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EXHIBIT 4.1
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Depositor
WELLS FARGO BANK, N.A.
Master Servicer and Securities Administrator
LITTON LOAN SERVICING LP,
Servicer
and
HSBC BANK USA, NATIONAL ASSOCIATION,
Trustee
-------------------------------
POOLING AND SERVICING AGREEMENT
Dated as of December 1, 2005
-------------------------------
OWNIT MORTGAGE LOAN TRUST,
MORTGAGE LOAN ASSET-BACKED CERTIFICATES, SERIES 2005-5
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TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS.....................................................................................................
1
ARTICLE II CONVEYANCE
OF MORTGAGE LOANS; REPRESENTATIONS AND
WARRANTIES....................................................
53
SECTION 2.01.
Conveyance of Mortgage
Loans.....................................................................
53
SECTION 2.02.
Acceptance by the Trustee of the Mortgage
Loans..................................................
56
SECTION 2.03.
Representations, Warranties and Covenants of the
Depositor....................................... 58
SECTION 2.04.
Representations and Warranties of the Master Servicer;
Representations and Warranties of the
Servicer; Representations and Warranties of the Securities
Administrator......................... 62
SECTION 2.05.
Substitutions and Repurchases of Mortgage Loans that are not
"Qualified Mortgages.".............. 65
SECTION 2.06.
Authentication and Delivery of
Certificates......................................................
65
SECTION 2.07. REMIC
Elections..................................................................................
65
SECTION 2.08.
[RESERVED].......................................................................................
69
SECTION 2.09.
Covenants of the
Servicer........................................................................
69
SECTION 2.10.
[RESERVED].......................................................................................
70
SECTION 2.11.
Permitted Activities of the
Trust................................................................
70
SECTION 2.12.
Qualifying Special Purpose
Entity................................................................
70
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE
LOANS..................................................................
70
SECTION 3.01. Servicer
to Service Mortgage
Loans...............................................................
70
SECTION 3.02.
Servicing and Subservicing; Enforcement of the Obligations of
Servicer........................... 72
SECTION 3.03. Rights
of the Depositor, the Securities Administrator and the Trustee in
Respect of the
Servicer.........................................................................................
73
SECTION 3.04. Master
Servicer to Act as
Servicer...............................................................
73
SECTION 3.05.
Collection of Mortgage Loan Payments; Collection Account;
Certificate Account.................... 74
SECTION 3.06.
Collection of Taxes, Assessments and Similar Items; Escrow
Accounts.............................. 77
SECTION 3.07. Access
to Certain Documentation and Information Regarding the Mortgage
Loans..................... 78
SECTION 3.08.
Permitted Withdrawals from the Collection Account and Certificate
Account........................ 78
SECTION 3.09.
[RESERVED].......................................................................................
80
SECTION 3.10.
Maintenance of Hazard
Insurance..................................................................
80
SECTION 3.11.
Enforcement of Due-On-Sale Clauses; Assumption
Agreements........................................ 81
SECTION 3.12.
Realization Upon Defaulted Mortgage Loans; Determination of Excess
Proceeds...................... 82
SECTION 3.13. Trustee
to Cooperate; Release of Mortgage
Files..................................................
86
SECTION 3.14.
Documents, Records and Funds in Possession of Servicer to be Held
for the Trustee................ 87
SECTION 3.15.
Servicing
Compensation...........................................................................
87
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SECTION 3.16. Access
to Certain
Documentation..................................................................
88
SECTION 3.17. Annual
Statement as to
Compliance................................................................
88
SECTION 3.18. Annual
Independent Public Accountants' Servicing Statement; Financial
Statements................. 88
SECTION 3.19. Rights
of the NIMs
Insurer.......................................................................
89
SECTION 3.20.
[RESERVED].......................................................................................
89
SECTION 3.21. Annual
Certificate by Securities
Administrator...................................................
89
SECTION 3.22. Annual
Certificate by
Servicer...................................................................
89
SECTION 3.23.
Prepayment Charge Reporting
Requirements.........................................................
90
SECTION 3.24.
Statements to Securities
Administrator...........................................................
90
SECTION 3.25.
Indemnification..................................................................................
90
SECTION 3.26.
Nonsolicitation..................................................................................
92
ARTICLE IV
DISTRIBUTIONS...................................................................................................
92
SECTION 4.01.
Advances.........................................................................................
92
SECTION 4.02.
Reduction of Servicing Compensation in Connection with Prepayment
Interest Shortfalls............ 93
SECTION 4.03.
Distributions on the REMIC
Interests.............................................................
94
SECTION 4.04.
Distributions....................................................................................
94
SECTION 4.05. Monthly
Statements to
Certificateholders.........................................................
100
ARTICLE V THE
CERTIFICATES................................................................................................
104
SECTION 5.01. The
Certificates.................................................................................
104
SECTION 5.02.
Certificate Register; Registration of Transfer and Exchange of
Certificates...................... 105
SECTION 5.03.
Mutilated, Destroyed, Lost or Stolen
Certificates................................................
113
SECTION 5.04. Persons
Deemed
Owners............................................................................
113
SECTION 5.05. Access
to List of Certificateholders' Names and
Addresses........................................ 113
SECTION 5.06.
Book-Entry
Certificates..........................................................................
113
SECTION 5.07. Notices
to
Depository............................................................................
114
SECTION 5.08.
Definitive
Certificates..........................................................................
114
SECTION 5.09.
Maintenance of Office or
Agency..................................................................
115
ARTICLE VI THE
DEPOSITOR, THE MASTER SERVICER, THE SERVICER AND THE SECURITIES
ADMINISTRATOR............................... 115
SECTION 6.01.
Respective Liabilities of the Depositor, the Master Servicer, the
Servicer and the
Securities
Administrator.........................................................................
115
SECTION 6.02. Merger
or Consolidation of the Depositor, the Master Servicer, the
Servicer or the
Securities
Administrator.........................................................................
116
SECTION 6.03.
Limitation on Liability of the Depositor, the Securities
Administrator, the Master Servicer,
the
Servicer and
Others..........................................................................
116
SECTION 6.04.
Limitation on Resignation of
Servicer............................................................
117
SECTION 6.05. Errors
and Omissions Insurance; Fidelity
Bonds...................................................
118
SECTION 6.06.
Limitation on Resignation of the Master
Servicer.................................................
118
SECTION 6.07.
Assignment of Master
Servicing...................................................................
118
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ARTICLE VII DEFAULT; TERMINATION OF
SERVICER................................................................................
119
SECTION 7.01. Events
of
Default................................................................................
119
SECTION 7.02. Servicer
Trigger
Event...........................................................................
120
SECTION 7.03. Master
Servicer to Act; Appointment of
Successor.................................................
121
SECTION 7.04.
Notification to
Certificateholders...............................................................
123
ARTICLE VIII CONCERNING THE TRUSTEE AND THE SECURITIES
ADMINISTRATOR........................................................
123
SECTION 8.01. Duties
of the Trustee and the Securities
Administrator...........................................
123
SECTION 8.02. Certain
Matters Affecting the Trustee and the Securities
Administrator........................... 124
SECTION 8.03. Trustee
and Securities Administrator Not Liable for Certificates or
Mortgage Loans............... 126
SECTION 8.04. Trustee
and Securities Administrator May Own
Certificates........................................ 126
SECTION 8.05.
Trustee's and Securities Administrator's Fees and
Expenses....................................... 126
SECTION 8.06.
Indemnification and
Expenses of
Trustee..........................................................
126
SECTION 8.07.
Eligibility Requirements for
Trustee.............................................................
127
SECTION 8.08.
Resignation and Removal of
Trustee...............................................................
128
SECTION 8.09.
Successor
Trustee................................................................................
128
SECTION 8.10. Merger
or Consolidation of
Trustee...............................................................
129
SECTION 8.11.
Appointment of Co-Trustee or Separate
Trustee....................................................
129
SECTION 8.12. Tax
Matters......................................................................................
130
ARTICLE IX
TERMINATION.....................................................................................................
132
SECTION 9.01.
Termination upon Liquidation or Auction of all Mortgage
Loans.................................... 132
SECTION 9.02. Final
Distribution on the
Certificates...........................................................
133
SECTION 9.03.
Additional Termination
Requirements..............................................................
134
ARTICLE X
MISCELLANEOUS
PROVISIONS........................................................................................
135
SECTION 10.01.
Amendment........................................................................................
135
SECTION 10.02.
Counterparts.....................................................................................
136
SECTION 10.03. Governing
Law....................................................................................
136
SECTION 10.04. Intention of
Parties.............................................................................
137
SECTION 10.05.
Notices..........................................................................................
137
SECTION 10.06. Severability of
Provisions.......................................................................
138
SECTION 10.07.
Assignment.......................................................................................
138
SECTION 10.08. Limitation on Rights of
Certificateholders.......................................................
138
SECTION 10.09. Inspection and Audit
Rights......................................................................
139
SECTION 10.10. Certificates Nonassessable and Fully
Paid........................................................
139
SECTION 10.11. Third Party
Rights...............................................................................
139
SECTION 10.12. Additional Rights of the NIMs
Insurer............................................................
139
SECTION 10.13. Assignment; Sales; Advance
Facilities............................................................
140
ARTICLE XI
ADMINISTRATION AND MASTER SERVICING OF THE MORTGAGE
LOANS.......................................................
142
SECTION 11.01. Master
Servicer..................................................................................
142
SECTION 11.02. Monitoring of
Servicer...........................................................................
143
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SECTION 11.03. Fidelity
Bond....................................................................................
144
SECTION 11.04. Power to Act;
Procedures.........................................................................
144
SECTION 11.05. Documents, Records and Funds in Possession of Master
Servicer to Be Held for Trustee............. 145
SECTION 11.06. Trustee to Retain Possession of Certain Insurance
Policies and Documents......................... 145
SECTION 11.07. Compensation for the Master Servicer and the
Securities Administrator............................ 146
SECTION 11.08. Annual Statement as to
Compliance................................................................
146
SECTION 11.09. Periodic
Filings.................................................................................
146
SECTION 11.10. Obligation of the Master Servicer in Respect of
Prepayment Interest Shortfalls................... 147
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EXHIBIT A FORMS OF
CERTIFICATES
EXHIBIT B-1 MORTGAGE LOAN SCHEDULE
- MORTGAGE POOL
EXHIBIT B-2 MORTGAGE LOAN SCHEDULE
- GROUP ONE MORTGAGE LOANS
EXHIBIT B-3 MORTGAGE LOAN SCHEDULE
- GROUP TWO MORTGAGE LOANS
EXHIBIT B-4 MORTGAGE LOAN SCHEDULE
- MI MORTGAGE LOANS
EXHIBIT C
[RESERVED]
EXHIBIT D FORM OF
TRUSTEE CERTIFICATION
EXHIBIT E-1 FORM OF [CLASS R/CLASS
R-X] TRANSFEREE'S
LETTER AND AFFIDAVIT
EXHIBIT E-2 FORM OF [CLASS R/CLASS
R-X] TRANSFEROR'S
AFFIDAVIT
EXHIBIT F FORM OF
TRANSFEROR CERTIFICATE
EXHIBIT G FORM OF
INVESTMENT LETTER (ACCREDITED INVESTOR)
EXHIBIT H FORM OF
RULE 144A LETTER (QUALIFIED INSTITUTIONAL BUYER)
EXHIBIT I FORM OF
REQUEST FOR RELEASE
EXHIBIT J
[RESERVED]
EXHIBIT K FORM OF
OFFICER'S CERTIFICATE OF TRUSTEE
EXHIBIT L FORM OF
OFFICER'S CERTIFICATE OF SERVICER
EXHIBIT M-1 FORM OF DELINQUENCY
REPORT
EXHIBIT M-2 FORM OF MONTHLY
REMITTANCE ADVICE
EXHIBIT M-3 FORM OF REALIZED LOSS
REPORT
EXHIBIT N-1 FORM OF CLASS A-1 CAP
CONTRACT
EXHIBIT N-2 FORM OF CLASS A-2 CAP
CONTRACT
EXHIBIT N-3 FORM OF SUBORDINATE
CERTIFICATE CAP CONTRACT
EXHIBIT O-1 ONE-MONTH LIBOR CAP
TABLE - CLASS A-1 CAP CONTRACT
EXHIBIT O-2 ONE MONTH LIBOR CAP
TABLE - CLASS A-2 CAP CONTRACT
EXHIBIT O-3 ONE MONTH LIBOR CAP
TABLE - SUBORDINATE CERTIFICATE CAP CONTRACT
EXHIBIT P FORM OF
POWER OF ATTORNEY
EXHIBIT Q FORM OF
TRANSFEROR REPRESENTATION LETTER FOR TRANSFER TO REGULATION S
BOOK-ENTRY CERTIFICATE
FROM A HOLDER OF A RULE 144A BOOK-ENTRY CERTIFICATE OR DEFINITIVE
CERTIFICATE
EXHIBIT R FORM OF
TRANSFEROR REPRESENTATION LETTER FOR TRANSFER PURSUANT TO RULE 144A
FROM A HOLDER OF
A REGULATION S BOOK-ENTRY CERTIFICATE OR DEFINITIVE CERTIFICATE
EXHIBIT S FORM OF MI
POLICY
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POOLING
AND SERVICING AGREEMENT (the "Agreement"), dated as of December
1,
2005, among MERRILL LYNCH MORTGAGE INVESTORS, INC., a Delaware
corporation, as
depositor (the "Depositor"), WELLS FARGO BANK, N.A, a national
banking
association, as master servicer (the "Master Servicer") and
securities
administrator (the "Securities Administrator"), LITTON LOAN
SERVICING LP, a
Delaware limited partnership, as servicer (the "Servicer") and HSBC
BANK USA,
NATIONAL ASSOCIATION, a national banking association, as trustee
(the
"Trustee").
The
Depositor is the owner of the Trust Fund that is hereby conveyed
to
the Trustee in return for the Certificates. The Trust Fund for
federal income
tax purposes will consist of (i) ten real estate mortgage
investment conduits,
(ii) the right to receive payments distributable to the Class P
Certificates
pursuant to Section 4.04(b)(i) hereof, (iii) each Cap Contract and
the Cap
Contract Account and (iv) the grantor trusts described in Section
2.07 hereof.
The Lower Tier REMIC will consist of all of the assets constituting
the Trust
Fund (other than the assets described in clauses (ii), (iii) and
(iv) above, the
Lower Tier REMIC Regular Interests, the Class UTM Interests, the
Class UTB
Interests, and the Class UTC Interest) and will be evidenced by the
Lower Tier
REMIC Regular Interests (which will be uncertificated and will
represent the
"regular interests" in the Lower Tier REMIC) and the Class LTR
Interest as the
single "residual interest" in the Lower Tier REMIC. The Trustee
will hold the
Lower Tier REMIC Regular Interests. The Upper Tier REMIC will
consist of the
Lower Tier REMIC Regular Interests and will be evidenced by the
REMIC Regular
Interests (which will represent the "regular interests" in the
Upper Tier REMIC)
and the Residual Interest as the single "residual interest" in the
Upper Tier
REMIC. The Trustee will hold the Class UTM Interests, the Class UTB
Interests
and the Class UTC Interest. The M3 REMIC will consist of the Class
UTM3 Interest
and will be evidenced by the Class M-3 Certificates (which will
represent the
"regular interest" in the M3 REMIC) and the Class M3R Interest as
the single
"residual interest" in the M3 REMIC. The M4 REMIC will consist of
the Class UTM4
Interest and will be evidenced by the Class M-4 Certificates (which
will
represent the "regular interest" in the M4 REMIC) and the Class M4R
Interest as
the single "residual interest" in the M4 REMIC. The M5 REMIC will
consist of the
Class UTM5 Interest and will be evidenced by the Class M-5
Certificates (which
will represent the "regular interest" in the M5 REMIC) and the
Class M5R
Interest as the single "residual interest" in the M5 REMIC. The M6
REMIC will
consist of the Class UTM6 Interest and will be evidenced by the
Class M-6
Certificates (which will represent the "regular interest" in the M6
REMIC) and
the Class M6R Interest as the single "residual interest" in the M6
REMIC. The B1
REMIC will consist of the Class UTB1 Interest and will be evidenced
by the Class
B-1 Certificates (which will represent the "regular interest" in
the B1 REMIC)
and the Class B1R Interest as the single "residual interest" in the
B1 REMIC.
The B2 REMIC will consist of the Class UTB2 Interest and will be
evidenced by
the Class B-2 Certificates (which will represent the "regular
interest" in the
B2 REMIC) and the Class B2R Interest as the single "residual
interest" in the B2
REMIC. The B3 REMIC will consist of the Class UTB3 Interest and
will be
evidenced by the Class B-3 Certificates (which will represent the
"regular
interest" in the B3 REMIC) and the Class B3R Interest as the single
"residual
interest" in the B3 REMIC. The C REMIC will consist of the Class
UTC Interest
and will be evidenced by the Uncertificated Class C Interest (which
will
represent the "regular interest" in the C REMIC) and the Class CR
Interest as
the single "residual interest" in the C REMIC. The Class R-X
Certificate will
represent beneficial ownership of the Class M3R interest, the Class
M4R
Interest, the Class M5R Interest, the Class M6R Interest, the Class
B1R
Interest, the Class B2R Interest, the Class B3R Interest and the
Class CR
Interest. The Class R Certificate will represent beneficial
ownership of the
Class LTR Interest and the Residual Interest. The "latest possible
maturity
date" for federal income tax purposes of all interests created
hereby will be
the Latest Possible Maturity Date.
All
covenants and agreements made by the Transferor in the Transfer
Agreement, by the Seller in the Sale Agreement and by the Depositor
and the
Trustee herein with respect to the Mortgage Loans and the other
property
constituting the Trust Fund are for the benefit of the Holders from
time to time
of the Certificates and, to the extent provided herein, the NIMs
Insurer.
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In
consideration of the mutual agreements herein contained, the
Depositor,
the Master Servicer, the Securities Administrator, the Servicer and
the Trustee
hereby agree as follows:
ARTICLE I
DEFINITIONS
Whenever
used in this Agreement, the following words and phrases, unless
the context otherwise requires, shall have the following
meanings:
Accepted
Master Servicing Practices: With respect to any Mortgage Loan,
as
applicable, either (x) those customary mortgage master servicing
practices of
prudent master servicing institutions that master service mortgage
loans of the
same type and quality as such Mortgage Loan in the jurisdiction
where the
related Mortgaged Property is located, to the extent applicable to
the Master
Servicer (except in its capacity as successor to the Servicer), or
(y) as
provided in Section 11.01 hereof, but in no event below the
standard set forth
in clause (x) of this definition.
Accepted
Servicing Practices: The Servicer's normal servicing practices,
which will conform to the mortgage servicing practices of prudent
mortgage
lending institutions that service for their own account mortgage
loans of the
same type as the Mortgages Loans in the jurisdictions in which the
related
Mortgaged Properties (or Underlying Mortgaged Properties in the
case of Co-op
Loans) are located.
Accrual
Period: With respect to each Class of Certificates and the
Lower
Tier REMIC Interests and any Distribution Date, the period
commencing on the
immediately preceding Distribution Date (or, in the case of the
first
Distribution Date, the Closing Date) and ending on the day
immediately preceding
such Distribution Date. All calculations of interest on each Class
of
Certificates and the Lower Tier REMIC Interests will be made on the
basis of the
actual number of days elapsed in the related Accrual Period and a
360 day year.
Adjustable
Rate Mortgage Loan: A Mortgage Loan identified in the Mortgage
Loan Schedule as having a Mortgage Rate that is adjustable.
Adjustment
Date: As to each Adjustable Rate Mortgage Loan, each date on
which the related Mortgage Rate is subject to adjustment, as
provided in the
related Mortgage Note.
Advance:
The aggregate of the advances required to be made by the
Servicer
with respect to any Distribution Date pursuant to Section 4.01, the
amount of
any such advances being equal to the sum of the aggregate amount of
all payments
of principal and interest (net of the Servicing Fee) on the
Mortgage Loans that
were due during the applicable Due Period and not received as of
the close of
business on the related Determination Date (other than the
principal portion of
any Balloon Amount), less the aggregate amount of any such
Delinquent payments
that the Servicer has determined would constitute a Non-Recoverable
Advance were
an advance to be made with respect thereto; provided, however, that
with respect
to any Mortgage Loan (x) that is a second lien Mortgage Loan or (y)
that has
been converted to an REO Property, the obligation to make advances
shall be
limited to payments of interest.
Advance
Facility: A financing or other facility as described in Section
10.13.
Advance
Facility Notice: As defined in Section 10.13(b).
Advance
Financing Person: As defined in Section 10.13(a).
-2-
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Advance
Reimbursement Amount: As defined in Section 10.13(b).
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.
Aggregate
Certificate Principal Balance: For any date of determination,
the sum of the Class A-1 Certificate Principal Balance, the Class
A-2A
Certificate Principal Balance, the Class A-2B Certificate Principal
Balance, the
Class R Certificate Principal Balance, the Class M-1 Certificate
Principal
Balance, the Class M-2 Certificate Principal Balance, the Class M-3
Certificate
Principal Balance, the Class M-4 Certificate Principal Balance, the
Class M-5
Certificate Principal Balance, the Class M-6 Certificate Principal
Balance, the
Class B-1 Certificate Principal Balance, the Class B-2 Certificate
Principal
Balance, and the Class B-3 Certificate Principal Balance, in each
case as of
such date of determination.
Agreement:
This Pooling and Servicing Agreement and any and all amendments
or supplements hereto made in accordance with the terms herein.
Applied
Realized Loss Amount: With respect to any Distribution Date,
the
amount, if any, by which, the sum of (i) the Aggregate Certificate
Principal
Balance and (ii) the Class C Certificate Principal Balance after
distributions
of principal on such Distribution Date exceeds the aggregate Stated
Principal
Balance of the Mortgage Loans as of such Distribution Date.
Appraised
Value: With respect to a Mortgage Loan the proceeds of which
were used to purchase the related Mortgaged Property (or the
related residential
dwelling unit in the Underlying Mortgaged Property in the case of a
Co-op Loan),
the "Appraised Value" of a Mortgaged Property (or the related
residential
dwelling unit in the Underlying Mortgaged Property in the case of a
Co-op Loan)
is the lesser of (1) the appraised value based on an appraisal made
for the
Seller by an independent fee appraiser at the time of the
origination of the
related Mortgage Loan, and (2) the sales price of such Mortgaged
Property (or
the related residential dwelling unit in the Underlying Mortgaged
Property in
the case of a Co-op Loan) at such time of origination. With respect
to a
Mortgage Loan the proceeds of which were used to refinance an
existing mortgage
loan, the "Appraised Value" is the appraised value of the Mortgaged
Property (or
the related residential dwelling unit in the Underlying Mortgaged
Property in
the case of a Co-op Loan) based upon the appraisal obtained at the
time of
refinancing.
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) (except for the name of the assignee if such Mortgage Loan is
endorsed in
blank), 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.
Available
Funds Cap: Any of the Class A-1 Available Funds Cap, the Class
A-2 Available Funds Cap or the Weighted Average Available Funds
Cap.
Balloon
Loan: A Mortgage Loan having an original term to stated
maturity
of approximately 10 years which provides for level monthly payments
of principal
and interest based on a 30-year
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amortization schedule, with a balloon payment of the remaining
outstanding
principal balance due on such Mortgage Loan at its stated
maturity.
Book-Entry
Certificates: Any of the Certificates that shall be registered
in the name of the Depository or its nominee, the ownership of
which is
reflected on the books of the Depository or on the books of a
Person maintaining
an account with the Depository (directly, as a "Depository
Participant," or
indirectly, as an indirect participant in accordance with the rules
of the
Depository and as described in Section 5.06). As of the Closing
Date, each of
the Class A (other than the Class R Certificate), Class M and Class
B
Certificates constitutes a Class of Book-Entry Certificates.
Bring Down
Letter: Those certain letter agreements, dated as of December
28, 2005 between Ownit and the Seller, with respect to the Mortgage
Loans.
Business
Day: Any day other than (1) a Saturday or a Sunday, or (2) a
day
on which banking institutions in the State of California, State of
Maryland,
State of Minnesota, State of Texas and in the City of New York, New
York are
authorized or obligated by law or executive order to be closed.
Cap
Contract: Any of the Class A-1 Cap Contract, the Class A-2 Cap
Contract, or the Subordinate Certificate Cap Contract.
Cap
Contract Account: The separate Eligible Account created and
maintained
by the Securities Administrator pursuant to Section 4.04(k)(i) in
the name of
the Trustee for the benefit of the Trust Fund and designated "Wells
Fargo Bank,
N.A., as securities administrator for HSBC Bank USA, National
Association, as
trustee, in trust for registered holders of Ownit Mortgage Loan
Trust, Mortgage
Loan Asset-Backed Certificates, Series 2005-5." Funds in the Cap
Contract
Account shall be held in trust for the Trust Fund for the uses and
purposes set
forth in this Agreement.
Cap
Contract Counterparty: The Royal Bank of Scotland, plc.
Cap
Contract Notional Balance: Any of the Class A-1 Cap Contract
Notional
Balance, the Class A-2 Cap Contract Notional Balance or the
Subordinate
Certificate Cap Contract Notional Balance.
Cap
Contract Termination Date: Any of the Class A-1 Cap Contract
Termination Date, the Class A-2 Cap Contract Termination Date or
the Subordinate
Certificate Cap Contract Termination Date.
Certificate: Any one of the certificates of any Class executed by
the
Securities Administrator and authenticated by the Securities
Administrator in
substantially the forms attached hereto as Exhibit A.
Certificate Account: The separate Eligible Account created and
maintained
by the Securities Administrator pursuant to Section 3.05(e) in the
name of the
Trustee for the benefit of the Certificateholders and designated
"Wells Fargo
Bank, N.A., as securities administrator for HSBC Bank USA, National
Association,
as trustee, in trust for registered holders of Ownit Mortgage Loan
Trust,
Mortgage Loan Asset-Backed Certificates, Series 2005-5." Funds in
the
Certificate Account shall be held in trust for the
Certificateholders for the
uses and purposes set forth in this Agreement.
Certificate Group: Either of Certificate Group One or Certificate
Group
Two.
Certificate Group One: The Class A-1 and Class R Certificates.
For
purposes of Section 2.07 hereof, Certificate Group One shall be
related to Group
One.
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<PAGE>
Certificate Group Two: The Class A-2A, and Class A-2B Certificates.
For
purposes of Section 2.07 hereof, Certificate Group Two shall be
related to Group
Two.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person
that is the beneficial owner of such Book-Entry Certificate.
Certificate Principal Balance: As to any Certificate and as of
any
Distribution Date, the Initial Certificate Principal Balance of
such Certificate
less the sum of (1) all amounts distributed with respect to such
Certificate in
reduction of the Certificate Principal Balance thereof on previous
Distribution
Dates pursuant to Section 4.04, and (2) any Applied Realized Loss
Amounts
allocated to such Certificate on previous Distribution Dates
pursuant to Section
4.04(i). On each Distribution Date, after all distributions of
principal on such
Distribution Date, a portion of the Class C Interest Carry Forward
Amount in an
amount equal to the excess of the Overcollateralization Amount on
such
Distribution Date over the Overcollateralization Amount as of the
preceding
Distribution Date (or, in the case of the first Distribution Date,
the initial
Overcollateralization Amount) will be added to the aggregate
Certificate
Principal Balance of the Class C Certificates (on a pro rata
basis).
Notwithstanding the foregoing on any Distribution Date relating to
a Due Period
in which a Subsequent Recovery has been received by the Servicer,
the
Certificate Principal Balance of any Class of Certificates then
outstanding for
which any Applied Realized Loss Amount has been allocated will be
increased, in
order of seniority, by an amount equal to the lesser of (i) the
Unpaid Realized
Loss Amount for such Class of Certificates and (ii) the total of
any Subsequent
Recovery distributed on such date to the Certificateholders
(reduced by the
amount of the increase in the Certificate Principal Balance of any
more senior
Class of Certificates pursuant to this sentence on such
Distribution Date).
Certificate Register: The register maintained pursuant to Section
5.02
hereof.
Certificateholder or Holder: The Person in whose name a Certificate
is
registered in the Certificate Register (initially, Cede & Co.,
as nominee for
the Depository) in the case of any Class of Regular Certificates or
the Class R
Certificate, except that solely for the purpose of giving any
consent pursuant
to this Agreement, any Certificate registered in the name of the
Depositor or
any Affiliate of the Depositor shall be deemed not to be
Outstanding and the
Percentage Interest evidenced thereby shall not be taken into
account in
determining whether the requisite amount of Percentage Interests
necessary to
effect such consent has been obtained; provided, however, that if
any such
Person (including the Depositor) owns 100% of the Percentage
Interests evidenced
by a Class of Certificates, such Certificates shall be deemed to be
Outstanding
for purposes of any provision hereof that requires the consent of
the Holders of
Certificates of a particular Class as a condition to the taking of
any action
hereunder. The Securities Administrator and the Trustee are
entitled to rely
conclusively on a certification of the Depositor or any Affiliate
of the
Depositor in determining which Certificates are registered in the
name of an
Affiliate of the Depositor.
Class: All
Certificates bearing the same Class designation as set forth in
Section 5.01 hereof.
Class A
Certificate Principal Balance: As of any date of determination,
the sum of the Class A-1 Certificate Principal Balance, the Class
A-2A
Certificate Principal Balance, the Class A-2B Certificate Principal
Balance and
the Class R Certificate Principal Balance.
Class A
Certificates: Any of the Class A-1 Certificates, the Class A-2
Certificates and the Class R Certificates.
Class A
Principal Distribution Amount: With respect to any Distribution
Date (1) prior to the related Stepdown Date or any Distribution
Date on which a
Stepdown Trigger Event exists, 100% of the
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<PAGE>
Principal Distribution Amount for such Distribution Date and (2) on
or after the
Stepdown Date where a Stepdown Trigger Event does not exist, the
excess of (A)
the Class A Certificate Principal Balance immediately prior to such
Distribution
Date over (B) the lesser of (i) 53.70% of the aggregate Stated
Principal Balance
of the Mortgage Loans as of such Distribution Date and (ii) the
excess of the
aggregate Stated Principal Balance of the Mortgage Loans as of such
Distribution
Date over the Minimum Required Overcollateralization Amount;
provided, however,
that in no event will the Class A Principal Distribution Amount
with respect to
any Distribution Date exceed the aggregate Certificate Principal
Balance of the
Class A Certificates.
Class A-1
Available Funds Cap: With respect to a Distribution Date, the
per annum rate equal to the product of (i) 12, (ii) the quotient of
(x) the
total scheduled interest on the Mortgage Loans in Group One based
on the Net
Mortgage Rates in effect on the related Due Date divided by (y) the
aggregate
Stated Principal Balance of the Mortgage Loans in Group One as of
the first day
of the related Accrual Period (or, in the case of the first
Distribution Date,
as of the Cut-off Date) and (iii) a fraction, the numerator of
which is 30, and
the denominator of which is the actual number of days in the
related Accrual
Period.
Class A-1
Cap Contract: The confirmation and agreement between the Trust
Fund or Securities Administrator and the Cap Contract Counterparty
(in the form
of Exhibit N-1 hereto).
Class A-1
Cap Contract Notional Balance: With respect to any Distribution
Date, the Class A-1 Cap Contract Notional Balance set forth for
such
Distribution Date in the Class A-1 One-Month LIBOR Cap Table
attached hereto as
Exhibit O-1.
Class A-1
Cap Contract Termination Date: The Distribution Date in
February
2009.
Class A-1
Certificates: Any Certificate designated as a "Class A-1
Certificate" on the face thereof, in the form of Exhibit A hereto,
representing
the right to distributions as set forth herein.
Class A-1
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance of the Class A-1
Certificates.
Class A-1
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period at the Class A-1
Pass-Through Rate on
the Class A-1 Certificate Principal Balance as of such Distribution
Date plus
the portion of any previous distributions on such Class in respect
of Current
Interest or a Class A-1 Interest Carry Forward Amount that is
recovered as a
voidable preference by a trustee in bankruptcy, less any
Non-Supported Interest
Shortfall allocated on such Distribution Date to the Class A-1
Certificates.
Class A-1
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class A-1 Current Interest with
respect to
prior Distribution Dates over (B) the amount actually distributed
to the Class
A-1 Certificates with respect to interest on such prior
Distribution Dates and
(2) interest on such excess (to the extent permitted by applicable
law) at the
Class A-1 Pass-Through Rate for the related Accrual Period.
Class A-1
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date, 0.240% per annum and, as of any
Distribution
Date after the Initial Optional Termination Date, 0.480% per
annum.
Class A-1
Maximum Rate Cap: With respect to a Distribution Date, the per
annum rate, adjusted to reflect the length of the related Accrual
Period, equal
to the weighted average of the maximum lifetime
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<PAGE>
Net Mortgage Rates on the Adjustable Rate Mortgage Loans in Group
One and the
Net Mortgage Rates on the Fixed Rate Mortgage Loans in Group One.
The Class A-1
Maximum Rate Cap shall relate to the Class A-1 and Class R
Certificates.
Class A-1
Pass-Through Rate: For the first Distribution Date, 4.62% per
annum. As of any Distribution Date thereafter, the lesser of (1)
One-Month LIBOR
plus the Class A-1 Margin (2) the Class A-1 Available Funds Cap for
such
Distribution Date.
Class A-1
Upper Collar: With respect to each Distribution Date with
respect to which payments are received on the Class A-1 Cap
Contract, a rate
equal to the lesser of One-Month LIBOR and 9.760% per annum.
Class A-2 Available
Funds Cap: With respect to a Distribution Date, the
per annum rate equal to the product of (i) 12, (ii) the quotient of
(x) the
total scheduled interest on the Mortgage Loans in Group Two based
on the Net
Mortgage Rates in effect on the related Due Date divided by (y) the
aggregate
Stated Principal Balance of the Mortgage Loans in Group Two as of
the first day
of the related Accrual Period (or, in the case of the first
Distribution Date,
as of the Cut-off Date) and (iii) a fraction, the numerator of
which is 30, and
the denominator of which is the actual number of days in the
related Accrual
Period.
Class A-2
Cap Contract: The confirmation and agreement between the Trust
Fund or Securities Administrator and the Cap Contract Counterparty
(in the form
of Exhibit N-2 hereto).
Class A-2
Cap Contract Notional Balance: With respect to any Distribution
Date, the Class A-2 Cap Contract Notional Balance set forth for
such
Distribution Date in the Class A-2 One-Month LIBOR Cap Table
attached hereto as
Exhibit O-2.
Class A-2
Cap Contract Termination Date: The Distribution Date in
February
2009.
Class A-2
Certificates: Any of the Class A-2A and Class A-2B
Certificates.
Class A-2
Maximum Rate Cap: With respect to a Distribution Date, the per
annum rate, adjusted to reflect the length of the related Accrual
Period, equal
to the weighted average of the maximum lifetime Net Mortgage Rates
on the
Adjustable Rate Mortgage Loans in Group Two and the Net Mortgage
Rates on the
Fixed Rate Mortgage Loans in Group Two. The Class A-2 Maximum Rate
Cap shall
relate to the Class A-2 Certificates.
Class A-2
Upper Collar: With respect to each Distribution Date with
respect to which payments are received on the Class A-2 Cap
Contract, a rate
equal to the lesser of One-Month LIBOR and 9.760% per annum.
Class A-2A
Certificate: Any Certificate designated as a "Class A-2A
Certificate" on the face thereof, in the form of Exhibit A hereto,
representing
the right to distributions as set forth herein.
Class A-2A
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance of the Class A-2A
Certificates.
Class A-2A
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period at the Class A-2A
Pass-Through Rate on
the Class A-2A Certificate Principal Balance as of such
Distribution Date plus
the portion of any previous distributions on such Class in respect
of Current
Interest or a Class A-2A Interest Carry Forward Amount that is
recovered as a
voidable
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<PAGE>
preference by a trustee in bankruptcy, less any Non-Supported
Interest Shortfall
allocated on such Distribution Date to the Class A-2A Certificates.
For purposes
of calculating interest, principal distributions on a Distribution
Date will be
deemed to have been made on the first day of the Accrual Period in
which such
Distribution Date occurs.
Class A-2A
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class A-2A Current Interest with
respect to
prior Distribution Dates over (B) the amount actually distributed
to the Class
A-2A Certificates with respect to interest on such prior
Distribution Dates and
(2) interest on such excess (to the extent permitted by applicable
law) at the
Class A-2A Pass-Through Rate for the related Accrual Period.
Class A-2A
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date, 0.100% per annum and, as of any
Distribution
Date after the Initial Optional Termination Date, 0.200% per
annum.
Class A-2A
Pass-Through Rate: For the first Distribution Date, 4.48% per
annum. As of any Distribution Date thereafter, the lesser of (1)
One-Month LIBOR
plus the Class A-2A Margin and (2) the Class A-2 Available Funds
Cap for such
Distribution Date.
Class A-2B
Certificate: Any Certificate designated as a "Class A-2B
Certificate" on the face thereof, in the form of Exhibit A hereto,
representing
the right to distributions as set forth herein.
Class A-2B
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance of the Class A-2B
Certificates.
Class A-2B
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period at the Class A-2B
Pass-Through Rate on
the Class A-2B Certificate Principal Balance as of such
Distribution Date plus
the portion of any previous distributions on such Class in respect
of Current
Interest or a Class A-2B Interest Carry Forward Amount that is
recovered as a
voidable preference by a trustee in bankruptcy, less any
Non-Supported Interest
Shortfall allocated on such Distribution Date to the Class A-2B
Certificates.
For purposes of calculating interest, principal distributions on a
Distribution
Date will be deemed to have been made on the first day of the
Accrual Period in
which such Distribution Date occurs.
Class A-2B
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class A-2B Current Interest with
respect to
prior Distribution Dates over (B) the amount actually distributed
to the Class
A-2B Certificates with respect to interest on such prior
Distribution Dates and
(2) interest on such excess (to the extent permitted by applicable
law) at the
Class A-2B Pass-Through Rate for the related Accrual Period.
Class A-2B
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date, 0.290% per annum and, as of any
Distribution
Date after the Initial Optional Termination Date, 0.580% per
annum.
Class A-2B
Pass-Through Rate: For the first Distribution Date, 4.67% per
annum. As of any Distribution Date thereafter, the lesser of (1)
One-Month LIBOR
plus the Class A-2B Margin and (2) the Class A-2 Available Funds
Cap for such
Distribution Date.
Class B
Certificates: Any of the Class B-1, Class B-2 and Class B-3
Certificates.
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<PAGE>
Class B-1
Applied Realized Loss Amount: As of any Distribution Date, the
sum of all Applied Realized Loss Amounts with respect to the
Mortgage Loans
which have been applied to the reduction of the Certificate
Principal Balance of
the Class B-1 Certificates.
Class B-1
Certificate: Any Certificate designated as "Class B-1
Certificate "on the face thereof in the form of Exhibit A hereto,
representing
the right to distributions as set forth herein.
Class B-1
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance of the Class B-1
Certificates.
Class B-1
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period at the Class B-1
Pass-Through Rate on
the Class B-1 Certificate Principal Balance as of such Distribution
Date plus
the portion of any previous distributions on such Class in respect
of Current
Interest or Class B-1 Interest Carry Forward Amount that is
recovered as a
voidable preference by a trustee in bankruptcy, less any
Non-Supported Interest
Shortfall allocated on such Distribution Date to the Class B-1
Certificates.
Class B-1
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class B-1 Current Interest with
respect to
prior Distribution Dates over (B) the amount actually distributed
to the Class
B-1 Certificates with respect to interest on such prior
Distribution Dates and
(2) interest on such excess (to the extent permitted by applicable
law) at the
Class B-1 Pass-Through Rate for the related Accrual Period.
Class B-1
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date, 1.650% per annum and, as of any
Distribution
Date after the Initial Optional Termination Date, 2.475% per
annum.
Class B-1
Pass-Through Rate: For the first Distribution Date, 6.03% per
annum. As of any Distribution Date thereafter, the lesser of (1)
One-Month LIBOR
plus the Class B-1 Margin and (2) the Weighted Average Available
Funds Cap for
such Distribution Date.
Class B-1
Principal Distribution Amount: With respect to any Distribution
Date on or after the Stepdown Date, 100% of the Principal
Distribution Amount
for such Distribution Date if the Class A Certificate Principal
Balance and the
Class M Certificate Principal Balance, have been reduced to zero
and a Stepdown
Trigger Event exists, or as long as a Stepdown Trigger Event does
not exist, the
excess of (1) the sum of (A) the Class A Certificate Principal
Balance (after
taking into account distributions of the Class A Principal
Distribution Amount
on such Distribution Date), (B) the Class M-1 Certificate Principal
Balance
(after taking into account distributions of the Class M-1 Principal
Distribution
Amount on such Distribution Date), (C) the Class M-2 Certificate
Principal
Balance (after taking into account distributions of the Class M-2
Principal
Distribution Amount on such Distribution Date), (D) the Class M-3
Certificate
Principal Balance (after taking into account distributions of the
Class M-3
Principal Distribution Amount on such Distribution Date), (E) the
Class M-4
Certificate Principal Balance (after taking into account
distributions of the
Class M-4 Principal Distribution Amount on such Distribution Date,
(F) the Class
M-5 Certificate Principal Balance (after taking into account
distributions of
the Class M-5 Principal Distribution Amount on such Distribution
Date, (G) the
Class M-6 Certificate Principal Balance (after taking into account
distributions
of the Class M-6 Principal Distribution Amount on such Distribution
Date and (H)
the Class B-1 Certificate Principal Balance immediately prior to
such
Distribution Date over (2) the lesser of (A) 97.00% of the Stated
Principal
Balance of the Mortgage Loans as of such Distribution Date and (B)
the excess of
the Stated Principal Balance of the Mortgage Loans as of such
Distribution Date
over the Minimum Required Overcollateralization Amount.
Notwithstanding the
foregoing, (I) on any Distribution Date prior to the Stepdown Date
on which the
Certificate Principal
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<PAGE>
Balance of each Class of Class A Certificates and Class M
Certificates has been
reduced to zero, the Class B-1 Principal Distribution Amount will
equal the
lesser of (x) the outstanding Certificate Principal Balance of the
Class B-1
Certificates and (y) 100% of the Principal Distribution Amount
remaining after
any distributions on such Class A and Class M Certificates and (II)
in no event
will the Class B-1 Principal Distribution Amount with respect to
any
Distribution Date exceed the Class B-1 Certificate Principal
Balance.
Class B-1
Unpaid Realized Loss Amount: As of any Distribution Date, the
excess of (1) the Class B-1 Applied Realized Loss Amount over (2)
the sum of (x)
all distributions in reduction of the Class B-1 Unpaid Realized
Loss Amounts on
all previous Distribution Dates and (y) all increases in the
Certificate
Principal Balance of the Class B-1 Certificates pursuant to the
last sentence of
the definition of "Certificate Principal Balance."
Class B-2
Applied Realized Loss Amount: As of any Distribution Date, the
sum of all Applied Realized Loss Amounts with respect to the
Mortgage Loans
which have been applied to the reduction of the Certificate
Principal Balance of
the Class B-2 Certificates.
Class B-2
Certificate: Any Certificate designated as a "Class B-2
Certificate" on the face thereof in the form of Exhibit A hereto,
representing
the right to distributions as set forth herein.
Class B-2
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance of the Class B-2
Certificates.
Class B-2
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period at the Class B-2
Pass-Through Rate on
the Class B-2 Certificate Principal Balance as of such Distribution
Date plus
the portion of any previous distributions on such Class in respect
of Current
Interest or Class B-2 Interest Carry Forward Amount that is
recovered as a
voidable preference by a trustee in bankruptcy, less any
Non-Supported Interest
Shortfall allocated on such Distribution Date to the Class B-2
Certificates.
Class B-2
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class B-2 Current Interest with
respect to
prior Distribution Dates over (B) the amount actually distributed
to the Class
B-2 Certificates with respect to interest on such prior
Distribution Dates and
(2) interest on such excess (to the extent permitted by applicable
law) at the
Class B-2 Pass-Through Rate for the related Accrual Period.
Class B-2
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date, 1.650% per annum and, as of any
Distribution
Date after the Initial Optional Termination Date, 2.475% per
annum.
Class B-2
Pass-Through Rate: For the first Distribution Date, 6.03% per
annum. As of any Distribution Date thereafter, the lesser of (1)
One-Month LIBOR
plus the Class B-2 Margin and (2) the Weighted Average Available
Funds Cap for
such Distribution Date.
Class B-2
Principal Distribution Amount: With respect to any Distribution
Date on or after the Stepdown Date, 100% of the Principal
Distribution Amount
for such Distribution Date if the Class A Certificate Principal
Balance, the
Class M Certificate Principal Balance and the Class B-1 Certificate
Principal
Balance have been reduced to zero and a Stepdown Trigger Event
exists, or as
long as a Stepdown Trigger Event does not exist, the excess of (1)
the sum of
(A) the Class A Certificate Principal Balance (after taking into
account
distributions of the Class A Principal Distribution Amount on such
Distribution
Date), (B) the Class M-1 Certificate Principal Balance (after
taking into
account distributions
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<PAGE>
of the Class M-1 Principal Distribution Amount on such Distribution
Date), (C)
the Class M-2 Certificate Principal Balance (after taking into
account
distributions of the Class M-2 Principal Distribution Amount on
such
Distribution Date), (D) the Class M-3 Certificate Principal Balance
(after
taking into account distributions of the Class M-3 Principal
Distribution Amount
on such Distribution Date), (E) the Class M-4 Certificate Principal
Balance
(after taking into account distributions of the Class M-4 Principal
Distribution
Amount on such Distribution Date), (F) the Class M-5 Certificate
Principal
Balance (after taking into account distributions of the Class M-5
Principal
Distribution Amount on such Distribution Date), (G) the Class M-6
Certificate
Principal Balance (after taking into account distributions of the
Class M-6
Principal Distribution Amount on such Distribution Date), (H) the
Class B-1
Certificate Principal Balance (after taking into account
distributions of the
Class B-1 Principal Distribution Amount on such Distribution Date)
and (I) the
Class B-2 Certificate Principal Balance immediately prior to such
Distribution
Date over (2) the lesser of (A) 98.00% of the Stated Principal
Balance of the
Mortgage Loans as of such Distribution Date and (B) the excess of
the Stated
Principal Balance of the Mortgage Loans as of such Distribution
Date over the
Minimum Required Overcollateralization Amount. Notwithstanding the
foregoing,
(I) on any Distribution Date prior to the Stepdown Date on which
the Certificate
Principal Balance of each Class of Class A, Class M and Class B-1
Certificates
has been reduced to zero, the Class B-2 Principal Distribution
Amount will equal
the lesser of (x) the outstanding Certificate Principal Balance of
the Class B-2
Certificates and (y) 100% of the Principal Distribution Amount
remaining after
any distributions on such Class A, Class M and Class B-1
Certificates and (II)
in no event will the Class B-2 Principal Distribution Amount with
respect to any
Distribution Date exceed the Class B-2 Certificate Principal
Balance.
Class B-2
Unpaid Realized Loss Amount: As of any Distribution Date, the
excess of (1) the Class B-2 Applied Realized Loss Amount over (2)
the sum of (x)
all distributions in reduction of the Class B-2 Unpaid Realized
Loss Amounts on
all previous Distribution Dates and (y) all increases in the
Certificate
Principal Balance of the Class B-2 Certificates pursuant to the
last sentence of
the definition of "Certificate Principal Balance."
Class B-3
Applied Realized Loss Amount: As of any Distribution Date, the
sum of all Applied Realized Loss Amounts with respect to the
Mortgage Loans
which have been applied to the reduction of the Certificate
Principal Balance of
the Class B-3 Certificates.
Class B-3
Certificate: Any Certificate designated as a "Class B-3
Certificate" on the face thereof in the form of Exhibit A hereto,
representing
the right to distributions as set forth herein.
Class B-3
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance of the Class B-3
Certificates.
Class B-3
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period at the Class B-3
Pass-Through Rate on
the Class B-3 Certificate Principal Balance as of such Distribution
Date plus
the portion of any previous distributions on such Class in respect
of Current
Interest or Class B-3 Interest Carry Forward Amount that is
recovered as a
voidable preference by a trustee in bankruptcy, less any
Non-Supported Interest
Shortfall allocated on such Distribution Date to the Class B-3
Certificates.
Class B-3
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class B-3 Current Interest with
respect to
prior Distribution Dates over (B) the amount actually distributed
to the Class
B-3 Certificates with respect to interest on such prior
Distribution Dates and
(2) interest on such excess (to the extent permitted by applicable
law) at the
Class B-3 Pass-Through Rate for the related Accrual Period.
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<PAGE>
Class B-3
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date, 1.650% per annum and, as of any
Distribution
Date after the Initial Optional Termination Date, 2.475% per
annum.
Class B-3
Pass-Through Rate: For the first Distribution Date, 6.03% per
annum. As of any Distribution Date thereafter, the lesser of (1)
One-Month LIBOR
plus the Class B-3 Margin and (2) the Weighted Average Available
Funds Cap for
such Distribution Date.
Class B-3
Principal Distribution Amount: With respect to any Distribution
Date on or after the Stepdown Date, 100% of the Principal
Distribution Amount
for such Distribution Date if the Class A Certificate Principal
Balance, the
Class M Certificate Principal Balance, the Class B-1 Certificate
Principal
Balance and the Class B-2 Certificate Principal Balance have been
reduced to
zero and a Stepdown Trigger Event exists, or as long as a Stepdown
Trigger Event
does not exist, the excess of (1) the sum of (A) the Class A
Certificate
Principal Balance (after taking into account distributions of the
Class A
Principal Distribution Amount on such Distribution Date), (B) the
Class M-1
Certificate Principal Balance (after taking into account
distributions of the
Class M-1 Principal Distribution Amount on such Distribution Date),
(C) the
Class M-2 Certificate Principal Balance (after taking into account
distributions
of the Class M-2 Principal Distribution Amount on such Distribution
Date), (D)
the Class M-3 Certificate Principal Balance (after taking into
account
distributions of the Class M-3 Principal Distribution Amount on
such
Distribution Date), (E) the Class M-4 Certificate Principal Balance
(after
taking into account distributions of the Class M-4 Principal
Distribution Amount
on such Distribution Date), (F) the Class M-5 Certificate Principal
Balance
(after taking into account distributions of the Class M-5 Principal
Distribution
Amount on such Distribution Date), (G) the Class M-6 Certificate
Principal
Balance (after taking into account distributions of the Class M-6
Principal
Distribution Amount on such Distribution Date), (H) the Class B-1
Certificate
Principal Balance (after taking into account distributions of the
Class B-1
Principal Distribution Amount on such Distribution Date), (I) the
Class B-2
Certificate Principal Balance (after taking into account
distributions of the
Class B-2 Principal Distribution Amount on such Distribution Date)
and (J) the
Class B-3 Certificate Principal Balance immediately prior to such
Distribution
Date over (2) the lesser of (A) 99.00% of the Stated Principal
Balance of the
Mortgage Loans as of such Distribution Date and (B) the excess of
the Stated
Principal Balance of the Mortgage Loans as of such Distribution
Date over the
Minimum Required Overcollateralization Amount. Notwithstanding the
foregoing,
(I) on any Distribution Date prior to the Stepdown Date on which
the Certificate
Principal Balance of each Class of Class A, Class M, Class B-1 and
Class B-2
Certificates has been reduced to zero, the Class B-3 Principal
Distribution
Amount will equal the lesser of (x) the outstanding Certificate
Principal
Balance of the Class B-3 Certificates and (y) 100% of the Principal
Distribution
Amount remaining after any distributions on such Class A, Class M,
Class B-1 and
Class B-2 Certificates and (II) in no event will the Class B-3
Principal
Distribution Amount with respect to any Distribution Date exceed
the Class B-3
Certificate Principal Balance.
Class B-3
Unpaid Realized Loss Amount: As of any Distribution Date, the
excess of (1) the Class B-3 Applied Realized Loss Amount over (2)
the sum of (x)
all distributions in reduction of the Class B-3 Unpaid Realized
Loss Amounts on
all previous Distribution Dates and (y) all increases in the
Certificate
Principal Balance of the Class B-3 Certificates pursuant to the
last sentence of
the definition of "Certificate Principal Balance".
Class C
Applied Realized Loss Amount: As of any Distribution Date, the
sum
of all Applied Realized Loss Amounts with respect to the Mortgage
Loans which
have been applied to the reduction of the Certificate Principal
Balance of the
Class C Certificates.
Class C
Certificate: Any Certificate designated as a "Class C
Certificate"
on the face thereof, in the form of Exhibit A hereto, representing
the right to
distributions as set forth herein.
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<PAGE>
Class C
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance of the Class C
Certificates.
Class C
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period at the Class C
Distributable Interest
Rate on a notional amount equal to 99.95% of the aggregate
principal balance of
the Lower Tier REMIC Regular Interests immediately prior to such
Distribution
Date (such amount of interest representing 100 percent of the
interest payments
on the Class UTC Interest), plus the interest portion of any
previous
distributions on such Class that is recovered as a voidable
preference by a
trustee in bankruptcy, less any Non-Supported Interest Shortfall
allocated on
such Distribution Date to the Class C Certificates.
Class C
Distributable Interest Rate: The excess, if any, of (a) the
weighted average of the interest rates on the Lower Tier REMIC
Regular Interests
over (b) two times the weighted average of the interest rates on
the Lower Tier
REMIC I Marker Interests and the Class LTIX Interest (treating for
purposes of
this clause (b) the interest rate on each of the Lower Tier REMIC I
Marker
Interests as being subject to a cap and a floor equal to the
interest rate of
the Corresponding Certificates and treating the Class LTIX Interest
as being
capped at zero). The averages described in the preceding sentence
shall be
weighted on the basis of the respective principal balances of the
Lower Tier
REMIC Regular Interests immediately prior to any date of
determination.
Class C
Interest Carry Forward Amount: As of any Distribution Date, the
excess of (A) the Class C Current Interest with respect to prior
Distribution
Dates over (B) the amount actually distributed to the Class C
Certificates with
respect to interest on such prior Distribution Dates or added to
the aggregate
Certificate Principal Balance of the Class C Certificates.
Class C
Unpaid Realized Loss Amount: As of any Distribution Date, the
excess of (1) the Class C Applied Realized Loss Amount over (2) the
sum of (x)
all distributions in reduction of the Class C Unpaid Realized Loss
Amounts on
all previous Distribution Dates and (y) all increases in the
Certificate
Principal Balance of such Class C Certificates pursuant to the last
sentence of
the definition of "Certificate Principal Balance."
Class
LTA-1 Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance equal to 1/4 of the initial
principal
balance of its Corresponding Certificates and an interest rate
equal to the Net
Rate.
Class
LTA-2A Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal balance equal to 1/4 of the
initial
principal balance of its Corresponding Certificate and an interest
rate equal to
the Net Rate.
Class
LTA-2B Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal balance equal to 1/4 of the
initial
principal balance of its Corresponding Certificate and an interest
rate equal to
the Net Rate.
Class
LTB-1 Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance equal to 1/4 of the initial
principal
balance of its Corresponding Certificate and an interest rate equal
to the Net
Rate.
Class
LTB-2 Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance equal to 1/4 of the initial
principal
balance of its Corresponding Certificate and an interest rate equal
to the Net
Rate.
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<PAGE>
Class
LTB-3 Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance equal to 1/4 of the initial
principal
balance of its Corresponding Certificate and an interest rate equal
to the Net
Rate.
Class LTIX
Interest: An uncertificated regular interest in the Lower Tier
REMIC with an initial principal balance equal to the excess of (i)
50% of the
aggregate Cut-off Date Principal Balance of the Mortgage Loans over
(ii) the
initial principal balance of the Lower Tier REMIC I Marker
Interests, and with
an interest rate equal to the Net Rate.
Class
LTIIX Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance equal to the excess of (i)
50% of the
aggregate Cut-off Date Principal Balance of the Mortgage Loans over
(ii) the
initial principal balance of the Lower Tier REMIC II Marker
Interests, and with
an interest rate equal to the Net Rate.
Class
LTII1A Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal balance equal to 0.05% of the
excess of (i)
the aggregate Cut-off Date Principal Balance of the Group One
Mortgage Loans
over (ii) the aggregate of the initial Certificate Principal
Balances of
Certificate Group One, and with an interest rate equal to the Net
Rate.
Class
LTII1B Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal balance equal to 0.05% the
aggregate
Cut-off Date Principal Balance of the Group One Mortgage Loans, and
with an
interest rate equal to the Class A-1 Available Funds Cap.
Class
LTII2A Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal balance equal to 0.05% of the
excess of (i)
the aggregate Cut-off Date Principal Balance of the Group Two
Mortgage Loans
over (ii) the aggregate of the initial Certificate Principal
Balances of
Certificate Group Two, and with an interest rate equal to the Net
Rate.
Class
LTII2B Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal balance equal to 0.05% of the
aggregate
Cut-off Date Principal Balance of the Group Two Mortgage Loans and
with an
interest rate equal to the Class A-2 Available Funds Cap.
Class
LTM-1 Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance equal to 1/4 of the initial
principal
balance of its Corresponding Certificate and an interest rate equal
to the Net
Rate.
Class
LTM-2 Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance equal to 1/4 of the initial
principal
balance of its Corresponding Certificate and an interest rate equal
to the Net
Rate.
Class
LTM-3 Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance equal to 1/4 of the initial
principal
balance of its Corresponding Certificate and an interest rate equal
to the Net
Rate.
Class
LTM-4 Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance equal to 1/4 of the initial
principal
balance of its Corresponding Certificate and an interest rate equal
to the Net
Rate.
Class
LTM-5 Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance equal to 1/4 of the initial
principal
balance of its Corresponding Certificate and an interest rate equal
to the Net
Rate.
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<PAGE>
Class
LTM-6 Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance equal to 1/4 of the initial
principal
balance of its Corresponding Certificate and an interest rate equal
to the Net
Rate.
Class LTR
Interest: The sole class of "residual interest" in the Lower
Tier REMIC.
Class M
Certificates: Any of the Class M-1, Class M-2, Class M-3, Class
M-4, Class M-5 and Class M-6 Certificates.
Class M
Certificate Principal Balance: For any date of determination,
the
sum of the Class M-1 Certificate Principal Balance, Class M-2
Certificate
Principal Balance, Class M-3 Certificate Principal Balance, Class
M-4
Certificate Principal Balance, Class M-5 Certificate Principal
Balance and Class
M-6 Certificate Principal Balance.
Class M-1
Applied Realized Loss Amount: As of any Distribution Date, the
sum of all Applied Realized Loss Amounts with respect to the
Mortgage Loans
which have been applied to the reduction of the Certificate
Principal Balance of
the Class M-1 Certificates.
Class M-1
Certificate: Any Certificate designated as a "Class M-1
Certificate" on the face thereof, in the form of Exhibit A hereto,
representing
the right to distributions as set forth herein.
Class M-1
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance of the Class M-1
Certificates.
Class M-1
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period at the Class M-1
Pass-Through Rate on
the Class M-1 Certificate Principal Balance as of such Distribution
Date plus
the portion of any previous distributions on such Class in respect
of Current
Interest or Class M-1 Interest Carry Forward Amount that is
recovered as a
voidable preference by a trustee in bankruptcy, less any
Non-Supported Interest
Shortfall allocated on such Distribution Date to the Class M-1
Certificates.
Class M-1
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class M-1 Current Interest with
respect to
prior Distribution Dates over (B) the amount actually distributed
to the Class
M-1 Certificates with respect to interest on such prior
Distribution Dates and
(2) interest on such excess (to the extent permitted by applicable
law) at the
Class M-1 Pass-Through Rate for the related Accrual Period.
Class M-1
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date, 0.600% per annum and, as of any
Distribution
Date after the Initial Optional Termination Date, 0.900% per
annum.
Class M-1
Pass-Through Rate: For the first Distribution Date, 4.98% per
annum. As of any Distribution Date thereafter, the lesser of (1)
One-Month LIBOR
plus the Class M-1 Margin and (2) the Weighted Average Available
Funds Cap for
such Distribution Date.
Class M-1
Principal Distribution Amount: With respect to any Distribution
Date on or after the Stepdown Date, 100% of the Principal
Distribution Amount
for such Distribution Date if the Class A Certificate Principal
Balance has been
reduced to zero and a Stepdown Trigger Event exists, or as long as
a Stepdown
Trigger Event does not exist, the excess of (1) the sum of (A) the
Class A
Certificate Principal Balance (after taking into account
distributions of the
Class A Principal Distribution Amount on such Distribution Date)
and (B) the
Class M-1 Certificate Principal Balance immediately prior to
such
-15-
<PAGE>
Distribution Date over (2) the lesser of (A) 81.50% of the Stated
Principal
Balances of the Mortgage Loans as of such Distribution Date and (B)
the excess
of the Stated Principal Balances for the Mortgage Loans as of such
Distribution
Date over the Minimum Required Overcollateralization Amount.
Notwithstanding the
foregoing, (I) on any Distribution Date prior to the Stepdown Date
on which the
Certificate Principal Balance of each Class of Class A Certificates
has been
reduced to zero, the Class M-1 Principal Distribution Amount will
equal the
lesser of (x) the outstanding Certificate Principal Balance of the
Class M-1
Certificates and (y) 100% of the Principal Distribution Amount
remaining after
any distributions on such Class A Certificates and (II) in no event
will the
Class M-1 Principal Distribution Amount with respect to any
Distribution Date
exceed the Class M-1 Certificate Principal Balance.
Class M-1
Unpaid Realized Loss Amount: As of any Distribution Date, the
excess of (1) the Class M-1 Applied Realized Loss Amount over (2)
the sum of (x)
all distributions in reduction of the Class M-1 Unpaid Realized
Loss Amounts on
all previous Distribution Dates and (y) all increases in the
Certificate
Principal Balance of such Class M-1 Certificates pursuant to the
last sentence
of the definition of "Certificate Principal Balance."
Class M-2
Applied Realized Loss Amount: As of any Distribution Date, the
sum of all Applied Realized Loss Amounts with respect to the
Mortgage Loans
which have been applied to the reduction of the Certificate
Principal Balance of
the Class M-2 Certificates.
Class M-2
Certificate: Any Certificate designated as a "Class M-2
Certificate" on the face thereof, in the form of Exhibit A hereto,
representing
the right to distributions as set forth herein.
Class M-2
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance of the Class M-2
Certificates.
Class M-2
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period at the Class M-2
Pass-Through Rate on
the Class M-2 Certificate Principal Balance as of such Distribution
Date plus
the portion of any previous distributions on such Class in respect
of Current
Interest or Class M-2 Interest Carry Forward Amount that is
recovered as a
voidable preference by a trustee in bankruptcy, less any
Non-Supported Interest
Shortfall allocated on such Distribution Date to the Class M-2
Certificates.
Class M-2
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class M-2 Current Interest with
respect to
prior Distribution Dates over (B) the amount actually distributed
to the Class
M-2 Certificates with respect to interest on such prior
Distribution Dates and
(2) interest on such excess (to the extent permitted by applicable
law) at the
Class M-2 Pass-Through Rate for the related Accrual Period.
Class M-2
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date, 0.700% per annum and, as of any
Distribution
Date after the Initial Optional Termination Date, 1.050% per
annum.
Class M-2
Pass-Through Rate: For the first Distribution Date, 5.08% per
annum. As of any Distribution Date thereafter, the lesser of (1)
One-Month LIBOR
plus the Class M-2 Margin and (2) the Weighted Average Available
Funds Cap for
such Distribution Date.
Class M-2
Principal Distribution Amount: With respect to any Distribution
Date on or after the Stepdown Date, 100% of the Principal
Distribution Amount
for such Distribution Date if the Class A Certificate Principal
Balance and the
Class M-1 Certificate Principal Balance have been reduced to zero
and a Stepdown
Trigger Event exists, or as long as a Stepdown Trigger Event does
not exist, the
excess of
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<PAGE>
(1) the sum of (A) the Class A Certificate Principal Balance (after
taking into
account distributions of the Class A Principal Distribution Amount
on such
Distribution Date), (B) the Class M-1 Certificate Principal Balance
(after
taking into account distributions of the Class M-1 Principal
Distribution Amount
on such Distribution Date) and (C) the Class M-2 Certificate
Principal Balance
immediately prior to such Distribution Date over (2) the lesser of
(A) 87.70% of
the Stated Principal Balances of the Mortgage Loans as of such
Distribution Date
and (B) the excess of the Stated Principal Balances of the Mortgage
Loans as of
the end of such Distribution Date over the Minimum Required
Overcollateralization Amount. Notwithstanding the foregoing, (I) on
any
Distribution Date prior to the Stepdown Date on which the
Certificate Principal
Balance of each Class of Class A Certificates and the Class M-1
Certificates has
been reduced to zero, the Class M-2 Principal Distribution Amount
will equal the
lesser of (x) the outstanding Certificate Principal Balance of the
Class M-2
Certificates and (y) 100% of the Principal Distribution Amount
remaining after
any distributions on such Class A and Class M-1 Certificates and
(II) in no
event will the Class M-2 Principal Distribution Amount with respect
to any
Distribution Date exceed the Class M-2 Certificate Principal
Balance.
Class M-2
Unpaid Realized Loss Amount: As of any Distribution Date, the
excess of (1) the Class M-2 Applied Realized Loss Amount over (2)
the sum of (x)
all distributions in reduction of the Class M-2 Unpaid Realized
Loss Amounts on
all previous Distribution Dates and (y) all increases in the
Certificate
Principal Balance of such Class M-2 Certificates pursuant to the
last sentence
of the definition of "Certificate Principal Balance."
Class M-3
Applied Realized Loss Amount: As of any Distribution Date, the
sum of all Applied Realized Loss Amounts with respect to the
Mortgage Loans
which have been applied to the reduction of the Certificate
Principal Balance of
the Class M-3 Certificates.
Class M-3
Certificate: Any Certificate designated as a "Class M-3
Certificate" on the face thereof, in the form of Exhibit A hereto,
representing
the right to distributions as set forth herein.
Class M-3
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance of the Class M-3
Certificates.
Class M-3
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period at the Class M-3
Pass-Through Rate on
the Class M-3 Certificate Principal Balance as of such Distribution
Date plus
the portion of any previous distributions on such Class in respect
of Current
Interest or Class M-3 Interest Carry Forward Amount that is
recovered as a
voidable preference by a trustee in bankruptcy, less any
Non-Supported Interest
Shortfall allocated on such Distribution Date to the Class M-3
Certificates.
Class M-3
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class M-3 Current Interest with
respect to
prior Distribution Dates over (B) the amount actually distributed
to the Class
M-3 Certificates with respect to interest on such prior
Distribution Dates and
(2) interest on such excess (to the extent permitted by applicable
law) at the
Class M-3 Pass-Through Rate for the related Accrual Period.
Class M-3
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date, 0.800% per annum and, as of any
Distribution
Date after the Initial Optional Termination Date, 1.200% per
annum.
Class M-3
Pass-Through Rate: For the first Distribution Date, 5.18% per
annum. As of any Distribution Date thereafter, the lesser of (1)
One-Month LIBOR
plus the Class M-3 Margin and (2) the Weighted Average Available
Funds Cap for
such Distribution Date.
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<PAGE>
Class M-3
Principal Distribution Amount: With respect to any Distribution
Date on or after the Stepdown Date, 100% of the Principal
Distribution Amount
for such Distribution Date if the Class A Certificate Principal
Balance, Class
M-1 Certificate Principal Balance and Class M-2 Certificate
Principal Balance
have been reduced to zero and a Stepdown Trigger Event exists, or
as long as a
Stepdown Trigger Event does not exist, the excess of (1) the sum of
(A) the
Class A Certificate Principal Balance (after taking into account
distributions
of the Class A Principal Distribution Amount on such Distribution
Date), (B) the
Class M-1 Certificate Principal Balance (after taking into account
distributions
of the Class M-1 Principal Distribution Amount on such Distribution
Date), (C)
the Class M-2 Certificate Principal Balance (after taking into
account
distributions of the Class M-2 Principal Distribution Amount on
such
Distribution Date) and (D) the Class M-3 Certificate Principal
Balance
immediately prior to such Distribution Date over (2) the lesser of
(A) 89.50% of
the Stated Principal Balances of the Mortgage Loans as of such
Distribution Date
and (B) the excess of the Stated Principal Balances for the
Mortgage Loans as of
such Distribution Date over the Minimum Required
Overcollateralization Amount.
Notwithstanding the foregoing, (I) on any Distribution Date prior
to the
Stepdown Date on which the Certificate Principal Balance of each
Class of Class
A Certificates, the Class M-1 Certificates and the Class M-2
Certificates has
been reduced to zero, the Class M-3 Principal Distribution Amount
will equal the
lesser of (x) the outstanding Certificate Principal Balance of the
Class M-3
Certificates and (y) 100% of the Principal Distribution Amount
remaining after
any distributions on such Class A, Class M-1 and Class M-2
Certificates and (II)
in no event will the Class M-3 Principal Distribution Amount with
respect to any
Distribution Date exceed the Class M-3 Certificate Principal
Balance.
Class M-3
Unpaid Realized Loss Amount: As of any Distribution Date, the
excess of (1) the Class M-3 Applied Realized Loss Amount over (2)
the sum of (x)
all distributions in reduction of the Class M-3 Unpaid Realized
Loss Amounts on
all previous Distribution Dates and (y) all increases in the
Certificate
Principal Balance of such Class M-3 Certificates pursuant to the
last sentence
of the definition of "Certificate Principal Balance."
Class M-4
Applied Realized Loss Amount: As of any Distribution Date, the
sum of all Applied Realized Loss Amounts with respect to the
Mortgage Loans
which have been applied to the reduction of the Certificate
Principal Balance of
the Class M-4 Certificates.
Class M-4
Certificate: Any Certificate designated as a "Class M-4
Certificate" on the face thereof, in the form of Exhibit A hereto,
representing
the right to distributions as set forth herein.
Class M-4
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance of the Class M-4
Certificates.
Class M-4
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period at the Class M-4
Pass-Through Rate on
the Class M-4 Certificate Principal Balance as of such Distribution
Date plus
the portion of any previous distributions on such Class in respect
of Current
Interest or Class M-4 Interest Carry Forward Amount that is
recovered as a
voidable preference by a trustee in bankruptcy, less any
Non-Supported Interest
Shortfall allocated on such Distribution Date to the Class M-4
Certificates.
Class M-4
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class M-4 Current Interest with
respect to
prior Distribution Dates over (B) the amount actually distributed
to the Class
M-4 Certificates with respect to interest on such prior
Distribution Dates and
(2) interest on such excess (to the extent permitted by applicable
law) at the
Class M-4 Pass-Through Rate for the related Accrual Period.
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<PAGE>
Class M-4
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date, 1.650% per annum and, as of any
Distribution
Date after the Initial Optional Termination Date, 2.475% per
annum.
Class M-4
Pass-Through Rate: For the first Distribution Date, 6.03% per
annum. As of any Distribution Date thereafter, the lesser of (1)
One-Month LIBOR
plus the Class M-4 Margin and (2) the Weighted Average Available
Funds Cap for
such Distribution Date.
Class M-4
Principal Distribution Amount: With respect to any Distribution
Date on or after the Stepdown Date, 100% of the Principal
Distribution Amount
for such Distribution Date if the Class A Certificate Principal
Balance, Class
M-1 Certificate Principal Balance, Class M-2 Certificate Principal
Balance and
Class M-3 Certificate Principal Balance have been reduced to zero
and a Stepdown
Trigger Event exists, or as long as a Stepdown Trigger Event does
not exist, the
excess of (1) the sum of (A) the Class A Certificate Principal
Balance (after
taking into account distributions of the Class A Principal
Distribution Amount
on such Distribution Date), (B) the Class M-1 Certificate Principal
Balance
(after taking into account distributions of the Class M-1 Principal
Distribution
Amount on such Distribution Date), (C) the Class M-2 Certificate
Principal
Balance (after taking into account distributions of the Class M-2
Principal
Distribution Amount on such Distribution Date), (C) the Class M-3
Certificate
Principal Balance (after taking into account distributions of the
Class M-3
Principal Distribution Amount on such Distribution Date) and (D)
the Class M-4
Certificate Principal Balance immediately prior to such
Distribution Date over
(2) the lesser of (A) 92.70% of the Stated Principal Balances of
the Mortgage
Loans as of such Distribution Date and (B) the excess of the Stated
Principal
Balances for the Mortgage Loans as of such Distribution Date over
the Minimum
Required Overcollateralization Amount. Notwithstanding the
foregoing, (I) on any
Distribution Date prior to the Stepdown Date on which the
Certificate Principal
Balance of each Class of Class A Certificates, the Class M-1
Certificates, the
Class M-2 Certificates and the Class M-3 Certificates has been
reduced to zero,
the Class M-4 Principal Distribution Amount will equal the lesser
of (x) the
outstanding Certificate Principal Balance of the Class M-4
Certificates and (y)
100% of the Principal Distribution Amount remaining after any
distributions on
such Class A, Class M-1, Class M-2 and Class M-3 Certificates and
(II) in no
event will the Class M-4 Principal Distribution Amount with respect
to any
Distribution Date exceed the Class M-4 Certificate Principal
Balance.
Class M-4
Unpaid Realized Loss Amount: As of any Distribution Date, the
excess of (1) the Class M-4 Applied Realized Loss Amount over (2)
the sum of (x)
all distributions in reduction of the Class M-4 Unpaid Realized
Loss Amounts on
all previous Distribution Dates and (y) all increases in the
Certificate
Principal Balance of such Class M-4 Certificates pursuant to the
last sentence
of the definition of "Certificate Principal Balance."
Class M-5
Applied Realized Loss Amount: As of any Distribution Date, the
sum of all Applied Realized Loss Amounts with respect to the
Mortgage Loans
which have been applied to the reduction of the Certificate
Principal Balance of
the Class M-5 Certificates.
Class M-5
Certificate: Any Certificate designated as a "Class M-5
Certificate" on the face thereof, in the form of Exhibit A hereto,
representing
the right to distributions as set forth herein.
Class M-5
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance of the Class M-5
Certificates.
Class M-5
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period at the Class M-5
Pass-Through Rate on
the Class M-5 Certificate Principal Balance as of such Distribution
Date plus
the portion of any previous distributions on such Class in respect
of Current
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<PAGE>
Interest or Class M-5 Interest Carry Forward Amount that is
recovered as a
voidable preference by a trustee in bankruptcy, less any
Non-Supported Interest
Shortfall allocated on such Distribution Date to the Class M-5
Certificates.
Class M-5
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class M-5 Current Interest with
respect to
prior Distribution Dates over (B) the amount actually distributed
to the Class
M-5 Certificates with respect to interest on such prior
Distribution Dates and
(2) interest on such excess (to the extent permitted by applicable
law) at the
Class M-5 Pass-Through Rate for the related Accrual Period.
Class M-5
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date, 1.650% per annum and, as of any
Distribution
Date after the Initial Optional Termination Date, 2.475% per
annum.
Class M-5
Pass-Through Rate: For the first Distribution Date, 6.03% per
annum. As of any Distribution Date thereafter, the lesser of (1)
One-Month LIBOR
plus the Class M-5 Margin and (2) the Weighted Average Available
Funds Cap for
such Distribution Date.
Class M-5
Principal Distribution Amount: With respect to any Distribution
Date on or after the Stepdown Date, 100% of the Principal
Distribution Amount
for such Distribution Date if the Class A Certificate Principal
Balance, Class
M-1 Certificate Principal Balance, Class M-2 Certificate Principal
Balance,
Class M-3 Certificate Principal Balance and Class M-4 Certificate
Principal
Balance have been reduced to zero and a Stepdown Trigger Event
exists, or as
long as a Stepdown Trigger Event does not exist, the excess of (1)
the sum of
(A) the Class A Certificate Principal Balance (after taking into
account
distributions of the Class A Principal Distribution Amount on such
Distribution
Date), (B) the Class M-1 Certificate Principal Balance (after
taking into
account distributions of the Class M-1 Principal Distribution
Amount on such
Distribution Date), (C) the Class M-2 Certificate Principal Balance
(after
taking into account distributions of the Class M-2 Principal
Distribution Amount
on such Distribution Date), (D) the Class M-3 Certificate Principal
Balance
(after taking into account distributions of the Class M-3 Principal
Distribution
Amount on such Distribution Date), (E) the Class M-4 Certificate
Principal
Balance (after taking into account distributions of the Class M-4
Principal
Distribution Amount on such Distribution Date) and (F) the Class
M-5 Certificate
Principal Balance immediately prior to such Distribution Date over
(2) the
lesser of (A) 94.50% of the Stated Principal Balances of the
Mortgage Loans as
of such Distribution Date and (B) the excess of the Stated
Principal Balances
for the Mortgage Loans as of such Distribution Date over the
Minimum Required
Overcollateralization Amount. Notwithstanding the foregoing, (I) on
any
Distribution Date prior to the Stepdown Date on which the
Certificate Principal
Balance of each Class of Class A Certificates, the Class M-1
Certificates, the
Class M-2 Certificates, the Class M-3 Certificates an the Class M-4
Certificates
has been reduced to zero, the Class M-5 Principal Distribution
Amount will equal
the lesser of (x) the outstanding Certificate Principal Balance of
the Class M-5
Certificates and (y) 100% of the Principal Distribution Amount
remaining after
any distributions on such Class A, Class M-1, Class M-2, Class M-3
and Class M-4
Certificates and (II) in no event will the Class M-5 Principal
Distribution
Amount with respect to any Distribution Date exceed the Class M-5
Certificate
Principal Balance.
Class M-5
Unpaid Realized Loss Amount: As of any Distribution Date, the
excess of (1) the Class M-5 Applied Realized Loss Amount over (2)
the sum of (x)
all distributions in reduction of the Class M-5 Unpaid Realized
Loss Amounts on
all previous Distribution Dates and (y) all increases in the
Certificate
Principal Balance of such Class M-5 Certificates pursuant to the
last sentence
of the definition of "Certificate Principal Balance."
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<PAGE>
Class M-6
Applied Realized Loss Amount: As of any Distribution Date, the
sum of all Applied Realized Loss Amounts with respect to the
Mortgage Loans
which have been applied to the reduction of the Certificate
Principal Balance of
the Class M-6 Certificates.
Class M-6
Certificate: Any Certificate designated as a "Class M-6
Certificate" on the face thereof, in the form of Exhibit A hereto,
representing
the right to distributions as set forth herein.
Class M-6
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance of the Class M-6
Certificates.
Class M-6
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period at the Class M-6
Pass-Through Rate on
the Class M-6 Certificate Principal Balance as of such Distribution
Date plus
the portion of any previous distributions on such Class in respect
of Current
Interest or Class M-6 Interest Carry Forward Amount that is
recovered as a
voidable preference by a trustee in bankruptcy, less any
Non-Supported Interest
Shortfall allocated on such Distribution Date to the Class M-6
Certificates.
Class M-6
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class M-6 Current Interest with
respect to
prior Distribution Dates over (B) the amount actually distributed
to the Class
M-6 Certificates with respect to interest on such prior
Distribution Dates and
(2) interest on such excess (to the extent permitted by applicable
law) at the
Class M-6 Pass-Through Rate for the related Accrual Period.
Class M-6
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date, 1.650% per annum and, as of any
Distribution
Date after the Initial Optional Termination Date, 2.475% per
annum.
Class M-6
Pass-Through Rate: For the first Distribution Date, 6.03% per
annum. As of any Distribution Date thereafter, the lesser of (1)
One-Month LIBOR
plus the Class M-6 Margin and (2) the Weighted Average Available
Funds Cap for
such Distribution Date.
Class M-6
Principal Distribution Amount: With respect to any Distribution
Date on or after the Stepdown Date, 100% of the Principal
Distribution Amount
for such Distribution Date if the Class A Certificate Principal
Balance, Class
M-1 Certificate Principal Balance, Class M-2 Certificate Principal
Balance,
Class M-3 Certificate Principal Balance, Class M-4 Certificate
Principal Balance
and Class M-5 Certificate Principal Balance have been reduced to
zero and a
Stepdown Trigger Event exists, or as long as a Stepdown Trigger
Event does not
exist, the excess of (1) the sum of (A) the Class A Certificate
Principal
Balance (after taking into account distributions of the Class A
Principal
Distribution Amount on such Distribution Date), (B) the Class M-1
Certificate
Principal Balance (after taking into account distributions of the
Class M-1
Principal Distribution Amount on such Distribution Date), (C) the
Class M-2
Certificate Principal Balance (after taking into account
distributions of the
Class M-2 Principal Distribution Amount on such Distribution Date),
(D) the
Class M-3 Certificate Principal Balance (after taking into account
distributions
of the Class M-3 Principal Distribution Amount on such Distribution
Date), (E)
the Class M-4 Certificate Principal Balance (after taking into
account
distributions of the Class M-4 Principal Distribution Amount on
such
Distribution Date), (F) the Class M-5 Certificate Principal Balance
(after
taking into account distributions of the Class M-5 Principal
Distribution Amount
on such Distribution Date), and (G) the Class M-6 Certificate
Principal Balance
immediately prior to such Distribution Date over (2) the lesser of
(A) 95.90% of
the Stated Principal Balances of the Mortgage Loans as of such
Distribution Date
and (B) the excess of the Stated Principal Balances for the
Mortgage Loans as of
such Distribution Date over the Minimum Required
Overcollateralization Amount.
Notwithstanding the foregoing, (I) on any Distribution Date prior
to the
Stepdown Date on which the
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Certificate Principal Balance of each Class of Class A
Certificates, the Class
M-1 Certificates, the Class M-2 Certificates, the Class M-3
Certificates, the
Class M-4 Certificates and the Class M-5 Certificates has been
reduced to zero,
the Class M-6 Principal Distribution Amount will equal the lesser
of (x) the
outstanding Certificate Principal Balance of the Class M-6
Certificates and (y)
100% of the Principal Distribution Amount remaining after any
distributions on
such Class A, Class M-1, Class M-2, Class M-3, Class M-4 and Class
M-5
Certificates and (II) in no event will the Class M-6 Principal
Distribution
Amount with respect to any Distribution Date exceed the Class M-6
Certificate
Principal Balance.
Class M-6
Unpaid Realized Loss Amount: As of any Distribution Date, the
excess of (1) the Class M-6 Applied Realized Loss Amount over (2)
the sum of (x)
all distributions in reduction of the Class M-6 Unpaid Realized
Loss Amounts on
all previous Distribution Dates and (y) all increases in the
Certificate
Principal Balance of such Class M-6 Certificates pursuant to the
last sentence
of the definition of "Certificate Principal Balance."
Class P
Certificate: Any Certificate designated as a Class P
Certificate
on the face thereof, executed by the Securities Administrator and
authenticated
by the Securities Administrator in substantially the form set forth
in Exhibit
A, representing the right to distributions as set forth herein.
Class R
Certificate: The Class R Certificate executed by the Securities
Administrator and authenticated by the Securities Administrator in
substantially
the form set forth in Exhibit A.
Class R
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance of the Class R
Certificate.
Class R
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period at the Class R
Pass-Through Rate on
the Class R Certificate Principal Balance as of such Distribution
Date plus the
portion of any previous distributions on such Class in respect of
Current
Interest or a Class R Interest Carry Forward Amount that is
recovered as a
voidable preference by a trustee in bankruptcy, less any
Non-Supported Interest
Shortfall allocated on such Distribution Date to the Class R
Certificate. For
purposes of calculating interest, principal distributions on a
Distribution Date
will be deemed to have been made on the first day of the Accrual
Period in which
such Distribution Date occurs.
Class R
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class R Current Interest with
respect to prior
Distribution Dates over (B) the amount actually distributed to the
Class R
Certificate with respect to interest on such prior Distribution
Dates and (2)
interest on such excess (to the extent permitted by applicable law)
at the Class
R Pass-Through Rate for the related Accrual Period.
Class R
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date for the Certificates, 0.240% per
annum and, as
of any Distribution Date after the Initial Optional Termination
Date, 0.480% per
annum.
Class R
Pass-Through Rate: For the first Distribution Date, 4.62% per
annum. As of any Distribution Date thereafter, the lesser of (1)
One-Month LIBOR
plus the Class R Margin and (2) the Class A-1 Available Funds Cap
for such
Distribution Date.
Class R-X
Certificate: The Class R-X Certificate executed by the
Securities Administrator and authenticated by the Securities
Administrator in
substantially the form set forth in Exhibit A.
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<PAGE>
Class UTB
Interests: The Class UTB1 Interest, the Class UTB2 Interest and
the Class UTB3 Interest.
Class UTB1
Interest: An uncertificated "regular interest" in the Upper
Tier REMIC having the same rights to payments as the Class B-1
Certificates
other than the right to any payments in respect of Excess
Interest.
Class UTB2
Interest: An uncertificated "regular interest" in the Upper
Tier REMIC having the same rights to payments as the Class B-2
Certificates
other than the right to any payments in respect of Excess
Interest
Class UTB3
Interest: An uncertificated "regular interest" in the Upper
Tier REMIC having the same rights to payments as the Class B-3
Certificates
other than the right to any payments in respect of Excess
Interest.
Class UTC
Interest: An uncertificated "regular interest" in the Upper
Tier
REMIC having the same rights to payments as the Uncertificated
Class C Interest.
Class UTM
Interests: The Class UTM3 Interest, the Class UTM4 Interest,
the
Class UTM5 Interest and the Class UTM6 Interest.
Class UTM3
Interest: An uncertificated "regular interest" in the Upper
Tier REMIC having the same rights to payments as the Class M-3
Certificates
other than the right to any payments in respect of Excess
Interest.
Class UTM4
Interest: An uncertificated "regular interest" in the Upper
Tier REMIC having the same rights to payments as the Class M-4
Certificates
other than the right to any payments in respect of Excess
Interest.
Class UTM5
Interest: An uncertificated "regular interest" in the Upper
Tier REMIC having the same rights to payments as the Class M-5
Certificates
other than the right to any payments in respect of Excess
Interest.
Class UTM6
Interest: An uncertificated "regular interest" in the Upper
Tier REMIC having the same rights to payments as the Class M-6
Certificates
other than the right to any payments in respect of Excess
Interest.
Closing
Date: December 28, 2005.
Code: The
Internal Revenue Code of 1986, including any successor or
amendatory provisions.
Collection
Account: The separate Eligible Account created and initially
maintained by the Servicer pursuant to Section 3.05(d) in the name
of the
Trustee for the benefit of the Certificateholders and designated
"Litton Loan
Servicing LP, as servicer for HSBC Bank USA, National Association,
as trustee,
in trust for registered holders of Ownit Mortgage Loan Trust,
Mortgage Loan
Asset-Backed Certificates, Series 2005-5." Funds in the Collection
Account shall
be held in trust for the Certificateholders for the uses and
purposes set forth
in this Agreement.
Combined Loan-to-Value
Ratio: For any Mortgage Loan in a second lien
position, the fraction, expressed as a percentage, the numerator of
which is the
sum of (1) the original principal balance of the related Mortgage
Loan and (2)
any outstanding principal balances of Mortgage Loans the liens on
which are
senior to the lien on such related Mortgage Loan (such sum
calculated at the
date of origination of
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<PAGE>
such related Mortgage Loan) and the denominator of which is the
lesser of (A)
the Appraised Value of the related Mortgaged Property (or
applicable dwelling
unit, in the case of a Co-op Loan) and (B) the sales price of the
related
Mortgaged Property (or applicable dwelling unit, in the case of a
Co-op Loan) at
time of origination.
Compensating Interest: With respect to any Mortgage Loan and
any
Distribution Date, an amount equal to the portion of any Prepayment
Interest
Shortfalls required to be deposited in the Collection Account by
the Servicer
pursuant to Section 4.02 hereof.
Condemnation Proceeds: All awards or settlements in respect of a
Mortgaged
Property (or Underlying Mortgaged Property, in the case of a Co-op
Loan),
whether permanent or temporary, partial or entire, by exercise of
the power of
eminent domain or condemnation, to the extent not required to be
released either
to a Mortgagor in accordance with the terms of the related mortgage
loan
documents or to the holder of a senior lien on the Mortgaged
Property (or
Underlying Mortgaged Property, in the case of a Co-op Loan).
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.
Corresponding Certificates: With respect to the Class LTA-1
Interest, the
Class A-1 and Class R Certificates. With respect to the Class
LTA-2A Interest,
the Class A-2A Certificates. With respect to the Class LTA-2B
Interest, the
Class A-2B Certificates. With respect to the Class LTM-1 Interest,
the Class M-1
Certificates. With respect to the Class LTM-2 Interest, the Class
M-2
Certificates. With respect to the Class LTM-3 Interest, the Class
M-3
Certificates. With respect to the Class LTM-4 Interest, the Class
M-4
Certificates. With respect to the Class LTM-5 Interest, the Class
M-5
Certificates. With respect to the Class LTM-6 Interest, the Class
M-6
Certificates. With respect to the Class LTB-1 Interest, the Class
B-1
Certificates. With respect to the Class LTB-2 Interest, the Class
B-2
Certificates. With respect to the Class LTB-3 Interest, the Class
B-3
Certificates.
Current
Interest: Any of the Class A-1 Current Interest, the Class A-2A
Current Interest, the Class A-2B Current Interest, the Class R
Current Interest,
the Class M-1 Current Interest, the Class M-2 Current Interest, the
Class M-3
Current Interest, the Class M-4 Current Interest, the Class M-5
Current
Interest, the Class M-6 Current Interest, the Class B-1 Current
Interest, the
Class B-2 Current Interest, the Class B-3 Current Interest and the
Class C
Current Interest.
Custodian:
Wells Fargo Bank, N.A., on behalf of HSBC as Trustee.
Cut-off
Date: December 1, 2005.
Cut-off
Date Principal Balance: As to any Mortgage Loan, the unpaid
principal balance thereof as of the close of business on the
calendar day
immediately preceding the Cut-off Date after application of all
payments of
principal due on or prior to the Cut-off Date, whether or not
received, and all
Principal Prepayments received prior to the Cut-off Date, but
without giving
effect to any installments of principal received in respect of Due
Dates after
the Cut-off Date.
Definitive
Certificates: As defined in Section 5.06.
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<PAGE>
Deleted
Mortgage Loan: A Mortgage Loan replaced or to be replaced by a
Replacement Mortgage Loan.
Delinquent: A Mortgage Loan is "delinquent" if any payment due
thereon is
not made pursuant to the terms of such Mortgage Loan by the close
of business on
the day such payment is scheduled to be due. A Mortgage Loan is "30
days
delinquent" if such payment has not been received by the close of
business on
the corresponding day of the month immediately succeeding the month
in which
such payment was due, or, if there is no such corresponding day
(e.g., as when a
30-day month follows a 31-day month in which a payment was due on
the 31st day
of such month), then on the last day of such immediately succeeding
month.
Similarly for "60 days delinquent," "90 days delinquent" and so
on.
Denomination: With respect to each Certificate, the amount set
forth on
the face thereof as the "Initial Principal Balance of this
Certificate."
Depositor:
Merrill Lynch Mortgage Investors, Inc., a Delaware corporation,
or any successor in interest.
Depository: The initial Depository shall be The Depository Trust
Company
("DTC"), the nominee of which is Cede & Co., or any other
organization
registered as a "clearing agency" pursuant to Section 17A of the
Securities
Exchange Act of 1934, as amended. The Depository shall initially be
the
registered Holder of the Book-Entry Certificates. The Depository
shall at all
times be a "clearing corporation" as defined in Section 8-102(3) of
the Uniform
Commercial Code of the State of New York.
Depository
Agreement: With respect to Classes of Book-Entry Certificates,
the agreement between the Securities Administrator and the initial
Depository.
Depository
Participant: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository
effects
book-entry transfers and pledges of securities deposited with the
Depository.
Designated
Transaction: A transaction in which the assets underlying the
Certificates consist of single-family residential, multi-family
residential,
home equity, manufactured housing and/or commercial mortgage
obligations that
are secured by single-family residential, multi-family residential,
commercial
real property or leasehold interests therein.
Determination Date: With respect to any Distribution Date, the 15th
day of
the month of such Distribution Date or, if such 15th day is not a
Business Day,
the immediately preceding Business Day.
Disqualified Organization: (1) the United States, any state or
political
subdivision thereof, any foreign government, any international
organization, or
any agency or instrumentality of any of the foregoing, (2) any
organization
(other than a cooperative described in Section 521 of the Code)
which is exempt
from tax under Chapter 1 of Subtitle A of the Code unless such
organization is
subject to the tax imposed by Section 511 of the Code and (3) any
organization
described in Section 1381(a)(2)(C) of the Code.
Distribution Date: The 25th day of each calendar month, or if such
25th
day is not a Business Day, the next succeeding Business Day,
commencing in
January 2006.
Due Date:
With respect to any Distribution Date and any Mortgage Loan,
the
day during the related Due Period on which a Scheduled Payment is
due.
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<PAGE>
Due
Period: With respect to any Distribution Date, the period beginning
on
the second day of the calendar month preceding the calendar month
in which such
Distribution Date occurs and ending on 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 bank which (A) has a
rating of at least
Baa3 or P-3 by Moody's and (B) is either the Depositor or the
corporate trust
department of a national bank or banking corporation which has a
rating of at
least A-1 by S&P or F1 by Fitch, or (iii) an account or
accounts the deposits in
which are fully insured by the FDIC, or (iv) an account or
accounts, acceptable
to each Rating Agency without reduction or withdrawal of the rating
of any Class
of Certificates, as evidenced in writing, by 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 Securities
Administrator, 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
Permitted
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, or (v) maintained at an eligible institution whose
commercial paper,
short-term debt or other short-term deposits are rated at least
A-1+ by S&P and
F-1+ by Fitch, or (vi) maintained with a federal or state chartered
depository
institution the deposits in which are insured by the FDIC to the
applicable
limits and the short-term unsecured debt obligations of which (or,
in the case
of a depository institution that is a subsidiary of a holding
company, the
short-term unsecured debt obligations of such holding company) are
rated A-1 by
S&P or Prime-1 by Moody's at the time any deposits are held on
deposit therein,
or (vii) otherwise acceptable to each Rating Agency, as evidenced
by a letter
from each Rating Agency to the Securities Administrator and the
Trustee.
ERISA: The
Employee Retirement Income Security Act of 1974, including any
successor or amendatory provisions.
ERISA-Qualifying Underwriting: A best efforts or firm
commitment
underwriting or private placement that would satisfy the
requirements of
Prohibited Transaction Exemption 90-29, Exemption Application No.
D-8012, 55
Fed. Reg. 21459 (1990), as amended, granted to the Underwriter by
the United
States Department of Labor (or any other applicable underwriter's
exemption
granted by the United States Department of Labor), 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.
ERISA
Restricted Certificates: The Class C and Class P Certificates
and
any other Certificate, as long as the acquisition and holding of
such
Certificate is not covered by and exempt under the Underwriter's
exemption.
Event of
Default: As defined in Section 7.01 hereof.
Excess
Interest: On any Distribution Date, for each Class of the Class
A,
Class M and Class B Certificates, the excess, if any, of (1) the
amount of
interest such Class of Certificates is entitled to receive on such
Distribution
Date over (2) the amount of interest such Class of Certificates
would have been
entitled to receive on such Distribution Date at an interest rate
equal to the
REMIC Pass-Through Rate.
Excess
Proceeds: With respect to any Liquidated Loan, any Liquidation
Proceeds that are in excess of the sum of (1) the unpaid principal
balance of
such Liquidated Loan as of the date of such
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<PAGE>
liquidation plus (2) interest at the Mortgage Rate from the Due
Date as to which
interest was last paid or advanced to Certificateholders (and not
reimbursed to
the Servicer) up to the Due Date in the month in which such
Liquidation Proceeds
are required to be distributed on the unpaid principal balance of
such
Liquidated Loan outstanding during each Due Period as to which such
interest was
not paid or advanced.
Exchange
Act: The Securities Exchange Act of 1934, as amended.
Extra
Principal Distribution Amount: With respect to any Distribution
Date, (1) prior to the Stepdown Date, the excess of (A) the sum of
(i) the
Aggregate Certificate Principal Balance immediately preceding such
Distribution
Date reduced by the Principal Funds with respect to such
Distribution Date and
(ii) $2,326,644 and over (B) the aggregate Stated Principal Balance
of the
Mortgage Loans as of such Distribution Date and (2) on and after
the Stepdown
Date, (A) the sum of (x) the Aggregate Certificate Principal
Balance immediately
preceding such Distribution Date, reduced by the Principal Funds
with respect to
such Distribution Date and (y) the greater of (a) 1.00% of the
aggregate Stated
Principal Balance of the Mortgage Loans and (b) the Minimum
Required
Overcollateralization Amount less (B) the aggregate Stated
Principal Balance of
the Mortgage Loans as of such Distribution Date; provided, however,
that if on
any Distribution Date a Stepdown Trigger Event is in effect, the
Extra Principal
Distribution Amount will not be reduced to the applicable
percentage of the
then-current aggregate Stated Principal Balance of the Mortgage
Loans (and will
remain fixed at the applicable percentage of the aggregate Stated
Principal
Balance of the Mortgage Loans as of the Due Date immediately prior
to the
Stepdown Trigger Event) until the next Distribution Date on which
the Stepdown
Trigger Event is not in effect.
Fannie
Mae: A federally chartered and privately owned corporation
organized and existing under the Federal National Mortgage
Association Charter
Act, or any successor thereto.
FDIC: The
Federal Deposit Insurance Corporation, or any successor
thereto.
Fitch:
Fitch, Inc., or any successor in interest.
Fixed Rate
Mortgage Loan: A Mortgage Loan identified in the Mortgage Loan
Schedule as having a Mortgage Rate which is fixed.
Floating
Rate Certificate Carryover: With respect to a Distribution
Date,
in the event that the Pass-Through Rate for a class of Class A,
Class M or Class
B Certificates is based upon the related Available Funds Cap, the
excess of (1)
the amount of interest that such Class would have been entitled to
receive on
such Distribution Date had the Pass-Through Rate for that Class not
been
calculated based on the related Available Funds Cap, up to but not
exceeding
greater of (x) the related Maximum Rate Cap or (y) the sum of (i)
the related
Available Funds Cap and (ii) the product of (A) a fraction, the
numerator of
which is 360 and the denominator of which is the actual number of
days in the
related Accrual Period and (B) the quotient obtained by dividing
(I) an amount
equal to the proceeds, if any, payable under the related Cap
Contract with
respect to such Distribution Date by (II) the aggregate Certificate
Principal
Balance of each of the Classes of Certificates to which such Cap
Contract
relates for such Distribution Date over (2) the amount of interest
such class
was entitled to receive on such Distribution Date based on the
related Available
Funds Cap, together with (i) the unpaid portion of any such excess
from prior
Distribution Dates (and interest accrued thereon at the then
applicable
Pass-Through Rate, without giving effect to the applicable
Available Funds Cap)
and (ii) any amount previously distributed with respect to Floating
Rate
Certificate Carryover for such class that is recovered as a
voidable preference
by a trustee in bankruptcy.
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<PAGE>
Freddie
Mac: A corporate instrumentality of the United States created
and
existing under Title III of the Emergency Home Finance Act of 1970,
as amended,
or any successor thereto.
Grantor
Trusts: The grantor trusts described in Section 2.07 hereof.
Gross
Margin: The percentage set forth in the related Mortgage Note
for
each of the Adjustable Rate Mortgage Loans which is to be added to
the
applicable index for use in determining the Mortgage Rate on each
Adjustment
Date, and which is set forth in the Mortgage Loan Schedule for each
Adjustable
Rate Mortgage Loan.
Group One:
The portion of the Mortgage Pool identified as "Group One" in
the Prospectus Supplement.
Group One
Mortgage Loan: Any Mortgage Loan at any time identified in the
Group One Mortgage Loan Schedule attached hereto as Exhibit
B-2.
Group One
Principal Distribution Amount: As of any Distribution Date, the
amount equal to the lesser of (i) the aggregate Certificate
Principal Balance of
the Class A-1 and Class R Certificates and (ii) the product of (x)
the Group One
Principal Distribution Percentage and (y) the Class A Principal
Distribution
Amount; provided, however, that with respect to any Distribution
Date on which
the Class A-1 and Class R Certificates are outstanding and the
Certificate
Principal Balance of the Class A-2 Certificates has been reduced to
zero, the
Group One Principal Distribution Amount will equal the Class A
Principal
Distribution Amount.
Group One
Principal Distribution Percentage: With respect to any
Distribution Date, a fraction expressed as a percentage, the
numerator of which
is the amount of Principal Funds received with respect to Mortgage
Loans in
Group One and the denominator of which is the amount of Principal
Funds received
from all of the Mortgage Loans in the mortgage pool.
Group Two:
The portion of the Mortgage Pool identified as "Group Two" in
the Prospectus Supplement.
Group Two
Mortgage Loan: Any Mortgage Loan at any time identified in the
Group Two Mortgage Loan Schedule attached hereto as Exhibit
B-3.
Group Two
Principal Distribution Amount: As of any Distribution Date, the
amount equal to the lesser of (i) the aggregate Certificate
Principal Balance of
the Class A-2 Certificates and (ii) the product of (x) the Group
Two Principal
Distribution Percentage and (y) the Class A Principal Distribution
Amount;
provided, however, that with respect to any Distribution Date on
which the Class
A-2 Certificates are outstanding and the Certificate Principal
Balances of the
Class A-1 and Class R Certificates have been reduced to zero, the
Group Two
Principal Distribution Amount will equal the Class A Principal
Distribution
Amount.
Group Two
Principal Distribution Percentage: With respect to any
Distribution Date, a fraction expressed as a percentage, the
numerator of which
is the amount of Principal Funds received with respect to Mortgage
Loans in
Group Two and the denominator of which is the amount of Principal
Funds received
from all of the Mortgage Loans in the mortgage pool.
Indenture:
An indenture relating to the issuance of notes guaranteed by
the NIMs Insurer.
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Initial
Adjustment Date: As to any Adjustable Rate Mortgage Loan, the
first Adjustment Date following the origination of such Mortgage
Loan.
Initial
Certificate Principal Balance: With respect to any Certificate,
the Certificate Principal Balance of such Certificate or any
predecessor
Certificate on the Closing Date as set forth in Section 5.01
hereof.
Initial
Mortgage Rate: As to each Mortgage Loan, the Mortgage Rate in
effect prior to the Initial Adjustment Date.
Initial
Optional Termination Date: The first Distribution Date on which
the aggregate Stated Principal Balance of the Mortgage Loans (or if
such
Mortgage Loan is an REO Property, the fair market value of such REO
Property) is
equal to or less than 10% of the aggregate Stated Principal Balance
of the
Mortgage Loans as of the Cut-off Date.
Insurance
Policy: With respect to any Mortgage Loan or the related
Mortgaged Property (or the related Underlying Mortgaged Property,
in the case of
a Co-op Loan) included in the Trust Fund, any insurance policy,
including all
riders and endorsements thereto in effect with respect to such
Mortgage Loan or
Mortgaged Property (or related Underlying Mortgage Property, in the
case of a
Co-op Loan), including any replacement policy or policies for any
insurance
policies, including, without limitation, the MI Policy.
Insurance
Proceeds: Proceeds paid in respect of a Mortgage Loan or the
related Mortgaged Property (or the related Underlying Mortgaged
Property, in the
case of a Co-op Loan) pursuant to any Insurance Policy or any other
insurance
policy covering such Mortgage Loan or Mortgaged Property (or
Underlying
Mortgaged Property, in the case of a Co-op Loan), to the extent
such proceeds
are payable to the mortgagee under the Mortgage, the Servicer or
the trustee
under the deed of trust and are not applied to the restoration of
the related
Mortgaged Property (or the related Underlying Mortgaged Property,
in the case of
a Co-op Loan) or released either to the Mortgagor or to the holder
of a senior
lien on the related Mortgaged Property (or the related Underlying
Mortgaged
Property in the case of a Co-op Loan) in accordance with the
procedures that the
Servicer would follow in servicing mortgage loans held for its own
account, in
each case other than any amount included in such Insurance Proceeds
in respect
of Insured Expenses.
Insured
Expenses: Expenses covered by an Insurance Policy or any other
insurance policy with respect to a Mortgage Loan or the related
Mortgaged
Property (or the related Underlying Mortgaged Property, in the case
of a Co-op
Loan).
Interest
Carry Forward Amount: Any of the Class A-1 Interest Carry
Forward
Amount, the Class A-2A Interest Carry Forward Amount, the Class
A-2B Interest
Carry Forward Amount, the Class R Interest Carry Forward Amount,
the Class M-1
Interest Carry Forward Amount, the Class M-2 Interest Carry Forward
Amount, the
Class M-3 Interest Carry Forward Amount, the Class M-4 Interest
Carry Forward
Amount, the Class M-5 Interest Carry Forward Amount, the Class M-6
Interest
Carry Forward Amount, the Class B-1 Interest Carry Forward Amount,
the Class B-2
Interest Carry Forward Amount, the Class B-3 Interest Carry Forward
Amount or
the Class C Interest Carry Forward Amount, as the case may be.
Interest
Determination Date: With respect to the Certificates, (i) for
any
Accrual Period other than the first Accrual Period, the second
LIBOR Business
Day preceding the commencement of such Accrual Period and (ii) for
the first
Accrual Period, December 23, 2005.
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Interest
Funds: With respect to any Distribution Date, the sum, without
duplication, of (1) all scheduled interest due during the related
Due Period and
received before the related Servicer Remittance Date or advanced on
or before
the related Servicer Remittance Date less the Servicing Fee and the
Securities
Administrator Fee, (2) all Advances relating to interest with
respect to the
Mortgage Loans and such Distribution Date, (3) all Compensating
Interest with
respect to the Mortgage Loans and such Distribution Date, (4)
Liquidation
Proceeds with respect to the Mortgage Loans (to the extent such
Liquidation
Proceeds relate to interest) collected during the related
Prepayment Period, (5)
all proceeds of any purchase pursuant to Section 2.02 or 2.03
during the related
Prepayment Period or pursuant to Section 9.01 not later than the
related
Determination Date (to the extent that such proceeds relate to
interest) less
the Servicing Fee and the Securities Administrator Fee and (6) all
Prepayment
Charges received with respect to the Mortgage Loans during the
related
Prepayment Period less (A) all Non-Recoverable Advances relating to
interest and
(B) other amounts reimbursable to the Servicer, the Master
Servicer, the
Securities Administrator and the Trustee pursuant to this
Agreement.
Latest
Possible Maturity Date: The latest maturity date for any
Mortgage
Loan in the Trust Fund plus one year.
LIBOR
Business Day: Any day on which banks in the City of London,
England
and New York City, U.S.A. are open and conducting transactions in
foreign
currency and exchange.
Liquidated
Loan: With respect to any Distribution Date, a defaulted
Mortgage Loan that either (a) pursuant to Section 3.12 has been
realized upon or
liquidated through deed-in-lieu of foreclosure, foreclosure sale,
trustee's sale
or other realization as provided by applicable law governing the
real property
subject to the related Mortgage and any security agreements and as
to which the
Servicer has certified (in accordance with Section 3.12) in the
related
Prepayment Period that it has received all amounts it expects to
receive in
connection with such liquidation or (b) as to which is not a first
lien Mortgage
Loan and is delinquent 180 days or longer, the Servicer has
certified in a
certificate of an officer of the Servicer delivered to the
Depositor and the
Trustee that it does not believe that there is a reasonable
likelihood that any
further net proceeds will be received or recovered with respect to
such Mortgage
Loan.
Liquidation Proceeds: Amounts, including Condemnation Proceeds,
Insurance
Proceeds, received in connection with the partial or complete
liquidation of a
Mortgage Loan, whether through trustee's sale, foreclosure sale,
sale by the
Servicer pursuant to this Agreement or otherwise or amounts
received in
connection with any condemnation or partial release of a Mortgaged
Property and
any other proceeds received in connection with the final sale of a
related REO
Property, less the sum of related unreimbursed Advances, Servicing
Fees,
Servicing Advances and any other expenses related to such Mortgage
Loan.
Loan-to-Value Ratio: With respect to any Mortgage Loan, the
fraction,
expressed as a percentage, the numerator of which is the original
principal
balance of the related Mortgage Loan and the denominator of which
is the lesser
of (X) the Appraised Value of the related Mortgaged Property (or
applicable
dwelling unit, in the case of a Co-op Loan) and (Y) the sales price
of the
related Mortgaged Property (or applicable dwelling unit, in the
case of a Co-op
Loan) at the time of origination.
Losses:
Any losses, claims, damages, liabilities or expenses
collectively.
Lower Tier
REMIC: As described in the Preliminary Statement and Section
2.07.
Lower Tier
REMIC Interests: Each of the Class LTA-1 Interest, the Class
LTA-2A Interest, the Class LTA-2B Interest, the Class LTM-1
Interest, the Class
LTM-2 Interest, the Class LTM-3 Interest,
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the Class LTM-4 Interest, the Class LTM-5 Interest, the Class LTM-6
Interest,
the Class LTB-1 Interest, the Class LTB-2 Interest, the Class LTB-3
Interest,
the Class LTIX Interest, the Class LTIIX Interest, the Class LTII1A
Interest,
the Class LTII1B Interest, the Class LTII2A Interest, the Class
LTII2B Interest
and the Class LTR Interest.
Lower Tier
REMIC I Marker Interests: Each of the classes of Lower Tier
REMIC Regular Interests other than the Class LTIX Interest, the
Class LTIIX
Interest, the Class LTII1A Interest, the Class LTII1B Interest, the
Class LTII2A
Interest, the Class LTII2B Interest.
Lower Tier
REMIC II Marker Interests: Each of the Class LTII1A Interest,
the Class LTII1B Interest, the Class LTII2A Interest and the Class
LTII2B
Interest.
Lower Tier
REMIC Regular Interests: Each of the Lower Tier REMIC Interests
other than the Class LTR Interest.
Lower Tier
REMIC Subordinated Balance Ratio: The ratio of (i) the
principal balance of the Class LTII1A Interest to (ii) the
principal balance of
the Class LTII2A Interest that is equal to the ratio of (i) the
excess of (A)
the aggregate Stated Principal Balance of Group One over (B) the
current
Certificate Principal Balance of the Class A-1 and Class R
Certificates to (ii)
the excess of (A) the aggregate Stated Principal Balance of Group
Two over (B)
the current Certificate Principal Balance of the Class A-2
Certificates.
Master
Servicer: Wells Fargo Bank, N.A., a national banking
association,
or any successor in interest.
Maximum
Mortgage Rate: With respect to each Adjustable Rate Mortgage
Loan,
the maximum rate of interest set forth as such in the related
Mortgage Note and
with respect to each Fixed Rate Mortgage Loan, the rate of interest
set forth in
the related Mortgage Note.
Maximum
Rate Cap: Any of the Class A-1 Maximum Rate Cap, the Class A-2
Maximum Rate Cap or the Weighted Average Maximum Rate Cap.
MERS:
Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or
any successor
thereto.
MERS Loan:
Any Mortgage Loan registered with MERS on the MERS System.
MERS
System: The system of recording transfers of mortgage
electronically
maintained by MERS.
MI Insurer
Fee: The amount payable to the MI Insurer on each Distribution
Date, which amount shall equal one-twelfth of the product of (i)
the MI Insurer
Fee Rate and (ii) the Stated Principal Balance of the applicable MI
Mortgage
Loan (or the related REO Property) as of the immediately preceding
Distribution
Date.
MI Insurer
Fee Rate: With respect to each MI Mortgage Loan, the rate
specified for such MI Mortgage Loan on the schedule attached to the
MI Policy,
plus a rate computed so that the MI Insurer Fee would make the MI
Insurer whole
for any taxes imposed on the MI Insurer by the States of Kentucky
or West
Virginia with respect to MI Mortgage Loans located in such
States.
MI
Insurer: PMI Mortgage Insurance Co., or its successor in
interest.
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MI
Mortgage Loans: The list of Mortgage Loans insured by the MI
Insurers
attached hereto as Exhibit B-4.
MI Policy:
The PMI primary private mortgage Insurance Policy No.
22510-0010-0 and all endorsements thereto, dated December 28, 2005,
a form of
which is attached hereto as Exhibit P.
MIN: The
loan number for any MERS Loan.
Minimum
Mortgage Rate: With respect to each Adjustable Rate Mortgage
Loan,
the minimum rate of interest set forth as such in the related
Mortgage Note.
Minimum
Required Overcollateralization Amount: An amount equal to the
product of (x) 0.50% and (y) the Stated Principal Balance of the
Mortgage Loans
as of the Cut-off Date.
MOM Loan: Any Mortgage
Loan as to which MERS is acting as mortgagee,
solely as nominee for the originator of such Mortgage Loan and its
successors
and assigns.
Monthly
Statement: The statement delivered to the Certificateholders
pursuant to Section 4.05.
Moody's:
Moody's Investors Service, Inc. or any 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 with all riders
attached thereto
creating a first or second lien or a first or second 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 with all riders
attached thereto
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: The mortgage documents listed in Section 2.01 hereof
pertaining to a particular Mortgage Loan and any additional
documents delivered
to the Trustee to be added to the Mortgage File pursuant to this
Agreement.
Mortgage
Group: Either of Group One or Group Two.
Mortgage
Loans: Such of the mortgage loans transferred and assigned to
the
Trustee pursuant to the provisions hereof as from time to time are
held as a
part of the Trust Fund (including any REO Properties the mortgage
loans so held
being identified in the Mortgage Loan Schedule, notwithstanding
foreclosure or
other acquisition of title of the related Mortgaged Property. Any
mortgage loan
that was intended by the parties hereto to be transferred to the
Trust Fund as
indicated by such Mortgage Loan Schedule which is in fact not so
transferred for
any reason shall continue to be a Mortgage Loan hereunder until the
Purchase
Price with respect thereto has been paid to the Trust Fund.
Mortgage
Loan Schedule: The list of Mortgage Loans (as from time to time
amended by the Trustee to reflect the deletion of Deleted Mortgage
Loans and the
addition of Replacement Mortgage Loans pursuant to the provisions
of this
Agreement transferred to the Trustee as part of the Trust Fund and
from time to
time subject to this Agreement, attached hereto as Exhibits B-1,
B-2 and B-3,
setting forth the following information with respect to each
Mortgage Loan:
(i) the loan
number;
(ii) borrower name and
address;
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(iii) the unpaid principal balance of the Mortgage Loans;
(iv) the Initial
Mortgage Rate;
(v) the original
maturity date and the months remaining before
maturity
date;
(vi) the original
principal balance;
(vii) the Cut-off Date Principal Balance;
(viii) the first payment due date of the Mortgage Loan;
(ix) the Loan-to-Value
Ratio at origination with respect to a first
lien
Mortgage Loan, or the Combined Loan-to-Value Ratio with respect to
a
second
lien Mortgage Loan;
(x) a code
indicating whether the residential dwelling at the time
of
origination was represented to be owner-occupied;
(xi) a code indicating
the property type;
(xii) with respect to each Adjustable Rate Mortgage Loan;
(A) the
frequency of each Adjustment Date;
(B) the next
Adjustment Date;
(C) the Maximum
Mortgage Rate;
(D) the Minimum
Mortgage Rate;
(E) the Mortgage
Rate as of the Cut-off Date;
(F) the related
Periodic Rate Cap;
(G) the Gross
Margin;
(H) the lifetime
rate cap;
(xiii) location of the related Mortgaged Property (or
Underlying
Mortgaged
Property, in the case of a Co-op Loan);
(xiv) a code indicating whether a Prepayment Charge is
applicable
and, if
so, the term of such Prepayment Charge;
(xv) the Credit Score
and date obtained; and
(xvi) the MIN.
Mortgage
Note: The original executed note or other evidence of
indebtedness evidencing the indebtedness of a Mortgagor under a
Mortgage Loan
and all amendments, modifications and attachments thereto with all
riders
attached thereto.
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Mortgage
Pool: The aggregate of the Mortgage Loans identified in the
Mortgage Loan Schedule.
Mortgaged
Property: The underlying property securing a Mortgage Loan.
Mortgage
Rate: The annual rate of interest borne by a Mortgage Note from
time to time.
Mortgagor:
The obligor on a Mortgage Note.
Net
Mortgage Rate: As to each Mortgage Loan, and at any time, the
per
annum rate equal to the then current Mortgage Rate less (1) the
Servicing Fee
Rate, (2) the Securities Administrator Fee Rate and (3) the MI
Insurer Fee Rate
if applicable.
Net Rate:
With respect to any Distribution Date, the product of (x) the
weighted average Net Mortgage Rate for the Mortgage Loans
calculated based on
the respective Net Mortgage Rates and the Stated Principal Balances
of such
Mortgage Loans as of the preceding Distribution Date (or, in the
case of the
first Distribution Date, as of the Cut-off Date) and (y) a
fraction, the
numerator of which is 30 and the denominator of which is the actual
number of
days in the related Accrual Period.
NIM Notes:
The notes to be issued pursuant to the Indenture.
NIMs
Insurer: Any of the one or more insurers, if any, that is
guaranteeing certain payments under any NIM Notes; provided, that
upon the
payment in full of the NIM Notes, all rights of the NIMs Insurer
hereunder shall
terminate.
NIMs
Insurer Default: As defined in Section 10.12.
Non-Recoverable Advance: Any portion of an Advance previously made
or
proposed to be made by the Servicer that, in the good faith
judgment of the
Servicer, will not or, in the case of a current delinquency, would
not, be
ultimately recoverable by the Servicer from the related Mortgagor,
related
Liquidation Proceeds or otherwise with respect to the related
Mortgage Loan.
Non-Recoverable Servicing Advance: Any portion of a Servicing
Advance
previously made or proposed to be made by the Servicer that, in the
good faith
judgment of the Servicer, will not or, in the case of a current
Servicing
Advance, would not, be ultimately recoverable by the Servicer from
the related
Mortgagor, related Liquidation Proceeds or otherwise with respect
to the related
Mortgage Loan.
Non-Supported Interest Shortfall: As defined in Section 4.02.
Officer's
Certificate: A certificate (1) signed by the Chairman of the
Board, the Vice Chairman of the Board, the President, a vice
president (however
denominated), an Assistant Vice President, the Treasurer, the
Secretary, or one
of the assistant treasurers or assistant secretaries of the
Depositor, the
Master Servicer, the Servicer or the Securities Administrator (or
any other
officer customarily performing functions similar to those performed
by any of
the above designated officers and also to whom, with respect to a
particular
matter, such matter is referred because of such officer's knowledge
of and
familiarity with a particular subject) or (2), if provided for in
this
Agreement, signed by a Servicing Officer, as the case may be, and
delivered to
the Depositor, the Master Servicer, the Servicer, the Securities
Administrator
or the Trustee, as the case may be, as required by this
Agreement.
One-Month
LIBOR: With respect to any Accrual Period, the rate determined
by the Securities Administrator on the related Interest
Determination Date on
the basis of (a) the offered rates for one-month United States
dollar deposits,
as such rates appear on Telerate page 3750, as of 11:00 a.m.
(London
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time) on such Interest Determination Date or (b) if such rate does
not appear on
Telerate Page 3750 as of 11:00 a.m. (London time), the offered
rates of the
Reference Banks for one-month United States dollar deposits, as
such rates
appear on the Reuters Screen LIBO Page, as of 11:00 a.m. (London
time) on such
Interest Determination Date. If One-Month LIBOR is determined
pursuant to clause
(b) above, on each Interest Determination Date, One-Month LIBOR for
the related
Accrual Period will be established by the Securities Administrator
as follows:
(i) If on such
Interest Determination Date two or more Reference
Banks
provide such offered quotations, One-Month LIBOR for the
related
Accrual
Period shall be the arithmetic mean of such offered quotations
(rounded
upwards if necessary to the nearest whole multiple of
0.03125%).
(ii) If on such
Interest Determination Date fewer than two
Reference
Banks provide such offered quotations, One-Month LIBOR for the
related
Accrual Period shall be the higher of (i) One-Month LIBOR as
determined
on the previous Interest Determination Date and (ii) the
Reserve
Interest Rate.
Opinion of
Counsel: A written opinion of counsel, who may be counsel for
the Depositor, the Master Servicer, the Servicer or the
Securities
Administrator, reasonably acceptable to each addressee of such
opinion;
provided, however, that with respect to Section 6.04 or 10.01, or
the
interpretation or application of the REMIC Provisions, such counsel
must (1) in
fact be independent of the Depositor, the Master Servicer, the
Servicer or the
Securities Administrator, (2) not have any direct financial
interest in the
Depositor, the Master Servicer, the Servicer or the Securities
Administrator or
in any affiliate of any such party and (3) not be connected with
the Depositor,
the Master Servicer, the Servicer or the Securities Administrator
as an officer,
employee, promoter, underwriter, trustee, partner, director or
person performing
similar functions.
Optional
Termination: The termination of the Trust Fund hereunder
pursuant
to clause (b) of Section 9.01 hereof.
Optional
Termination Amount: The amount received by the Securities
Administrator in connection with any purchase of all of the
Mortgage Loans and
REO Properties pursuant to Section 9.01(b).
Optional
Termination Price: On any date after the Initial Optional
Termination Date an amount equal to the sum of (i) the then
aggregate
outstanding Stated Principal Balance of the Mortgage Loans (or, if
such Mortgage
Loan is an REO Property, the fair market value of such REO
Property) plus
accrued interest thereon at the applicable Mortgage Rate through
the Due Date in
the month in which the Optional Termination Price is to be
distributed to the
Certificateholders; (ii) any unreimbursed out-of-pocket costs and
expenses owed
to the Trustee, the Master Servicer, the Securities Administrator
or the
Servicer, any unpaid or unreimbursed Servicing Fees, Securities
Administrator
Fees and all unreimbursed Advances and Servicing Advances, in each
case incurred
by such party in the performance of its obligations and (iii) any
unreimbursed
costs, penalties and/or damages incurred by the Trust Fund in
connection with
any violation relating to any of the Mortgage Loans of any
predatory or abusive
lending law.
OTS: The
Office of Thrift Supervision.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore executed and
authenticated under
this Agreement except: (1) Certificates theretofore canceled by the
Securities
Administrator or delivered to the Securities Administrator for
cancellation; and
(2)
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Certificates in exchange for which or in lieu of which other
Certificates have
been executed by the Securities Administrator and delivered by the
Securities
Administrator pursuant to this Agreement.
Outstanding Mortgage Loan: As of any Distribution Date, a Mortgage
Loan
with a Stated Principal Balance greater than zero that was not the
subject of a
Principal Prepayment in full, and that did not become a Liquidated
Loan, prior
to the end of the related Due Period.
Overcollateralization Amount: As of any date of determination, the
excess
of (1) the sum of (x) the Stated Principal Balance of the Mortgage
Loans over
(2) the Certificate Principal Balance of the Certificates (other
than the Class
P Certificates and the Class C Certificates).
Ownership
Interest: As to any Certificate, any ownership interest in such
Certificate including any interest in such Certificate as the
Holder thereof and
any other interest therein, whether direct or indirect, legal or
beneficial.
Ownit:
Ownit Mortgage Solutions Inc., a California corporation, or its
successor in interest.
Pass-Through Rate: With respect to any Class of Certificates,
the
corresponding Pass-Through Rate for such Class of Certificates.
Percentage
Interest: With respect to:
(i) any Class,
the percentage interest in the undivided beneficial
ownership
interest evidenced by such Class which shall be equal to the
Certificate Principal Balance of such Class divided by the
aggregate
Certificate Principal Balance of all Classes; and
(ii) any Certificate,
the Percentage Interest evidenced thereby of
the
related Class shall equal the percentage obtained by dividing
the
Denomination of such Certificate by the aggregate of the
Denominations of
all
Certificates of such Class; except that in the case of any Class
P
Certificates, the Percentage Interest with respect to such
Certificate
shown on
the face of such Certificate.
Periodic
Rate Cap: As to each Adjustable Rate Mortgage Loan and the
related Mortgage Note, the provision therein that limits
permissible increases
and decreases in the Mortgage Rate on any Adjustment Date.
Permitted
Activities: The primary activities of the Trust Fund created
pursuant to this Agreement which shall be:
(i) holding
Mortgage Loans transferred from the Depositor and
other
assets of the Trust Fund, including the Cap Contracts and 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 the Cap
Contracts
and making payments on such Certificates and interests in
accordance
with the terms of this Agreement; and
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(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.
Permitted
Investments: At any time, any one or more of the following
obligations and securities:
(i) obligations
of the United States or any agency thereof,
provided
such obligations are backed by the full faith and credit of the
United
States;
(ii) general
obligations of or obligations guaranteed by any state
of the
United States or the District of Columbia receiving the highest
long-term
debt rating of each Rating Agency rating the Certificates;
(iii) commercial or finance company paper, other than commercial
or
finance
company paper issued by the Depositor, the Securities
Administrator or any of its Affiliates, which is then receiving
the
highest
commercial or finance company paper rating of each such Rating
Agency;
(iv) certificates of
deposit, demand or time deposits, or bankers'
acceptances (other than banker's acceptances issued by the
Securities
Administrator or
any of its Affiliates) issued by any depository
institution or trust company incorporated under the laws of the
United
States or
of any state thereof and subject to supervision and examination
by federal
and/or state banking authorities, provided that the commercial
paper
and/or long term unsecured debt obligations of such depository
institution or trust company are then rated one of the two
highest
long-term
and the highest short-term ratings of each such Rating Agency
for such
securities;
(v) demand or
time deposits or certificates of deposit issued by
any bank
or trust company or savings institution to the extent that such
deposits
are fully insured by the FDIC;
(vi) guaranteed
reinvestment agreements issued by any bank,
insurance
company or other corporation rated in the two highest long-term
or the
highest short-term ratings of each Rating Agency containing, at
the
time of
the issuance of such agreements, such terms and conditions as
will
not result
in the downgrading or withdrawal of the rating then assigned to
the
Certificates by any such Rating Agency as evidenced by a letter
from
each
Rating Agency;
(vii) repurchase obligations with respect to any security
described
in clauses
(i) and (ii) above, in either case entered into with a
depository
institution or trust company (acting as principal) described in
clause (v)
above;
(viii)
securities (other than stripped bonds, stripped coupons or
instruments sold at a purchase price in excess of 115% of the face
amount
thereof)
bearing interest or sold at a discount issued by any
corporation,
other than
the Securities Administrator or any of its Affiliates,
incorporated under the laws of the United States or any state
thereof
which, at
the time of such investment, have one of the two highest long
term
ratings of each Rating Agency;
(ix) interests in any
money market fund (including those managed or
advised by
the Securities Administrator, the Trustee or their respective
affiliates) which at the date of acquisition of the interests in
such fund
and
throughout the time such interests are held in such fund has
the
highest
applicable long term rating by each Rating Agency rating such
fund;
and
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<PAGE>
(x) short term
investment funds sponsored by any trust company or
national
banking association incorporated under the laws of the United
States or
any state thereof, other than the Securities Administrator or
any of its
Affiliates, which on the date of acquisition has been rated by
each such
Rating Agency in their respective highest applicable rating
category;
provided, that no such instrument shall be a Permitted Investment
if such
instrument (i) evidences the right to receive interest only
payments with
respect to the obligations underlying such instrument, (ii) is
purchased at a
premium or above par or (iii) is purchased at a deep discount;
provided,
further, that no such instrument shall be a Permitted Investment
(A) if such
instrument evidences principal and interest payments derived from
obligations
underlying such instrument and the interest 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, or (B) if it may be
redeemed at
a price below the purchase price (the foregoing clause (B) not to
apply to
investments in units of money market funds pursuant to clause (ix)
above); and
provided, further, (I) that no amount beneficially owned by any
REMIC
(including, without limitation, any amounts collected by the
Servicer but not
yet deposited in the Collection Account) may be invested in
investments (other
than money market funds) treated as equity interests for Federal
income tax
purposes, unless the Servicer shall receive an Opinion of Counsel,
at the
expense of the party requesting that such investment be made, to
the effect that
such investment will not adversely affect the status of the any
REMIC provided
for herein as a REMIC under the Code or result in imposition of a
tax on the
Trust Fund or any REMIC provided for herein and (II) each such
investment must
be a "permitted investment" within the meaning of Section
860G(a)(5) of the
Code. Permitted Investments that are subject to prepayment or call
may not be
purchased at a price in excess of par.
Permitted
Transferee: Any Person other than (i) the United States, any
State or political subdivision thereof, or any agency or
instrumentality of any
of the foregoing, (ii) a foreign government, International
Organization or any
agency or instrumentality of either of the foregoing, (iii) an
organization
(except certain farmers' cooperatives described in Section 521 of
the Code) that
is exempt from tax imposed by Chapter 1 of the Code (including the
tax imposed
by Section 511 of the Code on unrelated business taxable income) on
any excess
inclusions (as defined in Section 860E(c)(1) of the Code) with
respect to the
Class R or Class R-X Certificate, (iv) rural electric and telephone
cooperatives
described in Section 1381(a)(2)(C) of the Code, and (v) a Person
that is not a
citizen or resident of the United States, a corporation or
partnership (or other
entity treated as a corporation or partnership for United States
federal income
tax purposes) created or organized in or under the laws of the
United States or
any State thereof or the District of Columbia or an estate whose
income from
sources without the United States is includable in gross income for
United
States federal income tax purposes regardless of its connection
with the conduct
of a trade or business within the United States, or a trust if a
court within
the United States is able to exercise primary supervision over
the
administration of the trust and one or more United States persons
have authority
to control all substantial decisions of the trust, unless, in the
case of this
clause (v), such Person has furnished the transferor and the
Securities
Administrator with a duly completed Internal Revenue Service Form
W-8ECI or
applicable successor form. The terms "United States," "State" and
"International
Organization" shall have the meanings set forth in Section 7701 of
the Code. A
corporation will not be treated as an instrumentality of the United
States or of
any State thereof for these purposes if all of its activities are
subject to tax
and, with the exception of the Federal Home Loan Mortgage
Corporation, a
majority of its board of directors is not selected by such
government unit.
Person:
Any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust,
unincorporated
organization or government, or any agency or political subdivision
thereof.
PMI: PMI
Mortgage Insurance Co.
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<PAGE>
Pool
Stated Principal Balance: As to any Distribution Date, the
aggregate
of the Stated Principal Balances, as of such Distribution Date, of
the Mortgage
Loans that were Outstanding Mortgage Loans as of such date.
Preference
Claim: The meaning set forth in Section 4.04(j) hereof.
Prepayment
Assumption: A rate or rates of prepayment, as described in the
Prospectus Supplement in the definition of "Modeling Assumptions,"
relating to
the Publicly Offered Certificates and Privately Offered
Certificates.
Prepayment
Charges: Any prepayment fees, premiums or charges to be paid by
the Mortgagor on a Mortgage Loan pursuant to the terms of the
related Mortgage
Note or Mortgage, as applicable, as identified on the Mortgage Loan
Schedule.
Prepayment
Interest Excesses: With respect to any Servicer Remittance
Date, for each Mortgage Loan that was the subject of a Principal
Prepayment in
full during the portion of the related Prepayment Period occurring
between the
first day of the calendar month in which such Servicer Remittance
Date occurs
and the last day of the related Prepayment Period, an amount equal
to interest
(to the extent received) at the applicable Net Mortgage Rate on the
amount of
such Principal Prepayment for the number of days commencing on the
first day of
the calendar month in which such Servicer Remittance Date occurs
and ending on
the date on which such Principal Prepayment is so applied.
Prepayment
Interest Shortfall: With respect to any Distribution Date, for
each Mortgage Loan that was the subject of a Principal Prepayment
in full (other
than a Principal Prepayment in full resulting from the purchase of
a Mortgage
Loan pursuant to Section 2.02, 2.03 or 9.01 hereof), the amount, if
any, by
which (i) one month's interest at the applicable Net Mortgage Rate
on the Stated
Principal Balance of such Mortgage Loan as of the preceding
Distribution Date or
in the case of a partial Principal Prepayment, on the amount of
such prepayment,
exceeds (ii) the amount of interest paid or collected in connection
with such
Principal Prepayment.
Prepayment
Period: As to any Distribution Date, the period beginning with
the opening of business on the 15th day of the calendar month
preceding the
month in which such Distribution Date occurs (or in the case of the
first
Distribution Date, beginning with the opening of business on the
Cut-off Date)
and ending on the close of business on the 14th day of the month in
which such
Distribution Date occurs.
Principal
Distribution Amount: With respect to each Distribution Date,
the
sum of (i) the Principal Funds for such Distribution Date and (ii)
any Extra
Principal Distribution Amount for such Distribution Date.
Principal
Funds: With respect to the Mortgage Loans and any Distribution
Date, the sum, without duplication, of (1) all scheduled principal
due during
the related Due Period and received before the related Servicer
Remittance Date
or advanced on or before the related Servicer Remittance Date, (2)
Principal
Prepayments collected in the related Prepayment Period, (3) the
Stated Principal
Balance of each Mortgage Loan that was purchased by the Depositor
or the
Servicer during the related Prepayment Period or, in the case of a
purchase
pursuant to Section 9.01, on any Business Day prior to such
Distribution Date,
(4) the amount, if any, by which the aggregate unpaid principal
balance of any
Replacement Mortgage Loan is less than the aggregate unpaid
principal of the
related Deleted Mortgage Loans delivered by the Seller in
connection with a
substitution of a Mortgage Loan pursuant to Section 2.03(c), (5)
all Liquidation
Proceeds collected during the related Prepayment Period (to the
extent such
Liquidation Proceeds related to principal), (6) all Subsequent
Recoveries
received during the related Due
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<PAGE>
Period, and (7) all other collections and recoveries in respect of
principal
during the related Prepayment Period less (A) all Non-Recoverable
Advances
relating to principal with respect to the Mortgage Loans and (B)
other amounts
reimbursable to the Servicer, the Master Servicer, the Securities
Administrator
and the Trustee pursuant to this Agreement and allocable to
principal.
Principal
Prepayment: Any Mortgagor payment or other recovery of (or
proceeds with respect to) principal on a Mortgage Loan (including
Mortgage Loans
purchased or repurchased under Sections 2.02, 2.03, 3.12 and 9.01
hereof) that
is received or recovered in advance of its scheduled Due Date and
is not
accompanied by an amount as to interest representing scheduled
interest due on
any date or dates in any month or months subsequent to the month of
prepayment.
Partial Principal Prepayments shall be applied by the Servicer in
accordance
with the terms of the related Mortgage Note.
Privately
Offered Certificates: The Class B-1, Class B-2, Class B-3,
Class
M-3, Class M-4, Class M-5 and Class M-6 Certificates.
Prospectus
Supplement: The Prospectus Supplement dated December 22, 2005
relating to the public offering of the Publicly - Offered
Certificates.
Publicly
Offered Certificates: The Class A and Class M-1, Class M-2.
PUD: A
Planned Unit Development.
Purchase
Price: With respect to any Mortgage Loan required to be
repurchased by the Seller or the Transferor pursuant to Section
2.02 or 2.03
hereof or purchased by the Servicer pursuant to Section 3.12(c)
hereof, an
amount equal to the sum of (i) 100% of the unpaid principal balance
of the
Mortgage Loan as of the date of such purchase together with any
unreimbursed
Servicing Advances, (ii) accrued interest on such unpaid principal
balance at
the applicable Mortgage Rate from (a) the date through which
interest was last
paid by the Mortgagor to (b) the Due Date in the month in which the
Purchase
Price is to be distributed to Certificateholders and (iii) any
unreimbursed
costs, penalties and/or damages incurred by the Trust Fund (or the
Trustee on
behalf of the Trust Fund) in connection with any violation relating
to such
Mortgage Loan of any predatory or abusive lending law. With respect
to any REO
Property purchased by the Servicer pursuant to Section 3.12(c)
hereof, an amount
equal to the fair market value of such REO Property, as determined
in good faith
by the Servicer
Rating
Agency: Either S&P or Moody's. If any such organization or
its
successor is no longer in existence, "Rating Agency" shall be a
nationally
recognized statistical rating organization, or other comparable
Person,
designated by the Depositor, notice of which designation shall be
given to the
Trustee. References herein to a given rating category of a Rating
Agency shall
mean such rating category without giving effect to any
modifiers.
Realized
Loss: With respect to (1) a Liquidated Loan, the amount, if
any,
by which the Stated Principal Balance and accrued interest thereon
at 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 Loan or (2) a Mortgage Loan
which is not
a Liquidated 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).
Record
Date: With respect to any Distribution Date, the close of
business
on the last Business Day of the month preceding the month in which
the
applicable Distribution Date occurs (or, in the case of the first
Distribution
Date, the Closing Date).
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<PAGE>
Reference
Banks: Barclays Bank PLC, JPMorgan Chase Bank, N.A., Citibank,
N.A., Wells Fargo Bank, N.A. and NatWest, N.A.; provided that if
any of the
foregoing banks are not suitable to serve as a Reference Bank, then
any leading
banks selected by the Securities Administrator which are engaged in
transactions
in Eurodollar deposits in the international Eurocurrency market (i)
with an
established place of business in London, England, (ii) whose
quotations appear
on the Reuters Screen LIBO Page on the relevant Interest
Determination Date and
(iii) which have been designated as such by the Securities
Administrator.
Regular
Certificate: Any one of the Class A, Class M and Class B
Certificates.
Regulation
S: Regulation S promulgated under the Securities Act or any
successor provision thereto, in each case as the same may be
amended from time
to time; and all references to any rule, section or subsection of,
or definition
or term contained in, Regulation S means such rule, section,
subsection,
definition or term, as the case may be, or any successor thereto,
in each case
as the same may be amended from time to time.
Regulation
S Book-Entry Certificates: Certificates sold in offshore
transactions in reliance on Regulation S in the form of one or more
permanent
global Certificates in definitive, fully registered form without
interest
coupons, which shall be deposited on behalf of the subscribers for
such
Certificates represented thereby with the Securities Administrator,
as custodian
for DTC and registered in the name of a nominee of DTC.
Relief
Act: The Servicemembers Civil Relief Act or any similar state
or
local law.
Relief Act
Shortfall: With respect to any Distribution Date and any
Mortgage Loan, any reduction in the amount of interest or principal
collectible
on such Mortgage Loan for the most recently ended calendar month as
a result of
the application of the Relief Act.
REMIC: A
"real estate mortgage investment conduit" within the meaning of
section 860D of the Code. References herein to "the REMICs" or "a
REMIC" shall
mean any of (or, as the context requires, all of) the Lower Tier
REMIC, the
Upper Tier REMIC, the M3 REMIC, the M4 REMIC, the M5 REMIC, the M6
REMIC, the B1
REMIC, the B2 REMIC, the B3 REMIC and the C REMIC.
REMIC
Pass-Through Rate: The Class A-1 Available Funds Cap (in the case
of
a Class included in Certificate Group One), the Class A-2 Available
Funds Cap
(in the case of a Class included in Certificate Group Two) or the
Weighted
Average Available Funds Cap (in the case of the Subordinate
Certificates).
REMIC
Provisions: Provisions of the federal income tax law relating
to
real estate mortgage investment conduits, which appear at sections
860A through
860G of Subchapter M of Chapter 1 of the Code, and related
provisions, and
proposed, temporary and final regulations and published rulings,
notices and
announcements promulgated thereunder, as the foregoing may be in
effect from
time to time as well as provisions of applicable state laws.
REMIC
Regular Interests: (i) any of the rights under any of the
Certificates (other than the Class M-3 Certificates, Class M-4
Certificates, the
Class M-5 Certificates, Class M-6 Certificates, the Class B-1
Certificates, the
Class B-2 Certificates, the Class B-3 Certificates, the Class P
Certificates,
the Class R Certificate, the Class R-X Certificate and the Class C
Certificates)
other than the rights in interest rate cap contracts described in
Section 2.07,
(ii) the Class UTM Interests and the Class UTB Interests and (iii)
the
Uncertificated Class C Interest.
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<PAGE>
Remittance
Report: As defined in Section 4.04(j) hereof.
REO
Property: A Mortgaged Property acquired by the Servicer, on behalf
of
the Trustee for the benefit of the Certificateholders, through
foreclosure or
deed-in-lieu of foreclosure in connection with a defaulted Mortgage
Loan.
Replacement Mortgage Loan: A Mortgage Loan substituted by the
Depositor
for a Deleted Mortgage Loan, which must, on the date of such
substitution, as
confirmed in a Request for Release, substantially in the form of
Exhibit I (1)
have a Stated Principal Balance, after deduction of the principal
portion of the
Scheduled Payment due in the month of substitution, not in excess
of, and not
less than 90% of the Stated Principal Balance of the Deleted
Mortgage Loan; (2)
with respect to any Fixed Rate Mortgage Loan, have a Mortgage Rate
not less than
or no more than 1% per annum higher than the Mortgage Rate of the
Deleted
Mortgage Loan and, with respect to any Adjustable Rate Mortgage
Loan: (A) have a
Maximum Mortgage Rate no more than 1% per annum higher or lower
than the Maximum
Mortgage Rate of the Deleted Mortgage Loan; (B) have a Minimum
Mortgage Rate no
more than 1% per annum higher or lower than the Minimum Mortgage
Rate of the
Deleted Mortgage Loan; (C) have the same index and Periodic Rate
Cap as that of
the Deleted Mortgage Loan and a Gross Margin not more than 1% per
annum higher
or lower than that of the Deleted Mortgage Loan; (D) not permit
conversion of
the related Mortgage Rate to a fixed Mortgage Rate and (F)
currently be accruing
interest at a rate not more than 1% per annum higher or lower than
that of the
Deleted Mortgage Loan; (3) have a similar or higher FICO score or
credit grade
than that of the Deleted Mortgage Loan; (4) have a Loan-to-Value
Ratio (or
Combined Loan-to-Value Ratio, in the case of the Mortgage Loans in
a second lien
position) no higher than that of the Deleted Mortgage Loan; (5)
have a remaining
term to maturity no greater than (and not more than one year less
than) that of
the Deleted Mortgage Loan; (6) provide for a Prepayment Charge on
terms
substantially similar to those of the Prepayment Charge, if any, of
the Deleted
Mortgage Loan; (7) have the same lien priority as the Deleted
Mortgage Loan; (8)
constitute the same occupancy type as the Deleted Mortgage Loan;
and (9) comply
with each representation and warranty set forth in Section 2.03
hereof.
Request
for Release: The Request for Release of Documents submitted by
the
Servicer to the Trustee (or its custodian), substantially in the
form of Exhibit
I hereto.
Required
Insurance Policy: With respect to any Mortgage Loan, any
insurance policy that is required to be maintained from time to
time under this
Agreement, including, without limitation, in the case of the MI
Mortgage Loans,
the MI Policy.
Required
Percentage: As of any Distribution Date following the Stepdown
Date, the quotient of (1) the excess of (A) the Stated Principal
Balances of the
Mortgage Loans as of such Distribution Date, over (B) the
Certificate Principal
Balance of the most senior Class of Certificates outstanding as of
such
Distribution Date, prior to giving effect to distributions to be
made on such
Distribution Date and (2) the Stated Principal Balance of the
Mortgage Loans as
of such Distribution Date.
Reserve
Interest Rate: With respect to any Interest Determination Date,
the rate per annum that the Securities Administrator determines to
be (1) the
arithmetic mean (rounded upwards if necessary to the nearest whole
multiple of
0.03125%) of the one-month United States dollar lending rates which
New York
City banks selected by the Securities Administrator are quoting on
the relevant
Interest Determination Date to the principal London offices of
leading banks in
the London interbank market or (2) in the event that the
Securities
Administrator can determine no such arithmetic mean, the lowest
one-month United
States dollar lending rate which New York City banks selected by
the Securities
Administrator are quoting on such Interest Determination Date to
leading
European banks.
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<PAGE>
Residual
Interest: An interest in the Upper Tier REMIC that is entitled
to
all distributions of principal and interest on the Class R
Certificate other
than distributions in respect of the Class LTR Interest and
distributions on the
Class R Certificate in respect of Excess Interest.
Responsible Officer: When used with respect to the Securities
Administrator or the Servicer, any officer of the Securities
Administrator or
the Servicer with direct responsibility for the administration of
this Agreement
and any other officer to whom, with respect to a particular matter,
such matter
is referred because of such officer's knowledge of and familiarity
with the
particular subject. When used with respect to the Trustee, any
officer of the
Trustee with direct responsibility for the administration of this
Agreement and
also means any other officer to whom, with respect to a particular
matter, such
matter is referred because of such officer's knowledge of and
familiarity with
the particular subject.
Reuters
Screen LIBO Page: The display designated as page "LIBO" on the
Reuters Monitor Money Rates Service (or such other page as may
replace such LIBO
page on that service for the purpose of displaying London interbank
offered
rates of major banks.
S&P:
Standard & Poor's, a division of The McGraw-Hill Companies,
Inc., or
any successor in interest.
Sale
Agreement: The Mortgage Loan Sale and Assignment Agreement dated
as
of December 1, 2005 between the Depositor and the Seller.
Scheduled
Payment: The scheduled monthly payment on a Mortgage Loan due
on
any Due Date allocable to principal and/or interest on such
Mortgage Loan.
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).
Securities
Act: The Securities Act of 1933, as amended.
Securities
Administrator: Wells Fargo Bank, N.A., a national banking
association, or any successor in interest.
Securities
Administrator Fee: A fee paid monthly to the Securities
Administrator from interest collected with respect to each Mortgage
Loan equal
to the product of (a) one-twelfth of the Securities Administrator
Fee Rate and
(b) the Stated Principal Balance of such Mortgage Loan. The
Securities
Administrator is also entitled to a portion of investment income
earned on
amounts on deposit in the Certificate Account as set forth in
Section 3.05(g)
hereof.
Securities
Administrator Fee Rate: 0.01% for each Mortgage Loan.
Seller:
Merrill Lynch Mortgage Lending, Inc., a Delaware corporation,
or
its successor in interest.
Servicer:
Litton Loan Servicing LP, a Delaware limited partnership, or
its
successor in interest.
Servicer
Advance Date: As to any Distribution Date, the related Servicer
Remittance Date.
Servicer
Remittance Date: With respect to any Distribution Date, the
10th
day (or if such day is not a Business Day, the next succeeding
Business Day) of
the month in which the related Distribution Date occurs.
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Servicer
Trigger Event: As defined in Section 7.02 hereof.
Servicer's
Assignee: As defined in Section 10.14(a).
Servicing
Advances: All customary, reasonable and necessary "out of
pocket" costs and expenses incurred in the performance of the
Servicer's
servicing obligations hereunder, including, but not limited to, the
cost of (1)
the preservation, inspection, restoration and protection of a
Mortgaged Property
(or Underlying Mortgaged Property, in the case of a Co-op Loan),
including
without limitation advances in respect of real estate taxes and
assessments, (2)
any collection, enforcement or judicial proceedings, including
without
limitation foreclosures, collections and liquidations, (3) the
conservation,
management, sale and liquidation of any REO Property, (4) executing
and
recording instruments of satisfaction, deeds of reconveyance or
Assignments of
Mortgage to the extent not otherwise recovered from the related
Mortgages or
payable under this Agreement, (5) correcting errors of prior
servicers; costs
and expenses charged to the Servicer by the Trustee or Securities
Administrator;
tax tracking; title research; flood certifications; lender paid
mortgage
insurance, (6) obtaining or correcting any legal documentation
required to be
included in the Mortgage Files and reasonably necessary for the
Servicer to
perform its obligations under this Agreement and (7) compliance
with the
obligations under Sections 3.01 and 3.10; provided that such
amounts are
required to be advanced only to the extent such advances
constitute
"unanticipated expenses" within the meaning of Treasury Regulation
Section
1.860G-1(b)(3)(ii).
Servicing
Fee: As to each Mortgage Loan and any Distribution Date, an
amount equal to the product of (x) one-twelfth of the Servicing Fee
Rate and (y)
the Stated Principal Balance of such Mortgage Loan as of the
preceding
Distribution Date or, in the event of any payment of interest that
accompanies a
Principal Prepayment in full made by the Mortgagor, interest at the
Servicing
Fee Rate on the Stated Principal Balance of such Mortgage Loan as
of the
preceding Distribution Date for the period covered by such payment
of interest.
Servicing
Fee Rate: 0.50% for each Mortgage Loan.
Servicing
Officer: Any officer of the Servicer involved in, or
responsible
for, the administration and servicing of the Mortgage Loans whose
name appears
on a list of servicing officers furnished to the Master Servicer,
the Securities
Administrator and the Trustee by the Servicer on the Closing Date
pursuant to
this Agreement, as such lists may from time to time be amended.
Servicing
Rights Pledgee: One or more lenders, selected by the Servicer,
to which the Servicer may pledge and assign all of its right, title
and interest
in, to and under this Agreement (other than rights with respect to
Advances and
Servicing Advances herein), including JPMorgan Chase Bank, N.A., as
the
representative of certain lenders.
Servicing
Transfer Costs: In the event that the Servicer does not
reimburse the Master Servicer under this Agreement, all costs
associated with
the transfer of servicing from the predecessor Servicer, including,
without
limitation, any costs or expenses associated with the termination
of the
predecessor servicer, the appointment of a successor servicer, the
complete
transfer of all servicing data and the manipulation, completion or
correction of
such servicing data as may be required by the Master Servicer or
any successor
servicer to correct any errors or insufficiencies in the servicing
data or
otherwise to enable the Master Servicer or successor servicer to
service the
Mortgage Loans properly and effectively.
SFAS 140:
Statement of Financial Accounting Standard No. 140, Accounting
for Transfers and Servicing of Financial Assets and Extinguishments
of
Liabilities dated September 2000, published by the Financial
Accounting
Standards Board of the Financial Accounting Foundation.
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Startup Day: As
defined in Section 2.07 hereof.
Stated
Principal Balance: With respect to any Mortgage Loan or related
REO
Property (1) as of the Cut-off Date, the Cut-off Date Principal
Balance thereof,
and (2) as of any Distribution Date, such Cut-off Date Principal
Balance minus
the sum of (A) the principal portion of the Scheduled Payments (x)
due with
respect to such Mortgage Loan during each Due Period ending prior
to such
Distribution Date and (y) that were received by the Servicer as of
the close of
business on the Determination Date related to such Distribution
Date or with
respect to which Advances were made on the Servicer Advance Date
prior to such
Distribution Date and (B) all Principal Prepayments with respect to
such
Mortgage Loan received on or prior to the last day of the related
Prepayment
Period, and all Liquidation Proceeds to the extent applied by the
Servicer as
recoveries of principal in accordance with Section 3.12 with
respect to such
Mortgage Loan, that were received by the Servicer as of the close
of business on
the last day of the related Due Period. Notwithstanding the
foregoing, the
Stated Principal Balance of a Liquidated Loan shall be deemed to be
zero.
Stepdown
Date: The later to occur of (1) the Distribution Date in
January
2009 or (2) the first Distribution Date on which (A) the Class A
Certificate
Principal Balance (reduced by the Principal Funds with respect to
such
Distribution Date) is less than or equal to (B) 53.70% of the
Stated Principal
Balances of the Mortgage Loans as of such Distribution Date.
Stepdown
Required Loss Percentage: For any Distribution Date, the
applicable percentage for such Distribution Date set forth in the
following
table:
<TABLE>
<CAPTION>
DISTRIBUTION DATE OCCURRING IN
STEPDOWN REQUIRED LOSS PERCENTAGE
------------------------------
---------------------------------
<S>
<C>
January 2009 - December 2009
2.25% with respect to January 2008,
plus an additional 1/12th of 0.75% for
each month thereafter
January 2010 - December 2010
3.00% with respect to January 2010,
plus an additional 1/12th of 0.50% for
each month thereafter
January 2011 - December 2011
3.50% with respect to January 2011,
plus an additional 1/12th of 0.25% for
each month thereafter
January 2012 and thereafter
3.75%
</TABLE>
Stepdown
Trigger Event: With respect to the Certificates on or after the
Stepdown Date, a Distribution Date on which (1) the quotient of (A)
the
aggregate Stated Principal Balance of all Mortgage Loans which are
60 or more
days Delinquent measured on a rolling three month basis (including,
for the
purposes of this calculation, Mortgage Loans in foreclosure and REO
Properties
and Mortgage Loans with respect to which the applicable Mortgagor
is in
bankruptcy) and (B) the Stated Principal Balance of the Mortgage
Loans as of the
preceding Servicer Remittance Date, equals or exceeds the product
of (i) 40.40%
and (ii) the Required Percentage or (2) the quotient (expressed as
a percentage)
of (A) the aggregate Realized Losses incurred from the Cut-off Date
through the
last day of the calendar month preceding such Distribution Date and
(B) the
aggregate principal balance of the Mortgage Loans as of the Cut-off
Date exceeds
the Stepdown Required Loss Percentage.
Subordinate Certificates: Each Class of the Class M and Class B
Certificates.
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Subordinate Certificate Cap Contract: The confirmation and
agreement
between the Trust Fund and the Cap Contract Counterparty (in the
form of Exhibit
N-4 hereto).
Subordinate Certificate Cap Contract Notional Balance: With respect
to any
Distribution Date, the Subordinate Certificate Cap Contract
Notional Balance set
forth for such Distribution Date in the Subordinate Certificate One
Month LIBOR
Cap Table attached hereto as Exhibit O-4.
Subordinate Certificate Cap Contract Termination Date: The
Distribution
Date in February 2004.
Subordinate Certificate Upper Collar: With respect to each
Distribution
Date with respect to which payments are received on the Subordinate
Certificate
Cap Contract, a rate equal to the lesser of One-Month LIBOR and
9.180% per
annum.
Subsequent
Recovery: Any amount received on a Mortgage Loan (net of
amounts reimbursed to the Servicer related to such Mortgage Loan)
subsequent to
such Mortgage Loan being determined to be a Liquidated Mortgage
Loan.
Subservicing Agreement: As defined in Section 3.02(a).
Substitution Adjustment Amount: The meaning ascribed to such term
pursuant
to Section 2.03(c).
Tax
Matters Person: The Person designated as "tax matters person" in
the
manner provided under Treasury regulation Section 1.860F-4(d) and
Treasury
regulation Section 301.6231(a)(7)-1.
Transfer:
Any direct or indirect transfer or sale of any Ownership
Interest in a Certificate.
Transfer
Agreement: The Master Mortgage Loan Purchase and Interim
Servicing Agreement dated as of April 1, 2005, between Merrill
Lynch Mortgage
Capital Inc., as purchaser and Ownit, as seller and interim
servicer, as
supplemented by the Bring Down Letter.
Transferor: Ownit.
Transferor Affirmation
Notice: A notice from Fitch to the Depositor or the
Seller that the ratings of the Certificates will not be negatively
impacted by
the removal of the Seller's obligation to honor the Transferor's
representations
and warranties, a copy of which notice shall be provided by either
the Seller or
the Depositor to the Securities Administrator and the Trustee.
Trust
Fund: The corpus of the trust (the "Ownit Mortgage Loan Trust,
Series 2005-5") created hereunder consisting of (i) the Mortgage
Loans and all
interest and principal received on or with respect thereto on and
after the
Cut-off Date to the extent not applied in computing the Cut-off
Date Principal
Balance thereof, exclusive of interest not required to be deposited
in the
Collection Account; (ii) the Collection Account, the Certificate
Account and all
amounts deposited therein pursuant to the applicable provisions of
this
Agreement; (iii) property that secured a Mortgage Loan and has been
acquired by
foreclosure, deed in lieu of foreclosure or otherwise; (iv) the
mortgagee's
rights under the Insurance Policies with respect to the Mortgage
Loans; (v) all
proceeds of the conversion, voluntary or involuntary, of any of the
foregoing
into cash or other liquid property; and (vi) the Cap Contracts and
Cap Contract
Account.
Trustee:
HSBC Bank USA, National Association, a national banking
association, not in its individual capacity, but solely in its
capacity as
trustee for the benefit of the Certificateholders under this
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Agreement, and any successor thereto, and any corporation or
national banking
association resulting from or surviving any consolidation or merger
to which it
or its successors may be a party and any successor trustee as may
from time to
time be serving as successor trustee hereunder.
Uncertificated Class C Interest: An uncertificated interest with
an
initial principal amount equal to the initial Overcollateralization
Amount and
having (i) the same rights to payments as the Class C Certificates,
other than
the rights to payments of amounts with respect to the Cap
Contracts, and (ii)
the rights to the payments treated as distributed to the Class C
Certificates
under Section 2.07(d), provided, however, that such interest shall
have no
obligation to make any payments treated as paid by the Class C
Certificates
pursuant to interest rate cap agreements under Section 2.07(d).
Underlying
Mortgaged Property: With respect to each Co-op Loan, the
underlying real property owned by the related residential
cooperative housing
corporation.
Unpaid
Realized Loss Amount: The Class M-1 Unpaid Realized Loss
Amount,
Class M-2 Unpaid Realized Loss Amount, Class M-3 Unpaid Realized
Loss Amount,
Class M-4 Unpaid Realized Loss Amount, Class M-5 Unpaid Realized
Loss Amount,
Class M-6 Unpaid Realized Loss Amount, Class B-1 Unpaid Realized
Loss Amount,
Class B-2 Unpaid Realized Loss Amount, Class B-3 Unpaid Realized
Loss Amount and
Class C Unpaid Realized Loss Amount, collectively.
Upper
Collar: Any of the Class A-1 Upper Collar, the Class A-2 Upper
Collar or the Subordinate Certificate Upper Collar.
Upper Tier
REMIC: As described in the Preliminary Statement and Section
2.07.
USAP
Report: A report in compliance with the Uniform Single
Attestation
Program for Mortgage Bankers delivered in accordance with Section
3.18.
Voting
Rights: The portion of the voting rights of all the
Certificates
that is allocated to any of the Certificates for purposes of the
voting
provisions hereunder. Voting Rights allocated to each Class of
Certificates
shall be allocated as follows: (1) 98% to the Class A, Class M and
Class B
Certificates, with the allocation among such Certificates to be in
proportion to
the Certificate Principal Balance of each Class relative to the
Certificate
Principal Balance of all other Classes and (2) each Class of the
Class C and
Class P will be allocated 1% of the Voting Rights. Voting Rights
will be
allocated among the Certificates of each such Class in accordance
with their
respective Percentage Interests.
Weighted
Average Available Funds Cap: With respect to a Distribution
Date,
the per annum rate equal to the weighted average (weighted in
proportion to the
results of subtracting the current Certificate Principal Balance of
the Class
A-1 and Class R Certificates, in the case of Group One, or the
Class A-2
Certificates, in the case of Group Two, from the aggregate Stated
Principal
Balance of the Mortgage Loans in each Mortgage Group as of the
immediately
preceding Distribution Date (or, in the case of the first
Distribution Date, as
of the Cut-off Date)) of the Class A-1 Available Funds Cap and the
Class A-2
Available Funds Cap.
Weighted
Average Maximum Rate Cap: With respect to a Distribution Date,
the per annum rate equal to the weighted average (weighted in
proportion to the
results of subtracting from the aggregate Stated Principal Balance
of the
Mortgage Loans in each Mortgage Group as of the immediately
preceding
Distribution Date (or, in the case of the first Distribution Date,
as of the
Cut-off Date) the current Certificate Principal Balance of the
Class A-1 and
Class R Certificates, in the case of Group One, or the Class A-2
Certificates,
in the case of Group Two) of the Class A-1 Maximum Rate Cap and the
Class A-2
Maximum Rate Cap.
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ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
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 assets
of the Trust Fund. Such assignment includes all interest and
principal received
on or with respect to the Mortgage Loans, on or after the Cut-off
Date (other
than Scheduled Payments due on the Mortgage Loans on or before the
Cut-off
Date).
It is
agreed and understood by the Depositor, the Master Servicer,
the
Servicer, the Securities Administrator and the Trustee that it is
not intended
that any Mortgage Loan be included in the Trust that is, without
limitation, a
"High-Cost Home Loan" as defined by the Home Ownership and Equity
Protection Act
of 1994 or any other applicable anti-predatory lending laws,
including but not
limited to (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; or
(iii) a "High-Cost Home Loan" as defined in the Massachusetts
Predatory Home
Loan Practices Act effective November 7, 2004; (iv) a "High-Cost
Home Loan" as
defined by the Indiana High Cost Home Loan Law effective January 1,
2005 or (v)
a "High-Cost Home Loan" as defined by the Illinois High-Risk Home
Loan Act
effective January 1, 2004.
(i) In
connection with such assignment, the Depositor does hereby
deliver
to, and deposit with, the Trustee or its Custodian, the following
documents or
instruments with respect to each Mortgage Loan so assigned that is
not a Co-op
Loan:
(A) The original Mortgage Note endorsed in blank or, "Pay to
the
order of
HSBC Bank USA, National Association, as trustee, without
recourse"
together with all riders thereto. The Mortgage Note shall
include
all intervening endorsements showing a complete chain of the
title
from the
originator to [____________________] or "Pay to the order of
HSBC
Bank USA,
National Association, as trustee, without recourse";
(B) Except as provided below and for each Mortgage Loan that is
not
a MERS
Loan, the original recorded Mortgage with all riders thereto,
with
evidence
of recording thereon, or, if the original Mortgage has not yet
been
returned from the recording office, a copy of the original
Mortgage
certified
by the Transferor to be true copy of the original of the
Mortgage
that has been delivered for recording in the appropriate
recording
office of the jurisdiction in which the Mortgaged Property is
located
and in the case of each MERS Loan, the original Mortgage,
noting
the
presence of the MIN of the Loan and either language indicating
that
the
Mortgage Loan is a MOM Loan or if the Mortgage Loan was not a MOM
Loan
at
origination, the original Mortgage and the assignment thereof to
MERS,
with evidence of
recording indicated thereon, or a copy of the Mortgage
certified
by the public recording office in which such Mortgage has been
recorded;
(C) In the case of each Mortgage Loan that is not a MERS Loan,
the
original Assignment of
each Mortgage endorsed either in blank or, to "HSBC
Bank USA,
National Association, as trustee;"
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(D) The original policy of title insurance (or a preliminary
title
report,
commitment or binder if the original title insurance policy has
not been
received from the title insurance company);
(E) Originals of any intervening assignments of the Mortgage,
with
evidence
of recording thereon or, if the original intervening assignment
has not
yet been returned from the recording office, a copy of such
assignment
certified to be a true copy of the original of the assignment
which has
been sent for recording in the appropriate jurisdiction in
which
the
Mortgaged Property is located; and
(F) Originals of all assumption and modification agreements, if
any.
(ii) 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 that is a 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 either in blank
or, "Pay
to the
order of HSBC Bank, USA, National Association 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 endorsed either in blank
or
to "HSBC
Bank USA, National Association, as trustee;"
(D) Original assignments of Mortgage showing a complete chain
of
assignment
from the originator of the related Co-Op Loan to the last
endorsee
on the Mortgage Note;
(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 (or a recorded copy thereof);
(F) Form UCC-3 (or copy thereof) by the Transferor or its agent
assigning
the security interest covered by such Form UCC-1 to "HSBC Bank,
USA,
National Association., 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 Transferor, with evidence of
recording
thereon;
(G) Original 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;
(I) Original assignment of proprietary lease or a copy thereof,
to
the
Trustee or in blank, and all intervening assignments thereof;
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(J) Original recognition agreement or a copy thereof 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; and
(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 that is not a Co-op Loan, the
Depositor cannot deliver the Mortgage, Assignments of Mortgage or
assumption,
consolidation or modification, as the case may be, with evidence of
recording
thereon, if applicable, 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, 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 or assumption, consolidation or
modification, 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 (or its custodian) such Mortgage, Assignments of
Mortgage or
assumption, consolidation or modification, as the case may be, with
evidence of
recording indicated thereon, if applicable, upon receipt thereof
from the public
recording office. To the extent any required endorsement is not
contained on a
Mortgage Note or an Assignment of Mortgage, the Depositor shall
make or cause
such endorsement to be made.
With
respect to any Mortgage Loan that is not a Co-op Loan, none of
the
Depositor, the Master Servicer, the Servicer, the Securities
Administrator or
the Trustee shall be obligated to cause to be recorded the
Assignment of
Mortgage referred to in this Section 2.01. With respect to any
Co-op Loan, none
of the Depositor, the Servicer or the Trustee shall be obligated to
cause to be
filed the Form UCC-3 referred to in this Section 2.01. In the event
that any
Assignment of Mortgage referred to in this Section 2.01 is not
recorded or is
improperly recorded, the Servicer and the Trustee shall have no
liability for
any failure to receive or act on notices related to such Assignment
of Mortgage.
The
ownership of each Mortgage Note, the Mortgage and the contents of
the
related Mortgage File is vested in the Trustee on behalf of the
Certificateholders. None of the Depositor, the Master Servicer, the
Servicer or
the Securities Administrator shall take any action inconsistent
with such
ownership and shall not claim any ownership interest therein. The
Depositor, the
Master Servicer, the Servicer and Securities Administrator 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
(or its custodian) are and shall be held in trust by the Servicer,
for the
benefit of the Trustee as the owner thereof, and the 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 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.
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
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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 for
the benefit of the Certificateholders its rights and interests
under the Sale
Agreement, including the Depositor's right, title and interest in
the
representations and warranties contained in the Sale Agreement, the
rights in
the Transfer Agreement described therein and the benefit of the
repurchase
obligations and the obligation 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 Trustee hereby accepts such assignment, and shall be entitled
to exercise
all rights of the Depositor under the Sale Agreement as if, for
such purpose, it
were the Depositor. The foregoing sale, transfer, assignment,
set-over, deposit
and conveyance does not and is not intended to result in creation
or assumption
by the Trustee of any obligation of the Depositor, the Seller, or
any other
Person in connection with the Mortgage Loans or any other agreement
or
instrument relating thereto except as specifically set forth
herein.
SECTION 2.02. Acceptance by the Trustee of the Mortgage Loans.
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 (or its
custodian) 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 Loan to which a
material 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 acknowledges receipt of the three Cap Contracts (forms
of
which are attached hereto as Exhibits N-1, N-2 and N-3), the
Transfer Agreement,
the Bring Down Letter and the Sale Agreement.
The
Trustee agrees, for the benefit of Certificateholders and the
NIMs
Insurer, to review or cause its Custodian to review each Mortgage
File delivered
to it within 60 days after the Closing Date to ascertain and to
certify, within
70 days of the Closing Date, to the NIMs Insurer, the Depositor,
the Master
Servicer and the Servicer 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 B that have been conveyed to it. If the
Trustee (or its
custodian) 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 (or its custodian)
shall
promptly (and in any event within no more than five Business Days)
after such
finding so notify the NIMs Insurer, the Servicer, the Master
Servicer, the
Seller and the Depositor. In addition, the Trustee (or its
custodian) shall also
notify the NIMs Insurer, the Master Servicer, the Servicer, the
Seller and the
Depositor if the original Mortgage with evidence of recording
thereon with
respect to a Mortgage Loan is not received within 70 days of the
Closing Date;
if
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<PAGE>
it has not been received 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 office
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 2.03, within 90
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 Trust Fund 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 Certificate Account
or Collection
Account, as appropriate, promptly upon receipt, and, upon receipt
by the Trustee
of written notification of such deposit signed by a Servicing
Officer, the
Trustee, upon receipt of a Request for Release, 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 requested
by the Seller and 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
and the NIMs
Insurer. The preceding sentence shall not, however, limit any
remedies available
to the Certificateholders, the NIMs Insurer, the Depositor or the
Trustee
pursuant to the Sale Agreement, the Transfer Agreement and the
Bring Down
Letter. 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, recordable 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 Servicer, the Master
Servicer, the
Securities Administrator and the Trustee shall keep confidential
the name of
each Mortgagor except as required by this Agreement and the
Servicer, the Master
Servicer, the Securities Administrator and the Trustee shall not
solicit any
such Mortgagor for the purpose of refinancing the related Mortgage
Loan;
notwithstanding anything herein to the contrary, the foregoing
shall not be
construed to prohibit (i) disclosure of any and all information
that is or
becomes publicly known, or information obtained by the Trustee, the
Servicer,
the Master Servicer or the Securities Administrator from sources
other than the
other parties hereto, (ii) disclosure of any and all information
(A) if required
by any applicable law, rule or regulation, (B) to any government
agency or
regulatory body having or claiming authority to regulate or oversee
any aspects
of the Trustee's business or that of its affiliates, (C) pursuant
to any
subpoena, civil investigation demand or similar demand or request
of any court,
regulatory authority, arbitrator or arbitration to which Trustee or
any
affiliate or an officer, director, employer or shareholder thereof
is a party or
(D) to any affiliate, independent or internal auditor, agent,
employee or
attorney of the Trustee, the Servicer, the Master Servicer or the
Securities
Administrator having a need to know the same, provided that the
Trustee, the
Servicer, the Master Servicer or the Securities Administrator, as
applicable,
advises such recipient of the confidential nature of the
information being
disclosed, or (iii) any other disclosure authorized by the
Depositor. It is
understood and agreed that all rights and benefits relating to the
solicitation
of any Mortgagors and the attendant rights, title and interest in
and to the
list of Mortgagors and data relating to their Mortgages shall be
retained by the
Servicer.
Within 70
days of the Closing Date, the Trustee (or its custodian) shall
deliver to the NIMs Insurer, the Depositor, the Master Servicer and
the Servicer
the Trustee's Certification, substantially in the form of Exhibit D
attached
hereto, evidencing the completeness of the Mortgage Files, with any
exceptions
noted thereto.
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SECTION 2.03. Representations, Warranties and Covenants of the
Depositor.
(a) The Depositor hereby represents and warrants to the
Servicer,
the Master Servicer, the Securities Administrator, the NIMs Insurer
and the
Trustee as follows, as of the date hereof:
(i) The Depositor is duly organized and is validly existing as
a
corporation in good standing under the laws of the State of
Delaware and
has full
power and authority (corporate and other) necessary to own or
hold its
properties and to conduct its business as now conducted by it
and
to enter
into and perform its obligations under this Agreement and the
Sale
Agreement.
(ii) The Depositor has the full corporate power and authority
to
execute,
deliver and perform, and to enter into and consummate the
transactions contemplated by, this Agreement and the Sale Agreement
and
has duly
authorized, by all necessary corporate action on its part, the
execution,
delivery and performance of this Agreement and the Sale
Agreement;
and this Agreement and the Sale Agreement, assuming the due
authorization, execution and delivery hereof by the other parties
hereto,
constitutes a legal, valid and binding obligation of the
Depositor,
enforceable against the Depositor in accordance with its terms,
subject,
as to
enforceability, to (i) bankruptcy, insolvency, reorganization,
moratorium
and other similar laws affecting creditors' rights generally
and (ii)
general principles of equity, regardless of whether enforcement
is sought
in a proceeding in equity or at law.
(iii) The execution and delivery of this Agreement and the Sale
Agreement
by the Depositor, the consummation of the transactions
contemplated by this Agreement and the Sale Agreement, and the
fulfillment
of or
compliance with the terms hereof are in the ordinary course of
business
of the Depositor and will not (A) result in a material breach
of
any term
or provision of the charter or by-laws of the Depositor or (B)
materially
conflict with, result in a violation or acceleration of, or
result in
a material default under, the terms of any other material
agreement
or instrument to which the Depositor is a party or by which it
may be
bound or (C) constitute a material violation of any statute,
order
or
regulation applicable to the Depositor of any court, regulatory
body,
administrative agency or governmental body having jurisdiction over
the
Depositor;
and the Depositor is not in breach or violation of any material
indenture
or other material agreement or instrument, or in violation of
any
statute, order or regulation of any court, regulatory body,
administrative agency or governmental body having jurisdiction over
it
which
breach or violation may materially impair the Depositor's ability
to
perform or
meet any of its obligations under this Agreement.
(iv) No litigation is pending, or, to the best of the
Depositor's
knowledge,
threatened, against the Depositor that would materially and
adversely
affect the execution, delivery or enforceability of this
Agreement
and the Sale Agreement or the ability of the Depositor to
perform
its obligations under this Agreement and the Sale Agreement in
accordance
with the terms hereof.
(v) No consent, approval, authorization or order of any court
or
governmental agency or body is required for the execution, delivery
and
performance by the Depositor of, or compliance by the Depositor
with, this
Agreement
and the Sale Agreement or the consummation of the transactions
contemplated hereby, or if any such consent, approval,
authorization or
order is
required, the Depositor has obtained the same. The Depositor
hereby
represents and warrants to the Trustee with respect to each
Mortgage
Loan as of the Closing Date and following the transfer of the
Mortgage
Loans to it by the Seller, the Depositor had good title to the
Mortgage
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Loans and
the Mortgage Notes were subject to no offsets, claims, liens,
mortgage,
pledge, charge, security interest, defenses or counterclaims.
(b) The representations and warranties of the Transferor with
respect to the Mortgage Loans contained in the Transfer Agreement
were made as
of the date of the Transfer Agreement and brought forward to the
Closing Date
pursuant to the Bring Down Letter. The representations and
warranties of the
Transferor with respect to the Mortgage Loans contained in the
Bring Down Letter
were made as of the Closing Date. The representations and
warranties of the
Seller with respect to the Mortgage Loans contained in the Sale
Agreement were
made as of the Closing Date.
To the
extent that any fact, condition or event with respect to a
Mortgage
Loan constitutes a breach of a representation or warranty of the
Transferor
under the Transfer Agreement (whether or not such fact, condition
or event would
also constitute a breach of a representation or warranty of the
Seller under the
Sale Agreement), the only rights or remedies of the Trustee, the
NIMs Insurer or
of any Certificateholder shall be first, the Trustee's right to
enforce the
obligations of the Transferor under such applicable representation
or warranty
made by it and, second, only if the Transferor is unable or
unwilling to fulfill
its obligations to cure or repurchase such Mortgage Loan, the
Trustee shall
exercise its right to enforce any rights it may have against the
Seller under
the Sale Agreement with respect to such representation or warranty;
provided,
that in the event the Trustee shall have received a copy of any
Transferor
Affirmation Notice, the Trustee shall only be entitled to enforce
any rights it
has against the Transferor under the Transfer Agreement and shall
not have any
rights against the Seller under the Sale Agreement with respect to
such
representation or warranty. To the extent that any fact, condition
or event with
respect to a Mortgage Loan constitutes a breach of a representation
or warranty
made by the Seller in the Sale Agreement that does not also
constitute a breach
of a representation or warranty of the Transferor under the
Transfer Agreement,
the Trustee shall enforce any rights it may have against the Seller
under the
Sale Agreement. In furtherance of the above, the Seller expressly
acknowledges
that prior to the issuance of a Transferor Affirmation Notice, it
shall be
obligated and liable to the Trustee, the NIMs Insurer and the
Certificateholders
for any breach of a representation or warranty made under the
Transfer
Agreement, but only after the Transferor evidences that it is
unwilling or
unable to fulfill its contractual obligations under the Transfer
Agreement. The
Trustee acknowledges that the Depositor shall have no obligation or
liability
with respect to any breach of any representation or warranty with
respect to the
Mortgage Loans (except as set forth in Section 2.03(a)(v)) under
any
circumstances.
In
addition to the representations and warranties of the Transferor in
the
Transfer Agreement that were brought forward to the Closing Date
pursuant to the
Bring Down Letter, with respect to each Mortgage Loan, the
Transferor made
certain additional covenants regarding such Mortgage Loan, as set
forth in the
Transfer Agreement. With respect to any breach of such additional
covenants that
materially and adversely affects the interests of the
Certificateholders in such
Mortgage Loan, the Seller shall (1) use reasonable efforts to
enforce such
covenant against the Transferor and (2) if the Seller successfully
enforces any
obligation of the Transferor to repurchase such Mortgage Loan, the
Seller shall
repurchase such Mortgage Loan in accordance with this Section 2.03.
If the
Seller does not successfully enforce the obligation, if any, of the
Transferor
to repurchase a Mortgage Loan with respect to any breach of any
such additional
covenants, the Seller shall have no obligation or right to
repurchase or cure
such Mortgage Loan.
(c) Upon discovery by any of the Depositor, the Master Servicer,
the
Securities Administrator, the Servicer, the NIMs Insurer or the
Trustee of a
breach of any of such representations and warranties that adversely
and
materially affects the value of the related Mortgage Loan,
Prepayment Charges or
the interests of the Certificateholders, the party discovering such
breach shall
give prompt written notice to the other parties. Within 90 days of
the discovery
of such breach of any representation or warranty, the Transferor or
the Seller,
as applicable, shall either (a) cure such breach in all
material
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<PAGE>
respects, (b) repurchase such Mortgage Loan or any property
acquired in respect
thereof from the Trustee at the Purchase Price or (c) within the
two year period
following the Closing Date, substitute a Replacement Mortgage Loan
for the
affected Mortgage Loan. In the event of discovery of a breach of
any
representation and warranty of the Transferor or the Seller, the
Trustee shall
enforce its rights under the Transfer Agreement or the Sale
Agreement for the
benefit of Certificateholders and the NIMs Insurer. If a breach of
the
representations and warranties set forth in the Transfer Agreement
exists solely
due to the unenforceability of a Prepayment Charge, the Trustee
shall notify the
NIMs Insurer thereof and not seek to enforce the repurchase remedy
provided for
herein unless directed in writing to do so by the NIMs Insurer. In
the event of
a breach of the representations and warranties with respect to the
Mortgage
Loans set forth in the Transfer Agreement, the Trustee shall, at
the request of
the NIMs Insurer, enforce the right of the Trust Fund and the NIMs
Insurer to be
indemnified for such breach of representation and warranty. In the
event that
such breach relates solely to the unenforceability of a Prepayment
Charge,
amounts received in respect of such indemnity up to the amount of
such
Prepayment Charge shall be distributed pursuant to Section
4.04(b)(i). As
provided in the Sale Agreement, if the Transferor substitutes for a
Mortgage
Loan for which there is a breach of any representations and
warranties in the
Transfer Agreement which adversely and materially affects the value
of such
Mortgage Loan and such substitute mortgage loan is not a
Replacement Mortgage
Loan, under the terms of the Sale Agreement, the Seller will, in
exchange for
such substitute Mortgage Loan, (i) provide the applicable Purchase
Price for the
affected Mortgage Loan or (ii) within two years of the Closing
Date, substitute
such affected Mortgage Loan with a Replacement Mortgage Loan. Any
such
substitution shall not be effected prior to the additional delivery
to the
Trustee of a Request for Release substantially in the form of
Exhibit I and
shall not be effected unless it is within two years of the Startup
Day. As
provided in the Sale Agreement, the Seller indemnifies and holds
the Trust Fund,
the Trustee, the Depositor, the NIMs Insurer, the Master Servicer,
the
Securities Administrator, the Servicer and each Certificateholder
harmless
against any and all taxes, claims, losses, penalties, fines,
forfeitures,
reasonable legal fees and related costs, judgments, and any other
costs, fees
and expenses that the Trust Fund, the Trustee, the Depositor, the
NIMs Insurer,
the Master Servicer, the Securities Administrator, the Servicer and
any
Certificateholder may sustain in connection with any actions of the
Seller
relating to a repurchase of a Mortgage Loan other than in
compliance with the
terms of this Section 2.03 and the Sale Agreement, to the extent
that any such
action causes (i) any federal or state tax to be imposed on the
Trust Fund or
any REMIC provided for herein, including without limitation, any
federal tax
imposed on "prohibited transactions" under Section 860F(a)(1) of
the Code or on
"contributions after the startup day" under Section 860G(d)(1) of
the Code, or
(ii) any REMIC created hereunder to fail to qualify as a REMIC at
any time that
any Certificate is outstanding. In furtherance of the foregoing, if
the Seller
is not a member of MERS and repurchases a Mortgage Loan which is
registered on
the MERS System, the Seller, at its own expense and without any
right of
reimbursement, shall cause MERS to execute and deliver an
assignment of the
Mortgage in recordable form to transfer the Mortgage from MERS to
the Seller and
shall cause such Mortgage to be removed from registration on the
MERS System in
accordance with MERS' rules and regulations.
With respect to
any Mortgage Loan repurchased by the Depositor pursuant to
this Agreement, by the Seller pursuant to the Sale Agreement or by
the
Transferor pursuant to the Transfer Agreement, the principal
portion of the
funds received by the Servicer in respect of such repurchase of a
Mortgage Loan
will be considered a Principal Prepayment and shall be deposited by
the Servicer
in the Collection Account pursuant to Section 3.05 and the Servicer
shall notify
the Securities Administrator of its receipt of the same. The
Trustee, upon
receipt of notice from the Servicer of its receipt of the full
amount of the
Purchase Price for a Deleted Mortgage Loan, or upon receipt of the
Mortgage File
for a Replacement Mortgage Loan substituted for a Deleted Mortgage
Loan, shall
release or cause to be released and reassign to the Depositor, the
Seller or the
Transferor, as applicable, the related Mortgage File for the
Deleted Mortgage
Loan and shall execute and deliver such instruments of transfer or
assignment,
in each case without recourse, representation or warranty, as shall
be necessary
to vest in such party or its
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<PAGE>
designee or assignee title to any Deleted Mortgage Loan released
pursuant
hereto, free and clear of all security interests, liens and other
encumbrances
created by this Agreement, which instruments shall be prepared by
the Trustee
(or its custodian), and neither the Trustee nor the Securities
Administrator
shall not have any further responsibility with respect to the
Mortgage File
relating to such Deleted Mortgage Loan.
With
respect to each Replacement Mortgage Loan to be delivered to
the
Trustee (or its custodian) pursuant to the terms of this Article II
in exchange
for a Deleted Mortgage Loan: (i) the Depositor, the Transferor or
the Seller, as
applicable, must deliver to the Trustee (or its custodian) the
Mortgage File for
the Replacement Mortgage Loan containing the documents set forth in
Section 2.01
along with a written certification certifying as to the delivery of
such
Mortgage File and containing the granting language set forth in
Section 2.01;
and (ii) the Depositor will be deemed to have made, with respect to
such
Replacement Mortgage Loan, each of the representations and
warranties made by it
with respect to the related Deleted Mortgage Loan. The Trustee (or
its
custodian) shall review the Mortgage File with respect to each
Replacement
Mortgage Loan and certify to the NIMs Insurer and the Depositor
that all
documents required by Section 2.01 have been executed and
received.
For any
month in which the Seller substitutes one or more Replacement
Mortgage Loans for one or more Deleted Mortgage Loans, the Seller
will determine
the amount (if any) by which the aggregate principal balance of all
such
Replacement Mortgage Loans as of the date of substitution and the
aggregate
Prepayment Charges with respect to such Replacement Mortgage Loans
is less than
the aggregate Stated Principal Balance (after application of the
principal
portion of the Scheduled Payment due in the month of substitution)
and aggregate
Prepayment Charges of all such Deleted Mortgage Loans. An amount
equal to the
aggregate of the deficiencies described in the preceding sentence
(such amount,
the "Substitution Adjustment Amount") plus an amount equal to any
unreimbursed
costs, penalties and/or damages incurred by the Trust Fund in
connection with
any violation relating to such Deleted Mortgage Loan of any
predatory or abusive
lending law shall be remitted by the Seller to the Servicer for
deposit into the
Collection Account on the Determination Date for the Distribution
Date relating
to the Prepayment Period during which the related Mortgage Loan
became required
to be purchased or replaced hereunder.
Notwithstanding any other provision of this Agreement, the right
to
substitute Mortgage Loans pursuant to this Article II shall be
subject to the
additional limitations that no substitution of a Replacement
Mortgage Loan for a
Deleted Mortgage Loan shall be made unless the Trustee, the NIMs
Insurer and the
Securities Administrator shall each have received an Opinion of
Counsel (at the
expense of the party seeking to make the substitution) that, under
current law,
such substitution will not (A) affect adversely the status of any
REMIC
established hereunder as a REMIC, or of the related "regular
interests" as
"regular interests" in any such REMIC, or (B) cause any such REMIC
to engage in
a "prohibited transaction" or prohibited contribution pursuant to
the REMIC
Provisions.
The Trustee
shall cause the Mortgage Loan Schedule to be amended in
accordance with the terms of this Agreement.
The Seller
shall give or cause to be given written notice to the
Certificateholders and the NIMs Insurer that such substitution has
taken place,
shall amend the Mortgage Loan Schedule to reflect the removal of
such Deleted
Mortgage Loan from the terms of this Agreement and the substitution
of the
Replacement Mortgage Loan or Replacement Mortgage Loans and shall
deliver a copy
of such amended Mortgage Loan Schedule to the NIMs Insurer, the
Servicer, the
Master Servicer and the Trustee. Upon such substitution by the
Seller, such
Replacement Mortgage Loan or Replacement Mortgage Loans shall
constitute part of
the Mortgage Pool and shall be subject in all respects to the terms
of this
Agreement and the Sale Agreement, including all applicable
representations and
warranties thereof included in the Sale Agreement as of the date
of
substitution.
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<PAGE>
(d) It is understood and agreed that the representations,
warranties
and indemnification (i) set forth in this Section 2.03, (ii) of the
Seller and
the Depositor set forth in the Sale Agreement and assigned to the
Trustee by the
Depositor hereunder and (iii) of the Transferor, assigned by the
Seller to the
Depositor pursuant to the Sale Agreement and assigned to the
Trustee by the
Depositor hereunder shall each survive delivery of the Mortgage
Files and the
Assignment of Mortgage of each Mortgage Loan to the Trustee and
shall continue
throughout the term of this Agreement.
(e) The Depositor shall deliver a copy of the Mortgage Loan
Schedule
to the Servicer on the Closing Date.
SECTION 2.04. Representations and Warranties of the Master
Servicer;
Representations and
Warranties of the Servicer; Representations and Warranties
of the Securities
Administrator.
(a) The Master Servicer hereby represents and warrants to the
Depositor, the Servicer and the Trustee as follows, as of the date
hereof:
(i) The Master Servicer is duly organized and is validly
existing as a national banking association and is duly authorized
and qualified
to transact any and all business contemplated by this Agreement to
be conducted
by the Master Servicer.
(ii) The Master Servicer has the power and authority to master
service each Mortgage Loan, and to execute, deliver and perform,
and to enter
into and consummate, the transactions contemplated by this
Agreement and has
duly authorized by all necessary action on the part of the Master
Servicer the
execution, delivery and performance of this Agreement; and this
Agreement,
assuming the due authorization, execution and delivery hereof by
the other
parties hereto, constitutes a legal, valid and binding obligation
of the Master
Servicer, enforceable against the Master Servicer in accordance
with its terms,
except that (A) the enforceability hereof may be limited by
bankruptcy,
insolvency, moratorium, receivership and other similar laws
relating to
creditors' rights generally and (B) the remedy of specific
performance and
injunctive and other forms of equitable relief may be subject to
equitable
defenses and to the discretion of the court before which any
proceeding
hereunder may be brought.
(iii) The execution and delivery of this Agreement by the
Master Servicer, the master servicing of the Mortgage Loans under
this
Agreement, the consummation of any other of the transactions
contemplated by
this Agreement, and the fulfillment of or compliance with the terms
hereof are
in the ordinary course of business of the Master Servicer and will
not (A)
result in a material breach of any term or provision of the charter
or by-laws
of the Master Servicer or (B) materially conflict with, result in a
material
breach, violation or acceleration of, or result in a material
default under, the
terms of any other material agreement or instrument to which the
Master Servicer
is a party or by which it may be bound, or (C) constitute a
material violation
of any statute, order or regulation applicable to the Master
Servicer of any
court, regulatory body, administrative agency or governmental body
having
jurisdiction over the Master Servicer; and the Master Servicer is
not in breach
or violation of any material indenture or other material agreement
or
instrument, or in violation of any statute, order or regulation of
any court,
regulatory body, administrative agency or governmental body having
jurisdiction
over it which breach or violation may materially impair the Master
Servicer's
ability to perform or meet any of its obligations under this
Agreement.
(iv) The Master Servicer, or an affiliate thereof, is an
approved servicer of mortgage loans for Fannie Mae and for Freddie
Mac.
(v) No litigation is pending or, to the best of the Master
Servicer's knowledge, threatened, against the Master Servicer that
would
materially and adversely affect the
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execution, delivery or enforceability of this Agreement or its
performance of
any of its other obligations under this Agreement in accordance
with the terms
hereof.
(vi) No consent, approval, authorization or order of any court
or governmental agency or body is required for the execution,
delivery and
performance by the Master Servicer of, or compliance by the Master
Servicer
with, this Agreement or the consummation of the transactions
contemplated
hereby, or if any such consent, approval, authorization or order is
required,
the Master Servicer has obtained the same.
(b) The Servicer hereby represents and warrants to the
Depositor,
the Master Servicer, the Securities Administrator and the Trustee
as follows, as
of the date hereof:
(i) The Servicer is duly organized and is validly existing as
a limited partnership in good standing under the laws of the State
of Delaware
and is duly authorized and qualified to transact any and all
business
contemplated by this Agreement to be conducted by the Servicer in
any state in
which a Mortgaged Property (or Underlying Mortgaged Property, in
the case of a
Co-op Loan) is located or is otherwise not required under
applicable law to
effect such qualification and, in any event, is in compliance with
the doing
business laws of any such state, to the extent necessary to ensure
its ability
to enforce each Mortgage Loan, to service the Mortgage Loans in
accordance with
the terms of this Agreement and to perform any of its other
obligations under
this Agreement in accordance with the terms hereof.
(ii) The Servicer has the corporate power and authority to
service each Mortgage Loan, and to execute, deliver and perform,
and to enter
into and consummate the transactions contemplated by this Agreement
and has duly
authorized by all necessary corporate action on the part of the
Servicer the
execution, delivery and performance of this Agreement; and this
Agreement,
assuming the due authorization, execution and delivery hereof by
the other
parties hereto, constitutes a legal, valid and binding obligation
of the
Servicer, enforceable against the Servicer in accordance with its
terms, except
that (a) the enforceability hereof may be limited by bankruptcy,
insolvency,
moratorium, receivership and other similar laws relating to
creditors' rights
generally and (b) the remedy of specific performance and injunctive
and other
forms of equitable relief may be subject to equitable defenses and
to the
discretion of the court before which any proceeding therefor may be
brought.
(iii) The execution and delivery of this Agreement by the
Servicer, the servicing of the Mortgage Loans under this Agreement,
the
consummation of any other of the transactions contemplated by this
Agreement,
and the fulfillment of or compliance with the terms hereof are in
the ordinary
course of business of the Servicer and will not (A) result in a
material breach
of any term or provision of the charter or by-laws of the Servicer
or (B)
materially conflict with, result in a material breach, violation or
acceleration
of, or result in a material default under, the terms of any other
material
agreement or instrument to which the Servicer is a party or by
which it may be
bound, or (C) constitute a material violation of any statute, order
or
regulation applicable to the Servicer of any court, regulatory
body,
administrative agency or governmental body having jurisdiction over
the
Servicer; and the Servicer is not in breach or violation of any
material
indenture or other material agreement or instrument, or in
violation of any
statute, order or regulation of any court, regulatory body,
administrative
agency or governmental body having jurisdiction over it which
breach or
violation may materially impair the Servicer's ability to perform
or meet any of
its obligations under this Agreement.
(iv) The Servicer is an approved servicer of mortgage loans
for Fannie Mae and is an approved servicer of mortgage loans for
Freddie Mac.
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(v) No litigation is pending or, to the best of the Servicer's
knowledge, threatened, against the Servicer that would materially
and adversely
affect the execution, delivery or enforceability of this Agreement
or the
ability of the Servicer to service the Mortgage Loans or to perform
any of its
other obligations under this Agreement in accordance with the terms
hereof.
(vi) No consent, approval, authorization or order of any court
or governmental agency or body is required for the execution,
delivery and
performance by the Servicer of, or compliance by the Servicer with,
this
Agreement or the consummation of the transactions contemplated
hereby, or if any
such consent, approval, authorization or order is required, the
Servicer has
obtained the same.
(vii) The Servicer has fully furnished and will fully furnish
(for the period it serviced the Mortgage Loans), in accordance with
the Fair
Credit Reporting Act and its implementing regulations, accurate and
complete
information (e.g., favorable and unfavorable) on its borrower
credit files to
Equifax, Experian and Trans Union Credit Information Company on a
monthly basis.
(viii) Notwithstanding any state or federal law to the
contrary, the Servicer shall not impose or collect a Prepayment
Charge in any
instance when the mortgage debt is accelerated as the result of the
Mortgagor's
default in making the Mortgage Loan payments.
(c) The Securities Administrator hereby represents and warrants
to
the Depositor, the Master Servicer, the Servicer and the Trustee as
of the date
hereof:
(i) The Securities Administrator is duly organized and is
validly existing as a national banking association and is duly
authorized and
qualified to transact any and all business contemplated by this
Agreement to be
conducted by the Securities Administrator.
(ii) The Securities Administrator has the full corporate power
and authority to execute, deliver and perform, and to enter into
and consummate,
the transactions contemplated by this Agreement and has duly
authorized by all
necessary corporate action on the part of the Securities
Administrator the
execution, delivery and performance of this Agreement; and this
Agreement,
assuming the due authorization, execution and delivery hereof by
the other
parties hereto, constitutes a legal, valid and binding obligation
of the
Securities Administrator, enforceable against the Securities
Administrator in
accordance with its terms, except that (a) the enforceability
hereof may be
limited by bankruptcy, insolvency, moratorium, receivership and
other similar
laws relating to creditors' rights generally and (b) the remedy of
specific
performance and injunctive and other forms of equitable relief may
be subject to
equitable defenses and to the discretion of the court before which
any
proceeding hereunder may be brought.
(iii) The execution and delivery of this Agreement by the
Securities Administrator, the consummation of any other of the
transactions
contemplated by this Agreement, and the fulfillment of or
compliance with the
terms hereof are in the ordinary course of business of the
Securities
Administrator and will not (A) result in a material breach of any
term or
provision of the charter or by-laws of the Securities Administrator
or (B)
materially conflict with, result in a material breach, violation or
acceleration
of, or result in a material default under, the terms of any other
material
agreement or instrument to which the Securities Administrator is a
party or by
which it may be bound, or (C) constitute a material violation of
any statute,
order or regulation applicable to the Securities Administrator of
any court,
regulatory body, administrative agency or governmental body having
jurisdiction
over the Securities Administrator; and the Securities Administrator
is not in
breach or violation of any material indenture or other material
agreement or
instrument, or in violation of any statute, order or regulation of
any court,
regulatory body, administrative agency or governmental body
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having jurisdiction over it which breach or violation may
materially impair the
Securities Administrator's ability to perform or meet any of its
obligations
under this Agreement.
(iv) No litigation is pending or, to the best of the
Securities Administrator's knowledge, threatened, against the
Securities
Administrator that would materially and adversely affect the
execution, delivery
or enforceability of this Agreement or the ability of the
Securities
Administrator to perform any of its other obligations under this
Agreement in
accordance with the terms hereof.
(v) No consent, approval, authorization or order of any court
or governmental agency or body is required for the execution,
delivery and
performance by the Securities Administrator of, or compliance by
the Securities
Administrator with, this Agreement or the consummation of the
transactions
contemplated hereby, or if any such consent, approval,
authorization or order is
required, the Securities Administrator has obtained the same.
SECTION 2.05. Substitutions and Repurchases of Mortgage Loans that
are
not "Qualified
Mortgages."
Upon
discovery by the Depositor, the Master Servicer, the Servicer,
the
Securities Administrator or the Trustee that any Mortgage Loan does
not
constitute a "qualified mortgage" within the meaning of section
860G(a)(3) of
the Code, the party discovering such fact shall promptly (and in
any event
within 5 Business Days of discovery) give written notice thereof to
the other
parties. In connection therewith, the Depositor shall, at the
Depositor's
option, either (i) substitute, if the conditions in Section 2.03(c)
with respect
to substitutions are satisfied, a Replacement Mortgage Loan for the
affected
Mortgage Loan, or (ii) repurchase the affected Mortgage Loan within
90 days of
such discovery in the same manner as it would a Mortgage Loan for a
breach of
representation or warranty contained in Section 2.03. The Trustee,
upon the
written request of the Depositor, shall reconvey to the Depositor
the Mortgage
Loan to be released pursuant hereto in the same manner, and on the
same terms
and conditions, as it would a Mortgage Loan repurchased for breach
of a
representation or warranty contained in Section 2.03.
SECTION 2.06. Authentication and Delivery of Certificates.
The
Trustee acknowledges the transfer and assignment to it of the
Trust
Fund and, concurrently with such transfer and assignment, the
Securities
Administrator 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 Securities Administrator in authorized
denominations
evidencing ownership of the entire Trust Fund. The Trustee agrees
to hold the
Trust Fund and exercise the rights referred to above for the
benefit of all
present and future Holders of the Certificates and to perform its
duties set
forth in this Agreement in accordance with the provisions hereof to
the best of
its abilities, to the end that the interests of the Holders may be
adequately
and effectively protected.
SECTION
2.07. REMIC Elections.
(a) The Depositor hereby instructs and authorizes the Trustee
to
make an appropriate election to treat each of the Upper Tier REMIC,
the Lower
Tier REMIC, the M3 REMIC, the M4 REMIC, the M5 REMIC, the M6 REMIC,
the B1
REMIC, the B2 REMIC, the B3 REMIC and the C REMIC as a REMIC. The
Trustee, upon
written direction of the Securities Administrator, shall sign the
returns
providing for such elections and such other tax or information
returns which are
required to be signed by the Trustee under applicable law. This
Agreement shall
be construed so as to carry out the intention of the parties that
each of the
Upper Tier REMIC, the Lower Tier REMIC, the M3 REMIC, the M4 REMIC,
the M5
REMIC, the M6 REMIC, the B1 REMIC, the B2 REMIC, the B3 REMIC and
the C REMIC be
treated as a REMIC at all times prior to the date on which the
Trust Fund is
terminated.
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(b) The Preliminary Statement sets forth the designations and
"latest possible maturity date" for federal income tax purposes of
all interests
created hereby. The "Startup Day" for purposes of the REMIC
Provisions shall be
the Closing Date. Each REMIC's fiscal year shall be the calendar
year.
The Lower
Tier REMIC shall consist of all of the assets of the Trust
Fund,
other than (i) amounts distributable to the Class P Certificates
pursuant to
Section 4.04(b)(i) hereof, (ii) the interests issued by the Lower
Tier REMIC,
(iii) the grantor trusts described in Section 2.07 hereof, (iv)
each Cap
Contract and the Cap Contract Account and (v) the Class UTM
Interests, the Class
UTB Interests and the Class UTC Interest. The Lower Tier REMIC
shall issue the
Lower Tier REMIC Regular Interests which shall be designated as
regular
interests of such REMIC and shall issue the Class LTR Interest that
shall be
designated as the sole class of residual interest in the Lower Tier
REMIC. Each
of the Lower Tier REMIC Regular Interests shall have the
characteristics set
forth in its definition.
The assets
of the Upper Tier REMIC shall be the Lower Tier REMIC Regular
Interests. The REMIC Regular Interests shall be designated as the
regular
interests in the Upper Tier REMIC and the Residual Interest shall
be designated
as the sole class of residual interest in the Upper Tier REMIC. For
federal
income tax purposes, (i) the pass-through rate on the REMIC Regular
Interests
represented by the Class A-1 Certificates and on the sole class of
residual
interest in the Upper Tier REMIC shall be subject to a cap equal to
the Class
A-1 Available Funds Cap; (ii) the pass-through rate on the REMIC
Regular
Interests represented by the Class A-2 Certificates shall be
subject to a cap
equal to the Class A-2 Available Funds Cap; and (iii) the
pass-through rate on
the REMIC Regular Interests represented by the Subordinate
Certificates, and on
the Class UTM Interests and the Class UTB Interests shall be
subject to a cap
equal to the Weighted Average Available Funds Cap.
The asset
of the M3 REMIC shall be the Class UTM3 Interest. The Class M-3
Certificate (other than the rights in interest rate cap contracts
described in
this Section 2.07) shall be designated as the regular interest in
the M3 REMIC
and the Class M3R Interest shall be designated as the sole class of
residual
interest in the M3 REMIC. For federal income tax purposes, the
pass-through rate
on the REMIC regular interest represented by the Class M-3
Certificates shall be
subject to a cap equal to the Weighted Average Available Funds
Cap.
The asset
of the M4 REMIC shall be the Class UTM4 Interest. The Class M-4
Certificate (other than the rights in interest rate cap contracts
described in
this Section 2.07) shall be designated as the regular interest in
the M4 REMIC
and the Class M4R Interest shall be designated as the sole class of
residual
interest in the M4 REMIC. For federal income tax purposes, the
pass-through rate
on the REMIC regular interest represented by the Class M-4
Certificates shall be
subject to a cap equal to the Weighted Average Available Funds
Cap.
The asset
of the M5 REMIC shall be the Class UTM5 Interest. The Class M-5
Certificate (other than the rights in interest rate cap contracts
described in
this Section 2.07) shall be designated as the regular interest in
the M5 REMIC
and the Class M5R Interest shall be designated as the sole class of
residual
interest in the M5 REMIC. For federal income tax purposes, the
pass-through rate
on the REMIC regular interest represented by the Class M-5
Certificates shall be
subject to a cap equal to the Weighted Average Available Funds
Cap.
The asset
of the M6 REMIC shall be the Class UTM6 Interest. The Class M-6
Certificate (other than the rights in interest rate cap contracts
described in
this Section 2.07) shall be designated as the regular interest in
the M6 REMIC
and the Class M6R Interest shall be designated as the sole class of
residual
interest in the M6 REMIC. For federal income tax purposes, the
pass-through rate
on the
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REMIC regular interest represented by the Class M-6 Certificates
shall be
subject to a cap equal to the Weighted Average Available Funds
Cap.
The asset
of the B1 REMIC shall be the Class UTB1 Interest. The Class B-1
Certificate (other than the rights in interest rate cap contracts
described in
this Section 2.07) shall be designated as the regular interest in
the B1 REMIC
and the Class B1R Interest shall be designated as the sole class of
residual
interest in the B1 REMIC. For federal income tax purposes, the
pass-through rate
on the REMIC regular interest represented by the Class B-1
Certificates shall be
subject to a cap equal to the Weighted Average Available Funds
Cap.
The asset
of the B2 REMIC shall be the Class UTB2 Interest. The Class B-2
Certificate (other than the rights in interest rate cap contracts
described in
this Section 2.07) shall be designated as the regular interest in
the B2 REMIC
and the Class B2R Interest shall be designated as the sole class of
residual
interest in the B2 REMIC. For federal income tax purposes, the
pass-through rate
on the REMIC regular interest represented by the Class B-2
Certificates shall be
subject to a cap equal to the Weighted Average Available Funds
Cap.
The asset
of the B3 REMIC shall be the Class UTB3 Interest. The Class B-3
Certificate (other than the rights in interest rate cap contracts
described in
this Section 2.07) shall be designated as the regular interest in
the B3 REMIC
and the Class B3R Interest shall be designated as the sole class of
residual
interest in the B3 REMIC. For federal income tax purposes, the
pass-through rate
on the REMIC regular interest represented by the Class B-3
Certificates shall be
subject to a cap equal to the Weighted Average Available Funds
Cap.
The asset
of the C REMIC shall be the Class UTC Interest. The
Uncertificated Class C Interest shall be designated as the regular
interest in
the C REMIC and the Class CR Interest shall be designated as the
sole class of
residual interest in the C REMIC.
The
beneficial ownership of the Class LTR Interest and the Residual
Interest shall be represented by the Class R Certificate. The Class
LTR Interest
shall not have a principal balance or bear interest.
The
beneficial ownership of the Class M3R Interest, the Class M4R
Interest, the Class M5R Interest, the Class M6 Interest, the Class
B1R Interest,
the Class B2R Interest, the Class B3R Interest and the Class CR
Interest shall
be represented by the Class R-X Certificate. The Class M3R
Interest, the Class
M4R Interest, the Class M5R Interest, the Class M6R Interest, the
Class B1R
Interest, the Class B2R Interest, the Class B3R Interest and the
Class CR
Interest shall not have principal balances and shall not bear
interest.
(c) The "tax matters person" with respect to the Lower Tier
REMIC
and the Upper Tier REMIC for purposes of the REMIC Provisions shall
be the
beneficial owner of the Class R Certificate; provided, however,
that the Holder
of the Class R Certificate, by its acceptance thereof, irrevocably
appoints the
Securities Administrator as its agent and attorney-in-fact to act
as "tax
matters person" with respect to each such REMIC for purposes of the
REMIC
Provisions. If there is more than one beneficial owner of the Class
R
Certificate, the "tax matters person" shall be the Person with the
greatest
percentage interest in the Class R Certificate and, if there is
more than one
such Person, shall be determined under Treasury regulation Section
1.860F-4(d)
and Treasury regulation Section 301.6231(a)(7)-1. The "tax matters
person" with
respect to each of the M3 REMIC, the M4 REMIC, the M5 REMIC, the M6
REMIC, the
B1 REMIC, the B2 REMIC, the B3 REMIC and the C REMIC for purposes
of the REMIC
Provisions shall be the beneficial owner of the Class R-X
Certificate; provided,
however, that the Holder of a Class R-X Certificate, by its
acceptance thereof,
irrevocably appoints the Securities Administrator as its agent
and
attorney-in-fact to act as "tax matters person" with respect to
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each such REMIC for purposes of the REMIC Provisions. If there is
more than one
beneficial owner of the Class R-X Certificate, the "tax matters
person" shall be
the Person with the greatest percentage interest in the Class R-X
Certificate
and, if there is more than one such Person, shall be determined
under Treasury
regulation Section 1.860F-4(d) and Treasury regulation Section
301.6231(a)(7)-1.
(d) It is intended that the rights of each Class of the Class
A,
Class M and Class B Certificates to receive payments in respect of
Excess
Interest shall be treated as a right in interest rate cap contracts
written by
the Class C Certificateholders in favor of the holders of each
Class of the
Class A, Class M and Class B Certificates and such shall be
accounted for as
property held separate and apart from the regular interests in the
Upper Tier
REMIC held by the holders of the Class A (other than the Class R
Certificate),
Class M-1 Certificates, Class M-2 Certificates, the residual
interest in the
Upper Tier REMIC held by the holder of the Class R Certificate, the
regular
interest in the M3 REMIC held by the holders of the Class M-3
Certificates, the
regular interest in the M4 REMIC held by the holders of the Class
M-4
Certificates, the regular interest in the M5 REMIC held by the
holders of the
Class M-5 Certificates, the regular interest in the M6 REMIC held
by the holders
of the Class M-6 Certificates, the regular interest in the B1 REMIC
held by the
holders of the Class B-1 Certificates, the regular interest in the
B2 REMIC held
by the holders of the Class B-2 Certificates and the regular
interest in the B3
REMIC held by the holders of the Class B-3 Certificates. For
information
reporting requirements, the rights of the Class A, Class M and
Class B
Certificates to receive payments in respect of Excess Interest
shall be assumed
to have zero or a de minimis value. This provision is intended to
satisfy the
requirements of Treasury Regulations Section 1.860G-2(i) for the
treatment of
property rights coupled with REMIC interests to be separately
respected and
shall be interpreted consistently with such regulation. On each
Distribution
Date, to the extent that any of the Class A, Class M and Class B
Certificates
receive payments in respect of Excess Interest, such amounts, to
the extent not
derived from payments on the Cap Contracts, will be treated as
distributed by
the Upper Tier REMIC to the Class UTC Interest and distributed by
the C REMIC to
the Class C Certificates pro rata in payment of the amounts
specified in Section
4.04(g) and then paid to the relevant Class of Certificates
pursuant to the
related interest rate cap agreement.
(e) The parties intend that the portion of the Trust Fund
consisting
of the Uncertificated Class C Interest, the Cap Contracts, the Cap
Contract
Account, and the obligation of the holders of the Class C
Certificates to pay
amounts in respect of Excess Interest to the holders of the Class
A, Class M and
Class B Certificates shall be treated as a "grantor trust" under
the Code, for
the benefit of the holders of the Class C Certificates, and the
provisions
hereof shall be interpreted consistently with this intention. In
furtherance of
such intention, the Securities Administrator shall (i) furnish or
cause to be
furnished to the holders of the Class C Certificates information
regarding their
allocable share, if any, of the income with respect to such grantor
trust, (ii)
file or cause to be filed with the Internal Revenue Service Form
1041 (together
with any necessary attachments) and such other forms as may be
applicable and
(iii) comply with such information reporting obligations with
respect to
payments from such grantor trust to the holders of Class A, Class
M, Class B and
Class C Certificates as may be applicable under the Code.
(f) The parties intend that the portion of the Trust Fund
consisting
of the right to receive amounts distributable to the Class P
Certificates
pursuant to Section 4.04(b)(i) hereof shall be treated as a
"grantor trust"
under the Code, for the benefit of the holders of the Class P
Certificates, and
the provisions hereof shall be interpreted consistently with this
intention. In
furtherance of such intention, the Securities Administrator shall
(i) furnish or
cause to be furnished to the holders of the Class P Certificates
information
regarding their allocable share of the income with respect to such
grantor trust
and (ii) file or cause to be filed with the Internal Revenue
Service Form 1041
(together with any necessary attachments) and such other forms as
may be
applicable.
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(g) [RESERVED]
(h) All payments of principal and interest at the Net Mortgage
Rate
on each of the Mortgage Loans (other than amounts distributable to
the Class P
Certificates pursuant to Section 4.04(b)(i) hereof) received from
the Mortgage
Loans shall be paid to the Lower Tier REMIC Regular Interests until
the
principal balance of all such interests have been reduced to zero
and any losses
allocated to such interests have been reimbursed. Any excess
amounts shall be
distributed to the Class LTR Interest. On each Distribution Date,
payments and
losses shall be allocated among the Lower Tier REMIC Regular
Interests so that
(i) each of the Lower Tier REMIC I Marker Interests shall have a
principal
balance equal to 25% of the principal balance of the Corresponding
Certificates,
(ii) the Class LTIX Interest has a principal balance equal to the
excess of (x)
50% of the remaining principal balance of the Mortgage Loans over
(y) the
aggregate principal balance of the Lower Tier REMIC I Marker
Interests (if
necessary to reflect an increase in overcollateralization, accrued
and unpaid
interest on the Class LTIX interest may be added to its principal
amount to
achieve this result) and (iii) the aggregate principal amount of
the Class
LTII1A Interest, Class LTII1B Interest, Class LTII2A Interest,
Class LTII2B
Interest and the Class LTIIX Interest shall equal 50% of the
remaining principal
balance of the Mortgage Loans. Distributions and losses allocated
to the Lower
Tier REMIC Regular Interests described in clause (iii) of the
preceding sentence
will be allocated among such Lower Tier REMIC Regular Interests in
the following
manner: (x) such distributions shall be deemed made to such Lower
Tier REMIC
Regular Interests first, so as to keep the principal balance of the
each such
Lower Tier REMIC Regular Interest with "B" at the end of its
designation equal
to 0.05% of the aggregate scheduled principal balance of the
Mortgage Loans in
the related Mortgage Group and second, to such Lower Tier REMIC
Regular
Interests with "A" at the end of its designation so that the
uncertificated
principal balance of each such Lower Tier REMIC Regular Interest is
equal to
0.05% of the excess of (I) the aggregate scheduled principal
balance of the
Mortgage Loans in the related Mortgage Group over (II) the
aggregate principal
balance of Certificate Group One, in the case of the Class LTII1A
Interest, or
Certificate Group Two, in the case of the Class LTII2A Interest
(except that if
0.05% of any such excess is greater than the principal amount of
the related
Lower Tier REMIC II Marker Interest with "A" at the end of its
designation, the
least amount of principal shall be distributed to each Lower Tier
REMIC II
Marker Interest with "A" at the end of its designation such that
the Lower Tier
REMIC Subordinated Balance Ratio is maintained) and finally, any
remaining
distributions of principal to the Class LTIIX Interest and (y) such
losses shall
be allocated among the Lower Tier REMIC Regular Interests described
in clause
(iii) of the preceding sentence first, so as to keep the principal
balance of
the each such Lower Tier REMIC Regular Interest with "B" at the end
of its
designation equal to 0.05% of the aggregate scheduled principal
balance of the
Mortgage Loans in the related Mortgage Group; second, to such Lower
Tier REMIC
Regular Interests with "A" at the end of its designation so that
the
uncertificated principal balance of each such Lower Tier REMIC
Regular Interest
is equal to 0.05% of the excess of (I) the aggregate scheduled
principal balance
of the Mortgage Loans in the related Mortgage Group over (II) the
aggregate
principal balance of Certificate Group One, in the case of the
Class LTII1A
Interest, or Certificate Group Two, in the case of the Class LTII2A
Interest
(except that if 0.05% of any such excess is greater than the
principal amount of
the related Lower Tier REMIC II Marker Interest with "A" at the end
of its
designation, the least amount of losses shall be allocated to each
Lower REMIC
II Marker Interest with "A" at the end of its designation such that
the Lower
Tier REMIC Subordinated Balance Ratio is maintained) and finally,
any remaining
losses to the Class LTIIX Interest. Notwithstanding the preceding
two sentences,
however, losses not allocated to any Class of Certificates will not
be allocated
to any Lower Tier REMIC Regular Interests. All computations with
respect to the
Lower Tier REMIC Regular Interests shall be taken out to ten
decimal places.
Any
available funds remaining in the Lower Tier REMIC on a
Distribution
Date after distributions to the Lower Tier REMIC Regular Interests
shall be
distributed to the Class R Certificates in respect of the Class LTR
Interest.
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If on any
Distribution Date the Certificate Principal Balance of any
Class
of Certificates is increased pursuant to the last sentence of the
definition of
"Certificate Principal Balance", then there shall be an equivalent
increase in
the principal amounts of the Lower Tier REMIC Regular Interests,
with such
increase allocated (before the making of distributions and the
allocation of
losses on the Lower Tier REMIC Regular Interests on such
Distribution Date)
among the Lower Tier REMIC Regular Interests so that, to the
greatest extent
possible, (i) each of the Lower Tier REMIC I Marker Interests has a
principal
balance equal to 25% of the principal balance of the Corresponding
Certificates,
(ii) the Class LTIX Interest has a principal balance equal to the
excess of (x)
50% of the remaining principal balance of the Mortgage Loans over
(y) the
aggregate principal balance of the Lower Tier REMIC I Marker
Interests and (iii)
the aggregate principal amount of the Lower Tier REMIC II Marker
Interests and
the Class LTIIX Interest shall equal 50% of the remaining principal
balance of
the Mortgage Loans. Allocations in connection with clause (iii)
shall be made so
that, to the greatest extent possible, (a) the principal balance of
each Lower
Tier REMIC II Marker Interest with "B" at the end of its
designation equals
0.05% of the aggregate scheduled principal balance of the Mortgage
Loans in
related Mortgage Group, (b) the principal balance of each Lower
Tier REMIC II
Marker Interest with "A" at the end of its designation equals 0.05%
of the
excess of (x) the aggregate scheduled principal balance of the
Mortgage Loans in
related Mortgage Group over (y) the aggregate principal balance of
Certificate
Group One in the case of the Class LTII1A Interest, or Certificate
Group Two in
the case of the Class LTII2A Interest and (c) any remaining
allocations are made
to the Class LTIIX Interest.
For
purposes of this Section 2.07, (i) the Class LTII1A Interest and
Class
LTII1B Interest shall be related to Group One, and (ii) the Class
LTII2A
Interest and Class LTII2B Interest shall be related to Group
Two.
All
payments of scheduled principal and prepayments and Realized Losses
on
the Mortgage Loans that are allocated to the Class M-3
Certificates, shall be
allocated to the Class UTM3 Interest. If on any Distribution Date
the
Certificate Principal Balance of the Class M-3 Certificates is
increased
pursuant to the last sentence of the definition of "Certificate
Principal
Balance", then there shall be an equivalent increase in the
principal amount of
the Class UTM3 Interest.
All
payments of scheduled principal and prepayments and Realized Losses
on
the Mortgage Loans that are allocated to the Class M-4
Certificates, shall be
allocated to the Class UTM4 Interest. If on any Distribution Date
the
Certificate Principal Balance of the Class M-4 Certificates is
increased
pursuant to the last sentence of the definition of "Certificate
Principal
Balance", then there shall be an equivalent increase in the
principal amount of
the Class UTM4 Interest.
All
payments of scheduled principal and prepayments and Realized Losses
on
the Mortgage Loans that are allocated to the Class M-5
Certificates, shall be
allocated to the Class UTM5 Interest. If on any Distribution Date
the
Certificate Principal Balance of the Class M-5 Certificates is
increased
pursuant to the last sentence of the definition of "Certificate
Principal
Balance", then there shall be an equivalent increase in the
principal amount of
the Class UTM5 Interest.
All
payments of scheduled principal and prepayments and Realized Losses
on
the Mortgage Loans that are allocated to the Class M-6
Certificates, shall be
allocated to the Class UTM6 Interest. If on any Distribution Date
the
Certificate Principal Balance of the Class M-6 Certificates is
increased
pursuant to the last sentence of the definition of "Certificate
Principal
Balance", then there shall be an equivalent increase in the
principal amount of
the Class UTM6 Interest.
All
payments of scheduled principal and prepayments and Realized Losses
on
the Mortgage Loans that are allocated to the Class B-1
Certificates, shall be
allocated to the Class UTB1 Interest. If on any Distribution Date
the
Certificate Principal Balance of the Class B-1 Certificates is
increased
pursuant
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to the last sentence of the definition of "Certificate Principal
Balance", then
there shall be an equivalent increase in the principal amount of
the Class UTB1
Interest.
All
payments of scheduled principal and prepayments and Realized Losses
on
the Mortgage Loans that are allocated to the Class B-2
Certificates, shall be
allocated to the Class UTB2 Interest. If on any Distribution Date
the
Certificate Principal Balance of the Class B-2 Certificates is
increased
pursuant to the last sentence of the definition of "Certificate
Principal
Balance", then there shall be an equivalent increase in the
principal amount of
the Class UTB2 Interest.
All
payments of scheduled principal and prepayments and Realized Losses
on
the Mortgage Loans that are allocated to the Class B-3
Certificates, shall be
allocated to the Class UTB3 Interest. If on any Distribution Date
the
Certificate Principal Balance of the Class B-3 Certificates is
increased
pursuant to the last sentence of the definition of "Certificate
Principal
Balance", then there shall be an equivalent increase in the
principal amount of
the Class UTB3 Interest.
All
payments of scheduled principal and prepayments and Realized Losses
on
the Mortgage Loans that are allocated to the Class C Certificates,
shall be
allocated to the Class UTC Interest. If on any Distribution Date
the Certificate
Principal Balance of the Class C Certificates is increased pursuant
to the last
sentence of the definition of "Certificate Principal Balance", then
there shall
be an equivalent increase in the principal amount of the Class UTC
Interest.
(i) In the event that any REMIC provided for herein fails to
qualify
as a REMIC, loses its status as a REMIC or incurs federal, state or
local taxes
as a result of a prohibited transaction or prohibited contribution
under the
REMIC Provisions due to the negligent performance by the Servicer
of its duties
and obligations set forth herein, the Servicer shall indemnify the
NIMs Insurer,
the Trustee, the Securities Administrator, the Master Servicer and
the Trust
Fund against any and all Losses resulting from such negligence;
provided,
however, that the Servicer shall not be liable for any such Losses
attributable
to the action or inaction of the Trustee, the Securities
Administrator, the
Master Servicer, the Depositor or the Holder of the residual
interest in such
REMIC, as applicable, nor for any such Losses resulting from
misinformation
provided by the Holder of the residual interest in such REMIC on
which the
Servicer has relied. The foregoing shall not be deemed to limit or
restrict the
rights and remedies of the Holder of the residual interest in such
REMIC now or
hereafter existing at law or in equity. Notwithstanding the
foregoing, however,
in no event shall the Servicer have any liability (1) for any
action or omission
that is taken in accordance with and in compliance with the express
terms of, or
which is expressly permitted by the terms of, this Agreement, (2)
for any Losses
other than those arising out of a negligent performance by the
Servicer of its
duties and obligations set forth herein, and (3) for any special
or
consequential damages to Certificateholders (in addition to payment
of principal
and interest on the Certificates).
(j) In the event that any REMIC provided for herein fails to
qualify
as a REMIC, loses its status as a REMIC, or incurs federal, state
or local taxes
as a result of a prohibited transaction or prohibited contribution
under the
REMIC Provisions due to the negligent performance by the
Securities
Administrator of its duties and obligations set forth herein, the
Securities
Administrator shall indemnify the NIMs Insurer and the Trust Fund
against any
and all Losses resulting from such negligence; provided, however,
that the
Securities Administrator shall not be liable for any such Losses
attributable to
the action or inaction of the Servicer, the Master Servicer, the
Depositor, the
Trustee or the Holder of the residual interest in such REMIC, as
applicable, nor
for any such Losses resulting from misinformation provided by the
Holder of the
residual interest in such REMIC on which the Securities
Administrator has
relied. The foregoing shall not be deemed to limit or restrict the
rights and
remedies of the Holder of the residual interest in such REMIC now
or hereafter
existing at law or in equity. Notwithstanding the foregoing,
however, in no
event shall the Securities Administrator have any
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liability (1) for any action or omission that is taken in
accordance with and in
compliance with the express terms of, or which is expressly
permitted by the
terms of, this Agreement, (2) for any Losses other than those
arising out of a
negligent performance by the Securities Administrator of its duties
and
obligations set forth herein, and (3) for any special or
consequential damages
to Certificateholders (in addition to payment of principal and
interest on the
Certificates).
SECTION 2.08. [RESERVED]
SECTION 2.09. Covenants of the Servicer.
The
Servicer hereby covenants to each of the other parties to this
Agreement as follows:
(a) the Servicer shall comply in the performance of its
obligations
under this Agreement with all reasonable rules and requirements of
the insurer
under each Required Insurance Policy;
(b) no written information, certificate of an officer,
statement
furnished in writing or written report delivered to the Depositor,
the Master
Servicer, the Securities Administrator, the NIMs Insurer or the
Trustee, any
affiliate of the Depositor, the Master Servicer, the Securities
Administrator,
the NIMs Insurer or the Trustee and prepared by the Servicer
pursuant to this
Agreement is inaccurate in any material respect, provided, however,
that the
Servicer shall not be responsible for inaccurate information
provided to it by
third parties.
SECTION 2.10. [RESERVED]
SECTION 2.11. Permitted Activities of the Trust. The Trust is
created
for the object and
purpose of engaging in the Permitted Activities. In
furtherance of the
foregoing, the Trustee is hereby authorized and directed to
execute and deliver on
behalf of the Trust, and to perform the duties and
obligations of the
Trustee under, the Cap Contracts, an insurance and
indemnity agreement
with a NIMs Insurer and any other agreement or instrument
related thereto, in
each case in such form as the Depositor shall direct or
shall approve, the
execution and delivery of any such agreement by the
Depositor to be
conclusive evidence of its approval thereof.
SECTION 2.12. Qualifying Special Purpose Entity. For purposes of
SFAS
140, the parties
hereto intend that the Trust Fund 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 2.11
of this Agreement
shall be limited in accordance with paragraph 35 thereof.
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
SECTION 3.01. Servicer to Service Mortgage Loans.
For and on
behalf of the Certificateholders, the Servicer shall service
and administer the Mortgage Loans, including without limitation,
any powers of
attorney, in accordance with Accepted Servicing Practices. In
connection with
such servicing and administration, the Servicer shall have full
power and
authority, acting alone and/or through subservicers as provided in
Section 3.02
hereof, to do or cause to be done any and all things that it may
deem necessary
or desirable in connection with such servicing and administration,
including but
not limited to, the power and authority, subject to the terms
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hereof (i) to execute and deliver, on behalf of the
Certificateholders and the
Trustee, customary consents or waivers and other instruments and
documents, (ii)
to consent to transfers of any Mortgaged Property (or the stock
allocated to a
dwelling unit related to a Co-op Loan) and assumptions of the
Mortgage Notes and
related Mortgages (but only in the manner provided in this
Agreement), (iii) to
collect any Insurance Proceeds and other Liquidation Proceeds and
(iv) subject
to Section 3.12(a), to effectuate foreclosure or other conversion
of the
ownership of the Mortgaged Property (or the stock allocated to a
dwelling unit
related to a Co-op Loan) securing any Mortgage Loan; provided that,
subject to
Section 6.03, the Servicer shall not take any action that is
inconsistent with
or prejudices the interests of the Trust Fund or the
Certificateholders in any
Mortgage Loan serviced by it under this Agreement or the rights and
interests of
the other parties to this Agreement except as otherwise required by
this
Agreement or by law. The Servicer shall not make or permit any
modification,
waiver or amendment of any term of any Mortgage Loan which would
cause any of
the REMICs provided for herein to fail to qualify as a REMIC or
result in the
imposition of any tax under Section 860G(a) or 860G(d) of the Code.
The Servicer
shall represent and protect the interest of the Trust Fund in the
same manner as
it currently protects its own interest in mortgage loans in its own
portfolio in
any claim, proceeding or litigation regarding a Mortgage Loan, but
in any case
not in any manner that is a lesser standard than that provided in
the first
sentence of this Section 3.01. Without limiting the generality of
the foregoing,
the Servicer, in its own name or in the name of the Depositor and
the Trustee,
is hereby authorized and empowered by the Depositor and the
Trustee, when the
Servicer believes it appropriate in its reasonable judgment, to
execute and
deliver, on behalf of the Trustee, the Depositor, the
Certificateholders or any
of them, any and all instruments of satisfaction or cancellation,
or of partial
or full release or discharge, subordinations and all other
comparable
instruments, with respect to the Mortgage Loans, and with respect
to the
Mortgaged Properties held for the benefit of the
Certificateholders. The
Servicer shall prepare and deliver to the Depositor, the
Securities
Administrator and/or the Trustee such documents requiring execution
and delivery
by any or all of them as are necessary or appropriate to enable the
Servicer to
service and administer the Mortgage Loans, including without
limitation, any
powers of attorney. Upon receipt of such documents, the Depositor,
the
Securities Administrator and/or the Trustee shall execute such
documents and
deliver them to the Servicer. For purposes of this Section 3.01,
the Trustee
hereby grants to the Servicer a limited power of attorney in the
form of Exhibit
P to execute and file any and all documents necessary to fulfill
the obligations
of the Servicer under this Section 3.01.
The
Trustee shall deliver Powers of Attorney in the form attached
hereto
as Exhibit P to the Servicer promptly after the Closing Date and
additional
Powers of Attorney promptly after request therefor by the
Servicer.
In
accordance with the standards of the preceding paragraph, the
Servicer
shall advance or cause to be advanced funds as necessary for the
purpose of
effecting the payment of taxes and assessments on the Mortgaged
Properties,
which advances shall be reimbursable in the first instance from
related
collections from the Mortgagors pursuant to Section 3.06, and
further as
provided in Section 3.08. To the extent that a Mortgage does not
provide for
escrow payments, (i) the Servicer shall determine whether any such
payments are
made by the Mortgagor in a manner and at a time that is necessary
to avoid the
loss of the Mortgaged Property due to a tax sale or to foreclosure
as a result
of a tax lien and (ii) the Servicer shall ensure that all insurance
required to
be maintained on the Mortgaged Property pursuant to this Agreement
is
maintained. If any such payment has not been made and the Servicer
receives
notice of a tax lien being imposed with respect to the Mortgage
Loan, the
Servicer will, to the extent required to avoid loss of the
Mortgaged Property,
advance or cause to be advanced funds necessary to discharge such
lien on the
Mortgaged Property.
All costs
incurred by the Servicer, if any, in effecting the timely
payments of taxes and assessments on the Mortgaged Properties and
related
insurance premiums shall not, for the purpose of
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calculating monthly distributions to the Certificateholders, be
added to the
Stated Principal Balance under the related Mortgage Loans,
notwithstanding that
the terms of such Mortgage Loans so permit.
In the
event that the Mortgage Loan Documents relating to any Mortgage
Loan contain provisions requiring the related Mortgagor to submit
to binding
arbitration any disputes arising in connection with such Mortgage
Loan, the
Servicer shall be entitled to waive any such provisions on behalf
of the Trust
and to send written notice of such waiver to the related Mortgagor,
although the
Mortgagor may still require arbitration of such disputes at its
option.
The
Servicer shall not be required to make any Servicing Advance
with
respect to a Mortgage Loan that is 150 days or more delinquent.
The
Servicer shall have at least 30 days' notice of the appointment of
a
NIMs Insurer prior to being required to deliver any notices
pursuant to this
Agreement to such NIMs Insurer.
The
Servicer shall deliver a list of Servicing Officers to the
Master
Servicer and the Trustee by the Closing Date.
The
Servicer shall deliver to the MI Insurer updates on the Stated
Principal Balance of the MI Mortgage Loans as required by the MI
Policy, Notices
of Default and Monthly Delinquency Reports (as such reports are
defined in the
MI Policy) and all other reports required by the MI Insurer that
are reasonably
available to the Servicer.
The
Servicer will transmit full-file credit reporting data for each
Mortgage Loan pursuant to Fannie Mae Guide Announcement 97-02 and
for each
Mortgage Loan, the Servicer agrees that it shall report one of the
following
statuses each month as follows: current, delinquent (30-, 60-,
90-days, etc.),
foreclosed or charged-off.
The
Servicer further is authorized and empowered by the Trustee, on
behalf
of the Certificateholders and the Trustee, in its own name or in
the name of the
Sub-Servicer, when the Servicer or the Sub-Servicer, as the case
may be,
believes it is appropriate in its best judgment to register any
Mortgage Loan on
the MERS System, or cause the removal from the registration of any
Mortgage Loan
on the MERS System, to execute and deliver, on behalf of the
Trustee and the
Certificateholders or any of them, any and all instruments of
assignment,
release and other comparable instruments with respect to such
assignment,
release or re-recording of a Mortgage in the name of MERS, solely
as nominee for
the Trustee and its successors and assigns. Any reasonable expenses
incurred in
connection with the actions described in the preceding sentence or
as a result
of MERS discontinuing or becoming unable to continue operations in
connection
with the MERS System, shall be subject to withdrawal by the
Servicer from the
Collection Account (provided that such expenses constitute
"unanticipated
expenses" within the meaning of Treasury Regulation Section
1.860G-1(b)(3)(ii)).
With
respect to any Mortgage Loan, the Servicer may consent to the
refinancing of the prior senior lien relating to such Mortgage
Loan, provided
that the following requirements are met:
(a) the resulting Combined Loan-to-Value Ratio of such Mortgage
Loan
is no higher than the Combined Loan-to-Value Ratio prior to such
refinancing;
and
(b) the interest rate for the loan evidencing the refinanced
senior
lien is no more than 2.0% higher than the interest rate on the loan
evidencing
the existing senior lien immediately prior to the date of such
refinancing; and
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(c) the loan evidencing the refinanced senior lien is not subject
to
negative amortization;
provided,
however, the above requirements shall not be applicable if the
Mortgage Loan is in default or, in the judgment of the Servicer,
such default is
reasonably foreseeable.
In
connection with any modification pursuant to this Section and to
the
extent there are any unreimbursed Advances or Servicing Advances,
the Servicer
shall reimburse itself for such amounts from the Collection
Account.
SECTION 3.02. Servicing and Subservicing; Enforcement of the
Obligations of
Servicer.
(a) The Servicer may arrange for the subservicing of any
Mortgage
Loan by a subservicer, which may be an affiliate (each, a
"subservicer")
pursuant to a Subservicing Agreement (each, a "Subservicing
Agreement");
provided, however, that (i) such subservicing arrangement and the
terms of the
related Subservicing Agreement must provide for the servicing of
such Mortgage
Loans in a manner consistent with the servicing arrangements
contemplated
hereunder, (ii) that such agreement would not result in a
withdrawal or
downgrading by any Rating Agency of the ratings of any Certificates
or any of
the NIM Notes evidenced by a letter to that effect delivered by
each Rating
Agency to the Depositor and the NIMs Insurer and (iii) the NIMs
Insurer shall
have consented to such Subservicing Agreement, which consent shall
not be
unreasonably withheld. Notwithstanding the provisions of any
Subservicing
Agreement, any of the provisions of this Agreement relating to
agreements or
arrangements between the Servicer and a subservicer or reference to
actions
taken through a subservicer or otherwise, the Servicer shall remain
obligated
and liable to the Depositor, the Master Servicer, the Trustee and
the
Certificateholders for the servicing and administration of the
Mortgage Loans in
accordance with the provisions of this Agreement without diminution
of such
obligation or liability by virtue of such Subservicing Agreements
or
arrangements or by virtue of indemnification from the subservicer
and to the
same extent and under the same terms and conditions as if the
Servicer alone
were servicing and administering the Mortgage Loans. Every
Subservicing
Agreement entered into by the Servicer shall contain a provision
giving any
successor servicer the option to terminate such agreement, with the
consent of
the NIMs Insurer (which consent shall not be unreasonably
withheld), in the
event a successor servicer is appointed. All actions of the each
subservicer
performed pursuant to the related Subservicing Agreement shall be
performed as
an agent of the Servicer with the same force and effect as if
performed directly
by the Servicer. The Servicer shall deliver to the NIMs Insurer and
the Master
Servicer copies of all Subservicing Agreements. The Trustee, the
Master Servicer
and the Securities Administrator shall have no obligations, duties
or
liabilities with respect to a subservicer, including, without
limitation, any
obligation, duty or liability to monitor such subservicer or to pay
a
subservicer's fees and expenses.
(b) For purposes of this Agreement, the Servicer shall be deemed
to
have received any collections, recoveries or payments with respect
to the
Mortgage Loans that are received by a subservicer regardless of
whether such
payments are remitted by the subservicer to the Servicer.
SECTION 3.03. Rights of the Depositor, the Securities
Administrator
and the Trustee in
Respect of the Servicer.
None of
the Securities Administrator, the Trustee or the Depositor
shall
have any responsibility or liability for any action or failure to
act by the
Servicer, and none of them is obligated to supervise the
performance of the
Servicer hereunder or otherwise.
SECTION 3.04. Master Servicer to Act as Servicer.
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Subject to
Sections 6.04, 7.03 and 11.02, in the event that the Servicer
shall, for any reason, no longer be the servicer hereunder
(including by reason
of an Event of Default), the Master Servicer or its designee shall,
within a
period of time not to exceed ninety (90) days from the date of
notice of
termination or resignation, thereupon assume all of the rights and
obligations
of the Servicer hereunder arising thereafter (except that the
Master Servicer
shall not be (i) liable for losses of the Servicer pursuant to
Section 3.10
hereof or any acts or omissions of any predecessor servicer
hereunder, (ii)
obligated to make Advances if it is prohibited from doing so by
applicable law,
(iii) obligated to effectuate repurchases or substitutions of
Mortgage Loans
hereunder, including pursuant to Section 2.02 or 2.03 hereof, (iv)
responsible
for any expenses of the Servicer pursuant to Section 2.03 or (v)
deemed to have
made any representations and warranties hereunder, including
pursuant to Section
2.04 or the first paragraph of Section 6.02 hereof; provided,
however that the
Master Servicer (subject to clause (ii) above) or its designee, in
its capacity
as the successor servicer, shall immediately assume the Servicer's
obligation to
make Advances and Servicing Advances). No such termination or
resignation shall
affect any obligation of the Servicer to pay amounts owed under
this Agreement
and to perform its duties under this Agreement until its successor
assumes all
of its rights and obligations hereunder. If the Servicer shall for
any reason no
longer be the servicer (including by reason of any Event of
Default), the Master
Servicer (or any other successor servicer) may, at its option,
succeed to any
rights and obligations of the Servicer under any subservicing
agreement in
accordance with the terms thereof; provided, however, that the
Master Servicer
(or any other successor servicer) shall not incur any liability or
have any
obligations in its capacity as servicer under a subservicing
agreement arising
prior to the date of such succession unless it expressly elects to
succeed to
the rights and obligations of the Servicer thereunder; and the
Servicer shall
not thereby be relieved of any liability or obligations under the
subservicing
agreement arising prior to the date of such succession. To the
extent any costs
or expenses, including without limitation Servicing Transfer Costs
incurred by
the Master Servicer in connection with this Section 3.04 or Section
11.02, are
not paid by the Servicer pursuant to this Agreement within 30 days
of the date
of the Master Servicer's invoice thereof, such amounts shall be
payable out of
the Certificate Account; provided that the terminated servicer
shall reimburse
the Trust Fund for any such expense incurred by the Trust Fund upon
receipt of a
reasonably detailed invoice evidencing such expenses. If the Master
Servicer is
unwilling or unable to act as servicer, the Master Servicer shall
seek to
appoint a successor servicer that is eligible in accordance with
the criteria
specified in this Agreement and reasonably acceptable to the NIMs
Insurer.
The
Servicer shall, upon request of the Master Servicer, but at the
expense of the Servicer, deliver to the assuming party all
documents and records
relating to each subservicing agreement and the Mortgage Loans then
being
serviced and otherwise use its best efforts to effect the orderly
and efficient
transfer of the subservicing agreement to the assuming party.
Notwithstanding anything to the contrary above, the Trustee and
the
Depositor hereby agree that within 10 Business Days of delivery to
the Trustee
by the Servicing Rights Pledgee of a letter signed by the Servicer
whereby the
Servicer shall resign as Servicer under this Agreement, the
Servicing Rights
Pledgee or its designee shall be appointed as successor servicer
(provided that
at the time of such appointment the Servicing Rights Pledgee or
such designee
meets the requirements of a successor servicer set forth in Section
7.03 of this
Agreement) and the Servicing Rights Pledgee agrees to be subject to
the terms of
this Agreement.
SECTION 3.05. Collection of Mortgage Loan Payments; Collection
Account;
Certificate
Account.
(a) The Servicer shall make reasonable efforts in accordance
with
Accepted Servicing Practices to collect all payments called for
under the terms
and provisions of the Mortgage Loans to the extent such procedures
shall be
consistent with this Agreement and the terms and
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provisions of any related Required Insurance Policy. Consistent
with the
foregoing and subject to Section 3.01, the Servicer may in its
discretion (i)
waive any late payment charge or, if applicable, any default
interest charge, or
(ii) extend the due dates for payments due on a Mortgage Note for a
period not
greater than 180 days; provided, however, that any extension
pursuant to clause
(ii) above shall not affect the amortization schedule of any
Mortgage Loan for
purposes of any computation hereunder, except as provided below;
provided,
further, that the NIMs Insurer's prior written consent shall be
required for any
modification, waiver or amendment after the Cut-off Date if the
aggregate number
of outstanding Mortgage Loans which have been modified, waived or
amended
exceeds 5% of the number of Mortgage Loans as of the Cut-Off Date.
In the event
of any such arrangement pursuant to clause (ii) above, subject to
Section 4.01,
the Servicer shall make any Advances on the related Mortgage Loan
during the
scheduled period in accordance with the amortization schedule of
such Mortgage
Loan without modification thereof by reason of such
arrangements.
Notwithstanding the foregoing, in the event that any Mortgage Loan
is in default
or, in the judgment of the Servicer, such default is reasonably
foreseeable, the
Servicer, consistent with the standards set forth in Section 3.01,
may also
waive, modify or vary any term of such Mortgage Loan (including
modifications
that would change the Mortgage Rate, forgive the payment of
principal or
interest or extend the final maturity date of such Mortgage Loan),
accept
payment from the related Mortgagor of an amount less than the
Stated Principal
Balance in final satisfaction of such Mortgage Loan, or consent to
the
postponement of strict compliance with any such term or otherwise
grant
indulgence to any Mortgagor (any and all such waivers,
modifications, variances,
forgiveness of principal or interest, postponements, or indulgences
collectively
referred to herein as "forbearance"), provided, however, that in no
event shall
the Servicer grant any such forbearance (other than as permitted by
the second
sentence of this Section) with respect to any one Mortgage Loan
more than once
in any 12 month period or more than three times over the life of
such Mortgage
Loan, and provided, further, that in determining which course of
action
permitted by this sentence it shall pursue, the Servicer shall
adhere to the
standards of Section 3.01. In connection with any modification
pursuant to this
Section 3.05(a) and to the extent there are any unreimbursed
Advances, the
Servicer shall reimburse itself for such amounts from the
Collection Account.
(b) The Servicer will not waive any Prepayment Charge or
portion
thereof unless, (i) the enforceability thereof shall have been
limited by
bankruptcy, insolvency, moratorium, receivership and other similar
laws relating
to creditors' rights generally or is otherwise prohibited by law,
or (ii) the
collectability thereof shall have been limited due to acceleration
in connection
with a foreclosure or other involuntary payment, or (iii) in the
Servicer's
reasonable judgment as described in Section 3.01 hereof, (x) such
waiver relates
to a default or a reasonably foreseeable default, (y) such waiver
would maximize
recovery of total proceeds taking into account the value of such
Prepayment
Charge and related Mortgage Loan and (z) doing so is standard and
customary in
servicing similar Mortgage Loans (including any waiver of a
Prepayment Charge in
connection with a refinancing of a Mortgage Loan that is related to
a default or
a reasonably foreseeable default), or (iv) sufficient information
is not made
available to enable it to collect the Prepayment Charge. Except as
provided in
the preceding sentence, in no event will the Servicer waive a
Prepayment Charge
in connection with a refinancing of a Mortgage Loan that is not
related to a
default or a reasonably foreseeable default. If the Servicer waives
or does not
collect all or a portion of a Prepayment Charge relating to a
Principal
Prepayment in full or in part due to any action or omission of the
Servicer,
other than as provided above, the Servicer shall deposit the amount
of such
Prepayment Charge (or such portion thereof as had been waived for
deposit) into
the Collection Account for distribution in accordance with the
terms of this
Agreement.
(c) The Servicer shall not be required to institute or join in
litigation with respect to collection of any payment (whether under
a Mortgage,
Mortgage Note or otherwise or against any public or governmental
authority with
respect to a taking or condemnation) if it reasonably believes
that
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enforcing the provision of the Mortgage or other instrument
pursuant to which
such payment is required is prohibited by applicable law.
(d) The Servicer shall establish and maintain so long as it is
acting as servicer hereunder, on behalf of the Trustee for the
benefit of the
Certificateholders, the Collection Account. The Servicer shall
deposit into the
Collection Account, within two Business Days of receipt thereof, in
immediately
available funds, the following payments and collections received or
made by it
on and after the Cut-Off Date with respect to the Mortgage
Loans:
(i) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans, other than principal due on the
Mortgage
Loans on or prior to the Cut-off Date;
(ii) all payments on account of interest on the Mortgage Loans
net of the related Servicing Fee permitted under Section 3.15,
other than (x)
interest due on the Mortgage Loans on or prior to the Cut-off Date
and (y)
Prepayment Interest Excess;
(iii) all Liquidation Proceeds, other than proceeds to be
applied to the restoration or repair of the Mortgaged Property (or
Underlying
Mortgaged Property, in the case of a Co-op Loan) or released to
either the
Mortgagor or the holder of a senior lien on the Mortgaged Property
(or
Underlying Mortgaged Property, in the case of a Co-op Loan) in
accordance with
the Servicer's normal servicing procedures;
(iv) all Subsequent Recoveries;
(v) all Compensating Interest;
(vi) any amount required to be deposited by the Servicer
pursuant to Section 3.05(f) in connection with any losses on
Permitted
Investments;
(vii) any amounts required to be deposited by the Servicer
pursuant to Section 3.10 hereof;
(viii) all Purchase Prices and Substitution Adjustment
Amounts;
(ix) all Advances made by the Servicer pursuant to Section
4.01;
(x) all Prepayment Charges;
(xi) all net monthly rental income from REO Properties
required to be deposited by the Servicer pursuant to Section 3.12;
and
(xii) any other amounts required to be deposited hereunder.
The
foregoing requirements for remittance by the Servicer into the
Collection Account shall be exclusive, it being understood and
agreed that,
without limiting the generality of the foregoing, all
servicing-related fees,
including all late payment charges, insufficient funds charges,
customary real
estate referral fees and payments in the nature of assumption fees
(i.e. fees
related to the assumption of a Mortgage Loan upon the purchase of
the related
Mortgaged Property or stock allocated to a dwelling unit in the
case of a Co-op
Loan), modification fees, extension fees and other similar
ancillary fees and
charges (other than Prepayment Charges) if collected, and any
Prepayment
Interest Excess need not be remitted by the Servicer. Rather, such
fees and
charges and similar amounts may be retained by the
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Servicer as additional servicing compensation. In the event that
the Servicer
shall remit any amount not required to be remitted and not
otherwise subject to
withdrawal pursuant to Section 3.08 hereof, it may at any time
withdraw or
direct the Trustee, or such other institution maintaining the
Collection
Account, to withdraw such amount from the Collection Account, any
provision
herein to the contrary notwithstanding. The Servicer shall maintain
adequate
records with respect to all withdrawals made pursuant to this
Section. All funds
deposited in the Collection Account shall be held in trust for
the
Certificateholders until withdrawn in accordance with Section 3.08.
In no event
shall the Trustee incur liability for withdrawals from the
Collection Account at
the direction of the Servicer.
The
Servicer shall give notice to the NIMs Insurer, the Securities
Administrator and the Trustee of the location of the Collection
Account
maintained by it when established and prior to any change thereof.
Not later
than twenty days after each Distribution Date, the Servicer shall
forward to the
NIMs Insurer, and upon request, to the Securities Administrator,
the Trustee and
the Depositor the most current available bank statement for the
Collection
Account. Copies of such statement shall be provided by the
Securities
Administrator to any Certificateholder and to any Person identified
to the
Securities Administrator as a prospective transferee of a
Certificate, upon
request at the expense of the requesting party, provided such
statement is
delivered by the Servicer to the Securities Administrator.
(e) The Securities Administrator shall establish and maintain,
on
behalf of the Certificateholders, the Certificate Account. The
Securities
Administrator shall, promptly upon receipt, deposit or cause to be
deposited in
the Certificate Account and retain therein the following:
(i) the aggregate amount withdrawn by the Servicer from the
Collection Account and required to be deposited in the Certificate
Account;
(ii)
any amount required to be deposited by the Securities
Administrator pursuant to Section 3.05(g) in connection with any
losses on
Permitted Investments; and
(iii) the Optional Termination Amount received by the
Securities Administrator pursuant to Section 9.01.
Any
amounts received by the Securities Administrator prior to 1:00
p.m.
New York City time (or such earlier deadline for investment in the
Permitted
Investments designated by the Securities Administrator) which are
required to be
deposited in the Certificate Account by the Servicer or Master
Servicer shall be
invested in Permitted Investments on the Business Day on which they
were
received. The foregoing requirements for remittance by the Servicer
and Master
Servicer and deposit by the Servicer and Master Servicer into the
Certificate
Account shall be exclusive. In the event that the Servicer or the
Master
Servicer shall remit any amount not required to be remitted and not
otherwise
subject to withdrawal pursuant to Section 3.08 hereof, it may at
any time
withdraw such amount from the Certificate Account, any provision
herein to the
contrary notwithstanding. All funds deposited in the Certificate
Account shall
be held by the Securities Administrator in trust for the
Certificateholders
until disbursed in accordance with this Agreement or withdrawn in
accordance
with Section 3.08. In no event shall the Securities Administrator
incur
liability for withdrawals from the Certificate Account at the
direction of the
Servicer or the Master Servicer. The Securities Administrator shall
give notice
to the NIMs Insurer, the Master Servicer and the Servicer of the
location of the
Certificate Account maintained by it when established and prior to
any change
thereof.
(f) Each institution that maintains the Collection Account or
the
Certificate Account shall invest the funds in each such account as
directed by
the Servicer or the Securities Administrator, as applicable, in
writing, in
Permitted Investments, which shall mature not later than (i) in the
case of the
Collection Account the Business Day preceding the related Servicer
Remittance
Date
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(except that if such Permitted Investment is an obligation of the
institution
that maintains such Collection Account or is otherwise immediately
available,
then such Permitted Investment shall mature not later than the
Servicer
Remittance Date) and (ii) in the case of the Certificate Account,
the Business
Day immediately preceding the first Distribution Date that follows
the date of
such investment (except that if such Permitted Investment is an
obligation of
the institution that maintains such Certificate Account or is
otherwise
immediately available, then such Permitted Investment shall mature
not later
than such Distribution Date) and, in each case, shall not be sold
or disposed of
prior to its maturity. All such Permitted Investments shall be made
in the name
of the Servicer, or the Securities Administrator, as applicable,
for the benefit
of the Certificateholders. All income and gain net of any losses
realized from
amounts on deposit in the Collection Account shall be for the
benefit of the
Servicer as servicing compensation and shall be remitted to it or
withdrawn by
it monthly as provided herein. The amount of any losses incurred in
the
Collection Account in respect of any such investments shall be
deposited by the
Servicer in the Collection Account out of the Servicer's own funds
immediately
as realized.
(g) All income and gain net of any losses realized from amounts
on
deposit in the Certificate Account shall be for the benefit of (i)
the Servicer
to the extent such income and gain (net of any losses) relates to
the period
from the Servicer Remittance Date to but not including the fifth
Business Day
immediately preceding the related Distribution Date and (ii) the
Securities
Administrator to the extent such income and gain (net of any
losses) relates to
any other period. Any amounts in such Certificate Account earned
for the
benefit of the Servicer shall be remitted by the Securities
Administrator to
the Servicer not later than the third Business Day of the month
immediately
succeeding the month in which such amounts were earned. The amount
of any
losses incurred in the Certificate Account in respect of any such
investments
shall be deposited by the Servicer and/or the Securities
Administrator, as
applicable, in the Certificate Account out of the Securities
Administrator's
own funds immediately as realized; provided that the Securities
Administrator
shall be reimbursed by the Servicer for any such losses which
relate to the
period from the Servicer Remittance Date to but not including the
Business Day
immediately preceding the related Distribution Date.
SECTION 3.06. Collection of Taxes, Assessments and Similar
Items;
Escrow Accounts.
To the
extent required by the related Mortgage Note, the Servicer
shall
establish and maintain one or more accounts (each, an "Escrow
Account") and
deposit and retain therein all collections from the Mortgagors (or
advances by
the Servicer) for the payment of taxes, assessments, hazard
insurance premiums
or comparable items for the account of the Mortgagors. Nothing
herein shall
require the Servicer to compel a Mortgagor to establish an Escrow
Account in
violation of applicable law.
Withdrawals of amounts so collected from the Escrow Accounts may be
made
only to effect timely payment of taxes, assessments, insurance
premiums,
condominium or PUD association dues, or comparable items, to
reimburse the
Servicer out of related collections for any payments made pursuant
to Sections
3.01 hereof (with respect to taxes, assessments, dues or comparable
items and
insurance premiums) and 3.10 hereof (with respect to hazard
insurance), to
refund to any Mortgagors any sums as may be determined to be
overages, to pay
interest, if required by law or the terms of the related Mortgage
or Mortgage
Note, to Mortgagors on balances in the Escrow Account to withdraw
funds
deposited in error or amounts previously deposited but returned as
unpaid due to
a "not sufficient funds" or other denial by the related Mortgagor's
banking
institution or to clear and terminate the Escrow Account at the
termination of
this Agreement in accordance with Section 9.01 hereof. The Escrow
Accounts shall
not be a part of the Trust Fund.
SECTION 3.07. Access to Certain Documentation and Information
Regarding
the Mortgage
Loans.
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Upon
reasonable advance notice in writing if required by federal
regulation, the Servicer will provide to each Certificateholder
that is a
savings and loan association, bank or insurance company certain
reports and
reasonable access to information and documentation regarding the
Mortgage Loans
sufficient to permit such Certificateholder to comply with
applicable
regulations of the OTS or other regulatory authorities with respect
to
investment in the Certificates; provided, that the Servicer shall
be entitled to
be reimbursed by each such Certificateholder for actual expenses
incurred by the
Servicer in providing such reports and access.
In
addition, with respect to each MI Mortgage Loan that is subject to
a
modification, the Servicer shall provide the MI Insurer with
written notice of
such modification, which shall include the nature of such
modification.
SECTION 3.08. Permitted Withdrawals from the Collection Account
and
Certificate
Account.
(a) The Servicer may from time to time, make withdrawals from
the Collection Account for the following purposes (the order below
not
constituting an order of priority):
(i) to pay to the Servicer (to the extent not previously
paid to or withheld by the Servicer), as servicing compensation in
accordance
with Section 3.15, that portion of any payment or recovery of
interest on a
Mortgage Loan that equals the Servicing Fee for the period with
respect to which
such interest payment or recovery was made or allocated, and, as
additional
servicing compensation, those other amounts set forth in Section
3.15;
(ii) to reimburse the Servicer for Advances made by it
(or to reimburse the Advance Financing Person for Advances made by
it) with
respect to the Mortgage Loans, such right of reimbursement pursuant
to this
subclause (ii) being limited to amounts received on particular
Mortgage Loan(s)
(including, for this purpose, Condemnation Proceeds, Insurance
Proceeds,
Liquidation Proceeds) that represent late recoveries of payments of
principal
and/or interest on such particular Mortgage Loan(s) in respect of
which any such
Advance was made;
(iii) to reimburse the Servicer for any Non-Recoverable
Advance previously made and any Non-Recoverable Servicing Advances
previously
made to the extent that, in the case of Non-Recoverable Servicing
Advances,
reimbursement therefor constitutes "unanticipated expenses" within
the meaning
of Treasury Regulation Section 1.860G-1(b)(3)(ii);
(iv)
to pay to the Servicer earnings on or investment
income with respect to funds in or credited to the Collection
Account;
(v) to reimburse the Servicer from Insurance Proceeds
for Insured Expenses covered by the related Insurance Policy;
(vi) to pay the Servicer any unpaid Servicing Fees and
to reimburse it for any unreimbursed Servicing Advances (to the
extent that
reimbursement for Servicing Advances would constitute an
"unanticipated expense"
within the meaning of Treasury Regulation Section
1.860G-1(b)(3)(ii)), the
Servicer's right to reimbursement of Servicing Advances pursuant to
this
subclause (vi) with respect to any Mortgage Loan being limited to
amounts
received on particular Mortgage Loan(s)(including, for this
purpose, Liquidation
Proceeds and purchase and repurchase proceeds) that represent late
recoveries of
the payments for which such advances were made pursuant to Section
3.01 or
Section 3.06;
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(vii) to pay to the Depositor or the Servicer, as
applicable, with respect to each Mortgage Loan or property acquired
in respect
thereof that has been purchased pursuant to Section 2.02, 2.03 or
3.12, all
amounts received thereon and not taken into account in determining
the related
Stated Principal Balance of such repurchased Mortgage Loan;
(viii) to reimburse the Servicer, the Master Servicer,
the Securities Administrator or the Depositor for expenses incurred
by any of
them in connection with the Mortgage Loans or the Certificates and
reimbursable
pursuant to Section 3.25 or Section 6.03 hereof;
(ix) to reimburse the Trustee for enforcement expenses
reasonably incurred in respect of a breach or defect giving rise to
the purchase
obligation in Section 2.03 that were incurred in the Purchase Price
of the
Mortgage Loans including any expenses arising out of the
enforcement of the
purchase obligation; provided that any such expenses will be
reimbursable under
this subclause (ix) only to the extent that such expenses would
constitute
"unanticipated expenses" within the meaning of Treasury Regulation
Section
1.860G-1(b)(3)(ii) if paid by one of the REMICs provided for
herein;
(x) to withdraw any amount deposited in the Collection
Account and not required to be deposited therein;
(xi) to withdraw funds deposited in error or amounts
previously deposited but returned as unpaid due to a "not
sufficient funds" or
other denial by the related Mortgagor's banking institution;
(xii) to clear and terminate the Collection Account upon
termination of this Agreement pursuant to Section 9.01 hereof;
(xiii) to reimburse
itself for Advances or Servicing
Advances from amounts in the Collection Account held for future
distributions
that were not included in Available Funds for the preceding
Distribution Date.
An amount equal to the amount withdrawn from the Collection Account
pursuant to
this subclause (xiii) shall be deposited in the Collection Account
by the
Servicer on the next succeeding Distribution Date on which funds
are to be
distributed to Certificateholders;
(xiv) to reimburse itself from any amounts in the
Collection Account for any prior Advances or Servicing Advances
made by the
Servicer that have not otherwise been reimbursed to the Servicer at
the time a
Mortgage Loan is modified; and
(xv) to pay any obligations under the MI Policy.
In
addition, no later than 12:00 p.m. Eastern Time on the Servicer
Remittance Date, the Servicer shall cause to be withdrawn from the
Collection
Account the Interest Funds, the Principal Funds and the Securities
Administrator
Fee to the extent on deposit, and such amount shall be deposited in
the
Certificate Account; provided, however, if the Securities
Administrator does not
receive such Interest Funds, Principal Funds and Securities
Administrator Fee by
2:00 p.m. Eastern Time, such Interest Funds and Principal Funds
shall be
deposited in the Certificate Account on the next Business Day.
The
Servicer shall keep and maintain separate accounting, on a
Mortgage
Loan by Mortgage Loan basis, for the purpose of justifying any
withdrawal from
the Collection Account.
The
Servicer shall provide written notification to the Securities
Administrator on or prior to the next succeeding Servicer
Remittance Date upon
making any withdrawals from the Collection Account pursuant to
subclauses (iii)
and (viii) above.
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In the
event of any failure by the Servicer to remit to the Securities
Administrator for deposit into the Certificate Account any amounts
(including
any Advance) required to be so remitted by the Servicer on the
Servicer
Remittance Date, the Servicer shall pay to the Securities
Administrator, for its
own account, interest on such amounts at the "prime rate" (as
specified in the
New York edition of The Wall Street Journal) until such failure is
remedied.
Unless
otherwise specified, any amounts reimbursable to the Servicer
or
the Securities Administrator from amounts on deposit in the
Collection Account
or the Certificate Accounts shall be deemed to come from first,
Interest Funds,
and thereafter, Principal Funds for the related Distribution
Date.
(b) The Securities Administrator shall withdraw funds from the
Certificate Account for distribution to the Certificateholders in
the manner
specified in this Agreement (and shall withhold from the amounts so
withdrawn,
the amount of any taxes that it is authorized to retain pursuant to
this
Agreement). In addition, the Securities Administrator may from time
to time make
withdrawals from the Certificate Account for the following purposes
(the order
below not constituting an order of priority):
(i) to withdraw any amount deposited in the Certificate
Account and not required to be deposited therein;
(ii) to clear and terminate the Certificate Account upon
termination of the Agreement pursuant to Section 9.01 hereof (after
paying all
amounts necessary to the Trustee, the Securities Administrator, the
Master
Servicer or the Servicer in connection with any such
termination);
(iii) to reimburse the Securities Administrator, the
Master Servicer or the Trustee for any fees, expenses and
indemnification
reimbursable pursuant to this Agreement, including without
limitation Sections
3.04, 6.03, 8.05, 8.06 and 11.02 hereof;
(iv) to pay to the Servicer or the Securities
Administrator, as applicable, earnings on or investment income with
respect to
funds in or credited to the Certificate Account as provided in
Section 3.05(g);
and
(v) to pay to the MI Insurer, the MI Insurer Fee.
SECTION 3.09. [RESERVED]
SECTION 3.10. Maintenance of Hazard Insurance.
The
Servicer shall cause to be maintained, for each first lien
Mortgage
Loan (other than a Co-op Loan), fire and hazard insurance with
extended coverage
in an amount that is at least equal to the lesser of (i) the
replacement value
of the improvements that are part of such Mortgaged Property, or
(ii) the
greater of (a) the outstanding principal balance of the Mortgage
Loan and (b) an
amount such that the proceeds of such policy shall be sufficient to
prevent the
related Mortgagor and/or mortgagee from becoming a co-insurer or
(iii) the
amount required under applicable HUD/FHA regulations. Each policy
of standard
hazard insurance shall contain, or have an accompanying endorsement
that
contains, a standard mortgagee clause. The Servicer shall also
cause flood
insurance to be maintained on property acquired upon foreclosure or
deed in lieu
of foreclosure of any Mortgage Loan, to the extent described below.
Pursuant to
Section 3.05 hereof, any amounts collected by the Servicer under
any such
policies (other than the amounts to be applied to the restoration
or repair of
the related Mortgaged Property or property thus acquired or amounts
released to
the Mortgagor in accordance with the Servicer's normal
servicing
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procedures) shall be deposited in the Collection Account. Any cost
incurred by
the Servicer in maintaining any such insurance shall not, for the
purpose of
calculating monthly distributions to the Certificateholders or
remittances to
the Trustee for their benefit, be added to the principal balance of
the Mortgage
Loan, notwithstanding that the terms of the Mortgage Loan so
permit. Such costs
shall be recoverable by the Servicer out of late payments by the
related
Mortgagor or out of Liquidation Proceeds to the extent and as
otherwise
permitted by Section 3.08 hereof. It is understood and agreed that
no earthquake
or other additional insurance is to be required of any Mortgagor or
maintained
on property acquired in respect of a Mortgage other than pursuant
to such
applicable laws and regulations as shall at any time be in force
and as shall
require such additional insurance. If the Mortgaged Property is
located at the
time of origination of the Mortgage Loan in a federally designated
special flood
hazard area and such area is participating in the national flood
insurance
program, the Servicer shall cause flood insurance to be maintained
with respect
to such first lien Mortgage Loan. Such flood insurance shall be in
an amount
equal to the lesser of (i) the original principal balance of the
related
Mortgage Loan, (ii) the replacement value of the improvements that
are part of
such Mortgaged Property, or (iii) the maximum amount of such
insurance available
for the related Mortgaged Property under the Flood Disaster
Protection Act of
1973, as amended.
In the
event that the Servicer shall obtain and maintain a blanket
policy
insuring against hazard losses on all of the Mortgage Loans, it
shall
conclusively be deemed to have satisfied its obligations as set
forth in the
first sentence of this Section 3.10, it being understood and agreed
that such
policy may contain a deductible clause on terms substantially
equivalent to
those commercially available and maintained by comparable
servicers. If such
policy contains a deductible clause, the Servicer shall, in the
event that there
shall not have been maintained on the related Mortgaged Property a
policy
complying with the first sentence of this Section 3.10, and there
shall have
been a loss that would have been covered by such policy, deposit in
the
Collection Account the amount not otherwise payable under the
blanket policy
because of such deductible clause. In connection with its
activities as servicer
of the Mortgage Loans, the Servicer agrees to present, on behalf of
itself, the
Depositor and the Securities Administrator for the benefit of
the
Certificateholders, claims under any such blanket policy.
SECTION 3.11. Enforcement of Due-On-Sale Clauses; Assumption
Agreements.
(a) Except as otherwise provided in this Section 3.11(a), when
any property subject to a Mortgage has been or is about to be
conveyed by the
Mortgagor, the Servicer shall to the extent that it has knowledge
of such
conveyance, enforce any due-on-sale clause contained in any
Mortgage Note or
Mortgage, but only to the extent that such enforcement will not
adversely affect
or jeopardize coverage under any Required Insurance Policy;
provided, however,
that the Servicer shall not exercise any such right if the
due-on-sale clause,
in the reasonable belief of the Servicer, is not enforceable under
applicable
law. An opinion of counsel, which shall be reimbursable as a
Servicing Advance
(to the extent it is an "unanticipated expense" within the meaning
of Treasury
Regulation Section 1.860G-1(b)(3)(ii)), delivered to the
Securities
Administrator, Master Servicer, Trustee and the Depositor shall
conclusively
establish the reasonableness of such belief to the extent permitted
under
applicable law. Notwithstanding the foregoing, the Servicer is not
required to
exercise such rights with respect to a Mortgage Loan if the Person
to whom the
related Mortgaged Property (or stock allocated to a dwelling unit,
in the case
of a Co-op Loan) has been conveyed or is proposed to be conveyed
satisfies the
terms and conditions contained in the Mortgage Note and Mortgage
related thereto
and the consent of the mortgagee under such Mortgage Note or
Mortgage is not
otherwise so required under such Mortgage Note or Mortgage as a
condition to
such transfer. In the event that the Servicer is prohibited by law
from
enforcing any such due-on-sale clause, or if coverage under any
Required
Insurance Policy would be adversely affected, or if nonenforcement
is otherwise
permitted hereunder, the Servicer is authorized, subject to Section
3.11(b), to
take or enter into an assumption and modification agreement from or
with the
Person to whom such property has been or is about to be conveyed,
pursuant to
which such Person
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becomes liable under the Mortgage Note and, unless prohibited by
applicable
state law, the Mortgagor remains liable thereon, provided that the
Mortgage Loan
shall continue to be covered (if so covered before the Servicer
enters such
agreement) by the applicable Required Insurance Policies. The
Servicer, subject
to Section 3.11(b), is also authorized with the prior approval of
the insurers
under any Required Insurance Policies to enter into a substitution
of liability
agreement with such Person, pursuant to which the original
Mortgagor is released
from liability and such Person is substituted as Mortgagor and
becomes liable
under the Mortgage Note. Notwithstanding the foregoing, the
Servicer shall not
be deemed to be in default under this Section 3.11(a) by reason of
any transfer
or assumption that the Servicer reasonably believes it is
restricted by law from
preventing.
(b) Subject to the Servicer's duty to enforce any due-on-sale
clause to the extent set forth in Section 3.11(a) hereof, in any
case in which a
Mortgaged Property (or stock allocated to a dwelling unit, in the
case of Co-op
Loan) has been conveyed to a Person by a Mortgagor, and such Person
is to enter
into an assumption agreement or modification agreement or
supplement to the
Mortgage Note or Mortgage that requires the signature of the
Trustee, or if an
instrument of release signed by the Trustee is required releasing
the Mortgagor
from liability on the Mortgage Loan, the Servicer shall prepare and
deliver or
cause to be prepared and delivered to the Trustee for signature and
shall
direct, in writing, the Trustee to execute the assumption agreement
with the
Person to whom the Mortgaged Property (or the stock allocated to a
dwelling
unit, in the case of a Co-op Loan) is to be conveyed and such
modification
agreement or supplement to the Mortgage Note or Mortgage or other
instruments as
are reasonable or necessary to carry out the terms of the Mortgage
Note or
Mortgage or otherwise to comply with any applicable laws regarding
assumptions
or the transfer of the Mortgaged Property (or stock allocated to a
dwelling
unit, in the case of a Co-op Loan) to such Person. In connection
with any such
assumption, no material term of the Mortgage Note (including, but
not limited
to, the Mortgage Rate, the amount of the Scheduled Payment, the
Maximum Rate,
the Minimum Rate, the Gross Margin, the Periodic Rate Cap, the
Adjustment Date,
any prepayment penalty and any other term affecting the amount or
timing of
payment on the Mortgage Loan) may be changed. The Servicer shall
notify the
Trustee and the NIMs Insurer that any such substitution or
assumption agreement
has been completed by forwarding to the Trustee (with a copy to the
NIMs
Insurer) the original of such substitution or assumption agreement,
which in the
case of the original shall be added to the related Mortgage File
and shall, for
all purposes, be considered a part of such Mortgage File to the
same extent as
all other documents and instruments constituting a part thereof.
The Servicer
shall be responsible for recording any such assumption or
substitution
agreements. Any fee collected by the Servicer for entering into an
assumption or
substitution of liability agreement will be retained by the
Servicer as
additional servicing compensation.
SECTION 3.12. Realization Upon Defaulted Mortgage Loans;
Determination of
Excess Proceeds.
(a) The Servicer shall use reasonable efforts consistent with
the servicing standard set forth in Section 3.01 to foreclose upon
or otherwise
comparably convert the ownership of properties securing such of the
Mortgage
Loans as come into and continue in default and as to which no
satisfactory
arrangements can be made for collection of Delinquent payments. In
connection
with such foreclosure or other conversion, the Servicer shall
follow such
practices and procedures as it shall deem necessary or advisable
and as shall be
normal and usual in its general mortgage servicing activities and
the
requirements of the insurer under any Required Insurance Policy;
provided,
however, that the Servicer shall not be required to expend its own
funds in
connection with the restoration of any property that shall have
suffered damage
due to an uninsured cause unless it shall determine (i) that such
restoration
will increase the proceeds of liquidation of the Mortgage Loan
after
reimbursement to itself of such expenses and (ii) that such
expenses will be
recoverable to it through Liquidation Proceeds (respecting which it
shall have
priority for purposes of withdrawals from the Collection
Account
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pursuant to Section 3.08 hereof). The Servicer shall be responsible
for all
other costs and expenses incurred by it in any such proceedings;
provided,
however, that it shall be entitled to reimbursement thereof from
the proceeds of
liquidation of the related Mortgaged Property (or stock allocated
to a dwelling
unit, in the case of a Co-op Loan) and if applicable, as a
Non-Recoverable
Servicing Advance, as contemplated in
