepayment Percentage below the level in effect
for the most
recent period shall occur with respect to any Distribution Date
unless, as of
the last day of the month preceding such Distribution Date, (i) the
aggregate
outstanding Principal Balance of Mortgage Loans with respect to all
three Pools,
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each taken individually, delinquent 60 days or more (including for
this purpose
any Mortgage Loans in foreclosure and Mortgage Loans with respect
to which the
related Mortgaged Property has been acquired by the Trust Fund)
does not equal
or exceed 50% of the related Subordinated Percentage of the
outstanding
Principal Balance of the Mortgage Loans with respect to the related
Pool as of
such date and (ii) cumulative Realized Losses with respect to each
of the three
Pools do not exceed (a) 30% of the related Original Subordinated
Principal
Balance if such Distribution Date occurs in the year beginning with
and
including the seventh anniversary of the first Distribution Date,
(b) 35% of the
related Original Subordinated Principal Balance if such
Distribution Date occurs
in the year beginning with and including the eighth anniversary of
the first
Distribution Date, (c) 40% of the related Original Subordinated
Principal
Balance if such Distribution Date occurs in the year beginning with
and
including the ninth anniversary of the first Distribution Date, (d)
45% of the
related Original Subordinated Principal Balance if such
Distribution Date occurs
in the year beginning with and including the tenth anniversary of
the first
Distribution Date, and (e) 50% of the related Original Subordinated
Principal
Balance if such Distribution Date occurs in the year beginning with
and
including the eleventh anniversary of the first Distribution Date
or thereafter,
provided, notwithstanding the foregoing, if the following
conditions are met:
(i) the Aggregate Subordinate Percentage is greater than or equal
to
twice such percentage calculated as of the Closing Date;
(ii) the outstanding Principal Balance of all Mortgage Loans in
each
Pool delinquent 60 days or more (including Mortgage Loans in
foreclosure, REO
property or bankruptcy status), averaged over the preceding
six-month period, as
a percentage of the related Subordinated Amount (without giving
effect to any
payments on such Distribution Date), does not equal or exceed 50%;
and
(iii) cumulative Realized Losses with respect to the Mortgage Loans
in
each Pool do not exceed, as a percentage of the related
Subordinated Amount as
of the Closing Date plus the pro rata portion (based upon the
outstanding
Principal Balance of each outstanding Certificate Pool) of the
Subordinated
Amount for each Pool for which the related Class A Certificates
have been
reduced to zero,
(a) for any Distribution Date on or prior to the December 2008
Distribution Date, 20%, or
(b) for any Distribution Date after the December 2008
Distribution Date, 30%, then the Class 3-A Prepayment Percentage
for such
Distribution Date will equal:
(i) for any Distribution Date on or prior to the
December 2008 Distribution Date, the Class 3-A Percentage plus 50%
of the Class
3-A Subordinated Percentage, or
(ii) for any Distribution Date after the December
2008 Distribution Date, the Class 3-A Percentage.
CLASS 3-A PRINCIPAL BALANCE: As of any Distribution Date, (a) the
Class
3-A Principal Balance for the immediately preceding Distribution
Date less (b)
amounts distributed to the Class 3-A Certificateholders on such
preceding
Distribution Date allocable to principal (including the principal
portion of
Advances of the Servicer made pursuant to Section 6.03 and Realized
Losses
allocated to the Class 3-A Certificates pursuant to Section 6.04);
as adjusted
to reflect any adjustments to the Outstanding Certificate Principal
Balance of
the Class 3-A Certificates as a result of Subsequent Recoveries;
provided that
the Class 3-A Principal Balance on the first Distribution Date will
be the
Original Class 3-A Principal Balance.
CLASS 3-A PRINCIPAL PAYMENT RULES: (A) With respect to any
Distribution
Date prior to the Credit Support Depletion Date, distributions to
the Class 3-A
Certificateholders pursuant to Section 6.01(I)(b)(ii)(C) shall be
made to the
Class 3-A1, Class 3-A2, Class 3-A3, Class 3-A4, Class 3-A5 and
Class 3-A6
Certificates, as follows:
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Concurrently:
(I) 96.2499852833%, to the Class 3-A1, Class 3-A2, Class 3-A3,
Class
3-A4 and Class 3-A5 Certificates, as follows:
(a) concurrently:
(i) 35.976580685% to the Class 3-A1 Certificates,
until the Principal Balance of such Class has been reduced to
zero;
(ii) 64.023419315% to the Class 3-A2, Class 3-A3,
Class 3-A4 and Class 3-A5 Certificates as follows:
(A) First, concurrently:
(1) 76.0000327537% to the Class 3-A2
and Class 3-A3 Certificates, pro rata based upon their Outstanding
Certificate
Principal Balances, until the Principal Balance of each such Class
has been
reduced to zero;
(2) 23.9999672463% to the Class 3-A4
Certificates, until the Principal Balances of the Class 3-A2 and
Class 3-A3
Certificates have been reduced to zero;
(B) Second, sequentially, to the Class 3-A4
and Class 3-A5 Certificates, until the Principal Balance of each
such Class has
been reduced to zero; and
(II) 3.7500147167% to the Class 3-A6 Certificates, until the
Principal
Balance of such Class has been reduced to zero.
(B) With respect to any Distribution Date on or after the
Credit
Support Depletion Date, distributions otherwise allocated to the
Class A
Certificateholders pursuant to Section 6.01(I)(b)(ii)(C) shall be
allocated to
the Class A Certificateholders pursuant to Section 6.01(II) and not
in
accordance with the priorities set forth above.
CLASS 3-A SUBORDINATED PERCENTAGE: As of any Distribution Date,
the
difference between 100% and the Class 3-A Percentage.
CLASS 3-A SUBORDINATED PREPAYMENT PERCENTAGE: As of any
Distribution
Date, the difference between 100% and the Class 3-A Prepayment
Percentage.
CLASS 3-AX CERTIFICATE: Any one of the Class 3-AX Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 3-AX INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the Class
3-AX Notional
Amount minus (i) any Compensating Interest Shortfall allocated to
the Class 3-AX
Certificates on such Distribution Date pursuant to Section 6.05(b),
(ii) any
Realized Loss Interest Shortfall resulting from an Excess Loss
allocated to the
Class 3-AX Certificates on such Distribution Date pursuant to
Section 6.05(c),
and (iii) any interest shortfall resulting from the Relief Act,
allocated to the
Class 3-AX Certificates on such Distribution Date pursuant to
Section 6.05(d).
CLASS 3-AX NOTIONAL AMOUNT: With respect to any Distribution
Date
prior to the Distribution Date in December 2015, an amount equal to
the Class
3-A Principal Balance; and, with respect to any Distribution Date
on and after
the Distribution Date in December 2015, an amount equal to zero.
The Class 3-AX
Notional Amount for the first Distribution Date will be
$288,788,200.
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<PAGE>
CLASS 3-AX SHORTFALL: With respect to any Distribution Date the
amount
equal to the excess, if any, of the Class 3-AX Interest Accrual
Amount over the
amount actually distributed to the Class 3-AX Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(T).
CLASS 3-A1 CERTIFICATE: Any one of the Class 3-A1 Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 3-A1 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class 3-A1 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 3-A1
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class 3-A1
Certificates
on such Distribution Date pursuant to Section 6.05(c), and (iii)
any interest
shortfall resulting from the Relief Act allocated to the Class 3-A1
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 3-A1 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class 3-A1 Interest Accrual
Amount over the
amount actually distributed to the Class 3-A1 Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(K).
CLASS 3-A2 CERTIFICATE: Any one of the Class 3-A2 Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 3-A2 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class 3-A2 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 3-A2
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class 3-A2
Certificates
on such Distribution Date pursuant to Section 6.05(c), and (iii)
any interest
shortfall resulting from the Relief Act allocated to the Class 3-A2
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 3-A2 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class 3-A2 Interest Accrual
Amount over the
amount actually distributed to the Class 3-A2 Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(L).
CLASS 3-A3 CERTIFICATE: Any one of the Class 3-A3 Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 3-A3 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class 3-A3 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 3-A3
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class 3-A3
Certificates
on such Distribution Date pursuant to Section 6.05(c), and (iii)
any interest
shortfall resulting from the Relief Act allocated to the Class 3-A3
Certificates
on such Distribution Date pursuant to Section 6.05(d).
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<PAGE>
CLASS 3-A3 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class 3-A3 Interest Accrual
Amount over the
amount actually distributed to the Class 3-A3 Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(M).
CLASS 3-A4 CERTIFICATE: Any one of the Class 3-A4 Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 3-A4 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class 3-A4 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 3-A4
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class 3-A4
Certificates
on such Distribution Date pursuant to Section 6.05(c), and (iii)
any interest
shortfall resulting from the Relief Act allocated to the Class 3-A4
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 3-A4 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class 3-A4 Interest Accrual
Amount over the
amount actually distributed to the Class 3-A4 Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(N).
CLASS 3-A5 CERTIFICATE: Any one of the Class 3-A5 Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 3-A5 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class 3-A5 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 3-A5
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class 3-A5
Certificates
on such Distribution Date pursuant to Section 6.05(c), and (iii)
any interest
shortfall resulting from the Relief Act allocated to the Class 3-A5
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 3-A5 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class 3-A5 Interest Accrual
Amount over the
amount actually distributed to the Class 3-A5 Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(O).
CLASS 3-A6 CERTIFICATE: Any one of the Class 3-A6 Certificates,
executed by the Depositor and authenticated by the Trustee, senior
in right of
payment to the Class M and Class B Certificates, substantially in
the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS 3-A6 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class 3-A6 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 3-A6
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class 3-A6
Certificates
on such Distribution Date pursuant to Section 6.05(c), and (iii)
any interest
shortfall resulting from the Relief Act allocated to the Class 3-A6
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 3-A6 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class 3-A6 Interest Accrual
Amount over the
amount actually distributed to the Class 3-A6 Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(P).
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<PAGE>
CLASS A CERTIFICATES: The Class 1-A1, Class 1-A2, Class 1-A3,
Class
1-A4, Class 1-A5, Class 1-A6, Class 1-AX, Class 2-A1, Class 2-A2,
Class 2-A3,
Class 2-A4, Class 2-AX, Class 3-A1, Class 3-A2, Class 3-A3, Class
3-A4, Class
3-A5, Class 3-A6, Class 3-AX and Class A-R Certificates, referred
to
collectively.
CLASS A, CLASS M OR CLASS B: Pertaining to Class A Certificates,
Class
M Certificates or Class B Certificates, as the case may be.
CLASS A PERCENTAGE: As of any Distribution Date, the fraction,
expressed as a percentage (which shall never exceed 100%), the
numerator of
which is the Class A Principal Balance as of such Distribution Date
and the
denominator of which is the outstanding Principal Balance of the
Mortgage Loans
as of the immediately preceding Due Date.
CLASS A PRINCIPAL BALANCE: As of any Distribution Date, the sum of
the
Class 1-A Principal Balance, the Class 2-A Principal Balance and
the Class 3-A
Principal Balance.
CLASS A-R CERTIFICATE: The Class A-R Certificate executed by
the
Depositor and authenticated by the Trustee, substantially in the
form of the
Class A-R Certificate set forth in Exhibit F hereto.
CLASS A-R INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class A-R Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class A-R
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class A-R
Certificates
on such Distribution Date pursuant to Section 6.05(c), and (iii)
any interest
shortfall resulting from the Relief Act allocated to the Class A-R
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS A-R SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class A-R Interest Accrual
Amount over the
amount actually distributed to the Class A-R Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(b)(i)(Q).
CLASS B CERTIFICATES: The Class B-1, Class B-2, Class B-3, Class
B-4
and Class B-5 Certificates, referred to collectively.
CLASS B PERCENTAGE: As of any Distribution Date, the difference
between
100% and the sum of (i) the Class A Percentage and (ii) the Class M
Percentage
for such Distribution Date.
CLASS B PRINCIPAL
BALANCE: As of any Distribution Date, the excess of
the Mortgage Pool Principal Balance (together with the principal
portion of any
Monthly Payment due but not paid with respect to which an Advance
has not been
made) over the sum of (i) the Class A Principal Balance and (ii)
the Class M
Principal Balance.
CLASS B-1 CERTIFICATE: Any one of the Class B-1 Certificates
executed
by the Depositor and authenticated by the Trustee, subordinated in
right of
payment to the Class A and Class M Certificates, substantially in
the form of
the Class B Certificate set forth in Exhibit E hereto.
CLASS B-1 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class B-1 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class B-1
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class B-1
Certificates
on such Distribution Date pursuant to Section 6.05(c) and (iii) any
interest
shortfall resulting from the Relief Act allocated to the Class B-1
Certificates
on such Distribution Date pursuant to Section 6.05(d).
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<PAGE>
CLASS B-1 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class B-1 Interest Accrual
Amount over the
amount actually distributed to the Class B-1 Certificates on such
Distribution
Date pursuant to Section 6.01(I)(d)(1) (A) and (B).
CLASS B-2 CERTIFICATE: Any one of the Class B-2 Certificates
executed
by the Depositor and authenticated by the Trustee, subordinated in
right of
payment to the Class A, Class M and Class B-1 Certificates,
substantially in the
form of the Class B Certificate set forth in Exhibit E hereto.
CLASS B-2 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class B-2 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class B-2
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class B-2
Certificates
on such Distribution Date pursuant to Section 6.05(c) and (iii) any
interest
shortfall resulting from the Relief Act allocated to the Class B-2
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS B-2 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class B-2 Interest Accrual
Amount over the
amount actually distributed to the Class B-2 Certificates on such
Distribution
Date pursuant to Section 6.01(I)(d)(2) (A) and (B).
CLASS B-3 CERTIFICATE: Any one of the Class B-3 Certificates
executed
by the Depositor and authenticated by the Trustee, subordinated in
right of
payment to the Class A, Class M, Class B-1 and Class B-2
Certificates,
substantially in the form of the Class B Certificate set forth in
Exhibit E
hereto.
CLASS B-3 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class B-3 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class B-3
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class B-3
Certificates
on such Distribution Date pursuant to Section 6.05(c) and (iii) any
interest
shortfall resulting from the Relief Act allocated to the Class B-3
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS B-3 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class B-3 Interest Accrual
Amount over the
amount actually distributed to the Class B-3 Certificates on such
Distribution
Date pursuant to Section 6.01(I)(d)(3) (A) and (B).
CLASS B-4 CERTIFICATE: Any one of the Class B-4 Certificates
executed
by the Depositor and authenticated by the Trustee, subordinated in
right of
payment to the Class A, Class M, Class B-1, Class B-2 and Class
B-3
Certificates, substantially in the form of the Class B Certificate
set forth in
Exhibit E hereto.
CLASS B-4 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class B-4 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class B-4
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class B-4
Certificates
on such Distribution Date pursuant to Section 6.05(c) and (iii) any
interest
shortfall resulting from the Relief Act allocated to the Class B-4
Certificates
on such Distribution Date pursuant to Section 6.05(d).
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CLASS B-4 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class B-4 Interest Accrual
Amount over the
amount actually distributed to the Class B-4 Certificates on such
Distribution
Date pursuant to Section 6.01(I)(d)(4) (A) and (B).
CLASS B-5 CERTIFICATE: Any one of the Class B-5 Certificates
executed
by the Depositor and authenticated by the Trustee, subordinated in
right of
payment to the Class A, Class M, Class B-1, Class B-2, Class B-3
and Class B-4
Certificates, substantially in the form of the Class B Certificate
set forth in
Exhibit E hereto.
CLASS B-5 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the
Outstanding
Certificate Principal Balance of the Class B-5 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class B-5
Certificates on such
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class B-5
Certificates
on such Distribution Date pursuant to Section 6.05(c) and (iii) any
interest
shortfall resulting from the Relief Act allocated to the Class B-5
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS B-5 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class B-5 Interest Accrual
Amount over the
amount actually distributed to the Class B-5 Certificates on such
Distribution
Date pursuant to Section 6.01(I)(d)(5) (A) and (B).
CLASS LT-R INTEREST: The sole residual interest in the
Lower-Tier
REMIC.
CLASS M CERTIFICATE: Any one of the Class M Certificates executed
by
the Depositor and authenticated by the Trustee, subordinated in
right of payment
to the Class A Certificates, substantially in the form of the Class
M
Certificate set forth in Exhibit D hereto.
CLASS M INTEREST ACCRUAL AMOUNT: With respect to any Distribution
Date,
one (1) month's interest at the Certificate Rate on the Outstanding
Certificate
Principal Balance of the Class M Certificates minus (i) any
Compensating
Interest Shortfall allocated to the Class M Certificates on such
Distribution
Date pursuant to Section 6.05(b), (ii) any Realized Loss Interest
Shortfall
resulting from an Excess Loss allocated to the Class M Certificates
on such
Distribution Date pursuant to Section 6.05(c) and (iii) any
interest shortfall
resulting from the Relief Act allocated to the Class M Certificates
on such
Distribution Date pursuant to Section 6.05(d).
CLASS M PERCENTAGE: As of any Distribution Date, the percentage
obtained by dividing the Class M Principal Balance by the Mortgage
Pool
Principal Balance, but not more than 100%; provided, however, that
on any
Distribution Date on which the Class B Percentage equals 0%, the
Class M
Percentage shall equal 100% minus the Class A Percentage.
CLASS M PRINCIPAL BALANCE: As of any Distribution Date, (a) the
Class M
Principal Balance for the immediately preceding Distribution Date
less (b)
amounts distributed to the Class M Certificateholders on such
preceding
Distribution Date allocable to principal (including the principal
portion of
Advances of the Servicer made pursuant to Section 6.03 and Realized
Losses
allocated to the Class M Certificates pursuant to Section 6.04);
provided that
the Class M Principal Balance on the first Distribution Date shall
be the
Original Class M Principal Balance, and provided further that if
the aggregate
Outstanding Certificate Principal Balance of the Class B
Certificates has been
reduced to zero, as of any Distribution Date, the Class M Principal
Balance will
equal the excess of the Mortgage Pool Principal Balance (together
with the
portion of any Monthly Payment due but not paid with respect to
which an Advance
has not been made) over the Class A Principal Balance.
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CLASS M SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class M Interest Accrual Amount
over the
amount actually distributed to the Class M Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(c) (A) and (B).
CLASS MT-R INTEREST: The sole residual interest in the
Middle-Tier
REMIC.
CLOSING DATE: December 22, 2005.
CODE: The Internal Revenue Code of 1986, as amended from time to
time,
and any successor statutes thereto, and applicable U.S. Department
of Treasury
temporary or final regulations promulgated thereunder.
COLLECTION ACCOUNT: The account created and maintained pursuant
to
Section 5.08.
COMPENSATING INTEREST: The meaning specified in Section
6.05(a).
COMPENSATING INTEREST SHORTFALL: The meaning specified in
Section
6.05(b).
CO-OP LEASE: With respect to a Co-op Loan, the lease with respect
to a
dwelling unit occupied by the Mortgagor and relating to the stock
allocated to
the related dwelling unit.
CO-OP LOAN: A Mortgage Loan secured by the pledge of stock
allocated to
a dwelling unit in a residential cooperative housing corporation
and a
collateral assignment of the related Co-op Lease.
CREDIT SUPPORT: With respect to each Class of Subordinated
Certificates
(other than the Class B-5 Certificates), the level of credit
support supporting
such Class, expressed as a percentage of the aggregate Outstanding
Certificate
Principal Balance of all Classes of Certificates. With respect to
each
Distribution Date, Credit Support for each such Class will equal in
each case
the percentage, rounded to two decimal places, obtained by dividing
the
aggregate Outstanding Certificate Principal Balances immediately
prior to such
Distribution Date of all Classes of Subordinated Certificates
having higher
numerical class designations than such Class (for this purpose, the
Class M
Certificates shall be deemed to have a lower numerical class
designation than
each Class of Class B Certificates) by the aggregate Outstanding
Certificate
Principal Balance of all Classes of Certificates immediately prior
to such
Distribution Date.
CREDIT SUPPORT DEPLETION DATE: The first Distribution Date on which
the
aggregate Outstanding Certificate Principal Balance of the
Subordinated
Certificates has been or will be reduced to zero.
CUT-OFF DATE: December 1, 2005.
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, other than
such a
reduction resulting from a Deficient Valuation.
DEFICIENT VALUATION: With respect to any Mortgage Loan, a valuation
of
the related Mortgaged Property (or stock allocated to a dwelling
unit, in the
case of a Co-op Loan) 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: The Certificates referred to in
Section
4.01(c).
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DEPOSITOR: Chase Mortgage Finance Corporation, a Delaware
corporation,
or its successor in interest or any successor under this Agreement
appointed as
herein provided.
DEPOSITORY: The Depository Trust Company, the nominee of which is
Cede
& Co.
DEPOSITORY AGREEMENT: The agreement referred to in Section
4.01(b).
DEPOSITORY PARTICIPANT: A broker, dealer, bank or other
financial
institution or other Person for whom from time to time the
Depository effects
book-entry transfers and pledges of securities deposited with the
Depository.
DETERMINATION DATE: The sixteenth day of the month in which the
related
Distribution Date occurs (or, if such sixteenth day is not a
Business Day, the
preceding Business Day).
DISQUALIFIED ORGANIZATION: An organization referred to in
Section
860E(e)(5) of the Code.
DISTRIBUTION DATE: The 25th day of any month, or if such 25th day
is
not a Business Day, the first Business Day immediately following,
beginning with
January 25, 2006.
DUE DATE: The first day of each month, being the day of the month
on
which each Monthly Payment is due on a Mortgage Loan, exclusive of
any days of
grace.
DUE PERIOD: With respect to any Distribution Date, the period from
the
second day of the month preceding the month in which such
Distribution Date
occurs through the first day of the month in which such
Distribution Date
occurs.
ELIGIBLE ACCOUNT: An account that is (i) maintained with a
depository
institution the long-term unsecured debt obligations of which are
rated by each
Rating Agency in one of its two highest rating categories, or (ii)
maintained
with the corporate trust department of a national bank or banking
corporation
which (a) has a rating of at least Baa3 or P-3 by Moody's and (b)
is either
Chase or is the corporate trust department of a national bank or
banking
corporation which has a rating of at least A-1 by S&P and F1 by
Fitch Ratings,
or (iii) an account or accounts the deposits in which are fully
insured by the
FDIC, or (iv) an account or accounts in a depository institution in
which such
accounts are insured by the FDIC (to the limit established by the
FDIC), the
uninsured deposits in which accounts are otherwise secured such
that, as
evidenced by an Opinion of Counsel delivered to and acceptable to
the Trustee
and each Rating Agency, the Certificateholders have a claim with
respect to the
funds in such account and a perfected first security interest
against any
collateral (which shall be limited to Eligible Investments)
securing such funds
that is superior to claims of any other depositors or creditors of
the
depository institution with which such account is maintained,
provided, however,
that such uninsured deposits do not result in the reduction of the
ratings
assigned to the Certificates by the Rating Agencies as evidenced by
a letter
from each Rating Agency or (v) otherwise acceptable to each Rating
Agency
without reduction or withdrawal of the rating of any Class of
Certificates, as
evidenced by a letter from each Rating Agency.
ELIGIBLE INVESTMENTS: One or more of the following:
(i) obligations of, or guaranteed as to principal and interest by,
the
United States or obligations of any agency or instrumentality
thereof when such
obligations are backed by the full faith and credit of the United
States;
provided that any such obligation held as a "cash flow investment"
within the
meaning of section 860G(a)(6) of the Code shall mature before the
next
Distribution Date;
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(ii) repurchase agreements on obligations specified in clause
(i)
maturing not more than two months from the date of acquisition
thereof, provided
that the long-term unsecured obligations of the party agreeing to
repurchase
such obligations are at the time rated by each Rating Agency with
its highest
rating and the short-term debt obligations of the party agreeing to
repurchase
are rated with one of the two highest ratings by Moody's and A-1+
by S&P;
(iii) federal funds, certificates of deposit, time deposits and
bankers' acceptances (other than bankers' acceptances issued by
Chase or any of
its Affiliates) (which shall each have an original maturity of not
more than 60
days and, in the case of bankers' acceptances, shall in no event
have an
original maturity of more than 365 days) of any United States
depository
institution or trust company incorporated under the laws of the
United States or
any state, provided that the long-term unsecured debt obligations
of such
depository institution or trust company at the date of acquisition
thereof have
been rated by each Rating Agency with its highest rating and the
short-term
obligations of such depository institution or trust company are
rated A-1+ by
S&P and P-1 by Moody's;
(iv) commercial paper (other than commercial paper issued by Chase
or
any of its Affiliates) (having original maturities of not more than
365 days) of
any corporation incorporated under the laws of the United States or
any state
thereof which on the date of acquisition has been rated by each
Rating Agency in
its highest short-term unsecured commercial paper rating category;
provided that
such commercial paper shall have a remaining maturity of not more
than 45 days;
(v) units of taxable money market funds (including those for which
the
Trustee or the Servicer or any Affiliate thereof receives
compensation with
respect to such investment) which may be 12b-1 funds, as
contemplated under the
rules promulgated by the Securities and Exchange Commission under
the Investment
Company Act of 1940, as amended, and which funds have been rated by
each Rating
Agency in its highest rating category or which have been designated
in writing
by each Rating Agency as Eligible Investments with respect to this
definition;
or
(vi) other obligations or securities (other than investments or
obligations of Chase or any of its Affiliates) acceptable to each
Rating Agency
rating the Certificates as an Eligible Investment hereunder and
will not result
in a reduction or withdrawal in the then current rating of any
Class of
Certificates, as evidenced by a letter to such effect from each
Rating Agency;
Provided that no such instrument shall be an Eligible Investment if
such
instrument evidences either (a) a right to receive only interest
payments with
respect to the obligations underlying such instrument, or (b) both
principal and
interest payments derived from obligations underlying such
instrument where the
interest and principal payments with respect to such instrument
provide a yield
to maturity of greater than 120% of the yield to maturity at par of
such
underlying obligations; and provided further that no such
instrument shall be
purchased above par; and provided further that each Eligible
Investment must be
a "permitted investment" within the meaning of Section 860G(a)(5)
of the Code.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended
from time to time, and any successor statutes thereto, and
applicable U.S.
Department of Labor temporary or final regulations promulgated
thereunder.
ERISA
QUALIFYING UNDERWRITING: A best efforts or firm commitment
underwriting or private placement that would satisfy the
requirements of
Prohibited Transaction Exemption 2002-19, 67 Fed. Reg. 14797 (March
28, 2002),
as amended, or any substantially similar administrative exemption
granted by the
U.S. Department of Labor to Chase, except, in relevant part, for
the requirement
that the certificates have received a rating at the time of
acquisition that is
in one of the three (or four, in the case of a "designated
transaction") highest
generic rating categories by at least one of the Rating
Agencies.
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<PAGE>
ERISA RESTRICTED CERTIFICATE: Any Class B-3, Class B-4 or Class
B-5
Certificate and any other Certificate, as long as the acquisition
and holding of
such Certificate is not covered by and exempt under Prohibited
Transaction
Exemption 2002-19, 67 Fed. Reg. 14797 (March 28, 2002), as amended,
or any
substantially similar administrative exemption granted by the U.S.
Department of
Labor to Chase.
ESCROW ACCOUNT: The account or accounts created and maintained
pursuant
to Section 5.10.
ESCROW PAYMENTS: The amounts constituting applicable ground
rents,
taxes, assessments, water rates, Standard Hazard Policy premiums
and other
payments required to be escrowed by the Mortgagor with the
mortgagee pursuant to
a Mortgage Loan.
EVENT OF DEFAULT: Any of the events specified in Section 9.01.
EXCEPTION REPORT: The report of the Trustee referred to in
Section
2.02.
EXCESS BANKRUPTCY LOSS: Any Bankruptcy Loss, or portion thereof,
which
exceeds the then applicable Bankruptcy Amount.
EXCESS FRAUD LOSS: Any Fraud Loss, or portion thereof, which
exceeds
the then applicable Fraud Loss Amount.
EXCESS LOSSES: Excess Bankruptcy Losses, Excess Fraud Losses and
Excess
Special Hazard Losses, referred to collectively.
EXCESS PROCEEDS: All amounts (net of the related Servicing
Advances)
received on any Mortgage Loan (whether as regular principal
payments, Principal
Prepayments, Repurchase Proceeds, Liquidation Proceeds, Subsequent
Recoveries,
Insurance Proceeds, condemnation awards, or with respect to a
disposition of a
Mortgaged Property (or stock allocated to a dwelling unit, in the
case of a
Co-op Loan) which has been acquired by foreclosure or deed in lieu
of
foreclosure or otherwise) in excess of the Principal Balance at the
Cut-off Date
of such Mortgage Loan and accrued interest thereon at its Mortgage
Rate to the
Due Date immediately succeeding the date of prepayment, repurchase
or
liquidation, as the case may be.
EXCESS SPECIAL HAZARD LOSS: Any Special Hazard Loss, or portion
thereof, that exceeds the then applicable Special Hazard
Amount.
FDIC: The
Federal Deposit Insurance Corporation or any successor
organization.
FHLMC: The Federal Home Loan Mortgage Corporation or any
successor
organization.
FIDELITY BOND: The fidelity bond and errors and omissions insurance
to
be maintained by the Servicer pursuant to Section 5.19.
FINAL SCHEDULED DISTRIBUTION DATE. The Distribution Date in
January
2036.
FITCH RATINGS: Fitch, Inc. or its successor in interest.
FNMA: The Federal National Mortgage Association, or any
successor
organization.
FNMA GUIDES: The FNMA Sellers' Guide and the FNMA Servicers' Guide,
and
all amendments or additions thereto.
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<PAGE>
FRAUD LOSS: Any Realized Loss or portion thereof sustained by
reason of
a default arising from fraud, dishonesty or misrepresentation in
connection with
the related Mortgage Loan, including by reason of the denial of
coverage under
any related Primary Insurance Policy.
FRAUD LOSS AMOUNT: As of any date of determination after the
Cut-off
Date, an amount (initially, $10,750,624.16) equal to (X) prior to
the third
anniversary of the Cut-off Date, (a) 1.00% of the aggregate
principal balance of
all of the Mortgage Loans as of the most recent anniversary of the
Cut-off Date
minus (b) the aggregate amounts allocated to the Certificates with
respect to
Fraud Losses on the Mortgage Loans since the most recent
anniversary of the
Cut-off Date up to such date of determination, (Y) from the third
to (but
excluding) the fifth anniversary of the Cut-off Date, (a) 0.50% of
the aggregate
principal balance of all of the Mortgage Loans as of the most
recent anniversary
of the Cut-off Date minus (b) the aggregate amounts allocated to
the
Certificates with respect to Fraud Losses on the Mortgage Loans
since the most
recent anniversary of the Cut-off Date up to such date of
determination and (Z)
on and after the fifth anniversary of the Cut-off Date, zero.
INDIRECT PARTICIPANT: A broker, dealer, bank or other financial
institution or other Person that clears through or maintains a
custodial
relationship with a Depository Participant, either directly or
indirectly.
INSURANCE PROCEEDS: Proceeds paid by any insurer pursuant to
any
insurance policy covering a Mortgage Loan, net of costs of
collecting such
proceeds and net of amounts released to the Mortgagor or applied to
the
restoration of the Mortgaged Property (or in the underlying
Mortgaged Property,
in the case of a Co-op Loan).
INSURED EXPENSES:
Expenses covered by any insurance policy.
INTEREST ACCRUAL PERIOD: With respect to any Distribution Date and
any
Class of Certificates, the calendar month immediately preceding the
month in
which the related Distribution Date occurs, in each case calculated
on the basis
of a 360-day year of twelve 30-day months.
LATE COLLECTIONS: With respect to any Mortgage Loan, all
amounts
received during any Due Period, whether as late payments of Monthly
Payments or
as Liquidation Proceeds, condemnation proceeds, Insurance Proceeds,
Subsequent
Recoveries or with respect to a disposition of a Mortgaged Property
(or stock
allocated to a dwelling unit, in the case of a Co-op Loan) which
has been
acquired by foreclosure or deed in lieu of foreclosure or
otherwise, which
represent late payments or collections of Monthly Payments due but
delinquent
for a previous Due Period and not previously recovered.
LIQUIDATED MORTGAGE LOAN: Any Mortgage Loan (a) as to which the
Servicer has determined that all amounts which it expects to
recover from or on
account of such Mortgage Loan or property acquired in respect
thereof have been
recovered, (b) as to which a Cash Liquidation has taken place or
(c) with
respect to which the Mortgaged Property (or stock allocated to a
dwelling unit,
in the case of a Co-op Loan) has been acquired by foreclosure or
deed in lieu of
foreclosure and a disposition (the term disposition shall include,
for purposes
of a repurchase pursuant to Section 11.01, any repurchase of a
Mortgaged
Property (or stock allocated to a dwelling unit, in the case of a
Co-op Loan)
pursuant to such Section) of such Mortgaged Property (or stock
allocated to a
dwelling unit, in the case of a Co-op Loan) has occurred.
LIQUIDATION EXPENSES: Expenses which are incurred by the Servicer
or
any Sub-Servicer in connection with the liquidation of any
defaulted Mortgage
Loan or property acquired in respect thereof including, without
limitation,
legal fees and expenses, any unreimbursed amount expended by the
Servicer
pursuant to Sections 5.16 and 5.21 respecting the related Mortgage
Loan and any
related and unreimbursed expenditures for real estate property
taxes or for
property restoration or preservation.
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<PAGE>
LIQUIDATION PROCEEDS: Cash (including Insurance Proceeds) received
by
the Servicer in connection with the liquidation of any Mortgage
Loan or
Mortgaged Property (or stock allocated to a dwelling unit, in the
case of a
Co-op Loan) acquired in respect thereof, whether through the sale
or assignment
of such Mortgage Loan (other than pursuant to Section 5.21),
trustee's sale,
foreclosure sale or otherwise, or the sale of the Mortgaged
Property (or stock
allocated to a dwelling unit, in the case of a Co-op Loan) if the
Mortgaged
Property (or stock allocated to a dwelling unit, in the case of a
Co-op Loan) is
acquired in satisfaction of the Mortgage Loan other than amounts
required to be
paid to the Mortgagor pursuant to law or the terms of the
applicable Mortgage
Note.
LOAN-TO-VALUE RATIO: The fraction, expressed as a percentage,
the
numerator of which is the principal amount of the related Mortgage
Loan at the
time of origination (or, (i) for purposes of Section 5.15, at the
time of
determination and (ii) for purposes of a Mortgage Loan with respect
to which a
conversion from adjustable rate to fixed rate has occurred, at the
time of
initial origination) and the denominator of which is the Appraised
Value of the
related Mortgaged Property (or applicable dwelling unit, in the
case of a Co-op
Loan) at the time of origination or, in the case of a Mortgage Loan
financing
the acquisition of the Mortgaged Property (or applicable dwelling
unit, in the
case of a Co-op Loan), the sales price of the Mortgaged Property
(or applicable
dwelling unit, in the case of a Co-op Loan), if such sales price is
less than
such appraised value; provided however, certain Mortgage Loans
financing the
acquisition of a Mortgaged Property in New York will be based
solely on the
appraised value.
LOWER-TIER REMIC: The Lower-Tier REMIC as described in Section
2.04.
LOWER-TIER REMIC INTEREST: Any one of the classes of Lower-Tier
REMIC
Interests described in Section 2.04.
LOWER-TIER REMIC REGULAR INTEREST: Any one of the Lower-Tier
REMIC
Interests other than the Class LT-R Interest.
LOWER-TIER REMIC SUBORDINATED BALANCE RATIO: The ratio among
the
Uncertificated Principal Balances of each of the Lower-Tier REMIC
Regular
Interests ending with the designation "A" that is equal to the
ratio among, with
respect to each such Lower-Tier REMIC Regular Interest, the excess
of (x) the
aggregate Scheduled Principal Balance of the Mortgage Loans in the
related Pool
over (y) the aggregate class principal amounts of the Certificate
Pool related
to such Pool.
MERS: Mortgage Electronic Registration Systems, Inc., a
Delaware
corporation, or any successor in interest thereto.
MERS MORTGAGE LOAN: Any Mortgage Loan as to which the related
Mortgage,
or an Assignment of Mortgage, has been or will be recorded in the
name of MERS
or otherwise assigned to MERS, as agent for the holder from time to
time of the
Mortgage Note.
MIDDLE-TIER REMIC: The Middle-Tier REMIC as described in Section
2.04.
MIDDLE-TIER REMIC INTEREST: Any one of the classes of Middle-Tier
REMIC
Interests described in Section 2.04.
MIDDLE-TIER REMIC REGULAR INTEREST: Any one of the Middle-Tier
REMIC
Interests other than the Class MT-R Interest.
MODIFIED MORTGAGE LOAN: Any Mortgage Loan which the Servicer
has
modified pursuant to Section 5.01.
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MONTHLY PAYMENT: The minimum required monthly payment of principal
and
interest due on a Mortgage Loan as specified in the Mortgage Note
for any Due
Date (before any adjustment to such scheduled amount by reason of
any bankruptcy
or similar proceeding or any moratorium or similar waiver or grace
period).
Monthly Payments shall be deemed due on an Outstanding Mortgage
Loan until such
time as it becomes a Liquidated Mortgage Loan.
MOODY'S: Moody's Investors Service, Inc. or its successor in
interest.
MORTGAGE: With respect to a Mortgage Loan that is not a Co-op Loan,
the
mortgage, deed of trust or other instrument creating a first lien
or a first
priority ownership interest in an estate in fee simple in real
property securing
a Mortgage Note. With respect to a Co-op Loan, the security
agreement creating a
security interest in the stock allocated to a dwelling unit in a
residential
cooperative housing corporation and pledged to secure such Co-op
Loan and the
related Co-op Lease.
MORTGAGE FILE: As to each Mortgage Loan, the items referred to
in
Exhibit B annexed hereto.
MORTGAGE LOAN: An individual mortgage loan and all rights with
respect
thereto, evidenced by a Mortgage and a Mortgage Note, sold and
assigned by the
Depositor to the Trustee and which is subject to this Agreement and
included in
the Trust Fund. The Mortgage Loans originally sold and subject to
this Agreement
are identified on the Mortgage Loan Schedule.
MORTGAGE LOAN SCHEDULE: The schedule of Mortgage Loans attached
hereto
as Exhibit A as it may be amended in accordance with Section 3.03,
setting forth
the following information as to each Mortgage Loan: (i) the
Mortgage Loan
identifying number; (ii) the city, state and zip code of the
Mortgaged Property
(or Underlying Mortgaged Property, in the case of a Co-op Loan);
(iii) an
indication of whether the Mortgaged Property (or the related
residential
dwelling unit in the Underlying Mortgaged Property, in the case of
a Co-op Loan)
is owner-occupied; (iv) the property type of the Mortgaged Property
(or the
related residential dwelling unit in the Underlying Mortgaged
Property, in the
case of a Co-op Loan); (v) the original number of months to stated
maturity;
(vi) the number of months remaining to stated maturity from the
Cut-off Date;
(vii) the original Loan-to-Value Ratio; (viii) the original
principal balance of
the Mortgage Loan; (ix) the unpaid principal balance of the
Mortgage Loan as of
the close of business on the Cut-off Date; (x) the Mortgage Rate;
and (xi) the
amount of the current Monthly Payment.
MORTGAGE NOTE: The note or other evidence of the indebtedness of
a
Mortgagor secured by a Mortgage.
MORTGAGE POOL PRINCIPAL BALANCE: As of any date of determination,
the
aggregate of the Principal Balances of each Outstanding Mortgage
Loan on such
date of determination less the principal portion of any Monthly
Payment due but
not paid with respect to which an Advance has not been made,
initially
$1,075,062,416.02.
MORTGAGED PROPERTY: The property securing a Mortgage Note.
MORTGAGE RATE: With respect to each Mortgage Loan, the per annum
rate
of interest borne by the Mortgage Loan, as specified in the
Mortgage Note. The
Mortgage Rate for any Mortgage Loan shall be zero with respect to
the period
prior to the period during which interest accrues with respect to
such Mortgage
Loan's first Monthly Payment.
MORTGAGOR: The obligor on a Mortgage Note.
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NET LIQUIDATION PROCEEDS: As to any Liquidated Mortgage Loan,
Liquidation Proceeds net of Liquidation Expenses.
NET MORTGAGE RATE: With respect to each Mortgage Loan, a per annum
rate
of interest for the applicable period equal to the Mortgage Rate
less (i) the
Servicing Fee Rate and (ii) in the case of a substitute Mortgage
Loan, any
excess of the Mortgage Rate on the substitute Mortgage Loan over
the Mortgage
Rate on the removed Mortgage Loan.
NON-MERS MORTGAGE LOAN: Any Mortgage Loan other than a MERS
Mortgage
Loan.
NONRECOVERABLE ADVANCE: Any Advance previously made or proposed to
be
made in respect of a Mortgage Loan by the Servicer pursuant to
Section 6.03
which, in the good faith judgment of the Servicer, will not or, in
the case of a
proposed Advance, would not, ultimately be recoverable by the
Servicer from Late
Collections or otherwise. The determination by the Servicer that it
has made, or
would be making, a Nonrecoverable Advance shall be evidenced by a
certificate of
a Servicing Officer of the Servicer delivered to the Trustee, any
co-trustee and
the Depositor and detailing the reasons for such determination.
OFFICERS' CERTIFICATE: A certificate signed by two of the Chairman
of
the Board, the Vice Chairman of the Board, the President or a Vice
President,
the Treasurer or the Secretary or one of the Assistant Treasurers
or Assistant
Secretaries or any other duly authorized officer of the Depositor
or the
Servicer, and delivered to the Trustee.
OPINION OF COUNSEL: A written opinion of counsel, who may be
counsel
for the Depositor or the Servicer and who is reasonably acceptable
to the
Trustee.
ORIGINAL CERTIFICATE PRINCIPAL BALANCE: With respect to any Class
of
Certificates, the amount specified for such Class in Section
4.01(d).
ORIGINAL CLASS 1-A PRINCIPAL BALANCE:
$514,945,200.
ORIGINAL CLASS 2-A PRINCIPAL BALANCE:
$231,014,000.
ORIGINAL CLASS 3-A PRINCIPAL BALANCE:
$288,788,200.
ORIGINAL CLASS M PRINCIPAL BALANCE:
$21,501,400.
ORIGINAL CLASS B PRINCIPAL BALANCE:
$18,813,616.02.
ORIGINAL CREDIT SUPPORT: With respect to any Class of
Subordinated
Certificates (other than the Class B-5 Certificates), the level of
Credit
Support indicated below:
Class M:
1.75%
Class B-1:
1.10%
Class B-2:
0.80%
Class B-3:
0.45%
Class B-4:
0.25%
ORIGINAL SUBORDINATED PRINCIPAL BALANCE: With respect to any Pool,
the
related Subordinated Amount, as of the date of issuance of the
Certificates.
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OUTSTANDING CERTIFICATE PRINCIPAL BALANCE: With respect to any
Class of
Certificates and any Distribution Date, the Original Certificate
Principal
Balance of such Class minus the sum of (i) any distributions of
principal made
on such Class prior to such Distribution Date and (ii) any Realized
Losses
allocated to such Class prior to such Distribution Date; provided,
however, that
on any Distribution Date on which a Subsequent Recovery is
distributed, the
Outstanding Certificate Principal Balance of any Class of
Certificates then
outstanding for which any Realized Loss has been applied will be
increased, in
order of seniority, by an amount equal to the lesser of (i) the
amount the Class
of Certificates has been reduced by any Realized Losses which have
not been
previously offset by any Subsequent Recovery pursuant to this
proviso and (ii)
the total amount of any Subsequent Recovery distributed on such
date to
Certificateholders (as reduced (x) by increases in the Outstanding
Certificate
Principal Balance of more senior Classes of Certificates on such
Distribution
Date and (y) to reflect a proportionate amount of what would (but
for this
clause (y)) have been the increases in the Outstanding Certificate
Principal
Balance of Classes of Certificates of equal seniority on such
Distribution
Date); provided, further, however, that (I) with respect to the
Class of Class B
Certificates then outstanding having the highest numerical class
designation,
the Outstanding Certificate Principal Balance of such Class shall
equal the
excess of the Mortgage Pool Principal Balance (together with the
principal
portion of any Monthly Payment due but not paid with respect to
which an Advance
has not been made) over the sum of the Outstanding Certificate
Principal
Balances of all Classes of Certificates (other than the Class of
Class B
Certificates then outstanding having the highest numerical class
designation);
and (II) during such time as the Outstanding Certificate Principal
Balance of
the Class B-1 Certificates equals zero, with respect to the Class
M
Certificates, the Outstanding Certificate Principal Balance of such
Class shall
equal the excess of the Mortgage Pool Principal Balance (together
with the
principal portion of any Monthly Payment due but not paid with
respect to which
an Advance has not been made) over the sum of the Outstanding
Certificate
Principal Balances of all Class A Certificates.
OUTSTANDING MORTGAGE LOAN: As to any Distribution Date, a Mortgage
Loan
which was not paid in full during the related or any previous
Principal
Prepayment Period, which did not become a Liquidated Mortgage Loan
during the
related or any previous Principal Prepayment Period and which was
not
repurchased under Section 2.02, 3.01, 5.01, 5.21 or 11.01 during
the related or
any previous Principal Prepayment Period.
PASS-THRU ENTITY: A "Pass-Thru Entity" as defined in Section
860E(e)(6)
of the Code.
PAYING AGENT: The Person appointed by the Trustee as Paying
Agent
pursuant to Section 4.05.
PERCENTAGE INTEREST: As to any Certificate, the percentage
interest
evidenced thereby in distributions required to be made hereunder,
such
percentage interest being equal, with respect to any Class, to the
percentage
obtained by dividing the Outstanding Certificate Principal Balance
(or the Class
1-AX Notional Amount, Class 2-AX Notional Amount and Class 3-AX
Notional Amount
in the case of the Class 1-AX, Class 2-AX and Class 3-AX
Certificates,
respectively) of such Certificate by the aggregate of the
Outstanding
Certificate Principal Balances (or the Class 1-AX Notional Amount,
Class 2-AX
Notional Amount and Class 3-AX Notional Amount in the case of the
Class 1-AX,
Class 2-AX and Class 3-AX Certificates, respectively)of all the
Certificates of
such Class and with respect to all Certificates, the percentage
obtained by
dividing the Outstanding Certificate Principal Balance of such
Certificate by
the aggregate of the Outstanding Certificate Principal Balances of
all the
Certificates.
PERMITTED ACTIVITIES: The primary activities of the Trust
created
pursuant to this Agreement which shall be: (i) holding Mortgage
Loans
transferred from the Depositor and other assets of the Trust Fund,
including any
credit enhancement and passive derivative financial instruments
that pertain to
beneficial interests issued or sold to parties other than the
Depositor, its
Affiliates, or its agents; (ii) issuing certificates and other
interests in the
assets of the Trust Fund; (iii) receiving collections on the
Mortgage Loans and
making payments on such certificates and interests in accordance
with the terms
of this Agreement; and (iv) engaging in other activities that are
necessary or
incidental to accomplish these limited purposes, which activities
cannot be
contrary to the status of the Trust Fund as a qualified special
purpose entity
under existing accounting literature.
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PERSON: Any individual, corporation, partnership, limited
liability
company, limited liability partnership, joint venture, association,
joint-stock
company, trust, unincorporated organization or government or any
agency or
political subdivision thereof.
POOL: Any of the Pool 1, Pool 2 or Pool 3.
POOL 1: The pool consisting of the Pool 1 Mortgage Loans, and
representing approximately 49.77% of all of the Mortgage Loans held
in the Trust
Fund.
POOL 1 MORTGAGE LOANS: Mortgage Loans identified on the Mortgage
Loan
Schedule as being Pool 1 Mortgage Loans.
POOL 1 NET WAC: With respect to any Distribution Date, the
weighted
average of the Net Mortgage Rates of the Pool 1 Mortgage Loans as
of the first
day of the calendar month immediately preceding the calendar month
of such
Distribution Date, weighted on the basis of their Scheduled
Principal Balances
as of that date.
POOL 1 SUBORDINATED AMOUNT: For any Distribution Date, the excess
of
the aggregate Scheduled Principal Balance of the Pool 1 Mortgage
Loans over the
aggregate Outstanding Certificate Principal Balance of the Class
1-A
Certificates (prior to giving effect to distributions to be made on
such
Distribution Date).
POOL 2: The pool consisting of the Pool 2 Mortgage Loans, and
representing approximately 22.33% of all of the Mortgage Loans held
in the Trust
Fund.
POOL 2 MORTGAGE LOANS: Mortgage Loans identified on the Mortgage
Loan
Schedule as being Pool 2 Mortgage Loans.
POOL 2 NET WAC: With respect to any Distribution Date, the
weighted
average of the Net Mortgage Rates of the Pool 2 Mortgage Loans as
of the first
day of the calendar month immediately preceding the calendar month
of such
Distribution Date, weighted on the basis of their Scheduled
Principal Balances
as of that date.
POOL 2 SUBORDINATED AMOUNT: For any Distribution Date, the excess
of
the aggregate Scheduled Principal Balance of the Pool 2 Mortgage
Loans over the
aggregate Outstanding Certificate Principal Balance of the Class
2-A
Certificates (prior to giving effect to distributions to be made on
such
Distribution Date).
POOL 3: The pool consisting of the Pool 3 Mortgage Loans, and
representing approximately 27.91% of all of the Mortgage Loans held
in the Trust
Fund.
POOL 3 MORTGAGE LOANS: Mortgage Loans identified on the Mortgage
Loan
Schedule as being Pool 3 Mortgage Loans.
POOL 3 NET WAC: With respect to any Distribution Date, the
weighted
average of the Net Mortgage Rates of the Pool 3 Mortgage Loans as
of the first
day of the calendar month immediately preceding the calendar month
of such
Distribution Date, weighted on the basis of their Scheduled
Principal Balances
as of that date.
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POOL 3 SUBORDINATED AMOUNT: For any Distribution Date, the excess
of
the aggregate Scheduled Principal Balance of the Pool 3 Mortgage
Loans over the
aggregate Outstanding Certificate Principal Balance of the Class
3-A
Certificates (prior to giving effect to distributions to be made on
such
Distribution Date).
PRIMARY INSURANCE POLICY: Each primary policy of mortgage
guaranty
insurance or any replacement policy therefor referred to in Section
5.15 hereof.
PRINCIPAL BALANCE: At the time of any determination, the
principal
balance of a Mortgage Loan remaining to be paid at the close of
business on the
Cut-off Date (after deduction of all principal payments due on or
before the
Cut-off Date whether or not paid) (or, in the case of a substitute
Mortgage Loan
included in the Trust Fund pursuant to Section 3.04, the close of
business as of
the date of substitution) reduced by all amounts previously
distributed to
Certificateholders that are allocable to payments of principal on
such Mortgage
Loan (including the principal portion of Advances of the Servicer
made pursuant
to Section 6.03).
PRINCIPAL PREPAYMENT: Any payment or other recovery of principal on
a
Mortgage Loan (other than Late Collections) which is received other
than as part
of a monthly payment; provided, however, that the term Principal
Prepayment does
not include Insurance Proceeds, Liquidation Proceeds, Subsequent
Recoveries,
condemnation awards or other cash proceeds from a source other than
the
applicable Mortgagor.
PRINCIPAL PREPAYMENT PERIOD: With respect to any Distribution Date,
the
period beginning on the first day of the month preceding the month
in which such
Distribution Date occurs and ending on the last day of such
month.
PURCHASE PRICE: With respect to any Mortgage Loan required to
be
purchased on any date pursuant to Section 2.02, 3.01, 5.01, 5.21 or
11.01, an
amount equal to the sum of (a) 100% of the Principal Balance
thereof, (b) unpaid
accrued interest at the Mortgage Rate thereon from the Due Date on
which
interest was last paid by the Mortgagor or Advanced by the Servicer
to the Due
Date next following the date of repurchase, (c) the aggregate of
any
unreimbursed Advances and any unreimbursed Servicing Advances and
(d) any
unreimbursed costs, penalties and/or damages incurred by the Trust
Fund and/or
the Trustee in connection with any violation relating to such
Mortgage Loan of
any predatory or abusive lending law.
QUALIFIED INSURER: An insurance company duly qualified as such
under
the laws of the states in which the Mortgaged Properties are
located, duly
authorized and licensed in such states to transact the applicable
insurance
business and to write the insurance provided, approved as an
insurer by FNMA and
FHLMC and whose claims-paying ability is rated in the two highest
rating
categories by S&P and Moody's with respect to primary mortgage
insurance and in
the two highest rating categories for general policyholder rating
and financial
performance index rating by A.M. Best Company or its successor in
interest with
respect to hazard and flood insurance.
RATING AGENCY: Any nationally recognized statistical rating
organization, or its successor, that rated one or more Classes of
Certificates
at the request of the Depositor at the time of the initial issuance
of the
Certificates. If such organization or a successor is no longer in
existence,
"Rating Agency" shall be such nationally recognized statistical
rating
organization, or other comparable Person, designated by the
Depositor, notice of
which designation shall be given to the Trustee and the Servicer.
References
herein to the two highest long-term debt rating categories of a
Rating Agency
shall mean AA or better, in the case of S&P and Fitch Ratings
and Aa or better
in the case of Moody's.
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REALIZED LOSS: With respect to (i) a Liquidated Mortgage Loan,
the
amount, if any, by which the unpaid Principal Balance and accrued
interest
thereon at a rate equal to the Net Mortgage Rate exceeds the amount
actually
recovered by the Servicer with respect thereto (net of
reimbursement of Advances
and Servicing Advances) at the time such Mortgage Loan became a
Liquidated
Mortgage Loan or (ii) with respect to a Mortgage Loan which is not
a Liquidated
Mortgage Loan, any amount of principal that the Mortgagor is no
longer legally
required to pay (except for the extinguishment of debt that results
from the
exercise of remedies due to default by the Mortgagor).
REALIZED LOSS INTEREST SHORTFALL: The meaning specified in
Section
6.05(c).
RECORD DATE: The close of business of the last Business Day of
the
month preceding the month of the related Distribution Date.
RELEVANT MORTGAGE LOAN: The meaning specified in Section 5.01.
RELIEF ACT: The Servicemembers Civil Relief Act or the
California
Military and Veterans Code, as amended, or any other similar state
or local law.
REMIC: A "real estate mortgage investment conduit," as such term
is
defined in Section 860D of the Code. References herein to "a REMIC"
or "the
REMICs" shall mean one or all, as the context requires, of the
REMICs created
hereunder.
REMIC POOL: Each of the Lower-Tier REMIC, the Middle-Tier REMIC and
the
Upper-Tier REMIC.
REMIC PROVISIONS: Provisions of the federal income tax law relating
to
REMICs which appear at Sections 860A through 860G of Part IV of
Subchapter M of
Chapter 1 of Subtitle A of the Code, and related provisions, and
U.S. Department
of the Treasury temporary, proposed or final regulations and
rulings promulgated
thereunder, as the foregoing are in effect (or with respect to
proposed
regulations, are proposed to be in effect) from time to time.
REPURCHASE PROCEEDS: All proceeds of any Mortgage Loan or
property
acquired in respect thereof repurchased pursuant to Section 2.02,
3.01, 5.01,
5.21 or 11.01.
RESIDUAL INTEREST: The interest represented by (i) amounts, if
any,
remaining in the Collection Account following termination of the
Trust Fund
after payments to the Class A Certificateholders (other than the
Class A-R
Certificateholders), the Class M Certificateholders and the Class
B
Certificateholders and (ii) amounts paid in respect of principal
and accrued
interest on the Class A-R Certificates, other than, in the case of
both (i) and
(ii), amounts attributable to the Class LT-R Interest.
RESPONSIBLE OFFICER: When used with respect to the Trustee, any
senior
vice president, any vice president, any assistant vice president,
any senior
trust officer, any trust officer or any other officer of the
Trustee in its
Agency & Trust Office customarily performing functions similar
to those
performed by any of the above designated officers and also, with
respect to a
particular matter, any other officer in its Agency & Trust
Office to whom such
matter is referred because of such officer's knowledge of and
familiarity with
the particular subject.
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S&P: Standard & Poor's, a division of The McGraw-Hill
Companies, Inc.
or its successor in interest.
SALE AGREEMENT: The Mortgage Loan Sale Agreement dated as of
December
1, 2005 between the Depositor and CHF.
SCHEDULED PRINCIPAL BALANCE: With respect to any Mortgage Loan as
of
any Distribution Date, the unpaid principal balance of such
Mortgage Loan as
specified in the amortization schedule at the time relating thereto
(before any
adjustment to such schedule by reason of bankruptcy or similar
proceeding or any
moratorium or similar waiver or grace period) as of the Due Date in
the month
preceding the month of such Distribution Date, or as the Cut-off
Date, with
respect to the first (1st) Distribution Date, after giving effect
to any
previously applied prepayments, the payment of principal due on
such first day
of the month and any reduction of the principal balance of such
Mortgage Loan by
a bankruptcy court, irrespective of any delinquency in payment by
the related
Mortgagor.
SECTION 302 REQUIREMENTS: Any rules or regulations promulgated
pursuant
to the Sarbanes-Oxley Act of 2002 (as such may be amended from time
to time).
SELLER: CHF.
SERVICER: Chase or any successor under this Agreement as herein
provided.
SERVICING ADVANCES: All customary, reasonable and necessary "out
of
pocket" costs and expenses incurred in the performance by the
Servicer of its
servicing obligations and which are "unanticipated expenses"
(within the meaning
of Treasury regulations section 1.860G-1(b)(3)(ii)) including, but
not limited
to, the cost of (i) the preservation, restoration and protection of
the
Mortgaged Property (or Underlying Mortgaged Property, in the case
of a Co-op
Loan), (ii) any enforcement or judicial proceedings, including
foreclosures,
(iii) the management and liquidation of the Mortgaged Property (or
stock
allocated to a dwelling unit, in the case of a Co-op Loan) if the
Mortgaged
Property (or stock allocated to a dwelling unit, in the case of a
Co-op Loan) is
acquired in satisfaction of the Mortgage, (iv) taxes and
assessments on the
Mortgaged Properties subject to the Mortgage Loans and (v)
compliance with the
obligations under Section 5.21.
SERVICING FEE: The amount of the monthly fee paid for the servicing
of
the Mortgage Loans, equal to, as of any Distribution Date, with
respect to each
Mortgage Loan, one-twelfth of the Servicing Fee Rate of the
Principal Balance
thereof as of the Determination Date in the preceding month,
subject to
adjustment as provided in Section 6.05. The Servicing Fee shall be
payable only
at the time of and with respect to those Mortgage Loans for which
payment is in
fact made of the entire amount of the Monthly Payments that shall
have come due
and only at the time such Monthly Payment shall be made. The right
to receive
the Servicing Fee is limited to, and the Servicing Fee is payable
solely from,
the interest portion of such Monthly Payments (or the interest
portion of any
Principal Prepayment in full) collected by the Servicer, or as
otherwise
provided under Section 5.09 or 5.23.
SERVICING FEE RATE: 0.2660% per annum.
SERVICING OFFICER: Any officer of the Servicer or any
Sub-Servicer
involved in, or responsible for, the administration and servicing
of the
Mortgage Loans whose name appears on a written certificate listing
servicing
officers furnished to the Trustee by the Servicer on or prior to
the Closing
Date, and signed on behalf of the Servicer or any Sub-Servicer by
its President,
any Vice President or its Treasurer, as such certificate may from
time to time
be amended.
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SFAS 140: Statement of Financial Accounting Standard No. 140,
Accounting for Transfers and Servicing of Financial Assets and
Extinguishment of
Liabilities dated September 2000, published by the Financial
Accounting
Standards Board of the Financial Accounting Foundation.
SIMILAR LAW: The
meaning specified in Section 4.02(d).
SINGLE CERTIFICATE: A Certificate of any Class that evidences
the
smallest permissible original denomination for such Class of
Certificates as
specified in Section 4.01(d).
SPECIAL HAZARD AMOUNT: Initially, $10,750,624.16. As of the
first
anniversary of the Cut-off Date, the Special Hazard Amount shall be
reduced, but
not increased, to the lesser of (i) the initial Special Hazard
Amount less the
sum of all amounts allocated to the Subordinated Certificates in
respect of
Special Hazard Losses on the Mortgage Loans during such year or
(ii) the
Adjustment Amount for such anniversary. As of each subsequent
anniversary of the
Cut-off Date, the Special Hazard Amount shall be reduced, but not
increased, to
the lesser of (i) the Special Hazard Amount on the immediately
preceding
anniversary of the Cut-off Date less the sum of all amounts
allocated to the
Subordinated Certificates in respect of Special Hazard Losses on
the Mortgage
Loans during such year and (ii) the Adjustment Amount for such
anniversary. The
"Adjustment Amount" with respect to each anniversary of the Cut-off
Date will be
equal to 1.00% multiplied by the aggregate outstanding Principal
Balance of the
Mortgage Loans.
SPECIAL HAZARD LOSS: With respect to any Mortgage Loan, any
Realized
Loss or portion thereof resulting from direct physical loss or
damage to the
related Mortgaged Property (or Underlying Mortgaged Property, in
the case of a
Co-op Loan), which is not insured against under the Standard Hazard
Policy
required to be maintained hereunder.
STANDARD HAZARD POLICY: Each standard hazard insurance policy
or
replacement therefor referred to in Section 5.16.
STARTUP DAY: The meaning specified in Section 2.04(a).
SUBORDINATED AMOUNT: Any of the Pool 1 Subordinated Amount, Pool
2
Subordinated Amount or Pool 3 Subordinated Amount.
SUBORDINATED CERTIFICATES: The Class M and Class B
Certificates,
referred to collectively.
SUBORDINATED OPTIMAL PRINCIPAL AMOUNT: With respect to any
Distribution
Date, the lesser of (a) the aggregate Outstanding Certificate
Principal Balance
of the Subordinated Certificates (before giving effect to any
distributions of
principal on such Distribution Date) and (b) the sum of: (i) the
applicable
Subordinated Percentage of the principal portion of all Monthly
Payments,
whether or not received, which were due during the related Due
Period on
Mortgage Loans in the related Pool which were outstanding during
such Due
Period; (ii) the applicable Subordinated Prepayment Percentage of
all Principal
Prepayments made on related Mortgage Loans during the related
Principal
Prepayment Period; (iii) with respect to each Mortgage Loan not
described in
(iv) below, the applicable Subordinated Percentage of the sum of
the principal
portion of all Insurance Proceeds, condemnation awards and any
other cash
proceeds from a source other than the applicable Mortgagor, to the
extent
required to be deposited in the Collection Account pursuant to
Section 5.08(iv)
and (v), which were received during the related Principal
Prepayment Period, net
of related unreimbursed Servicing Advances and net of any portion
thereof which,
as to any such Mortgage Loan, constitutes Late Collections that
have been the
subject of an Advance on any prior Distribution Date; (iv) with
respect to each
Mortgage Loan which has become a Liquidated Mortgage Loan during
the related
Principal Prepayment Period, an amount equal to the portion (if
any) of the Net
Liquidation Proceeds with respect to such Mortgage Loan (net of any
unreimbursed
Advances) that was not included in the Class A Optimal Principal
Amount with
respect to such Distribution Date; and (v) with respect to each
Mortgage Loan
repurchased or purchased during the related Principal Prepayment
Period pursuant
to Section 2.02, 3.01, 5.01, 5.21 or 11.01, an amount equal to the
applicable
Subordinated Prepayment Percentage of the principal portion of the
Purchase
Price (net of amounts with respect to which a distribution of
principal has
previously been made to the Subordinated Certificateholders).
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SUBORDINATED PERCENTAGE: The Class 1-A Subordinated Percentage,
the
Class 2-A Subordinated Percentage or the Class 3-A Subordinated
Percentage, as
the case may be.
SUBORDINATED PREPAYMENT PERCENTAGE: The Class 1-A Subordinated
Prepayment Percentage, the Class 2-A Subordinated Prepayment
Percentage or the
Class 3-A Subordinated Prepayment Percentage, as the case may
be.
SUB-SERVICER: Any Person with whom the Servicer enters into a
Sub-Servicing Agreement.
SUB-SERVICING AGREEMENT: Any agreement between the Servicer and
any
Sub-Servicer, relating to servicing or administration of certain
Mortgage Loans
as provided in Section 5.02, in such form as has been approved by
the Servicer
and the Depositor.
SUBSEQUENT RECOVERY: The amount, if any, recovered by the Servicer
with
respect to a Liquidated Mortgage Loan with respect to which a
Realized Loss has
been incurred after liquidation and disposition of such Mortgage
Loan.
SUBSTITUTE EXCESS INTEREST: As defined in Section 3.03.
TRUST: The Trust created pursuant to this Agreement.
TRUST FUND: The corpus of the Trust consisting of (i) the
Mortgage
Loans, (ii) such assets as shall from time to time be identified as
deposited in
the Collection Account and the Certificate Account, (iii) property
which secured
a Mortgage Loan and which has been acquired by foreclosure or deed
in lieu of
foreclosure, (iv) Standard Hazard Policies and any other insurance
policies, and
the proceeds thereof and (v) any proceeds of any of the
foregoing.
TRUSTEE: Wachovia Bank, N.A., a national banking association and
its
successors and any corporation resulting from or surviving any
consolidation or
merger to which it or its successors may be a party, and any
successor trustee
at the time serving as successor trustee hereunder, appointed as
herein
provided.
UNCERTIFICATED PRINCIPAL BALANCE: With respect to any Lower-Tier
REMIC
Regular Interest as of any Distribution Date, the initial principal
amount of
such regular interest, reduced by (i) all amounts distributed on
previous
Distribution Dates on such regular interest with respect to
principal and (ii)
the principal portion of all Realized Losses allocated prior to
such
Distribution Date to such regular interest, and increased with
respect to
Subsequent Recoveries as provided in Section 2.04
UPPER-TIER REMIC: The Upper-Tier REMIC as described in Section
2.04.
UPPER-TIER REMIC REGULAR INTERESTS: Each of the Classes of
Certificates
(other than the Class A-R Certificates).
U.S. PERSON: A "United States Person" as defined in Section
7701(a)(30)
of the Code.
[END OF ARTICLE I]
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ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; TRUST FUND
Section 2.01 Conveyance of Mortgage Loans. The Depositor,
concurrently with the
execution and delivery hereof, does hereby sell, transfer, assign,
set over and
convey to the Trustee without recourse all the right, title and
interest of the
Depositor in and to the Mortgage Loans, including all interest and
principal
received on or with respect to the Mortgage Loans on or after the
Cut-off Date
(other than Monthly Payments due on the Mortgage Loans on or before
the Cut-off
Date).
In connection with such assignment, the Depositor does hereby
deliver
to, and deposit with, the Trustee the following documents or
instruments with
respect to each Mortgage Loan so assigned:
(i) With respect to each Mortgage Loan which is not a Co-op
Loan:
(A) Original Mortgage Note (or a lost note affidavit (including a
copy
of the original Mortgage Note)) or (II) original consolidation,
extension and
modification agreement (or a lost note affidavit (including a copy
of the
original consolidation, extension and modification agreement)), in
either case
endorsed "Pay to the order of Wachovia Bank, N.A., as trustee,
without
recourse".
(B) The original Mortgage (including all riders thereto) with
evidence
of recording thereon, or a copy thereof certified by the public
recording office
in which such Mortgage has been recorded or, if the original
Mortgage has not
been returned from the applicable public recording office, a true
certified
copy, certified by the Seller, of the original Mortgage together
with a
certificate of the Seller certifying that the original Mortgage has
been
delivered for recording in the appropriate public recording office
of the
jurisdiction in which the Mortgaged Property is located.
(ii) With respect to each Non-MERS Mortgage Loan which is not a
Co-op Loan:
(A) The original Assignment of Mortgage to "Wachovia Bank, N.A.,
as
trustee (Chase Mortgage Finance Corporation)," which assignment
shall be in form
and substance acceptable for recording, or a copy certified by the
Seller as a
true and correct copy of the original Assignment of Mortgage which
has been sent
for recordation. Subject to the foregoing, such assignments may, if
permitted by
law, be by blanket assignments for Mortgage Loans covering
Mortgaged Properties
situated within the same county. If the Assignment of Mortgage is
in blanket
form, a copy of the Assignment of Mortgage shall be included in the
related
individual Mortgage File.
(B) The original policy of title insurance, including riders
and
endorsements thereto, or if the policy has not yet been issued, a
written
commitment or interim binder or preliminary report of title issued
by the title
insurance or escrow company.
(C) Originals of all recorded intervening Assignments of Mortgage,
or
copies thereof, certified by the public recording office in which
such
Assignments or Mortgage have been recorded showing a complete chain
of title
from the originator to the Depositor, with evidence of recording,
thereon, or a
copy thereof certified by the public recording office in which such
Assignment
of Mortgage has been recorded or, if the original Assignment of
Mortgage has not
been returned from the applicable public recording office, a true
certified
copy, certified by the Seller of the original Assignment of
Mortgage together
with a certificate of the Seller certifying that the original
Assignment of
Mortgage has been delivered for recording in the appropriate public
recording
office of the jurisdiction in which the Mortgaged Property is
located.
38
<PAGE>
(D) Originals, or copies thereof certified by the public
recording
office in which such documents have been recorded, of each
assumption,
extension, modification, written assurance or substitution
agreements, if
applicable, or if the original of such document has not been
returned from the
applicable public recording office, a true certified copy,
certified by the
Seller, of such original document together with certificate of
Seller certifying
the original of such document has been delivered for recording in
the
appropriate recording office of the jurisdiction in which the
Mortgaged Property
is located.
(E) If the Mortgage Note or Mortgage or any other material document
or
instrument relating to the Mortgage Loan has been signed by a
Person on behalf
of the Mortgagor, the original power of attorney or other
instrument that
authorized and empowered such Person to sign bearing evidence that
such
instrument has been recorded, if so required in the appropriate
jurisdiction
where the Mortgaged Property is located (or, in lieu thereof, a
duplicate or
conformed copy of such instrument, together with a certificate of
receipt from
the recording office, certifying that such copy represents a true
and complete
copy of the original and that such original has been or is
currently submitted
to be recorded in the appropriate governmental recording office of
the
jurisdiction where the Mortgaged Property is located), or if the
original power
of attorney or other such instrument has been delivered for
recording in the
appropriate public recording office of the jurisdiction in which
the Mortgaged
Property is located.
(iii) With respect to each Co-op Loan:
(A) (I) The
original Mortgage Note (or a lost note affidavit
(including a copy of the original Mortgage Note)) or (II)
original consolidation, extension and modification agreement
(or a lost note affidavit (including a copy of the original
consolidation, extension and modification agreement)), in
either case endorsed "Pay to the order of Wachovia Bank, N.A.,
as trustee, without recourse."
(B) The
original Mortgage entered into by the Mortgagor with
respect to such Co-Op Loan.
(C) The
original Assignment of Mortgage to "Wachovia Bank, N.A. as
trustee (Chase Mortgage Finance Corporation)".
(D) Original
assignments of Mortgage showing a complete chain of
assignment from the originator of the related Co-Op Loan to
the Seller.
(E) Original
Form UCC-1 and any continuation statements with
evidence of filing thereon entered into by the Mortgagor with
respect to such Co-Op Loan.
(F) Form UCC-3
(or copy thereof) by the applicable Mortgage Loan
Seller or its agent assigning the security interest covered by
such Form UCC-1 to "Wachovia Bank, N.A. as trustee", together
with all Forms UCC-3 (or copies thereof) showing a complete
chain of assignment from the originator of the related Co-op
Loan to the Seller, with evidence of recording thereon.
(G) Stock
certificate representing the stock allocated to the
related dwelling unit in the related residential cooperative
housing corporation and pledged by the related Mortgagor to
the originator of such Co-op Loan with a stock power in blank
attached.
(H) Original
proprietary lease.
39
<PAGE>
(I) Original
assignment of proprietary lease, to the Trustee, and
all intervening assignments thereof.
(J) Original
recognition agreement of the interests of the
mortgagee with respect to the Co-op Loan by the residential
cooperative housing corporation, the stock of which was
pledged by the related Mortgagor to the originator of such
Co-op Loan.
(K) Originals
of any assumption, consolidation or modification
agreements relating to any of the items specified in (A)
through (F) above with respect to such Co-op Loan.
If in connection with any Mortgage Loan which is not a Co-op Loan
the
Depositor cannot deliver the Mortgage, Assignments of Mortgage, or
assumption,
consolidation or modification agreement, as the case may be, with
evidence of
recording thereon concurrently with the execution and delivery of
this Agreement
solely because of a delay caused by the public recording office
where such
Mortgage, Assignments of Mortgage, or assumption, consolidation or
modification
agreement, as the case may be, has been delivered for recordation,
the Depositor
shall deliver or cause to be delivered to the Trustee written
notice stating
that such Mortgage, Assignments of Mortgage, or assumption,
consolidation or
modification agreement, as the case may be, has been delivered to
the
appropriate public recording office for recordation. Thereafter,
the Depositor
shall deliver or cause to be delivered to the Trustee such
Mortgage, Assignments
of Mortgage, or assumption, consolidation or modification
agreement, as the case
may be, with evidence of recording indicated thereon upon receipt
thereof from
the public recording office.
With respect to any Non-MERS Mortgage Loans which are not Co-op
Loans,
and as to which the related Mortgaged Property is located in
Florida, the
Servicer shall cause to be recorded in the appropriate public
recording office
for real property records each Assignment of Mortgage referred to
in this
Section 2.01 as soon as practicable. With respect to any Non-MERS
Mortgage Loans
which are not Co-op Loans as to which the related Mortgaged
Property is located
outside of Florida, the Servicer shall not be obligated to cause to
be recorded
the Assignment of Mortgage referred to in this Section 2.01. With
respect to
Co-op Loans as to which the related dwelling unit is located in
Florida, the
Servicer shall cause to be filed in the appropriate filing office
the Form UCC-3
referred to in this Section 2.01 as soon as practicable. With
respect to any
Co-op Loans as to which the related dwelling unit is located
outside Florida,
the Servicer shall not be obligated to cause to be filed the Form
UCC-3 referred
to in this Section 2.01. While each such Assignment of Mortgage or
Form UCC-3 is
being recorded or filed, as applicable, the Servicer shall deliver
to the
Trustee a photocopy of such document. If any such Assignment of
Mortgage or Form
UCC-3 is returned unrecorded or unfiled to the Servicer because of
any defect
therein, the Servicer shall cause such defect to be cured and such
document to
be recorded or filed in accordance with this paragraph. The
Depositor shall
deliver or cause to be delivered each such original recorded or
filed Assignment
of Mortgage and intermediate assignment or Form UCC-3 to the
Trustee within 270
days of the Closing Date or shall deliver to the Trustee on or
before such date
an Officer's Certificate stating that such document has been
delivered to the
appropriate public recording or filing office for recording or
filing, but has
not been returned solely because of a delay caused by such
recording or filing
office. In any event, the Depositor shall use all reasonable
efforts to cause
each such document with evidence of recording or filing thereon to
be delivered
to the Trustee within 300 days of the Closing Date.
With respect to each MERS Mortgage Loan, the Trustee, at the
expense of
the Depositor and at the direction and with the cooperation of the
Servicer,
shall cause to be taken such actions as are necessary to cause the
Trustee to be
clearly identified as the owner of each such Mortgage Loan on the
records of
MERS for purposes of the system of recording transfers of
beneficial ownership
of mortgages maintained by MERS.
40
<PAGE>
The ownership of each Mortgage Note, the Mortgage and the contents
of
the related Mortgage File is vested in the Trustee. Neither the
Depositor nor
the Servicer shall take any action inconsistent with such ownership
and shall
not claim any ownership interest therein. The Depositor and the
Servicer shall
respond to any third party inquiries with respect to ownership of
the Mortgage
Loans by stating that such ownership is held by the Trustee on
behalf of the
Certificateholders. Mortgage documents relating to the Mortgage
Loans not
delivered to the Trustee are and shall be held in trust by the
Servicer or any
Sub-Servicer, for the benefit of the Trustee as the owner thereof,
and the
Servicer's or such Sub-Servicer's possession of the contents of
each Mortgage
File so retained is for the sole purpose of servicing the related
Mortgage Loan,
and such retention and possession by the Servicer or such
Sub-Servicer is in a
custodial capacity only. The Depositor agrees to take no action
inconsistent
with the Trustee's ownership of the Mortgage Loans, to promptly
indicate to all
inquiring parties that the Mortgage Loans have been sold and to
claim no
ownership interest in the Mortgage Loans. Each Mortgage File and
the mortgage
documents relating to the Mortgage Loans contain proprietary
business
information of the Servicer and its customers. The Trustee and the
Depositor
agree that they will not use such information for business purposes
without the
express written consent of the Servicer and that all such
information shall be
kept strictly confidential.
It is the intention of this Agreement that the conveyance of
the
Depositor's right, title and interest in and to the Trust Fund
pursuant to this
Agreement shall constitute a purchase and sale and not a loan. If a
conveyance
of Mortgage Loans from the Seller to the Depositor is characterized
as a pledge
and not a sale, then the Depositor shall be deemed to have
transferred to the
Trustee all of the Depositor's right, title and interest in, to and
under the
obligations of the Seller deemed to be secured by said pledge; and
it is the
intention of this Agreement that the Depositor shall also be deemed
to have
granted to the Trustee a first priority security interest in all of
the
Depositor's right, title, and interest in, to and under the
obligations of the
Seller to the Depositor deemed to be secured by said pledge and
that the Trustee
shall be deemed to be an independent custodian for purposes of
perfection of the
security interest granted to the Depositor. If the conveyance of
the Mortgage
Loans from the Depositor to the Trustee is characterized as a
pledge, it is the
intention of this Agreement that this Agreement shall constitute a
security
agreement under applicable law, and that the Depositor shall be
deemed to have
granted to the Trustee a first priority security interest in all of
the
Depositor's right, title and interest in, to and under the Mortgage
Loans, all
payments of principal of or interest on such Mortgage Loans, all
other rights
relating to and payments made in respect of the Trust Fund, and all
proceeds of
any thereof. If the trust created by this Agreement terminates
prior to the
satisfaction of the claims of any Person in any Certificates, the
security
interest created hereby shall continue in full force and effect and
the Trustee
shall be deemed to be the collateral agent for the benefit of such
Person.
In addition to the conveyance made in the first paragraph of
this
Section 2.01, the Depositor does hereby convey, assign and set over
to the
Trustee all of its right, title and interest in that portion of the
Trust Fund
described in items (ii), (iii), (iv) and (v) of the definition
thereof and
further assigns to the Trustee for the benefit of the
Certificateholders those
representations and warranties of the Seller contained in the Sale
Agreement and
described in Section 3.01 hereof and the benefit of the repurchase
obligations
of the Seller described in Sections 2.02 and 3.01 hereof and the
obligations of
the Seller contained in the Sale Agreement to take, at the request
of the
Depositor or the Trustee, all action on its part which is
reasonably necessary
to ensure the enforceability of a Mortgage Loan.
The parties hereto agree and understand that it is not intended
that
any mortgage loan be included in the Trust that is any of (i) a
"High-Cost Home
Loan" as defined in the New Jersey Home Ownership Act effective
November 27,
2003, (ii) a "High-Cost Home Loan" as defined in the New Mexico
Home Loan
Protection Act effective January 1, 2004, (iii) a "High-Cost Home
Mortgage Loan"
as defined in the Massachusetts Predatory Home Loan Practices Act
effective
November 7, 2004 or (iv) a "High-Cost Home Loan" as defined by the
Indiana High
Cost Home Loan Law effective January 1, 2005.
41
<PAGE>
Section 2.02 Acceptance by Trustee. Except as set forth in the
Exception Report delivered contemporaneously herewith (the
"Exception Report"),
the Trustee acknowledges receipt of the Mortgage Note for each
Mortgage Loan and
delivery of a Mortgage File (but does not acknowledge receipt of
all documents
required to be included in such Mortgage File) with respect to each
Mortgage
Loan and declares that it holds and will hold such documents and
any other
documents constituting a part of the Mortgage Files delivered to it
in trust for
the use and benefit of all present and future Certificateholders.
The Depositor
will cause the Seller to repurchase any Mortgage Loans to which an
exception was
taken in the Exception Report unless such exception is cured to the
satisfaction
of the Trustee within 45 Business Days of the Closing Date.
The Trustee agrees, for the benefit of Certificateholders, to
review
each Mortgage File delivered to it within 270 days after the
Closing Date to
ascertain that all documents required by Section 2.01 have been
executed and
received, and that such documents relate to the Mortgage Loans
identified in
Exhibit A that have been conveyed to it. If the Trustee finds any
document or
documents constituting a part of a Mortgage File to be missing or
defective
(that is, mutilated, damaged, defaced or unexecuted) in any
material respect,
the Trustee shall promptly (and in any event within no more than
five Business
Days) after such finding so notify the Servicer, the Seller and the
Depositor.
In addition, the Trustee shall also notify the Servicer, the Seller
and the
Depositor, if (a) in examining the Mortgage Files, the
documentation shows on
its face (i) any adverse claim, lien or encumbrance, (ii) that any
Mortgage Note
was overdue or had been dishonored, (iii) any evidence on the face
of any
Mortgage Note or Mortgage of any security interest or other right
or interest
therein, or (iv) any defense against or claim to the Mortgage Note
by any party
or (b) the original Mortgage with evidence of recording thereon
with respect to
a Mortgage Loan is not received within 270 days of the Closing
Date; provided,
however, that if the Depositor cannot deliver the original Mortgage
with
evidence of recording thereon because of a delay caused by the
public recording
office where such Mortgage has been delivered for recordation, the
Depositor
shall deliver or cause to be delivered to the Trustee written
notice stating
that such Mortgage has been delivered to the appropriate public
recording
officer for recordation and thereafter the Depositor shall deliver
or cause to
be delivered such Mortgage with evidence of recording thereon upon
receipt
thereof from the public recording office. The Trustee shall request
that the
Seller correct or cure such omission, defect or other irregularity,
or
substitute a Mortgage Loan pursuant to the provisions of Section
3.03, within 60
days from the date the Seller was notified of such omission or
defect and, if
the Seller does not correct or cure such omission or defect within
such period,
that the Seller purchase such Mortgage Loan from the Trustee within
90 days from
the date the Trustee notified the Seller of such omission, defect
or other
irregularity at the Purchase Price of such Mortgage Loan. The
Purchase Price for
any Mortgage Loan purchased pursuant to this Section 2.02 shall be
paid to the
Servicer and deposited by the Servicer in the Collection Account
promptly upon
receipt, and, upon receipt by the Trustee of written notification
of such
deposit signed by a Servicing Officer, the Trustee shall promptly
release to the
Seller the related Mortgage File and the Trustee shall execute and
deliver such
instruments of transfer or assignment, without recourse, as shall
be necessary
to vest in the Seller or its designee, as the case may be, any
Mortgage Loan
released pursuant hereto, and the Trustee shall have no further
responsibility
with regard to such Mortgage Loan. It is understood and agreed that
the
obligation of the Seller to purchase, cure or substitute any
Mortgage Loan as to
which a material defect in or omission of a constituent document
exists shall
constitute the sole remedy respecting such defect or omission
available to the
Trustee on behalf of Certificateholders. The Trustee shall be under
no duty or
obligation to inspect, review and examine such documents,
instruments,
certificates or other papers to determine that they are genuine,
enforceable or
appropriate to the represented purpose, or that they have actually
been
recorded, or that they are other than what they purport to be on
their face. The
Trustee shall keep confidential the name of each Mortgagor and
shall not solicit
any such Mortgagor for the purpose of refinancing the related
Mortgage Loan.
42
<PAGE>
Within 280 days of the Closing Date, the Trustee shall deliver to
the
Depositor and the Servicer the Trustee's Certification,
substantially in the
form of Exhibit G attached hereto, setting forth the status of the
Mortgage
Files as of such date.
Section 2.03 Trust Fund; Authentication of Certificates. The
Trustee
acknowledges and accepts the assignment to it of the Trust Fund
created pursuant
to this Agreement in trust for the use and benefit of all present
and future
Certificateholders. The Trustee acknowledges the assignment to it
for the
benefit of the Trust Fund of the Mortgage Loans and has caused to
be
authenticated and delivered to or upon the order of the Depositor,
in exchange
for the Mortgage Loans, Certificates duly authenticated by the
Trustee or, if an
Authenticating Agent has been appointed pursuant to Section 4.06,
the
Authenticating Agent in authorized denominations evidencing
ownership of the
entire Trust Fund.
Section 2.04 REMIC Elections.
(a) The Depositor hereby instructs and authorizes the Trustee to
make
appropriate elections to treat the Trust Fund as comprising three
REMICs (the
Lower-Tier REMIC, the Middle-Tier REMIC and the Upper-Tier REMIC).
This
Agreement shall be construed so as to carry out the intention of
the parties
that each REMIC created hereunder be treated as a REMIC at all
times prior to
the date on which the Trust Fund is terminated. The Closing Date is
hereby
designated as the "startup day" of each REMIC created hereunder
within the
meaning of Section 860G(a)(9) of the Code. The Lower-Tier REMIC
shall hold as
assets all property of the Trust Fund other than the Lower-Tier
REMIC Interests
and other than the Middle-Tier REMIC Interests. Each of the
Lower-Tier REMIC
Regular Interests is hereby designated a "regular interest" (within
the meaning
of Section 860G(a)(1) of the Code) in the Lower-Tier REMIC. The
Middle-Tier
REMIC shall hold as assets the several classes of uncertificated
Lower-Tier
REMIC Regular Interests. Each of the Middle-Tier REMIC Regular
Interests is
hereby designated a "regular interest" (within the meaning of
Section 860G(a)(1)
of the Code) in the Middle-Tier REMIC. The Upper-Tier REMIC shall
hold as assets
the several classes of uncertificated Middle-Tier REMIC Regular
Interests. Each
of the Upper-Tier REMIC Regular Interests is hereby designated as a
"regular
interest" (within the meaning of Section 860G(a)(1) of the Code) in
the
Upper-Tier REMIC. The Class LT-R Interest is hereby designated as
the sole
residual interest (within the meaning of Section 860G(a)(2) of the
Code) in the
Lower-Tier REMIC. The Class MT-R Interest is hereby designated as
the sole
residual interest (within the meaning of Section 860G(a)(2) of the
Code) in the
Middle-Tier REMIC. The Residual Interest is hereby designated as
the sole
residual interest (within the meaning of Section 860G(a)(2) of the
Code) in the
Upper-Tier REMIC. The Class A-R Certificate evidences ownership of
the Class
LT-R Interest, the Class MT-R Interest and the Residual Interest.
All interests
described in this Section 2.04(a) shall be designated as such on
the Startup
Day.
43
<PAGE>
LOWER-TIER REMIC
The following table specifies the class designation, pass-through
rate
and principal amount for each class of Lower-Tier REMIC
Interest.
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------
Lower-Tier REMIC
Interest Initial
Principal Amount
Pass-Through Rate
Related Pool
-------------------------
------------------------
-----------------
------------
-------------------------------------------------------------------------------------------------------------------
<S>
<C>
<C>
<C>
-------------------------------------------------------------------------------------------------------------------
LT-R
(1)
(1)
N/A
-------------------------------------------------------------------------------------------------------------------
LT1-A
(2)
Pool 1 Net WAC
Pool 1
-------------------------------------------------------------------------------------------------------------------
LT1-B
(3)
Pool 1 Net WAC
Pool 1
-------------------------------------------------------------------------------------------------------------------
LT2-A
(4)
Pool 2 Net WAC
Pool 2
-------------------------------------------------------------------------------------------------------------------
LT2-B
(3)
Pool 2 Net WAC
Pool 2
-------------------------------------------------------------------------------------------------------------------
LT3-A
(5)
Pool 3 Net WAC
Pool 3
-------------------------------------------------------------------------------------------------------------------
LT3-B
(3)
Pool 3 Net WAC
Pool 3
-------------------------------------------------------------------------------------------------------------------
</TABLE>
---------------
(1) The Class LT-R Interest shall represent the sole class of
residual interest
in the
Lower-Tier REMIC. The Class LT-R Interest will not have a
principal
amount or
an interest rate. The Class LT-R Interest shall be represented
by
the Class
A-R Certificate.
(2) The initial principal amount of the Class LT1-A Interest shall
equal 1% of
the Pool 1
Subordinated Amount as of the first Distribution Date.
(3) The initial principal amount of each Lower-Tier REMIC Interest
ending with
the
designation "B" shall equal the excess of (i) the aggregate
Scheduled
Principal
Balance of the Mortgage Loans in the related Pool as of the
first
Distribution Date over (ii) the initial principal amount of the
Lower-Tier
REMIC
Interest ending with the designation "A" that is related to the
same
Pool.
(4) The initial principal amount of the Class LT2-A Interest shall
equal 1% of
the Pool 2
Subordinated Amount as of the first Distribution Date.
(5) The initial principal amount of the Class LT3-A Interest shall
equal 1% of
the Pool 3
Subordinated Amount as of the first Distribution Date.
Distributions shall be deemed to be made to the Lower-Tier
REMIC
Regular Interests first, so as to keep the Uncertificated Principal
Balance of
each Lower-Tier REMIC Regular Interest ending with the designation
"A" equal to
1% of the excess of (x) the aggregate Principal Balance of the
Mortgage Loans in
the related Pool over (y) the aggregate class principal amounts of
the
Certificate Pool related to such Pool (except that if 1% of any
such excess is
greater than the principal amount of the corresponding Lower-Tier
REMIC Regular
Interest ending with the designation "A", the least amount of
principal shall be
distributed to such Lower-Tier REMIC Regular Interests such that
the Lower-Tier
REMIC Subordinated Balance Ratio is maintained); and second, any
remaining
principal to the Lower-Tier REMIC Regular Interests ending with the
designation
"B" in such a manner that the remaining principal balance of each
such
Lower-Tier REMIC Regular Interest equals the excess of the
aggregate Principal
Balance of the Mortgage Loans in the related Pool over the
Uncertificated
Principal Balance of the Lower-Tier REMIC Regular Interest ending
with the
designation "A" which is related to such Pool.
Realized Losses shall be applied after all distributions have been
made
on each Distribution Date first, so as to keep the Uncertificated
Principal
Balance of each Lower-Tier REMIC Regular Interest ending with the
designation
"A" equal to 1% of the excess of (x) the aggregate Principal
Balance of the
Mortgage Loans in the related Pool over (y) the aggregate class
principal
amounts of the Certificate Pool related to such Pool (except that
if 1% of any
such excess is greater than the principal amount of the
corresponding Lower-Tier
REMIC Regular Interest ending with the designation "A", the least
amount of
Realized Losses shall be allocated to such Lower-Tier REMIC Regular
Interests
such that the Lower-Tier REMIC Subordinated Balance Ratio is
maintained); and
second, the remaining Realized Losses shall be allocated to the
Lower-Tier REMIC
Regular Interests ending with the designation "B" in such a manner
that the
remaining principal balance of each such Lower-Tier REMIC Regular
Interest
equals the excess of the aggregate Principal Balance of the
Mortgage Loans in
the related Pool over the Uncertificated Principal Balance of the
Lower-Tier
REMIC Regular Interest ending with the designation "A" which is
related to such
Pool. All computations with respect to the Lower-Tier REMIC
Interests shall be
taken out to eight decimal places.
44
<PAGE>
If on any Distribution Date there is an increase in the
principal
amount of any Class of Certificates related to Subsequent
Recoveries, then,
prior to distributions of principal and allocations of losses on
such
Distribution Date with respect to the Lower-Tier REMIC, there shall
be a
corresponding increase in the Uncertificated Principal Balance of
the Lower-Tier
REMIC Regular Interests, with such increase allocated among the
Lower-Tier REMIC
Regular Interests first, to each Lower-Tier REMIC Regular Interest
ending with
the designation "A", so that the Uncertificated Principal Balance
of each such
Lower-Tier REMIC Regular Interest continues to equal the same
percentage of the
excess of (x) the Principal Balance of the Mortgage Loans in the
related Pool
over (y) the aggregate class principal amounts of the Certificate
Pool related
to such Pool and so that the Lower-Tier REMIC Subordinated Balance
Ratio is
maintained; and second, any remaining increase allocated to the
Lower-Tier REMIC
Regular Interests ending with the designation "B" in such a manner
that the
principal balance of each such Lower-Tier REMIC Regular Interest
equals the
excess of the aggregate Principal Balance of the Mortgage Loans in
the related
Pool over the Uncertificated Principal Balance of the Lower-Tier
REMIC Regular
Interest ending with the designation "A" which is related to such
Pool.
MIDDLE TIER REMIC
The following table specifies the class designation, interest
rate,
initial principal amount and Classes of corresponding certificates
for each
class of Middle-Tier REMIC Interest:
<TABLE>
<CAPTION>
Middle-Tier
Initial
Pass-Through
REMIC Interest
Balance
Rate
Corresponding Certificates
--------------
-------
----
--------------------------
<S>
<C>
<C>
<C>
MT-R
(1)
(1)
N/A
MT1-A
(2)
Pool 1 Net WAC
Class 1-A1, Class 1-A2,
Class 1-A3, Class 1-A4,
Class 1-A5, Class 1-A6,
Class 1-AX, Class A-R
MT2-A
(2)
Pool 2 Net WAC
Class 2-A1, Class 2-A2,
Class 2-A3, Class 2-A4,
Class 2-AX
MT3-A
(2)
Pool 3 Net WAC
Class 3-A1, Class 3-A2,
Class 3-A3, Class 3-A4,
Class 3-A5, Class 3-A6,
Class 3-AX
MTM
(2)
(3)
Class M
MTB-1
(2)
(3)
Class B-1
MTB-2
(2)
(3)
Class B-2
MTB-3
(2)
(3)
Class B-3
MTB-4
(2)
(3)
Class B-4
MTB-5
(2)
(3)
Class B-5
</TABLE>
45
<PAGE>
-------------
(1) The Class MT-R Interest shall represent the sole class of
residual interest
in the
Middle-Tier REMIC. The Class MT-R Interest will not have a
principal
amount or
an interest rate. The Class MT-R Interest shall be represented
by
the Class
A-R Certificate.
(2) The initial principal amount of each of these interests shall
be equal to
the
Original Certificate Principal Balance the Class or Classes of
corresponding Certificates (disregarding the notional amount of any
class of
"interest-only" certificates).
(3) For any Distribution Date, the interest rate for the Class MTM
Interest,
Class
MTB-1 Interest, Class MTB-2 Interest, Class MTB-3 Interest,
Class
MTB-4
Interest and Class MTB-5 Interest shall be a per annum rate equal
to
the
weighted average of the interest rates on the Class LT1-A Interest,
the
Class
LT2-A Interest and the Class LT3-A Interest weighted on the basis
of
their
principal amounts immediately prior to such Distribution Date.
Principal and interest shall be payable to, and shortfalls,
losses,
prepayments and increases in principal amount related to Subsequent
Recoveries
are allocable to, the Middle-Tier REMIRegular Interests as such
amounts are
payable and allocable to the corresponding certificates under this
Agreement
(excluding Section 6.01(a)(v) hereof).
(b) Solely for the purposes of Section 1.860G-1(a)(4)(iii) of
the
Treasury Regulations, the "latest possible maturity date" of each
"regular
interest" in each REMIC created hereunder is the Distribution Date
immediately
following the latest scheduled maturity of any Mortgage Loan.
(c) The "tax matters person" with respect to each REMIC created
hereunder for purposes of the REMIC Provisions shall be the
beneficial owner of
the Class A-R Certificate having the largest Percentage Interest of
such Class;
provided, however, that such largest beneficial owner and, to the
extent
relevant, each other Holder of a Class A-R Certificate, by its
acceptance
thereof, irrevocably appoints the Servicer as its agent and
attorney-in-fact to
act as "tax matters person" with respect to each REMIC created
hereunder for
purposes of the REMIC provisions.
(d) It is intended that each REMIC created hereunder shall
constitute,
and that the affairs of the Trust Fund shall be conducted so as to
qualify each
REMIC created hereunder as, a "real estate mortgage investment
conduit" as
defined in and in accordance with the REMIC Provisions. In
furtherance of such
intention, the Servicer covenants and agrees that it shall act as
agent (and the
Servicer is hereby appointed to act as agent) on behalf of the
Trust Fund, each
REMIC created hereunder and the Holder of the Class A-R Certificate
and that in
such capacity it shall:
(i) prepare and file, or cause to be prepared and filed, in a
timely manner, a U.S. Real Estate Mortgage Investment Conduit
Income
Tax Return (Form 1066) for each REMIC created hereunder and prepare
and
file or cause to be prepared and filed with the Internal
Revenue
Service and applicable state or local tax authorities income tax
or
information returns for each taxable year with respect to each
REMIC
created hereunder, using the calendar year as the taxable year and
the
accrual method of accounting, containing such information and at
the
times and in the manner as may be required by the Code or state
or
local tax laws, regulations, or rules, and shall furnish or cause
to be
furnished to Certificateholders the schedules, statements or
information at such times and in such manner as may be required
thereby;
46
<PAGE>
(ii) within thirty days of the Closing Date, shall furnish or
cause to be furnished to the Internal Revenue Service, on Form 8811
or
as otherwise may be required by the Code, the name, title, address,
and
telephone number of the person that the holders of the Certificates
may
contact for tax information relating thereto (and the Servicer
shall
act as the representative of the Trust Fund for this purpose),
together
with such additional information as may be required by such Form,
and
shall update such information at the time or times in the
manner
required by the Code;
(iii) make or cause to be made an election, on behalf of each
REMIC created hereunder, to be treated as a REMIC, and make the
appropriate designations, if applicable, in accordance with
this
Section 2.04 on the federal tax return of each REMIC hereunder for
its
first taxable year (and, if necessary, under applicable state
law);
(iv) prepare and forward, or cause to be prepared and
forwarded,
to the Certificateholders and to the Internal Revenue Service and,
if
necessary, state tax authorities, all information returns or
reports,
or furnish or cause to be furnished by telephone, mail, publication
or
other appropriate method such information, as and when required to
be
provided to them in accordance with the REMIC Provisions,
including
without limitation, the calculation of any original issue
discount;
(v) provide
information necessary for the computation of tax
imposed on the transfer of the Class A-R Certificate to a
Disqualified
Organization, or an agent (including a broker, nominee or other
middleman) of a Disqualified Organization, or a pass-through entity
in
which a Disqualified Organization is the record holder of an
interest
(the reasonable cost of computing and furnishing such information
may
be charged to the Person liable for such tax);
(vi) ensure that federal, state or local income tax or
information
returns shall be signed by the Trustee or such other Person as may
be
required to sign such returns by the Code or state or local
laws,
regulations or rules; and
(vii) maintain such records relating to each REMIC created
hereunder as may be required by the Code and as may be necessary
to
prepare the
foregoing returns, schedules, statements or information.
(e)
Pursuant to Section 6.02(b), the Servicer, with the consent of
the
Trustee, hereby appoints the Institution Trust Services Department
of Chase to
perform the duties enumerated in (d) above.
Section 2.05 Permitted Activities of Trust. The Trust is created
for
the object and purpose of engaging in the Permitted Activities.
Section 2.06 Qualifying Special Purpose Entity. For purposes of
SFAS
140, the parties hereto intend that the Trust shall be treated as a
"qualifying
special purpose entity" as such term is used in SFAS 140 and any
successor rule
thereto and its power and authority as stated in Section 2.05 of
this Agreement
shall be limited in accordance with paragraph 35 thereof.
[END OF ARTICLE II]
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR AND
THE SERVICER; REPURCHASE OF MORTGAGE LOANS
Section 3.01 Representations and Warranties of the Depositor
with
respect to the Mortgage Loans.
47
<PAGE>
The Depositor hereby represents and warrants to the Trustee for
the
benefit of the Certificateholders that on the Closing Date it has
entered into
the Sale Agreement with CHF as Seller, that the Seller has made the
following
representations and warranties with respect to each Mortgage Loan
in the Sale
Agreement as of the Closing Date, which representations and
warranties run to
and are for the benefit of the Depositor and the Trustee for the
benefit of the
Certificateholders, and as to which the Depositor has assigned to
the Trustee
for the benefit of the Certificateholders, pursuant to Section 2.01
hereof, the
right to cause the Seller to repurchase a Mortgage Loan as to which
there has
occurred an uncured breach of representations and warranties in
accordance with
the provisions of the Sale Agreement.
(a) The information set forth in the Mortgage Loan Schedule is
complete, true and correct in all material respects;
(b) With respect to a Mortgage Loan which is not a Co-op Loan,
the
Mortgage creates a first lien or a first priority ownership
interest in an
estate in fee simple in real property securing the related Mortgage
Note. With
respect to a Co-op Loan, the related Mortgage is a valid,
enforceable and
subsisting first security interest on the related cooperative
shares securing
the related Mortgage Note, subject only to (a) liens of the related
residential
cooperative housing corporation for unpaid assessments representing
the
Mortgagor's pro rata share of the related residential cooperative
housing
corporation's payments for its blanket mortgage, current and future
real
property taxes, insurance premiums, maintenance fees and other
assessments to
which like collateral is commonly subject and (b) other matters to
which like
collateral is commonly subject which do not materially interfere
with the
benefits of the security intended to be provided by the related
security
agreement. There are no liens against or security interest in the
cooperative
shares relating to each Co-op Loan (except for unpaid maintenance,
assessments
and other amounts owed to the related cooperative which
individually or in the
aggregate will not have a material adverse effect on such Co-op
Loan), which
have priority over the Trustee's security interest in such
cooperative shares;
(c) All payments due prior to the Cut-off Date for such Mortgage
Loan
have been made as of the Closing Date, the Mortgage Loan is not
delinquent in
payment more than 30 days and has not been dishonored; to the best
of the
Seller's knowledge, there are no material defaults under the terms
of the
Mortgage Loan; the Seller has not advanced funds, or induced,
solicited or
knowingly received any advance of funds from a party other than the
owner of the
Mortgaged Property subject to the Mortgage (or, with respect to a
Co-op Loan,
the related Mortgagor), directly or indirectly, for the payment of
any amount
required by the Mortgage Loan; there has been no more than one
delinquency in
excess of 30 days during the preceding twelve-month period;
(d) To the best of the Seller's knowledge, all taxes,
governmental
assessments, insurance premiums, water, sewer and municipal
charges, leasehold
payments or ground rents which previously became due and owing have
been paid,
or escrow funds have been established in an amount sufficient to
pay for every
such escrowed item which remains unpaid and which has been assessed
but is not
yet due and payable;
(e) The
terms of the Mortgage Note and the Mortgage have not been
impaired, waived, altered or modified in any respect, except by
written
instruments. No Mortgagor has been released, in whole or in part,
from the terms
thereof except in connection with an assumption agreement and which
assumption
agreement is part of the Mortgage File and the terms of which are
reflected in
the Mortgage Loan Schedule;
48
<PAGE>
(f) The Mortgage Note and the Mortgage are not subject to any right
of
rescission, set-off, counterclaim or defense, including, without
limitation, the
defense of usury, nor will the operation of any of the terms of the
Mortgage
Note or Mortgage, or the exercise of any right thereunder, render
the Mortgage
Note or Mortgage unenforceable, in whole or in part, or subject to
any right of
rescission, set-off, counterclaim or defense, including the defense
of usury,
and no such right of rescission, set-off, counterclaim or defense
has been
asserted with respect thereto, and the Mortgagor was not a debtor
in any state
or federal bankruptcy or insolvency proceeding at the time the
Mortgage Loan was
originated;
(g) With respect to a Mortgage Loan which is not a Co-op Loan,
all
buildings or other customarily insured improvements upon the
Mortgaged Property
are insured by an insurer acceptable under the FNMA Guides against
loss by fire,
hazards of extended coverage and such other hazards as are provided
for in the
FNMA Guides or by FHLMC. All such standard hazard policies are in
full force and
effect and on the date of origination contained a standard
mortgagee clause
naming the Seller and its successors in interest and assigns as
loss payee and
such clause is still in effect and all premiums due thereon have
been paid. If
required by the Flood Disaster Protection Act of 1973, as amended,
the Mortgaged
Property is covered by a flood insurance policy meeting the
requirements of the
current guidelines of the Federal Insurance Administration which
policy conforms
to FNMA and FHLMC requirements. The Mortgage obligates the
Mortgagor thereunder
to maintain all such insurance at the Mortgagor's cost and expense,
and on the
Mortgagor's failure to do so, authorizes the holder of the Mortgage
to maintain
such insurance at the Mortgagor's cost and expense and to seek
reimbursement
therefor from the Mortgagor;
(h) Any and all requirements of any federal, state or local laws
and
all applicable predatory and abusive lending laws, including,
without
limitation, usury, truth-in-lending, real estate settlement
procedures, consumer
credit protection, equal credit opportunity or disclosure laws
applicable to the
Mortgage Loan have been complied with in all material respects;
(i) The Mortgage has not been satisfied, canceled or subordinated,
in
whole or in part, or rescinded, and the Mortgaged Property has not
been released
from the lien of the Mortgage, in whole or in part nor has any
instrument been
executed that would effect any such release, cancellation,
subordination or
rescission;
(j) With respect to a Mortgage Loan which is not a Co-op Loan,
the
Mortgage is a valid, subsisting, enforceable and perfected first
lien on the
Mortgaged Property, including, all buildings on the Mortgaged
Property. The
Mortgage and the Mortgage Note do not contain any evidence of any
security
interest or other interest or right thereto. Such lien is free and
clear of all
adverse claims, liens and encumbrances having priority over the
first lien of
the Mortgage subject only to (1) the lien of non-delinquent current
real
property taxes and assessments not yet due and payable, (2)
covenants,
conditions and restrictions, rights of way, easements and other
matters of the
public record as of the date of recording which are acceptable to
mortgage
lending institutions generally and either (A) which are referred to
or otherwise
considered in the appraisal made for the originator of the Mortgage
Loan, or (B)
which do not adversely affect the Appraised Value of the Mortgaged
Property as
set forth in such appraisal, and (3) other matters to which like
properties are
commonly subject which do not materially interfere with the
benefits of the
security intended to be provided by the Mortgage or the use,
enjoyment, value or
marketability of the related Mortgaged Property. Any security
agreement, chattel
mortgage or equivalent document related to and delivered in
connection with the
Mortgage Loan establishes and creates a valid, subsisting,
enforceable and
perfected first lien and first priority security interest on the
property
described therein, and the Depositor has the full right to sell and
assign the
same to the Trustee for the benefit of the Certificateholders;
49
<PAGE>
(k) The Mortgage Note and the related Mortgage are original and
genuine
and each is the legal, valid and binding obligation of the maker
thereof,
enforceable in all respects in accordance with its terms subject to
bankruptcy,
insolvency and other laws of general application affecting the
rights of
creditors and the Depositor has taken all action necessary to
transfer such
rights of enforceability to the Trustee for the benefit of the
Certificateholders. All parties to the Mortgage Note and the
Mortgage had the
legal capacity to enter into the Mortgage Loan and to execute and
deliver the
Mortgage Note and the Mortgage. The Mortgage Note and the Mortgage
have been
duly and property executed by such parties. The proceeds of the
Mortgage Loan
have been fully disbursed and there is no requirement for future
advances
thereunder, and any and all requirements as to completion of any
on-site or
off-site improvements and as to disbursements of any escrow funds
therefor have
been complied with;
(l) The Seller is the sole owner and holder of the Mortgage Loan
and
the indebtedness evidenced by the Mortgage Note, except for the
Assignments of
Mortgage which have been sent for recording, and upon recordation
the Seller
will be the owner of record of the Mortgage and the indebtedness
evidenced by
the Mortgage Note, and upon the sale of the Mortgage Loan to the
Trust for the
benefit of the Certificateholders, the Seller will retain the
Mortgage File or
any part thereof with respect thereto not delivered to the Trust
for the benefit
of the Certificateholders or its designee in trust only for the
purpose of
servicing and supervising the servicing of the Mortgage Loan.
Immediately prior
to the transfer and assignment to the Trust for the benefit of
the
Certificateholders, the Mortgage Loan, including the Mortgage Note
and the
Mortgage, were not subject to an assignment or pledge, and the
Depositor had
good and marketable title to and was the sole owner thereof and had
full right
to transfer and sell the Mortgage Loan to the Trustee for the
benefit of the
Certificateholders free and clear of any encumbrance, equity, lien,
pledge,
charge, claim or security interest and has the full right and
authority subject
to no interest or participation of, or agreement with, any other
party, to sell
and assign the Mortgage Loan pursuant to this Agreement and
following the sale
of the Mortgage Loan, the Trustee for the benefit of the
Certificateholders will
own such Mortgage Loan free and clear of any encumbrance, equity,
participation
interest, lien, pledge, charge, claim or security interest;
(m) With respect to a Mortgage Loan which is not a Co-op Loan,
the
Mortgage Loan is covered by an ALTA lender's title insurance policy
or other
generally acceptable form of policy or insurance acceptable to FNMA
or FHLMC,
issued by a title insurer acceptable to FNMA or FHLMC and qualified
to do
business in the jurisdiction where the Mortgaged Property is
located, insuring
(subject to the exceptions contained in (j) (1), (2) and (3) above)
the Seller,
its successors and assigns, as to the first priority lien of the
Mortgage in the
original principal amount of the Mortgage Loan. Such lender's title
insurance
policy insures ingress and egress by or upon the Mortgaged Property
or any
interest therein. Where required by state law or regulation, the
Mortgagor has
been given the opportunity to choose the carrier of the required
mortgage title
insurance. The Seller, its successors and assigns, are the sole
insureds of such
lender's title insurance policy, and such lender's title insurance
policy is in
full force and effect and will be in full force and effect upon the
consummation
of the transactions contemplated by this Agreement. No claims have
been made
under such lender's title insurance policy, and no prior holder of
the related
Mortgage, including the Seller, has done, by act or omission,
anything which
would impair the coverage of such lender's title insurance
policy;
(n) There is no default, breach, violation or event of
acceleration
existent, under the Mortgage or the related Mortgage Note and no
event which,
with the passage of time or with notice and the expiration of any
grace or cure
period, would constitute a default, breach, violation or event
permitting
acceleration; and neither the Seller nor any prior mortgagee has
waived any
default, breach, violation or event permitting acceleration;
(o) There are no mechanics', or similar liens or claims which have
been
filed for work, labor or material (and no rights are outstanding
that under law
could give rise to such liens) affecting the related Mortgaged
Property (or the
related residential dwelling unit in the Underlying Mortgage
Property, in the
case of a Co-op Loan) which are or may be liens prior to or equal
to the lien of
the related Mortgage;
50
<PAGE>
(p) With respect to a Mortgage Loan which is not a Co-op Loan,
all
improvements subject to the Mortgage which were considered in
determining the
Appraised Value of the Mortgaged Property lie wholly within the
boundaries and
building restriction lines of the Mortgaged Property (and wholly
within the
project with respect to a condominium unit) and no improvements on
adjoining
properties encroach upon the Mortgaged Property except those which
are insured
against by the title insurance policy referred to in clause (m)
above and all
improvements on the property comply with all applicable zoning and
subdivision
laws and ordinances; the Mortgaged Property is lawfully occupied
under
applicable law;
(q) The Mortgage Loan complies in all material respects with all
the
terms, conditions and requirements of the Seller's underwriting
standards in
effect at the time of origination of such Mortgage Loan. The
Mortgage Notes and
Mortgages (exclusive of any riders) are on forms generally
acceptable to FNMA or
FHLMC. Monthly Payments under the Mortgage Note are due and payable
on the first
day of each month. The Mortgage contains the usual and enforceable
provisions of
the originator at the time of origination for the acceleration of
the payment of
the unpaid principal amount of the Mortgage Loan if the related
Mortgaged
Property is sold without the prior consent of the mortgagee
thereunder;
(r) The Mortgaged Property (or Underlying Mortgaged Property, in
the
case of a Co-op Loan), is not subject to any material damage by
waste, fire,
earthquake, windstorm, flood or other casualty. At origination of
the Mortgage
Loan there was, and there currently is, no proceeding pending for
the total or
partial condemnation of the Mortgaged Property (or Underlying
Mortgaged
Property, in the case of a Co-op Loan);
(s) The related Mortgage contains customary and enforceable
provisions
such as to render the rights and remedies of the holder thereof
adequate for the
realization against the Mortgaged Property of the benefits of the
security
provided thereby, including, (l) in the case of a Mortgage
designated as a deed
of trust, by trustee's sale, and (2) otherwise by judicial
foreclosure. There is
no homestead or other exemption available to the Mortgagor which
would interfere
with the right to sell the Mortgaged Property at a trustee's sale
or the right
to foreclose the Mortgage subject to applicable federal and state
laws and
judicial precedent with respect to bankruptcy and right of
redemption or similar
law;
(t) If the Mortgage constitutes a deed of trust, a trustee,
authorized
and duly qualified if required under applicable law to act as such,
has been
properly designated and currently so serves and is named in the
Mortgage, and no
fees or expenses, except as may be required by local law, are or
will become
payable by the Purchaser to the trustee under the deed of trust,
except in
connection with a trustee's sale or attempted sale after default by
the
Mortgagor;
(u) The Mortgage File contains an appraisal or a
recertification
document (in the case of a Mortgage Loan originated under the
Seller's
Streamlined Refinance Program) of the related Mortgaged Property
(or the related
residential dwelling unit in the Underlying Mortgaged Property, in
the case of a
Co-op Loan), signed prior to the final approval of the mortgage
loan application
by an appraiser approved by the Seller who had no interest, direct
or indirect,
in the Mortgaged Property (or Underlying Mortgaged Property, in the
case of a
Co-op Loan), or in any loan made on the security thereof, and whose
compensation
is not affected by the approval or disapproval of the Mortgage
Loan. The
appraisal is in a form acceptable to FNMA or FHLMC;
(v) All parties which have had any interest in the Mortgage,
whether as
mortgagee, assignee, pledgee or otherwise, are (or, during the
period in which
they held and disposed of such interest, were) (A) in substantial
compliance
with any and all applicable licensing requirements of the laws of
the state
wherein the Mortgaged Property (or Underlying Mortgaged Property,
in the case of
a Co-op Loan), is located, and (B) (1) organized under the laws of
such state,
or (2) qualified to do business in such state, or (3) federal
savings and loan
associations or national banks or a Federal Home Loan Bank or
savings bank
having principal offices in such state, or (4) not doing business
in such state;
51
<PAGE>
(w) The related Mortgage Note is not and has not been secured by
any
collateral except the lien of the corresponding Mortgage and the
security
interest of any applicable security interest of any applicable
agreement or
chattel mortgage referred to above and such collateral does not
serve as
security for any other obligation;
(x) The Mortgagor has received all disclosure materials required
by
applicable law with respect to the making of such mortgage
loans;
(y) The Mortgage Loan does not contain "graduated payment"
features;
(z) The Mortgagor is not in bankruptcy and, to the best of the
Seller's
knowledge, the Mortgagor is not insolvent;
(aa) The Mortgage Loans are adjustable rate mortgage loans.
Each
Mortgage Loan has an original term to maturity of not more than
thirty (30)
years with interest payable in arrears on the first day of each
month. No
Mortgage Loan contains terms or provisions which would result in
negative
amortization;
(bb) Each Mortgage Note, each Mortgage, each Assignment of Mortgage
and
any other documents required pursuant to this Agreement to be
delivered to the
Trustee on behalf of the Certificateholders or its designee, or its
assignee for
each Mortgage Loan, have been, on or before the Closing Date,
delivered to the
Trustee on behalf of the Certificateholders or its designee, or its
assignee;
(cc) All escrow payments have been collected in full compliance
with
state and federal law and the provisions of the related Mortgage
Note and
Mortgage. As to any Mortgage Loan that is the subject of an escrow,
escrow of
funds is not prohibited by applicable law and has been established
in an amount
sufficient to pay for every escrowed item that remains unpaid and
has been
assessed but is not yet due and payable. No escrow deposits or
other charges or
payments due under the Mortgage Note have been capitalized under
any Mortgage or
the related Mortgage Note. Any interest required to be paid
pursuant to state,
federal and local law has been properly paid and credited;
(dd) [Reserved];
(ee) In the event that at origination the Mortgage Loan has a
Loan-to-Value Ratio greater than 80%, the excess of the principal
balance of the
Mortgage Loan over 75% of the Appraised Value of the Mortgaged
Property, with
respect to a refinanced Mortgage Loan, or the lesser of the
Appraised Value or
the purchase price of the Mortgaged Property (or Underlying
Mortgaged Property,
in the case of a Co-op Loan), with respect to a purchase money
Mortgage Loan, is
and will be insured as to payment defaults by a Primary Insurance
Policy issued
by a Qualified Insurer, except where the primary mortgage insurance
was (i)
impermissible at origination at applicable law, in which case such
Mortgage Loan
was originated in accordance with applicable law, (ii) cancelled at
the request
of the Mortgagor pursuant to the cancellation requirements of FNMA,
FHLMC, state
law or, as applicable the Home Owner and Equity Protection Act of
1994, as
amended, or (iii) automatically terminated in accordance with the
termination
requirements of FNMA, FHLMC, state law or, as applicable the Home
Owner and
Equity Protection Act of 1994, as amended. All provisions of such
Primary
Insurance Policy have been and are being complied with, such policy
is in full
force and effect, and all premiums due thereunder have been paid.
No action,
inaction, or event has occurred and no state of facts exists that
has, or will
result in the exclusion from, denial of, or defense to coverage.
Any Mortgage
Loan subject to a Primary Insurance Policy obligates the Mortgagor
thereunder to
maintain the Primary Insurance Policy and to pay all premiums and
charges in
connection therewith. The Mortgage Rate for the Mortgage Loan as
set forth on
the Mortgage Loan Schedule is net of any such insurance
premium;
52
<PAGE>
(ff) The Assignment of Mortgage is in recordable form and is
acceptable
for recording (or, in the case of a Co-op Loan, is in a form
acceptable for
filing) under the laws of the jurisdiction in which the Mortgaged
Property (or
underlying Mortgaged Property, in the case of a Co-op Loan) is
located;
(gg) As to Mortgage Loans that are not secured by an interest in
a
leasehold estate, the Mortgaged Property (or Underlying Mortgaged
Property, in
the case of a Co-op Loan), is located in the state identified in
the Mortgage
Loan Schedule and consists of a single parcel of real property with
a detached
single family residence erected thereon, or a two-to four-family
dwelling, or an
individual condominium unit in a condominium project, or a dwelling
unit in a
residential cooperative housing corporation or an individual unit
in an attached
planned unit development or a detached planned unit development,
provided,
however, that no residence or dwelling is a single parcel of real
property with
a mobile home thereon. As of the date of origination, no portion of
the
Mortgaged Property (or Underlying Mortgaged Property, in the case
of a Co-op
Loan), was used for commercial purposes, and since the date of
origination, to
the best of the Seller's knowledge, no portion of the Mortgaged
Property (or
Underlying Mortgaged Property, in the case of a Co-op Loan), is
used for
commercial purposes;
(hh) If the Mortgaged Property is a condominium unit or a planned
unit
development (other than a de minimis planned unit development), as
of the date
of origination of the related Mortgage Loan, such condominium or
planned unit
development project met the Seller's eligibility requirements, as
set forth in
the Seller's underwriting guidelines as of such date; in the case
of each Co-op
Loan, the related residential cooperative housing corporation
complied in all
material respects with the Seller's requirements as set forth in
the Seller's
underwriting guidelines as of such date;
(ii) To the best of the Seller's knowledge, there is no pending
action
or proceeding directly involving the Mortgaged Property (or
Underlying Mortgaged
Property, in the case of a Co-op Loan), in which compliance with
any
environmental law, rule or regulation is an issue;
(jj) As of the Cut-off Date, the Seller has not granted any
interest
rate relief to the Mortgagor under the Relief Act;
(kk) No Mortgage Loan was made in connection with the construction
or
rehabilitation of a Mortgaged Property (or Underlying Mortgaged
Property, in the
case of a Co-op Loan), or facilitating the trade-in or exchange of
a Mortgaged
Property (or Underlying Mortgaged Property, in the case of a Co-op
Loan);
(ll) No action has been taken or failed to be taken by Depositor,
on or
prior to the Closing Date, which has resulted or will result in an
exclusion
from, denial of, or defense to coverage under any Primary Insurance
Policy
(including, without limitation, any exclusions, denials or defenses
which would
limit or reduce the availability of the timely payment of the full
amount of the
loss otherwise due thereunder to the insured) whether arising out
of actions,
representations, errors, omissions, negligence, or fraud of the
Depositor, or
for any other reason under such coverage;
(mm) The Mortgage Loan was originated by a mortgagee approved by
the
Secretary of Housing and Urban Development pursuant to Sections 203
and 211 of
the National Housing Act, as amended, a savings and loan
association, a savings
bank, a commercial bank, credit union, insurance company or similar
institution
which is supervised and examined by a federal or state
authority;
53
<PAGE>
(nn) Principal payments on the Mortgage Loan commenced no more
than
sixty (60) days after funds were disbursed in connection with the
Mortgage Loan.
The Mortgage Note is payable on the first day of each month in
equal monthly
installments of principal and interest, with interest calculated
and payable in
arrears, sufficient to amortize the Mortgage Loan fully by the
stated maturity
date, over an original term of not more than thirty years from
commencement of
amortization;
(oo) As of the Closing Date, the Mortgage Loan is a "qualified
mortgage" within the meaning of Section 860G(a)(3) of the Code
(without regard
to Treasury Regulations ss.1.860G-2(f) or any similar rule that
provides that a
defective obligation is a qualified mortgage for a temporary
period);
(pp) With respect to a Mortgage Loan that is a Co-op Loan, the
stock
that is pledged as security for the Mortgage Loan is held by a
Person as a
tenant-stockholder (as defined in Section 216 of the Code) in a
cooperative
housing corporation (as defined in Section 216 of the Code);
(qq) As of the Closing Date, the Mortgage Loan is not the subject
of
pending or final foreclosure proceedings and the Seller would not,
based on the
delinquency status of the Mortgage Loan, institute foreclosure
proceedings with
respect to the Mortgage Loan prior to the next scheduled payment
for the
Mortgage Loan;
(rr) As of the Closing Date, the Mortgage Loan does not provide
for
interest other than at either (i) a single fixed rate in effect
throughout the
term of the Mortgage Loan or (ii) a "variable rate" (within the
meaning of
Treasury Regulation Section 1.860G-1(a)(3)) in effect throughout
the term of the
Mortgage Loan;
(ss) No Mortgage Loan is a "covered loan" within the meaning of
the
Georgia Fair Lending Act of 2002, as amended;
(tt) None of the Mortgage Loans are (a) covered by the Home
Ownership
and Equity Protection Act of 1994 or (b) classified as a "high
cost" loan or
similarly classified using different terminology under any federal,
state or
local law imposing heightened regulatory scrutiny or additional
legal liability
for residential mortgage loans having high interest rates, points
and/or fees
such as predatory lending laws; None of the Mortgage Loans are
"high cost" loans
as defined by the applicable federal, state or local predatory and
abusive
lending laws nor is any Mortgage Loan a "High Cost Loan" or
"Covered Loan," as
applicable (as such terms are defined in the current Standard &
Poor's LEVELS(R)
Glossary which is now version 5.6(c) revised, appendix E) and no
Mortgage Loan
originated on or after October 1, 2002 through March 6, 2003 is
governed by the
Georgia Fair Lending Act of 2002, as amended; and
(uu) As to each Mortgage Loan that is secured by an interest in
a
leasehold estate, (i) the use of a leasehold estate for residential
properties
is an accepted practice in the area where the related Mortgaged
Property is
located, (ii) residential property consisting of leasehold estates
is marketable
in the area where the related Mortgaged Property is located, (iii)
the related
lease has been recorded in the applicable land records, (iv) the
lease is valid
and in good standing and is not subject to any prior lien by which
the lease
could be terminated or subject to any charge or penalty, and (v)
the remaining
term of the lease does not terminate less than five years after the
maturity
date of such Mortgage Loan.
54
<PAGE>
Upon discovery by any of the Depositor, the Servicer or the Trustee
of
a breach of any of the foregoing representations and warranties
which materially
and adversely affects the value of a Mortgage Loan or the interest
of the
Certificateholders (or which materially and adversely affects the
interests of
the Certificateholders in the related Mortgage Loan in the case of
a
representation and warranty relating to a particular Mortgage
Loan), the party
discovering such breach shall give prompt written notice to the
other parties
and to the Seller, which notice shall specify the date of
discovery. Pursuant to
the Sale Agreement, the Seller shall within 90 days from the
earlier of (i) the
date of receipt of notice of such breach or (ii) the date the
Seller otherwise
discovers such breach, cure such breach, substitute a Mortgage Loan
pursuant to
the provisions of Section 3.03 or, if the breach relates to a
particular
Mortgage Loan, purchase such Mortgage Loan from the Trustee at the
Purchase
Price. The Purchase Price for the purchased Mortgage Loan shall be
paid to the
Servicer and shall be deposited by the Servicer in the Collection
Account
promptly upon receipt, and, upon receipt by the Trustee of written
notification
of such deposit signed by a Servicing Officer, the Trustee shall
promptly
release to the Seller the related Mortgage File, and the Trustee
shall execute
and deliver such instruments of transfer or assignment as may be
provided to it
by the Servicer, without recourse, as shall be necessary to vest in
the Seller
or its designee, as the case may be, any Mortgage Loan released
pursuant hereto,
and the Trustee shall have no further responsibility with regard to
such
Mortgage Loan. It is understood and agreed that the obligation of
the Seller to
cure, substitute or purchase any Mortgage Loan as to which such a
breach has
occurred shall constitute the sole remedy respecting such breach
available to
Certificateholders or the Trustee on behalf of
Certificateholder.
Section 3.02 Representations and Warranties of the Servicer.
The
Servicer represents and warrants to, and covenants with, the
Trustee for the
benefit of the Certificateholders that as of the Closing Date:
(a) The Servicer is a limited liability company duly chartered
and
validly existing in good standing under the laws of the State of
Delaware, and
the Servicer is duly qualified or registered as a foreign
corporation in good
standing in each jurisdiction in which the ownership or lease or
its properties
or the conduct of its business requires such qualification;
(b) The execution and delivery of this Agreement by the Servicer
and
its performance and compliance with the terms of this Agreement
will not violate
the Servicer's certificate of formation or by-laws or constitute a
default (or
an event which, with notice or lapse of time, or both, would
constitute a
default) under, or result in the breach of, any material contract,
agreement or
other instrument to which the Servicer is a party or which may be
applicable to
the Servicer or any of its assets;
(c) This Agreement, assuming due authorization, execution and
delivery
by the Trustee and the Depositor, constitutes a valid, legal and
binding
obligation of the Servicer, enforceable against it in accordance
with the terms
hereof subject to applicable bankruptcy, insolvency,
reorganization, moratorium
and other laws affecting the enforcement of creditors' rights
generally and to
general principles of equity, regardless of whether such
enforcement is
considered in a proceeding in equity or at law;
(d) The Servicer is not in default with respect to any order or
decree
of any court or any order, regulation or demand of any federal,
state, municipal
or governmental agency, which default might have consequences that
would
materially and adversely affect the condition (financial or other)
or operations
of the Servicer or its properties or might have consequences that
would affect
its performance hereunder; and
(e) No litigation is pending or, to the best of the Servicer's
knowledge, threatened against the Servicer which would prohibit its
entering
into this Agreement or performing its obligations under this
Agreement. It is
understood and agreed that the representations and warranties set
forth in this
Section 3.02 shall survive the issuance and delivery of the
Certificates and
shall be continuing as long as any Certificate shall be outstanding
or this
Agreement has been terminated.
55
<PAGE>
Section 3.03 Option to Substitute. If the Seller is required to
repurchase any Mortgage Loan pursuant to Section 2.02 or 3.01, that
Seller may,
at its option, within two years from the Closing Date, remove such
defective
Mortgage Loan from the terms of this Agreement and substitute
another mortgage
loan for such defective Mortgage Loan, in lieu of repurchasing such
defective
Mortgage Loan. Any substitute Mortgage Loan shall (a) have a
Principal Balance
at the time of substitution not in excess of the Principal Balance
of the
removed Mortgage Loan (the amount of any difference, plus one
month's interest
thereon at the Mortgage Rate borne by the removed Mortgage Loan,
being paid by
the Seller and deemed to be a Principal Prepayment to be deposited
by the
Servicer in the Collection Account), (b) have a Mortgage Rate not
less than, and
not more than one percentage point greater than, the Mortgage Rate
of the
removed Mortgage Loan (provided, however, that if the Mortgage Rate
on the
substitute Mortgage Loan exceeds the Mortgage Rate on the removed
Mortgage Loan,
the amount of that excess interest (the "Substitute Excess
Interest") shall be
payable to the Class A-R Certificate), (c) have a remaining term to
stated
maturity not later than, and not more than one year less than, the
remaining
term to stated maturity of the removed Mortgage Loan, (d) be, in
the reasonable
determination of the Servicer, of the same type, quality and
character
(including location of the Mortgaged Property (or underlying
Mortgaged Property,
in the case of a Co-op Loan)) as the removed Mortgage Loan as if
the breach had
not occurred, (e) have a Loan-to-Value Ratio at origination no
greater than that
of the removed Mortgage Loan and (f) be, in the reasonable
determination of the
Seller, in material compliance with the representations and
warranties contained
in the Sale Agreement and described in Section 3.01, as of the date
of
substitution.
The Seller shall amend the Mortgage Loan Schedule to reflect
the
withdrawal of the removed Mortgage Loan from this Agreement and the
substitution
of such substitute Mortgage Loan therefor and shall send a copy of
such amended
Mortgage Loan Schedule to the Trustee. The Sale Agreement provides
that upon
such amendment the Seller shall be deemed to have made as to such
substitute
Mortgage Loan the representations and warranties set forth in
Section 3.01 as of
the date of such substitution, which shall be continuing as long as
any
Certificate shall be outstanding or this Agreement has not been
terminated, and
the remedies for breach of any such representation or warranty
shall be as set
forth in Section 3.01. Upon such amendment, the Trustee shall
review the
Mortgage File delivered to it relating to the substitute Mortgage
Loan, within
the time and in the manner and with the remedies specified in
Section 2.02,
except that for purposes of this Section 3.03 (other than the
two-year period
specified in the first sentence of this Section), such time shall
be measured
from the date of the applicable substitution. In the event of such
a
substitution, accrued interest on the substitute Mortgage Loan for
the month in
which the substitution occurs and any Principal Prepayments made
thereon during
such month shall be the property of the Trust Fund, and accrued
interest for
such month on the Mortgage Loan for which the substitution is made
and any
Principal Prepayments made thereon during such month shall be the
property of
the Seller. The principal payment on a substitute Mortgage Loan due
on the Due
Date in the month of substitution shall be the property of the
Seller, and the
principal payment on the Mortgage Loan for which the substitution
is made due on
such date shall be the property of the Trust Fund.
[END OF ARTICLE III]
ARTICLE IV
THE CERTIFICATES
Section 4.01 The Certificates.
(a) The Class A (other than the Class A-R), Class M, Class B and
Class
A-R Certificates shall be substantially in the forms thereof
included within
Exhibits C, D, E and F, respectively, and shall, on original issue,
be executed
by the Depositor and authenticated by the Trustee (or, if an
Authenticating
Agent has been appointed pursuant to Section 4.06, the
Authenticating Agent)
upon receipt by the Trustee of the documents specified in Section
2.01,
delivered to or upon the order of the Depositor.
56
<PAGE>
(b) The Depository and the Trustee have entered into a
Depository
Agreement dated as of December 22, 2005 (the "Depository
Agreement"). Except as
provided in paragraph (c) below, the Book-Entry Certificates shall
at all times
remain registered in the name of the Depository or its nominee and
at all times:
(i) registration of the Book-Entry Certificates may not be
transferred as
provided in Section 4.02 except to a successor to the Depository;
(ii) ownership
and transfers of registration of the Book-Entry Certificates on the
books of the
Depository shall be governed by applicable rules established by the
Depository;
(iii) the Depository may collect its usual and customary fees,
charges and
expenses from its Depository Participants; (iv) the Trustee shall
deal with the
Depository, Depository Participants and Indirect Participants as
representatives
of the Certificate Owners of the Book-Entry Certificates for
purposes of
exercising the rights of such Holders under this Agreement, and
requests and
directions for and votes of such representatives shall not be
deemed to be
inconsistent if they are made with respect to different Certificate
Owners; and
(v) the Trustee may rely and shall be fully protected in relying
upon
information furnished by the Depository with respect to its
Depository
Participants and furnished by the Depository Participants with
respect to
Indirect Participants and persons shown on the books of such
Indirect
Participants as direct or indirect Certificate Owners. The
Depository Agreement
provides that the Depository shall maintain book-entry records with
respect to
the Certificate Owners and with respect to ownership and transfers
of such
Certificates.
All transfers by Certificate Owners of Book-Entry Certificates
shall be
made in accordance with the procedures established by the
Depository Participant
or brokerage firm representing such Certificate Owners. Each
Depository
Participant shall only transfer Book-Entry Certificates of
Certificate Owners it
represents or of brokerage firms for which it acts as agent in
accordance with
the Depository's normal procedures.
(c) If (i)(A) the Depository advises the Depositor, the Paying
Agent or
the Trustee in writing that the Depository is no longer willing or
able to
properly discharge its responsibilities as Depository and (B) the
Trustee, the
Paying Agent or the Depositor are unable after exercise of their
reasonable best
efforts to locate a qualified successor or (ii) the Depositor at
its option
advises the Trustee in writing that it elects to terminate the
book-entry system
through the Depository, the Trustee or, if a Paying Agent has been
appointed
under Section 4.05, the Paying Agent, shall notify all Certificate
Owners,
through the Depository, of the occurrence of any such event and of
the
availability of definitive, fully registered Certificates (the
"Definitive
Certificates") to Certificate Owners requesting the same. Upon
surrender to the
Trustee or, if a Paying Agent has been appointed under Section
4.05, the Paying
Agent, of the Book-Entry Certificates by the Depository for
registration and
receipt by the Trustee or, if a Paying Agent has been appointed
under Section
4.05, the Paying Agent, of an adequate supply of certificates from
the
Depositor, the Trustee or if the Paying Agent is appointed under
Section 4.05,
the Paying Agent shall issue the Definitive Certificates based on
information
received from the Depository. Neither the Depositor, the Servicer,
the Paying
Agent nor the Trustee shall be liable for any delay in delivery of
such
instructions and may conclusively rely on, and shall be protected
in relying on,
such instructions.
(d) The Certificates (other than the Class A-R Certificate) shall
be
issuable in the minimum original dollar denominations (and integral
multiples of
$1,000.00 in excess of such amount) and aggregate original dollar
denominations
per Class (or in the case of the Class 1-AX, Class 2-AX and Class
3-AX
Certificates, the minimum denominations based upon the Class 1-AX
Notional
Amount, the Class 2-AX Notional Amount and the Class 3-AX Notional
Amount,
respectively) as set forth in the following table (except that, if
necessary, in
order to aggregate the Original Certificate Principal Balance of a
Class, one
Certificate of such Class will be issued in a different
denomination). A single
Class A-R Certificate will be issued in definitive form in a $100
denomination.
57
<PAGE>
<TABLE>
<CAPTION>
Aggregate Original Certificate
Minimum
Principal Balance of
all
Original
Certificates of the
CUSIP
Class
Denomination
Indicated Class
Number
----------------------
--------------
-------------------------------
-----------
<S>
<C>
<C>
<C>
Class 1-A1............
$ 100,000.00
210,000,000.00
16162W PV 5
Class 1-A2............
$ 100,000.00
5,384,700.00
16162W PW 3
Class 1-A3............
$ 100,000.00
98,362,900.00
16162W PX 1
Class 1-A4............
$ 100,000.00
42,330,700.00
16162W PY 9
Class 1-A5............
$ 100,000.00
139,556,300.00
16162W PZ 6
Class 1-A6............
$ 100,000.00
19,310,500.00
16162W QA 0
Class 1-AX............
$ 100,000.00
(2)
16162W QB 8
Class 2-A1............
$ 100,000.00
167,245,500.00
16162W QC 6
Class 2-A2............
$ 100,000.00
53,727,700.00
16162W QD 4
Class 2-A3............
$ 100,000.00
1,377,700.00
16162W QE 2
Class 2-A4............
$ 100,000.00
8,663,100.00
16162W QF 9
Class 2-AX............
$ 100,000.00
(2)
16162W QG 7
Class 3-A1............
$ 100,000.00
100,000,000.00
16162W QH 5
Class 3-A2............
$ 100,000.00
81,444,300.00
16162W QJ 1
Class 3-A3............
$ 100,000.00
2,088,400.00
16162W QK 8
Class 3-A4............
$ 100,000.00
72,310,600.00
16162W QL 6
Class 3-A5............
$ 100,000.00
22,115,300.00
16162W QM 4
Class 3-A6............
$ 100,000.00
10,829,600.00
16162W QN 2
Class 3-AX............
$ 100,000.00
(2)
16162W QP 7
Class A-R(1)..........
$
100.00
100.00
16162W QQ 5
Class M...............
$ 100,000.00
21,501,400.00
16162W QR 3
Class B-1.............
$ 100,000.00
6,987,900.00
16162W QS 1
Class B-2.............
$ 100,000.00
3,225,100.00
16162W QT 9
Class B-3.............
$ 100,000.00
3,762,700.00
16162W QU 6
Class B-4.............
$ 100,000.00
2,150,100.00
16162W QV 4
Class B-5.............
$ 100,000.00
2,687,816.02
16162W QW 2
</TABLE>
---------------
(1) The Class A-R Certificate represents the residual interest in
each of the
REMIC
Pools.
(2) The Class 1-AX, Class 2-AX and Class 3-AX Certificates are
interest-only
certificates, have no principal balance, are not entitled to
payments of
principal
and will bear interest on their notional amounts. The initial
notional
amounts of the Class 1-AX, Class 2-AX and Class 3-AX
Certificates
will be
approximately $514,945,200, $231,014,000 and $288,788,200,
respectively.
The Certificates shall be signed by manual or facsimile signature
on
behalf of the Depositor by an officer of the Depositor.
Certificates bearing the
manual or facsimile signatures of individuals who were at the time
of signature
officers of the Depositor shall bind the Depositor, notwithstanding
that such
individuals or any of them have ceased to be an officer prior to
the
authentication and delivery of such Certificate or did not hold
such offices at
the date of such Certificates. No Certificate shall be entitled to
any benefit
under this Agreement, or be valid for any purpose, unless there
appears on such
Certificate a manual authentication by an officer of the Trustee
(or if an
Authenticating Agent has been appointed pursuant to Section 4.06,
the
Authenticating Agent) and such authentication upon any Certificate
shall be
conclusive evidence, and the only evidence, that such Certificate
has been duly
authenticated and delivered hereunder. All Certificates shall be
dated the date
of their authentication.
58
<PAGE>
Section 4.02 Registration of Transfer and Exchange of
Certificates.
(a) The Trustee or, if a Paying Agent has been appointed under
Section
4.05, the Paying Agent, shall cause to be kept a Certificate
Register in which,
subject to such reasonable regulations as it may prescribe, the
Trustee or, if a
Paying Agent has been appointed under Section 4.05, the Paying
Agent, shall
provide for the registration of Certificates and of transfers and
exchanges of
Certificates as herein provided.
(b) Upon surrender for registration of transfer of any Certificate
at
any office or agency of the Trustee, or if a Paying Agent has been
appointed
hereunder pursuant to Section 4.05, the Paying Agent maintained for
such
purpose, the Depositor shall execute and the Trustee or if an
Authenticating
Agent is appointed under Section 4.06, the Authenticating Agent
shall
authenticate and deliver, in the name of the designated transferee
or
transferees, a Certificate of a like Class and aggregate Percentage
Interest and
dated the date of authentication by the Authenticating Agent.
(c) No transfer of a Class B-3, Class B-4 or Class B-5
Certificate
shall be made unless such transfer is made pursuant to an effective
registration
statement or otherwise in accordance with the requirements under
the Securities
Act of 1933, as amended. If such a transfer is to be made in
reliance upon an
exemption from said Act, (i) the Depositor may require (except with
respect to
the initial transfer of a Class B-3, Class B-4 or Class B-5
Certificate from
J.P. Morgan Securities Inc. and except if the transferee executes a
certificate
substantially in the form of Exhibit H hereto) a written opinion of
independent
counsel acceptable to and in form and substance satisfactory to the
Depositor
that such transfer may be made pursuant to an exemption, describing
the
applicable exemption and the basis therefor, from said Act and laws
or is being
made pursuant to said Act and laws, which opinion of counsel shall
not be an
expense of the Trust Fund, the Trustee, the Depositor or the
Servicer, and (ii)
the Depositor shall require the transferee to execute a
certification
substantially in the form of Exhibit H or Exhibit I.
(d) (i) No transfer of an ERISA Restricted Certificate or a Class
A-R
Certificate shall be made unless the prospective transferee
provides the
Depositor with (I) a representation as set forth in Exhibit K for
Class A-R
Certificates or in Exhibit M for ERISA Restricted Certificates to
the effect
that such transferee is not an employee benefit plan subject to
Title I of
ERISA, a plan subject to Section 4975 of the Code or a plan or
arrangement
subject to any provisions under any federal, state, local, non-U.S.
or other
laws or regulations that are substantively similar to the foregoing
provisions
of ERISA or the Code ("Similar Law") (collectively, a "Plan"), and
is not
directly or indirectly acquiring the Certificate for, on behalf of
or with any
assets of any such Plan, or (II) solely in the case of an ERISA
Restricted
Certificate, (A) if the Certificate has been the subject of an
ERISA-Qualifying
Underwriting, a representation as set forth in Exhibit M that such
transferee is
an insurance company that is acquiring the ERISA-Restricted
Certificate with
assets contained in an "insurance company general account," as
defined in
Section V(E) of Prohibited Transaction Class Exemption ("PTCE")
95-60, and the
acquisition and holding of the Certificate are covered and exempt
under Sections
I and III of PTCE 95-60, or (B) solely in the case of a Definitive
Certificate,
an Opinion of Counsel satisfactory to the Depositor to the effect
that the
acquisition and holding of such Certificate will not constitute or
result in a
nonexempt prohibited transaction under ERISA or the Code, or a
violation of
Similar Law, and will not subject the Depositor, the Servicer or
the Trustee to
any obligation in addition to those expressly undertaken in this
Agreement,
which Opinion of Counsel shall not be an expense of the Depositor,
the Servicer
or the Trustee.
(ii) Except in the case of a Definitive Certificate, the
representations set forth in paragraph (i) of this Subsection
4.02(d), other
than subparagraph (i)(II)(B), shall be deemed to have been made to
Depositor by
the transferee's acceptance of an ERISA Restricted Certificate or a
Class A-R
Certificate (or the acceptance by a Certificate Owner of the
beneficial interest
in any Class of ERISA Restricted Certificates or a Class A-R
Certificate).
Notwithstanding any other provision herein to the contrary, any
purported
transfer of an ERISA Restricted Certificate or a Class A-R
Certificate to or on
behalf of a Plan without the delivery to the Depositor of a
representation or an
Opinion of Counsel satisfactory to the Depositor as described above
shall be
void and of no effect. None of the Depositor, the Servicer or the
Trustee shall
be under any liability to any Person for any registration or
transfer of any
ERISA Restricted Certificate or Class A-R Certificate that is in
fact not
permitted by this Section 4.02(d) nor shall the Paying Agent be
under any
liability for making any payments due on such Certificate to the
Holder thereof
59
<PAGE>
or taking any other action with respect to such Holder under the
provisions of
this Agreement so long as the transfer was registered in accordance
with the
foregoing requirements. The Depositor, Servicer, Paying Agent
and/or Trustee
shall be entitled, but not obligated, to recover from any Holder of
any ERISA
Restricted Certificate or Class A-R Certificate that was in fact a
Plan and that
held such Certificate in violation of this Section 4.02(d) all
payments made on
such ERISA Restricted Certificate or Class A-R Certificate at and
after the time
it commenced such holding. Any such payments so recovered shall be
paid and
delivered to the last preceding Holder of such Certificate that is
not a Plan.
(e) At the option of a Certificateholder, a Certificate may be
exchanged for another Certificate or Certificates of authorized
denominations of
a like Class, upon surrender of the Certificate to be exchanged at
any office or
agency of the Trustee, or if a Paying Agent has been appointed
under Sec
