EXHIBIT 4
SECURITIZED ASSET BACKED RECEIVABLES LLC,
Depositor,
WELLS FARGO BANK, NATIONAL ASSOCIATION,
Servicer,
NC CAPITAL CORPORATION,
Responsible Party,
OFFICETIGER GLOBAL REAL ESTATE SERVICES INC.,
Loan Performance Advisor,
U.S. BANK NATIONAL ASSOCIATION,
Trustee
and
WELLS FARGO BANK, NATIONAL ASSOCIATION,
Securities Administrator and Custodian
--------------------------------------------
POOLING AND SERVICING AGREEMENT
Dated as of April 1, 2006
--------------------------------------------
SECURITIZED ASSET BACKED RECEIVABLES LLC TRUST 2006-NC1
MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2006-NC1
<PAGE>
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
Section 2.01
Conveyance of Mortgage Loans.................................
Section 2.02
Acceptance by the Trustee of the Mortgage Loans..............
Section 2.03
Representations, Warranties and Covenants of the
Responsible Party and the Servicer; Remedies for
Breaches of Representations and Warranties with Respect
to the Mortgage Loans.......................................
Section 2.04
[Reserved]...................................................
Section 2.05
Execution and Delivery of Certificates.......................
Section 2.06
REMIC Matters................................................
Section 2.07
Representations and Warranties of the Depositor..............
Section 2.08
Rights of the NIM Insurer....................................
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01
Servicer to Service Mortgage Loans...........................
Section 3.02
Subservicing Agreements between the Servicer and
Subservicers................................................
Section 3.03
Successor Subservicers.......................................
Section 3.04
Liability of the Servicer....................................
Section 3.05 No
Contractual Relationship between Subservicers and the
Trustee, the Securities Administrator or the NIM Insurer....
Section 3.06
Assumption or Termination of Subservicing Agreements by
Trustee.....................................................
Section 3.07
Collection of Certain Mortgage Loan Payments.................
Section 3.08
Subservicing Accounts........................................
Section 3.09
Collection of Taxes, Assessments and Similar Items;
Escrow Accounts.............................................
Section 3.10
Collection Account...........................................
Section 3.11
Withdrawals from the Collection Account......................
Section 3.12
Investment of Funds in the Collection Account, Escrow
Accounts and the Distribution Account.......................
Section 3.13
Maintenance of Hazard Insurance and Errors and Omissions
and Fidelity Coverage.......................................
Section 3.14
Enforcement of Due-On-Sale Clauses; Assumption Agreements....
Section 3.15
Realization upon Defaulted Mortgage Loans....................
Section 3.16
Release of Mortgage Files....................................
Section 3.17
Title, Conservation and Disposition of REO Property..........
Section 3.18
Notification of Adjustments..................................
Section 3.19
Access to Certain Documentation and Information Regarding
the Mortgage Loans..........................................
Section 3.20
Documents, Records and Funds in Possession of the
Servicer to Be Held for the Securities Administrator........
Section 3.21
Servicing Compensation.......................................
Section 3.22
Annual Statement as to Compliance............................
Section 3.23
Annual Reports on Assessment of Compliance with Servicing
Criteria; Annual Independent Public Accountants'
Attestation Report..........................................
Section 3.24
Trustee to Act as Servicer...................................
Section 3.25
Compensating Interest........................................
Section 3.26
Credit Reporting; Gramm-Leach-Bliley Act.....................
Section 3.27
Pool Policy; Claims Under the Pool Policy....................
ARTICLE IV
DISTRIBUTIONS AND
ADVANCES BY THE SERVICER
Section 4.01
Advances.....................................................
Section 4.02
Priorities of Distribution...................................
Section 4.03
Monthly Statements to Certificateholders.....................
Section 4.04
Certain Matters Relating to the Determination of LIBOR.......
Section 4.05
Allocation of Applied Realized Loss Amounts..................
Section 4.06
Swap Account.................................................
ARTICLE V
THE CERTIFICATES
Section 5.01 The
Certificates.............................................
Section 5.02
Certificate Register; Registration of Transfer and
Exchange of Certificates....................................
Section 5.03
Mutilated, Destroyed, Lost or Stolen Certificates............
Section 5.04
Persons Deemed Owners........................................
Section 5.05
Access to List of Certificateholders' Names and Addresses....
Section 5.06
Maintenance of Office or Agency..............................
ARTICLE VI
THE DEPOSITOR, THE SERVICER
AND THE LOAN PERFORMANCE ADVISOR
Section 6.01
Respective Liabilities of the Depositor and the Servicer.....
Section 6.02
Merger or Consolidation of the Depositor or the Servicer.....
Section 6.03
Limitation on Liability of the Depositor, the Servicer
and Others..................................................
Section 6.04
Limitation on Resignation of the Servicer....................
Section 6.05
Additional Indemnification by the Servicer; Third Party
Claims......................................................
Section 6.06
Duties of the Loan Performance Advisor.......................
Section 6.07
Loan Performance Advisor's Fees..............................
ARTICLE VII
DEFAULT
Section 7.01
Events of Default............................................
Section 7.02
Trustee to Act; Appointment of Successor.....................
Section 7.03
Notification to Certificateholders...........................
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.01
Duties of the Trustee........................................
Section 8.02
Certain Matters Affecting the Trustee........................
Section 8.03
Trustee Not Liable for Certificates or Mortgage Loans........
Section 8.04
Trustee May Own Certificates.................................
Section 8.05
Trustee's Fees and Expenses..................................
Section 8.06
Eligibility Requirements for the Trustee.....................
Section 8.07
Resignation and Removal of the Trustee.......................
Section 8.08
Successor Trustee............................................
Section 8.09
Merger or Consolidation of the Trustee.......................
Section 8.10
Appointment of Co-Trustee or Separate Trustee................
Section 8.11 Tax
Matters..................................................
Section 8.12
Periodic Filings.............................................
Section 8.13 Tax
Classification of the Excess Reserve Fund Account,
the Swap Account, the Interest Rate Swap Agreement and
the Cap Agreements..........................................
ARTICLE IX
CONCERNING THE SECURITIES ADMINISTRATOR
Section 9.01
Duties of Securities Administrator...........................
Section 9.02
Certain Matters Affecting the Securities Administrator.......
Section 9.03
Securities Administrator Not Liable for Certificates or
Mortgage Loans..............................................
Section 9.04
Securities Administrator May Own Certificates................
Section 9.05
Securities Administrator's Fees and Expenses.................
Section 9.06
Eligibility Requirements for Securities Administrator........
Section 9.07
Resignation and Removal of Securities Administrator..........
Section 9.08
Successor Securities Administrator...........................
Section 9.09
Merger or Consolidation of Securities Administrator..........
Section 9.10
Assignment or Delegation of Duties by the Securities
Administrator...............................................
ARTICLE X
TERMINATION
Section 10.01
Termination upon Liquidation or Purchase of the Mortgage
Loans.......................................................
Section 10.02 Final
Distribution on the Certificates.......................
Section 10.03
Additional Termination Requirements..........................
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01
Amendment....................................................
Section 11.02
Recordation of Agreement; Counterparts.......................
Section 11.03
Governing Law................................................
Section 11.04
Intention of Parties.........................................
Section 11.05
Notices......................................................
Section 11.06
Severability of Provisions...................................
Section 11.07
Assignment...................................................
Section 11.08
Limitation on Rights of Certificateholders...................
Section 11.09
Inspection and Audit Rights..................................
Section 11.10
Certificates Nonassessable and Fully Paid....................
Section 11.11
Assignment; Sales; Advance Facilities........................
Section 11.12 Rule of
Construction.........................................
Section 11.13 Waiver
of Jury Trial.........................................
Section 11.14 Rights
of the Swap Provider..................................
Section 11.15
Regulation AB Compliance; Intent of the Parties;
Reasonableness..............................................
Section 11.16 Third
Party Rights...........................................
<PAGE>
SCHEDULES
Schedule I
Mortgage Loan Schedule
Schedule II
Representations and Warranties of Wells Fargo
Schedule III
Representations and Warranties of the Responsible Party as
to the Mortgage Loans
Schedule IV
Representations and Warranties as to the Responsible Party
Schedule V
Representations and Warranties of the Depositor as to the
Mortgage
Loans
EXHIBITS
Exhibit A
Form of Class A, Class M and Class B Certificates
Exhibit B
Form of Class P Certificate
Exhibit C
Form of Class R Certificate
Exhibit D
Form of Class X Certificate
Exhibit E
Form of Initial Certification of Custodian
Exhibit F
Form of Document Certification and Exception Report of
Custodian
Exhibit G
Form of Residual Transfer Affidavit
Exhibit H
Form of Transferor Certificate
Exhibit I
Form of Rule 144A Letter
Exhibit J
Form of Request for Release
Exhibit K
Form of Contents for Each Mortgage File
Exhibit L
Form of Certification to be provided with Form 10-K
Exhibit M
Form of Securities Administrator's Certification to be
provided to Depositor
Exhibit N
Form of Servicer's Certification to be provided to Depositor
Exhibit O
Servicing Criteria
Exhibit P
Additional Form 10-D Disclosure
Exhibit Q
Additional
Form 10-K Disclosure
Exhibit R
Form 8-K Disclosure Information
Exhibit S
Interest Rate Swap Agreement
Exhibit T
Class M Cap Agreement
Exhibit U
Class B Cap Agreement
Exhibit V
Servicer Remittance Report Format
Exhibit W
Additional Disclosure Notification
Exhibit X
Pool Policy
<PAGE>
THIS POOLING AND SERVICING AGREEMENT, dated as of April 1,
2006,
among SECURITIZED ASSET BACKED RECEIVABLES LLC, a Delaware limited
liability
company, as depositor (the "Depositor"), WELLS FARGO BANK, NATIONAL
ASSOCIATION,
a national banking association, as servicer (the "Servicer"), NC
CAPITAL
CORPORATION, as responsible party (the "Responsible Party"),
OFFICETIGER GLOBAL
REAL ESTATE SERVICES INC., as loan performance advisor (the "Loan
Performance
Advisor"), U.S. BANK NATIONAL ASSOCIATION, a national banking
association, as
trustee (the "Trustee"), and WELLS FARGO BANK, NATIONAL
ASSOCIATION, a national
banking association, as securities administrator and custodian.
W I T N E S S E T H:
- - - - - - - - - -
In consideration of the mutual agreements herein contained, the
parties hereto agree as follows:
PRELIMINARY STATEMENT
The Securities Administrator shall elect that four segregated
asset
pools within the Trust Fund (exclusive of (i) the Prepayment
Charges, (ii) the
Interest Rate Swap Agreement and the Cap Agreements, (iii) the Swap
Account,
(iv) the Excess Reserve Fund Account, and (v) the right of the
LIBOR
Certificates to receive Upper Tier Carry Forward Amounts and,
without
duplication, Basis Risk Carry Forward Amounts and the obligation to
pay Class IO
Shortfalls) be treated for federal income tax purposes as
comprising four REMICs
(each, a "Trust REMIC" or, in the alternative, Pooling Tier
REMIC-1, Pooling
Tier REMIC-2, the Lower Tier REMIC and the Upper Tier REMIC,
respectively). Each
Class of Certificates (other than the Class P and Class R
Certificates), other
than the right of each Class of LIBOR Certificates to receive Upper
Tier Carry
Forward Amounts and, without duplication, Basis Risk Carry Forward
Amounts and
the obligation to pay Class IO Shortfalls and the right of the
Class X
Certificates to receive payments from the Interest Rate Swap
Agreement, the Cap
Agreements and the Class IO Shortfalls, represents ownership of a
regular
interest in the Upper Tier REMIC for purposes of the REMIC
Provisions. The Class
R Certificates represent ownership of the sole class of residual
interest in
each of Pooling Tier REMIC-1, Pooling Tier REMIC-2, the Lower Tier
REMIC and the
Upper Tier REMIC for purposes of the REMIC Provisions. The Startup
Day for each
Trust REMIC is the Closing Date. The latest possible maturity date
for each
regular interest is the latest date referenced in Section 2.06.
The Upper Tier REMIC shall hold as assets the several classes
of
uncertificated Lower Tier REMIC Regular Interests, set out below.
The Lower Tier
REMIC shall hold as assets the several classes of uncertificated
Pooling Tier
REMIC-2 Regular Interests. Pooling Tier REMIC-2 shall hold as
assets the several
classes of uncertificated Pooling Tier REMIC-1 Regular Interests.
Pooling Tier
REMIC-1 shall hold as assets the assets of the Trust Fund
(exclusive of (i) the
Prepayment Premiums, (ii) the Interest Rate Swap Agreement and the
Cap
Agreements, (iii) the Swap Account, (iv) the Excess Reserve Fund
Account, and
(v) the right of the LIBOR Certificates to receive Upper Tier Carry
Forward
Amounts and, without duplication, Basis Risk Carry Forward Amounts
and the
obligation to pay Class IO Shortfalls).
For federal income tax purposes, the Class P Certificates
represent
beneficial ownership of the Prepayment Charges, each Class of LIBOR
Certificates
represents beneficial ownership of a regular interest in the Upper
Tier REMIC
and the right to receive Upper Tier Carry Forward Amounts and,
without
duplication, Basis Risk Carry Forward Amounts, and the Class X
Certificates
represent beneficial ownership of two regular interests in the
Upper Tier REMIC
and the right to receive payments from the Class IO Shortfalls, the
Excess
Reserve Fund Account, the Swap Account, the Interest Rate Swap
Agreement and the
Cap Agreements, which portions of the Trust Fund shall be treated
as a grantor
trust.
Pooling Tier REMIC-1
Pooling Tier REMIC-1 shall issue the following interests in
Pooling
Tier REMIC-1, and each such interest, other than the Class PT1-R
Interest, is
hereby designated as a regular interest in the Pooling Tier
REMIC-1. Pooling
Tier REMIC-1 shall also issue the Class PT1-R Interest, which shall
be
represented by the Class R Certificates. The Class PT1-R Interest
is hereby
designated as the sole class of residual interest in Pooling Tier
REMIC-1.
Pooling Tier Initial Pooling
Tier
Pooling Tier REMIC-1 REMIC-1 Interest
REMIC-1
Interest
Rate
Principal Amount
-------------------- ----------------
--------------------
Class PT1-1
(1)
$
26,883,743.00
Class PT1-2A
(2)
$
12,777,926.50
Class PT1-2B
(3)
$
12,777,926.50
Class PT1-3A
(2)
$
12,502,406.00
Class PT1-3B
(3)
$
12,502,406.00
Class PT1-4A
(2)
$
12,241,491.50
Class PT1-4B
(3)
$
12,241,491.50
Class PT1-5A
(2)
$
11,993,399.00
Class PT1-5B
(3)
$
11,993,399.00
Class PT1-6A
(2)
$
11,756,368.50
Class PT1-6B
(3)
$
11,756,368.50
Class PT1-7A
(2)
$
11,528,665.50
Class PT1-7B
(3)
$
11,528,665.50
Class PT1-8A
(2)
$
11,308,599.00
Class PT1-8B
(3)
$ 11,308,599.00
Class PT1-9A
(2)
$
11,094,524.50
Class PT1-9B
(3)
$
11,094,524.50
Class PT1-10A
(2)
$
10,884,551.50
Class PT1-10B
(3)
$
10,884,551.50
Class PT1-11A
(2)
$
10,676,525.00
Class PT1-11B
(3)
$
10,676,525.00
Class PT1-12A
(2)
$
10,346,104.00
Class PT1-12B
(3)
$
10,346,104.00
Class PT1-13A
(2)
$
9,969,075.50
Class PT1-13B
(3)
$
9,969,075.50
Class PT1-14A
(2)
$
9,591,021.00
Class PT1-14B
(3)
$
9,591,021.00
Class PT1-15A
(2)
$
9,227,298.50
Class PT1-15B
(3)
$
9,227,298.50
Class PT1-16A
(2)
$
8,877,363.50
Class PT1-16B
(3)
$
8,877,363.50
Class PT1-17A
(2)
$
8,540,693.50
Class PT1-17B
(3)
$
8,540,693.50
Class PT1-18A
(2)
$
8,216,785.50
Class PT1-18B
(3)
$
8,216,785.50
Class PT1-19A
(2)
$
7,905,155.00
Class PT1-19B
(3)
$
7,905,155.00
Class PT1-20A
(2)
$
7,605,339.00
Class PT1-20B
(3)
$
7,605,339.00
Class PT1-21A
(2)
$
7,316,887.00
Class PT1-21B
(3)
$
7,316,887.00
Class PT1-22A
(2)
$
7,039,144.00
Class PT1-22B
(3)
$
7,039,144.00
Class PT1-23A
(2)
$
6,758,265.00
Class PT1-23B
(3)
$
6,758,265.00
Class PT1-24A
(2)
$
6,502,426.50
Class PT1-24B
(3)
$
6,502,426.50
Class PT1-25A
(2)
$
6,256,268.50
Class PT1-25B
(3)
$
6,256,268.50
Class PT1-26A
(2)
$
6,019,424.50
Class PT1-26B
(3)
$
6,019,424.50
Class PT1-27A
(2)
$
5,791,543.00
Class PT1-27B
(3)
$
5,791,543.00
Class PT1-28A
(2)
$
5,572,154.00
Class PT1-28B
(3)
$
5,572,154.00
Class PT1-29A
(2)
$
5,353,044.00
Class PT1-29B
(3)
$
5,353,044.00
Class PT1-30A
(2)
$
5,150,663.50
Class PT1-30B
(3)
$
5,150,663.50
Class PT1-31A
(2)
$
4,955,302.50
Class PT1-31B
(3)
$
4,955,302.50
Class PT1-32A
(2)
$
4,767,957.50
Class PT1-32B
(3)
$
4,767,957.50
Class PT1-33A
(2)
$
4,587,711.00
Class PT1-33B
(3)
$
4,587,711.00
Class PT1-34A
(2)
$
4,413,931.00
Class PT1-34B
(3)
$
4,413,931.00
Class PT1-35A
(2)
$
4,245,377.00
Class PT1-35B
(3)
$
4,245,377.00
Class PT1-36A
(2)
$
4,084,946.50
Class PT1-36B
(3)
$
4,084,946.50
Class PT1-37A
(2)
$
3,930,172.50
Class PT1-37B
(3)
$
3,930,172.50
Class PT1-38A
(2)
$
3,781,651.00
Class PT1-38B
(3)
$
3,781,651.00
Class PT1-39A
(2)
$
3,638,750.50
Class PT1-39B
(3)
$
3,638,750.50
Class PT1-40A
(2)
$
3,501,063.00
Class PT1-40B
(3)
$
3,501,063.00
Class PT1-41A
(2)
$
3,368,652.50
Class PT1-41B
(3)
$
3,368,652.50
Class PT1-42A
(2)
$
3,241,360.00
Class PT1-42B
(3)
$
3,241,360.00
Class PT1-43A
(2)
$
3,118,685.50
Class PT1-43B
(3)
$
3,118,685.50
Class PT1-44A
(2)
$
3,000,834.00
Class PT1-44B
(3)
$
3,000,834.00
Class PT1-45A
(2)
$
2,887,439.50
Class PT1-45B
(3)
$
2,887,439.50
Class PT1-46A
(2)
$
2,778,253.00
Class PT1-46B
(3)
$
2,778,253.00
Class PT1-47A
(2)
$
2,673,225.00
Class PT1-47B
(3)
$
2,673,225.00
Class PT1-48A
(2)
$
2,572,206.00
Class PT1-48B
(3)
$
2,572,206.00
Class PT1-49A
(2)
$
2,475,003.00
Class PT1-49B
(3)
$
2,475,003.00
Class PT1-50A
(2)
$
2,381,469.00
Class PT1-50B
(3)
$
2,381,469.00
Class PT1-51A
(2)
$
2,291,467.50
Class PT1-51B
(3)
$
2,291,467.50
Class PT1-52A
(2)
$
2,204,860.00
Class PT1-52B
(3)
$
2,204,860.00
Class PT1-53A
(2)
$
2,121,528.50
Class PT1-53B
(3)
$
2,121,528.50
Class PT1-54A
(2)
$
2,027,844.00
Class PT1-54B
(3)
$
2,027,844.00
Class PT1-55A
(2)
$
1,977,688.00
Class PT1-55B
(3)
$
1,977,688.00
Class PT1-56A
(3)
$
1,889,962.00
Class PT1-56B
(4)
$
1,889,962.00
Class PT1-57A
(3)
$
48,025,047.50
Class PT1-57B
(4)
$
48,025,047.50
Class PT1-R
(4)
N/A
------------
(1)
For any
Distribution Date (and the related Interest Accrual Period),
this Pooling Tier REMIC-1 Regular Interest shall bear interest at
a
per annum rate (its "Pooling Tier REMIC-1 Interest Rate") equal
to
the Pooling Tier REMIC-1 Net WAC Rate.
(2)
For any
Distribution Date (and the related Interest Accrual Period),
this Pooling Tier REMIC-1 Regular Interest shall bear interest at
a
per annum rate (its "Pooling Tier REMIC-1 Interest Rate") equal
to
the product of (i) 2 and (ii) the Pooling Tier REMIC-1 Net WAC
Rate,
subject to a maximum rate of 10.66%.
(3)
For any
Distribution Date (and the related Interest Accrual Period),
this Pooling Tier REMIC-1 Regular Interest shall bear interest at
a
per annum rate (its "Pooling Tier REMIC-1 Interest Rate") equal
to
the excess, if any, of (A) the product of (i) 2 and (ii) the
Pooling
Tier REMIC-1 Net WAC Rate over (B) 10.66%.
(4)
The Class PT1-R
Interest shall not have a principal balance and
shall not bear interest.
On each
Distribution Date, the Securities Administrator shall first
pay from the Trust Fund and charge as an expense of Pooling Tier
REMIC-1 all
expenses of the Trust for such Distribution Date. Such expense,
other than
Servicing Fees, Loan Performance Advisor Fees and Securities
Administrator Fees,
shall be allocated in the same manner as Realized Losses.
On each Distribution Date, the interest distributable in respect
of
the Mortgage Loans for such Distribution Date shall be deemed to be
distributed
to the Pooling Tier REMIC-1 Regular Interests at the rates shown
above.
On each Distribution Date, Realized Losses, Subsequent
Recoveries
and payments of principal in respect of the Mortgage Loans
(including, for the
first Distribution Date only, the Closing Date Deposit Amount)
shall be
allocated to the outstanding Pooling Tier REMIC-1 Regular Interest
with the
lowest numerical denomination until the Pooling Tier REMIC-1
Principal Amount of
such interest or interests, as the case may be, is reduced to zero,
provided
that, with respect to Pooling Tier REMIC-1 Regular Interests with
the same
numerical denomination, such Realized Losses and payments of
principal shall be
allocated pro rata between such Pooling Tier REMIC-1 Regular
Interests.
Pooling Tier REMIC-2
Pooling Tier REMIC-2 shall issue the following interests in
Pooling
Tier REMIC-2, and each such interest, other than the Class PT2-R
Interest, is
hereby designated as a regular interest in Pooling Tier REMIC-2.
The Class PT2-R
Interest is hereby designated as the sole class of residual
interest in Pooling
Tier REMIC-2 and shall be represented by the Class R
Certificates.
<TABLE>
<CAPTION>
Pooling Tier Pooling
Tier
Corresponding
Corresponding
Corresponding
Pooling Tier REMIC-2 REMIC-2
REMIC-2
Initial
Pooling Tier REMIC-2 Pooling Tier REMIC-1
Scheduled
Crossover
Interest
Interest Rate
Principal Amount IO Interest
Regular Interest
Distribution Date
-------------------- ------------- ----------------
-------------------- --------------------
-------------------
<S>
<C>
<C>
<C>
<C>
<C>
Class PT2-1
(1) $ 26,883,743.00
N/A
N/A
N/A
Class PT2-2A
(2) $ 12,777,926.50 Class
PT2-IO-2
N/A
N/A
Class PT2-2B
(3) $ 12,777,926.50
N/A
N/A
N/A
Class PT2-3A
(2) $ 12,502,406.00 Class
PT2-IO-3
N/A
N/A
Class PT2-3B
(3) $ 12,502,406.00
N/A
N/A
N/A
Class PT2-4A
(2) $ 12,241,491.50 Class
PT2-IO-4
N/A
N/A
Class PT2-4B
(3) $ 12,241,491.50
N/A
N/A
N/A
Class PT2-5A
(2) $ 11,993,399.00 Class
PT2-IO-5
N/A
N/A
Class PT2-5B
(3) $ 11,993,399.00
N/A
N/A
N/A
Class PT2-6A
(2) $ 11,756,368.50 Class
PT2-IO-6
N/A
N/A
Class PT2-6B
(3) $ 11,756,368.50
N/A
N/A
N/A
Class PT2-7A
(2) $ 11,528,665.50 Class
PT2-IO-7
N/A
N/A
Class PT2-7B
(3) $ 11,528,665.50
N/A
N/A
N/A
Class PT2-8A
(2) $ 11,308,599.00 Class
PT2-IO-8
N/A
N/A
Class PT2-8B
(3) $ 11,308,599.00
N/A
N/A
N/A
Class PT2-9A
(2) $ 11,094,524.50 Class
PT2-IO-9
N/A
N/A
Class PT2-9B
(3) $ 11,094,524.50
N/A
N/A
N/A
Class PT2-10A
(2) $ 10,884,551.50 Class PT2-IO-10
N/A
N/A
Class PT2-10B
(3) $ 10,884,551.50
N/A
N/A
N/A
Class PT2-11A
(2) $ 10,676,525.00 Class PT2-IO-11
N/A
N/A
Class PT2-11B
(3) $ 10,676,525.00
N/A
N/A
N/A
Class PT2-12A
(2) $ 10,346,104.00 Class PT2-IO-12
N/A
N/A
Class PT2-12B
(3) $ 10,346,104.00
N/A
N/A
N/A
Class PT2-13A
(2) $ 9,969,075.50 Class PT2-IO-13
N/A
N/A
Class PT2-13B
(3) $ 9,969,075.50
N/A
N/A
N/A
Class PT2-14A
(2) $ 9,591,021.00 Class PT2-IO-14
N/A
N/A
Class PT2-14B
(3) $ 9,591,021.00
N/A
N/A
N/A
Class PT2-15A
(2) $ 9,227,298.50 Class PT2-IO-15
N/A
N/A
Class PT2-15B
(3) $ 9,227,298.50
N/A
N/A
N/A
Class PT2-16A
(2) $ 8,877,363.50 Class PT2-IO-16
N/A
N/A
Class PT2-16B
(3) $ 8,877,363.50
N/A
N/A
N/A
Class PT2-17A
(2) $ 8,540,693.50 Class PT2-IO-17
N/A
N/A
Class PT2-17B
(3) $ 8,540,693.50
N/A
N/A
N/A
Class PT2-18A
(2) $ 8,216,785.50 Class PT2-IO-18
N/A
N/A
Class PT2-18B
(3) $ 8,216,785.50
N/A
N/A
N/A
Class PT2-19A
(2) $ 7,905,155.00 Class PT2-IO-19
N/A
N/A
Class PT2-19B
(3) $ 7,905,155.00
N/A
N/A
N/A
Class PT2-20A
(2) $ 7,605,339.00 Class PT2-IO-20
N/A
N/A
Class PT2-20B
(3) $ 7,605,339.00
N/A
N/A
N/A
Class PT2-21A
(2) $ 7,316,887.00 Class PT2-IO-21
N/A
N/A
Class PT2-21B
(3) $ 7,316,887.00
N/A
N/A
N/A
Class PT2-22A
(2) $ 7,039,144.00 Class PT2-IO-22
N/A
N/A
Class PT2-22B
(3) $ 7,039,144.00
N/A
N/A
N/A
Class PT2-23A
(2) $ 6,758,265.00 Class PT2-IO-23
N/A
N/A
Class PT2-23B
(3) $ 6,758,265.00
N/A
N/A
N/A
Class PT2-24A
(2) $ 6,502,426.50 Class PT2-IO-24
N/A
N/A
Class PT2-24B
(3) $ 6,502,426.50
N/A
N/A
N/A
Class PT2-25A
(2) $ 6,256,268.50 Class PT2-IO-25
N/A
N/A
Class PT2-25B
(3) $ 6,256,268.50
N/A
N/A
N/A
Class PT2-26A
(2) $ 6,019,424.50 Class PT2-IO-26
N/A
N/A
Class PT2-26B
(3) $ 6,019,424.50
N/A
N/A
N/A
Class PT2-27A
(2) $ 5,791,543.00 Class PT2-IO-27
N/A
N/A
Class PT2-27B
(3) $ 5,791,543.00
N/A
N/A
N/A
Class PT2-28A
(2) $ 5,572,154.00 Class PT2-IO-28
N/A
N/A
Class PT2-28B
(3) $ 5,572,154.00
N/A
N/A
N/A
Class PT2-29A
(2) $ 5,353,044.00 Class PT2-IO-29
N/A
N/A
Class PT2-29B
(3) $ 5,353,044.00
N/A
N/A
N/A
Class PT2-30A
(2) $ 5,150,663.50 Class PT2-IO-30
N/A
N/A
Class PT2-30B
(3) $ 5,150,663.50
N/A
N/A
N/A
Class PT2-31A
(2)
$ 4,955,302.50 Class PT2-IO-31
N/A
N/A
Class PT2-31B
(3) $ 4,955,302.50
N/A
N/A
N/A
Class PT2-32A
(2) $ 4,767,957.50 Class PT2-IO-32
N/A
N/A
Class PT2-32B
(3) $ 4,767,957.50
N/A
N/A
N/A
Class PT2-33A
(2) $ 4,587,711.00 Class PT2-IO-33
N/A
N/A
Class PT2-33B
(3) $ 4,587,711.00
N/A
N/A
N/A
Class PT2-34A
(2) $ 4,413,931.00 Class PT2-IO-34
N/A
N/A
Class PT2-34B
(3) $ 4,413,931.00
N/A
N/A
N/A
Class PT2-35A
(2) $ 4,245,377.00 Class PT2-IO-35
N/A
N/A
Class PT2-35B
(3) $ 4,245,377.00
N/A
N/A
N/A
Class PT2-36A
(2) $ 4,084,946.50 Class PT2-IO-36
N/A
N/A
Class PT2-36B
(3) $ 4,084,946.50
N/A
N/A
N/A
Class PT2-37A
(2) $ 3,930,172.50 Class PT2-IO-37
N/A
N/A
Class PT2-37B
(3) $ 3,930,172.50
N/A
N/A
N/A
Class PT2-38A
(2) $ 3,781,651.00 Class PT2-IO-38
N/A
N/A
Class PT2-38B
(3) $ 3,781,651.00
N/A
N/A
N/A
Class PT2-39A
(2) $ 3,638,750.50 Class PT2-IO-39
N/A
N/A
Class PT2-39B
(3) $ 3,638,750.50
N/A
N/A
N/A
Class PT2-40A
(2) $ 3,501,063.00 Class PT2-IO-40
N/A
N/A
Class PT2-40B
(3) $ 3,501,063.00
N/A
N/A
N/A
Class PT2-41A
(2) $ 3,368,652.50 Class PT2-IO-41
N/A
N/A
Class PT2-41B
(3) $ 3,368,652.50
N/A
N/A
N/A
Class PT2-42A
(2) $ 3,241,360.00 Class PT2-IO-42
N/A
N/A
Class PT2-42B
(3) $ 3,241,360.00
N/A
N/A
N/A
Class PT2-43A
(2) $ 3,118,685.50 Class PT2-IO-43
N/A
N/A
Class PT2-43B
(3) $ 3,118,685.50
N/A
N/A
N/A
Class PT2-44A
(2) $ 3,000,834.00 Class PT2-IO-44
N/A
N/A
Class PT2-44B
(3) $ 3,000,834.00
N/A
N/A
N/A
Class PT2-45A
(2) $ 2,887,439.50 Class PT2-IO-45
N/A
N/A
Class PT2-45B
(3) $ 2,887,439.50
N/A
N/A
N/A
Class PT2-46A
(2) $ 2,778,253.00 Class PT2-IO-46
N/A
N/A
Class PT2-46B
(3) $ 2,778,253.00
N/A
N/A
N/A
Class PT2-47A
(2) $ 2,673,225.00 Class PT2-IO-47
N/A
N/A
Class PT2-47B
(3) $ 2,673,225.00
N/A
N/A
N/A
Class PT2-48A
(2) $ 2,572,206.00 Class PT2-IO-48
N/A
N/A
Class PT2-48B
(3) $ 2,572,206.00
N/A
N/A
N/A
Class PT2-49A
(2) $ 2,475,003.00 Class PT2-IO-49
N/A
N/A
Class PT2-49B
(3) $ 2,475,003.00
N/A
N/A
N/A
Class PT2-50A
(2) $ 2,381,469.00 Class PT2-IO-50
N/A
N/A
Class PT2-50B
(3) $ 2,381,469.00
N/A
N/A
N/A
Class PT2-51A
(2) $ 2,291,467.50 Class PT2-IO-51
N/A
N/A
Class PT2-51B
(3) $ 2,291,467.50
N/A
N/A
N/A
Class PT2-52A
(2) $ 2,204,860.00 Class PT2-IO-52
N/A
N/A
Class PT2-52B
(3) $ 2,204,860.00
N/A
N/A
N/A
Class PT2-53A
(2) $ 2,121,528.50 Class PT2-IO-53
N/A
N/A
Class PT2-53B
(3) $ 2,121,528.50
N/A
N/A
N/A
Class PT2-54A
(2) $ 2,027,844.00 Class PT2-IO-54
N/A
N/A
Class PT2-54B
(3) $ 2,027,844.00
N/A
N/A
N/A
Class PT2-55A
(2) $ 1,977,688.00 Class PT2-IO-55
N/A
N/A
Class PT2-55B
(3) $ 1,977,688.00
N/A
N/A
N/A
Class PT2-56A
(2) $ 1,889,962.00 Class PT2-IO-56
N/A
N/A
Class PT2-56B
(3) $ 1,889,962.00
N/A
N/A
N/A
Class PT2-57A
(2) $ 48,025,047.50 Class PT2-IO-56
N/A
N/A
Class PT2-57B
(3) $ 48,025,047.50
N/A
N/A
N/A
Class PT2-IO-2
(4)
(4)
N/A
Class PT1-2A
May 2006
Class PT2-IO-3
(4)
(4)
N/A
Class PT1-3A
June 2006
Class PT2-IO-4
(4)
(4)
N/A
Class PT1-4A
July 2006
Class PT2-IO-5
(4)
(4)
N/A
Class PT1-5A
August 2006
Class PT2-IO-6
(4)
(4)
N/A
Class PT1-6A
September 2006
Class PT2-IO-7
(4)
(4)
N/A
Class
PT1-7A
October 2006
Class PT2-IO-8
(4)
(4)
N/A
Class PT1-8A
November 2006
Class PT2-IO-9
(4)
(4)
N/A
Class PT1-9A
December 2006
Class PT2-IO-10
(4)
(4)
N/A
Class PT1-10A
January 2007
Class PT2-IO-11
(4)
(4)
N/A
Class PT1-11A
February 2007
Class PT2-IO-12
(4)
(4)
N/A
Class PT1-12A
March 2007
Class PT2-IO-13
(4)
(4)
N/A
Class PT1-13A
April 2007
Class PT2-IO-14
(4)
(4)
N/A
Class PT1-14A
May 2007
Class PT2-IO-15
(4)
(4)
N/A
Class PT1-15A
June 2007
Class PT2-IO-16
(4)
(4)
N/A
Class PT1-16A
July 2007
Class PT2-IO-17
(4)
(4)
N/A
Class PT1-17A
August 2007
Class PT2-IO-18
(4)
(4)
N/A
Class PT1-18A
September 2007
Class PT2-IO-19
(4)
(4)
N/A
Class PT1-19A
October 2007
Class PT2-IO-20
(4)
(4)
N/A
Class PT1-20A
November 2007
Class PT2-IO-21
(4)
(4)
N/A
Class PT1-21A
December 2007
Class PT2-IO-22
(4)
(4)
N/A
Class PT1-22A
January 2008
Class PT2-IO-23
(4)
(4)
N/A
Class PT1-23A
February 2008
Class PT2-IO-24
(4)
(4)
N/A
Class PT1-24A
March 2008
Class PT2-IO-25
(4)
(4)
N/A
Class PT1-25A
April 2008
Class PT2-IO-26
(4)
(4)
N/A
Class PT1-26A
May
2008
Class PT2-IO-27
(4)
(4)
N/A
Class PT1-27A
June 2008
Class PT2-IO-28
(4)
(4)
N/A
Class PT1-28A
July 2008
Class PT2-IO-29
(4)
(4)
N/A
Class PT1-29A
August 2008
Class PT2-IO-30
(4)
(4)
N/A
Class PT1-30A
September 2008
Class PT2-IO-31
(4)
(4)
N/A
Class PT1-31A
October 2008
Class PT2-IO-32
(4)
(4)
N/A
Class PT1-32A
November 2008
Class PT2-IO-33
(4)
(4)
N/A
Class PT1-33A
December 2008
Class PT2-IO-34
(4)
(4)
N/A
Class PT1-34A
January 2009
Class PT2-IO-35
(4)
(4)
N/A
Class PT1-35A
February 2009
Class PT2-IO-36
(4)
(4)
N/A
Class PT1-36A
March 2009
Class PT2-IO-37
(4)
(4)
N/A
Class PT1-37A
April 2009
Class PT2-IO-38
(4)
(4)
N/A
Class PT1-38A
May 2009
Class PT2-IO-39
(4)
(4)
N/A
Class PT1-39A
June 2009
Class PT2-IO-40
(4)
(4)
N/A
Class PT1-40A
July 2009
Class PT2-IO-41
(4)
(4)
N/A
Class PT1-41A
August
2009
Class PT2-IO-42
(4)
(4)
N/A
Class PT1-42A
September 2009
Class PT2-IO-43
(4)
(4)
N/A
Class PT1-43A
October 2009
Class PT2-IO-44
(4)
(4)
N/A
Class PT1-44A
November 2009
Class PT2-IO-45
(4)
(4)
N/A
Class PT1-45A
December 2009
Class PT2-IO-46
(4)
(4)
N/A
Class PT1-46A
January 2010
Class PT2-IO-47
(4)
(4)
N/A
Class PT1-47A
February 2010
Class PT2-IO-48
(4)
(4)
N/A
Class PT1-48A
March 2010
Class PT2-IO-49
(4)
(4)
N/A
Class PT1-49A
April 2010
Class PT2-IO-50
(4)
(4)
N/A
Class PT1-50A
May 2010
Class PT2-IO-51
(4)
(4)
N/A
Class PT1-51A
June 2010
Class PT2-IO-52
(4)
(4)
N/A
Class PT1-52A
July 2010
Class PT2-IO-53
(4)
(4)
N/A
Class PT1-53A
August 2010
Class PT2-IO-54
(4)
(4)
N/A
Class
PT1-54A
September 2010
Class PT2-IO-55
(4)
(4)
N/A
Class PT1-55A
October 2010
Class PT2-IO-56
(4)
(4)
N/A
Class PT1-56A
November 2010
Class PT2-IO-57
(4)
(4)
N/A
Class PT1-57A
December 2010
Class PT2-R
(5)
(5)
N/A
N/A
N/A
</TABLE>
------------
(1)
For any
Distribution Date (and the related Interest Accrual Period),
this Pooling Tier REMIC-2 Regular Interest shall bear interest at
a
per annum rate (its "Pooling Tier REMIC-2 Interest Rate") equal
to
the Pooling Tier REMIC-1 Net WAC Rate.
(2)
For any
Distribution Date (and the related Interest Accrual Period),
this Pooling Tier REMIC-2 Regular Interest shall bear interest at
a
per annum rate (its "Pooling Tier REMIC-2 Interest Rate") equal
to
the weighted average of the Pooling Tier REMIC-1 Interest Rates
on
the Pooling Tier REMIC-1 Regular Interests and having an "A" in
their class designation, provided that, on each Distribution Date
on
which interest is distributable on the Corresponding Pooling
Tier
REMIC-2 IO Interest, this Pooling Tier REMIC-2 Regular Interest
shall bear interest at a per annum rate equal to Swap LIBOR
subject
to a maximum rate equal to the weighted average of the Pooling
Tier
REMIC-1 Interest Rates on the Pooling Tier REMIC-1 Regular
Interests
and having an "A" in their class designation.
(3)
For any
Distribution Date (and the related Interest Accrual Period),
this Pooling Tier REMIC-2 Regular Interest shall bear interest at
a
per annum rate (its "Pooling Tier REMIC-2 Interest Rate") equal
to
the weighted average of the Pooling Tier REMIC-1 Interest Rates
on
the Pooling Tier REMIC-1 Regular Interests and having a "B" in
their
class designation.
(4)
Each Pooling
Tier REMIC-2 IO Interest is an interest-only interest
and does not have a principal balance but has a notional
balance
("Pooling Tier REMIC-2 IO Notional Balance") equal to the
Pooling
Tier REMIC-1 Principal Amount of the Corresponding Pooling Tier
REMIC-1 Regular Interest. From the Closing Date through and
including the Corresponding Scheduled Crossover Distribution
Date,
each Pooling Tier REMIC-2 IO Interest shall be entitled to
receive
interest that accrues on the Corresponding Pooling Tier REMIC-1
Regular Interest at a rate equal to the excess, if any, of (i)
the
Pooling Tier REMIC-1 Interest Rate for the Corresponding
Pooling
Tier REMIC-1 Regular Interest over (ii) Swap LIBOR. After the
related Corresponding Scheduled Crossover Distribution Date,
the
Pooling Tier REMIC-2 IO Interest shall not accrue interest.
(5)
The Class PT2-R
Interest shall not have a principal balance and
shall not bear interest.
On each Distribution Date, the interest distributable in respect
of
the Mortgage Loans for such Distribution Date shall be distributed
to the
Pooling Tier REMIC-2 Regular Interests at the Pooling Tier REMIC-2
Interest
Rates shown above.
On each Distribution Date, Realized Losses, Subsequent
Recoveries
and payments of principal in respect of the Mortgage Loans
(including, for the
first Distribution Date only, the Closing Date Deposit Amount)
shall be
allocated to the then outstanding Pooling Tier REMIC-2 Regular
Interests (other
than the Pooling Tier REMIC-2 IO Interests) with the lowest
numerical
denomination until the Pooling Tier REMIC-2 Principal Amount of
such interest or
interests, as the case may be, is reduced to zero, provided that,
for Pooling
Tier REMIC-2 Regular Interests Mortgage Loans with the same
numerical
denomination, such Realized Losses, Subsequent Recoveries and
payments of
principal shall be allocated pro rata between such Pooling Tier
REMIC-2 Regular
Interests.
Lower Tier REMIC
The Lower Tier REMIC shall issue the following interests, and
each
such interest, other than the Class LT-R Interest, is hereby
designated as a
regular interest in the Lower Tier REMIC. The Class LT-R Interest
is hereby
designated as the sole class of residual interest in the Lower Tier
REMIC and
shall be represented by the Class R Certificates.
<TABLE>
<CAPTION>
Lower Tier
Corresponding
Lower Tier REMIC REMIC Interest
Initial Lower Tier
Upper Tier REMIC
Class Designation
Rate
REMIC Principal Amount
Regular Interest
----------------- --------------
---------------------------------- ----------------
<S>
<C>
<C>
<C>
Class LT-A-1
(1)
1/2 Corresponding Upper Tier REMIC
A-1
Regular Interest initial
Class Principal Balance
Class LT-A-2
(1)
1/2 Corresponding Upper Tier REMIC
A-2
Regular Interest initial
Class Principal Balance
Class LT-A-3
(1)
1/2 Corresponding Upper Tier REMIC
A-3
Regular Interest initial
Class Principal Balance
Class LT-M-1
(1)
1/2 Corresponding Upper Tier REMIC
M-1
Regular Interest initial
Class Principal Balance
Class LT-M-2
(1)
1/2 Corresponding Upper Tier REMIC
M-2
Regular Interest initial
Class Principal Balance
Class LT-M-3
(1)
1/2 Corresponding Upper Tier REMIC
M-3
Regular Interest initial
Class Principal Balance
Class LT-B-1
(1)
1/2 Corresponding Upper Tier REMIC
B-1
Regular Interest initial
Class Principal Balance
Class LT-B-2
(1)
1/2 Corresponding Upper Tier REMIC
B-2
Regular Interest initial
Class Principal Balance
Class LT-B-3
(1)
1/2 Corresponding Upper Tier REMIC
B-3
Regular Interest initial
Class Principal Balance
Class LT-Accrual
(1)
1/2 Pool Stated Principal Balance
N/A
plus 1/2 Subordinated Amount
Class LT-IO
(2)
(2)
N/A
Class LT-R
(3)
(3)
N/A
</TABLE>
------------------------------
(1) The interest
rate with respect to any Distribution Date for these
interests
is a per annum variable rate equal to the Lower Tier REMIC Net
WAC
Rate.
(2) This Lower
Tier Regular Interest is an interest-only interest and does not
have a
Lower Tier REMIC Principal Amount. On each Distribution Date,
this
Lower Tier
Regular Interest shall be entitled to receive all interest
distributable on the Pooling Tier REMIC-2 IO Interests.
(3) The Class
LT-R Interest is the sole class of residual interest in the
Lower Tier
REMIC and it does not have a principal amount or an interest
rate.
Each Lower Tier REMIC Regular Interest is hereby designated as
a
regular interest in the Lower Tier REMIC. The Class LT-A-1, Class
LT-A-2, Class
LT-A-3, Class LT-M-1, Class LT-M-2, Class LT-M-3, Class LT-B-1,
Class LT-B-2 and
Class LT-B-3 Interests are hereby designated the LT Accretion
Directed Classes
(the "LT Accretion Directed Classes").
On each Distribution Date, 50% of the increase in the
Subordinated
Amount shall be payable as a reduction of the Lower Tier REMIC
Principal Amount
of the LT Accretion Directed Classes (each such Class will be
reduced by an
amount equal to 50% of any increase in the Subordinated Amount that
is
attributable to a reduction in the Class Certificate Balance of
its
Corresponding Class) and shall be accrued and added to the Lower
Tier REMIC
Principal Amount of the Class LT-Accrual Interest. On each
Distribution Date,
the increase in the Lower Tier REMIC Principal Amount of the Class
LT-Accrual
Interest may not exceed interest accruals for such Distribution
Date for the
Class LT-Accrual Interest. All payments of scheduled principal and
prepayments
of principal generated by the Mortgage Loans (including, for the
first
Distribution Date only, the Closing Date Deposit Amount) and all
Subsequent
Recoveries allocable to principal shall be allocated (i) 50% to the
Class
LT-Accrual Interest and (ii) 50% to the LT Accretion Directed
Classes (such
principal payments and Subsequent Recoveries shall be allocated
among such LT
Accretion Directed Classes in an amount equal to 50% of the
principal amounts
and Subsequent Recoveries allocated to their respective
Corresponding Classes),
until paid in full. Notwithstanding the above, principal payments
allocated to
the Class X Interest that result in the reduction in the
Subordinated Amount
shall be allocated to the Class LT-Accrual Interest (until paid in
full).
Reductions to Lower Tier REMIC Principal Amounts as a result of
Realized Losses and increases in Lower Tier REMIC Principal Amounts
as a result
of Subsequent Recoveries shall be applied so that after all
distributions have
been made on each Distribution Date (i) the Lower Tier REMIC
Principal Amount of
each LT Accretion Directed Class is equal to 50% of the Class
Certificate
Balance of its Corresponding Class and (ii) the Class LT-Accrual
Interest is
equal to 50% of the aggregate Stated Principal Balance of the
Mortgage Loans
plus 50% of the Subordinated Amount.
Upper Tier REMIC
The Upper Tier REMIC shall issue the following classes of Upper
Tier
REMIC Regular Interests and each such interest, other than the
Class UT-R
Interest, is hereby designated as a regular interest in the Upper
Tier REMIC.
The Class UT-R Interest is hereby designated as the sole class of
residual
interests in the Upper Tier REMIC and shall be represented by the
Class R
Certificates.
Initial Upper
Corresponding
Upper Tier
REMIC
Upper Tier REMIC Tier REMIC
Class of
Class
Designation Interest Rate
Principal Amount
Certificates
----------------- ----------------
----------------
-------------
Class A-1
(1)
$
360,025,000 Class A-1
Class A-2
(1)
$
158,409,000 Class A-2
Class A-3
(1)
$
171,822,000 Class A-3
Class M-1
(1)
$
49,996,000 Class M-1
Class M-2
(1)
$
37,496,000 Class M-2
Class M-3
(1)
$
10,483,000 Class M-3
Class B-1
(1)
$ 5,644,000
Class B-1
Class B-2
(1)
$ 4,435,000
Class B-2
Class B-3
(1)
$ 4,032,000
Class B-3
Class IO
(2)
(4)
Class X
(3)
$ 4,032,743
Class X
(3)
Class UT-R
(4)
$
0 Class
R
------------
(1) For any
Distribution Date (and the related Interest Accrual Period),
this
interest
shall bear interest at the lesser of (i) the Pass-Through Rate
(determined without regard to the Net WAC Rate Cap) for the
Corresponding
Class of
Certificates and (ii) the Upper Tier REMIC Net WAC Rate.
(2) This
interest is an interest-only interest and does not have a
principal
balance.
On each Distribution Date, the Class IO Interest shall be
entitled
to receive all interest distributable on the Class LT-IO
Interest.
This interest shall be beneficially owned by the holders of the
Class X
Certificates and shall be held as an asset of the Swap Account.
(3) The Class X
Interest has an initial principal balance of $4,032,743 but it
will not
accrue interest on such balance but will accrue interest on a
notional
principal balance. As of any Distribution Date, the Class X
Interest
shall have a notional principal balance equal to the aggregate
of
the Lower
Tier Principal Amounts of the Lower Tier REMIC Regular
Interests
(other
than the Class LT-IO Interest) as of the first day of the
related
Interest
Accrual Period. With respect to any Interest Accrual Period,
the
Class X
Interest shall bear interest at a rate equal to the excess, if
any, of
the Lower Tier REMIC Net WAC Rate over the product of (i) 2 and
(ii) the
weighted average Lower Tier REMIC Interest Rate of the Lower
Tier
REMIC
Regular Interests (other than Class LT-IO Interest), where the
Lower
Tier REMIC
Interest Rate on the Class LT-Accrual Interest is subject to a
cap equal
to zero and each LT-Accretion Directed Class is subject to a
cap
equal to
the Upper Tier Interest Rate on its Corresponding Class of
Upper
Tier
Regular Interest. With respect to any Distribution Date,
interest
that so
accrues on the notional principal balance of the Class X
Interest
shall be
deferred in an amount equal to any increase in the Subordinated
Amount on
such Distribution Date. Such deferred interest shall not itself
bear
interest.
(4) The Class
UT-R Interest does not have an interest rate or a principal
balance.
On each Distribution Date, interest distributable in respect of
the
Lower Tier Interests for such Distribution Date shall be deemed to
be
distributed on the interests in the Upper Tier REMIC at the rates
shown above,
provided that the Class IO Interest shall be entitled to receive
interest before
any other interest in the Upper Tier REMIC.
On each
Distribution Date, all Realized Losses, Subsequent
Recoveries and all payments of principal shall be allocated to the
Upper Tier
Interests until the outstanding principal balance of each such
interest equals
the outstanding Class Certificate Balance of the Corresponding
Class of
Certificates as of such Distribution Date.
Certificates
Class Pass-Through Class Certificate
Class Designation
Rate
Balance
----------------- ------------------
-----------------
Class A-1 (5)
(1)
$
360,025,000
Class A-2 (5)
(1)
$
158,409,000
Class A-3 (5)
(1)
$
171,822,000
Class M-1 (5)
(2)
$
49,996,000
Class M-2 (5)
(2)
$
37,496,000
Class M-3 (5)
(2)
$
10,483,000
Class B-1 (5)
(2)
$
5,644,000
Class B-2 (5)
(2)
$
4,435,000
Class B-3 (5)
(2)
$
4,032,000
Class X
(3)
(3)
Class R
(4)
$
0
------------
(1) The Class
A-1, Class A-2 and Class A-3 Certificates will bear interest
during
each Interest Accrual Period at a per annum rate equal to the
lesser of
(i) LIBOR plus the applicable Pass-Through Margin and (ii) the
Net WAC
Rate Cap.
(2) The Class
M-1, Class M-2, Class M-3, Class B-1, Class B-2 and Class B-3
Certificates will bear interest during each Interest Accrual Period
at a
per annum
rate equal to the lesser of (i) LIBOR plus the applicable
Pass-Through Margin and (ii) the Net WAC Rate Cap.
(3) The Class X
Certificates will represent beneficial ownership of the Class
X
Interest, the Class IO Interest, the right to receive Class IO
Shortfalls, the Cap Agreements, amounts in the Swap Account,
subject to
the
obligation to pay Net Swap Payments to the Swap Provider and
Upper
Tier Carry
Forward Amounts to the LIBOR Certificates and, without
duplication, Basis Risk Carry Forward Amounts to the LIBOR
Certificates
and
amounts in the Excess Reserve Fund Account, subject to the
obligation
to make
payments from the Excess Reserve Fund Account in respect of
Basis
Risk Carry
Forward Amounts to the LIBOR Certificates. For federal income
tax
purposes, the Securities Administrator will treat a Class X
Certificateholder's obligation to make payments of Basis Risk
Carry
Forward
Amounts and, without duplication, Upper Tier Carry Forward
Amounts
to the
LIBOR Certificates from the Excess Reserve Fund Account and the
Swap
Account to the LIBOR Certificateholders as payments made pursuant
to
an
interest rate cap contract written by the Class X
Certificateholders in
favor of
each Class of LIBOR Certificates. Such rights of the Class X
Certificateholders and LIBOR Certificateholders shall be treated as
held
in a
portion of the Trust Fund that is treated as a grantor trust
under
subpart E,
Part I of subchapter J of the Code. The Class X Certificates do
not have a
Class Certificate Balance.
(4) The Class R
Certificates do not have a principal balance or an interest
rate.
(5) Each of
these Certificates will represent not only the ownership of the
Corresponding Class of Upper Tier REMIC Regular Interest but also
the
right to
receive payments from the Excess Reserve Fund Account and Swap
Account in
respect of any Basis Risk Carry Forward Amounts and, without
duplication, from the Swap Account in respect of Upper Tier Carry
Forward
Amounts.
Each of these Certificates will also be subject to the
obligation
to pay
Class IO Shortfalls as described in Section 8.13. For federal
income tax
purposes, any amount distributed on the LIBOR Certificates on
any such
Distribution Date in excess of the amount distributable on
their
Corresponding Class of Upper Tier Regular Interest on such
Distribution
Date shall
be treated as having been paid from the Excess Reserve Fund
Account or
the Swap Account, as applicable, and any amount distributable
on such
Corresponding Class of Upper Tier Regular Interest on such
Distribution Date in excess of the amount distributable on the
Corresponding Class of
Certificates on such Distribution Date shall be
treated as
having been paid to the Swap Account, all pursuant to, and as
further
provided in Section 8.13. For federal income tax purposes, the
Securities
Administrator will treat a LIBOR Certificateholder's right to
receive
payments from the Excess Reserve Fund Account and Swap Account
as
payments
made pursuant to an interest rate cap contract written by the
Class X
Certificateholders.
The minimum
denomination for each Class of Certificates, other than
the Class P, Class R and the Class X Certificates, will be $25,000
with integral
multiples of $1 in excess thereof except that one Certificate in
each Class may
be issued in a different amount. The minimum denomination for each
of the Class
P and Class X Certificates will be a 1% Percentage Interest in such
Class, and
the minimum denomination for the Class R Certificates shall be 100%
Percentage
Interest in such Class.
Set forth below are designations of Classes of Certificates to
the
categories used herein:
Book-Entry Certificates...... All Classes of Certificates other
than the
Physical Certificates.
Class A Certificates......... Class A-1, Class A-2 and Class A-3
Certificates.
Class B Certificates......... Class B-1, Class B-2 and Class B-3
Certificates.
Class M Certificates......... Class M-1, Class M-2 and Class M-3
Certificates.
Delay Certificates........... None.
ERISA-Restricted
Certificates............... Class R, Class P and Class X
Certificates; any
certificate with a rating below the lowest
applicable permitted rating under the
Underwriters' Exemption.
LIBOR Certificates........... Class A and Subordinated
Certificates.
Non-Delay Certificates....... Class A, Class X and Subordinated
Certificates.
Offered Certificates......... All Classes of Certificates other
than the Private
Certificates.
Physical Certificates........ Class P, Class X and Class R
Certificates.
Private Certificates......... Class P, Class X and Class R
Certificates.
Rating Agencies.............. Moody's and Standard &
Poor's.
Regular Certificates......... All Classes of Certificates other
than the Class P
and Class R Certificates.
Residual Certificates........ Class R Certificates.
Subordinated Certificates.... Class M and Class B Certificates.
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and
phrases,
unless the context otherwise requires, shall have the following
meanings:
10-K Filing Deadline: As defined in Section 8.12(c).
Accepted Servicing Practices: With respect to any Mortgage
Loan,
those mortgage servicing practices set forth in Section 3.01(a) of
this
Agreement.
Account: Any of the Collection Account, the Distribution
Account,
any Escrow Account, the Swap Account or the Excess Reserve Fund
Account. Each
Account shall be an Eligible Account.
Accrued Certificate Interest Distribution Amount: With respect
to
any Distribution Date for each Class of LIBOR Certificates, the
amount of
interest accrued during the related Interest Accrual Period at the
applicable
Pass-Through Rate on the related Class Certificate Balance
immediately prior to
such Distribution Date, as reduced by such Class' share of Net
Prepayment
Interest Shortfalls and Relief Act Interest Shortfalls for such
Distribution
Date allocated to such Class pursuant to Section 4.02.
Additional Disclosure Notification: As defined in Section
8.12(c).
Additional Form 10-D Disclosure: As defined in Section 8.12(b).
Additional Form 10-K Disclosure: As defined in Section 8.12(c).
Adjustable Rate Mortgage Loan: An adjustable rate Mortgage
Loan.
Adjusted Net Mortgage Rate: As to each Mortgage Loan and at any
time, the per annum rate equal to the Mortgage Rate less the
Expense Fee Rate.
Adjustment Date: As to any Adjustable Rate Mortgage Loan, the
first
Due Date on which the related Mortgage Rate adjusts as set forth in
the related
Mortgage Note and each Due Date thereafter on which the Mortgage
Rate adjusts as
set forth in the related Mortgage Note.
Advance: Any P&I Advance or Servicing Advance.
Advance Facility: A financing or other facility as described in
Section 11.11.
Advancing Person: The Person to whom the Servicer's rights
under
this Agreement to be reimbursed for any P&I Advances or
Servicing Advances have
been assigned pursuant to Section 11.11.
Affiliate: With respect to any Person, any other Person
controlling,
controlled by or under common control with such first Person. For
the purposes
of this definition, "control" means the power to direct the
management and
policies of such Person, directly or indirectly, whether through
the ownership
of voting securities, by contract or otherwise; and the terms
"controlling" and
"controlled" have meanings correlative to the foregoing.
Agreement: This Pooling and Servicing Agreement and all
amendments
or supplements hereto.
Amount Held for Future Distribution: As to the Certificates on
any
Distribution Date, the aggregate amount held in the Collection
Account at the
close of business on the related Determination Date on account of
(i) Principal
Prepayments, Insurance Proceeds, Condemnation Proceeds, Liquidation
Proceeds and
Subsequent Recoveries on the Mortgage Loans received after the end
of the
related Prepayment Period and (ii) all Scheduled Payments on the
Mortgage Loans
due after the end of the related Due Period.
Analytics Company: Intex Solutions, Inc., or any other bond
analytics service provider identified to the Securities
Administrator by the
Depositor.
Applied Realized Loss Amount: With respect to any Distribution
Date,
the amount, if any, by which the aggregate Class Certificate
Balance of the
LIBOR Certificates after distributions of principal on such
Distribution Date
exceeds the aggregate Stated Principal Balance of the Mortgage
Loans for such
Distribution Date.
Appraised Value: The value set forth in an appraisal made in
connection with the origination of the related Mortgage Loan as the
value of the
Mortgaged Property.
Assignment Agreement: The Assignment Agreement between the
Sponsor
and the Depositor, dated as of May 3, 2006.
Assignment of Mortgage: An assignment of the Mortgage, notice
of
transfer or equivalent instrument in recordable form (other than
the assignee's
name and recording information not yet returned from the recording
office),
reflecting the sale of the Mortgage to the Trustee.
Available Funds: With respect to any Distribution Date and the
Mortgage Loans, to the extent received by the Securities
Administrator (x) the
sum of (i) all scheduled installments of interest (net of the
related Expense
Fees) and principal due on the Due Date on such Mortgage Loans in
the related
Due Period and received by the Servicer on or prior to the related
Determination
Date, together with any P&I Advances in respect thereof; (ii)
all Condemnation
Proceeds, Insurance Proceeds, Liquidation Proceeds and Subsequent
Recoveries
received by the Servicer during the related Prepayment Period (in
each case, net
of unreimbursed expenses incurred in connection with a liquidation
or
foreclosure and unreimbursed Advances, if any); (iii) all partial
or full
prepayments on the Mortgage Loans received by the Servicer during
the related
Prepayment Period together with all Compensating Interest paid by
the Servicer
in connection therewith (excluding any Prepayment Charges); (iv)
all
Substitution Adjustment Amounts with respect to substitutions of
Mortgage Loans
that occur on or prior to the related Determination Date; (v) all
amounts
received with respect to such Distribution Date as the Repurchase
Price in
respect of a Mortgage Loan repurchased on or prior to the related
Determination
Date; and (vi) the proceeds with respect to the termination of the
Trust Fund
pursuant to clause (a) of Section 10.01; reduced by (y) amounts in
reimbursement
for Advances previously made with respect to the Mortgage Loans and
other
amounts as to which the Servicer, the Depositor or the Trustee are
entitled to
be paid or reimbursed pursuant to this Agreement.
Balloon Loan: Any Mortgage Loan that requires only payments of
interest until the stated maturity date of the Mortgage Loan or
Scheduled
Payments of principal (not including the payment due on its stated
maturity
date) that are based on an amortization schedule that would be
insufficient to
fully amortize the principal thereof by the stated maturity date of
the Mortgage
Loan.
Basic Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the Principal Remittance
Amount for such
Distribution Date over (ii) the Excess Subordinated Amount, if any,
for such
Distribution Date.
Basis Risk Carry Forward Amount: With respect to each Class of
LIBOR
Certificates, as of any Distribution Date, the sum of (A) if on
such
Distribution Date the Pass-Through Rate for any Class of LIBOR
Certificates is
based upon the Net WAC Rate Cap, the excess of (i) the Accrued
Certificate
Interest Distribution Amount such Class of Certificates would
otherwise be
entitled to receive on such Distribution Date had such rate been
calculated as
the sum of LIBOR and the applicable Pass-Through Margin on such
Class of
Certificates for such Distribution Date, over (ii) the Accrued
Certificate
Interest Distribution Amount payable on such Class of Certificates
at the Net
WAC Rate Cap for such Distribution Date and (B) the portion of any
such excess
described in clause (A) for such Class of Certificates from all
previous
Distribution Dates not previously paid, together with interest
thereon at a rate
equal to the sum of LIBOR and the applicable Pass-Through Margin
for such Class
of Certificates for such Distribution Date.
Basis Risk Payment: For any Distribution Date, an amount equal
to
the lesser of (i) the aggregate of the Basis Risk Carry Forward
Amounts for such
Distribution Date and (ii) the Class X Distributable Amount (prior
to any
reduction for amounts paid from the Excess Reserve Fund Account to
pay any Basis
Risk Carry Forward Amount or any Defaulted Swap Termination
Payment).
Best's: Best's Key Rating Guide, as the same shall be amended
from
time to time.
Book-Entry Certificates: As specified in the Preliminary
Statement.
Business Day: Any day other than (i) Saturday or Sunday, or (ii)
a
day on which banking and savings and loan institutions, in (a) the
State of New
York, California, New Jersey or Delaware, (b) the State in which
the Servicer's
servicing operations are located, or (c) any State in which the
Corporate Trust
Office is located, are authorized or obligated by law or executive
order to be
closed.
Cap Agreements: The Class M Cap Agreement and the Class B Cap
Agreement.
Cap Provider: Barclays Bank PLC, a bank authorized and regulated
by
the United Kingdom's Financial Services Authority and a member of
the London
Stock Exchange, and its successors in interest.
Certificate: Any one of the Certificates executed by the
Securities
Administrator in substantially the forms attached hereto as
exhibits.
Certificate Balance: With respect to any Class of Certificates,
other than the Class X, Class P or Class R Certificates, at any
date, the
maximum dollar amount of principal to which the Holder thereof is
then entitled
hereunder, such amount being equal to the Denomination thereof
minus all
distributions of principal previously made with respect thereto and
in the case
of any Certificates, reduced by any Applied Realized Loss Amounts
allocated to
such Class of Certificates pursuant to Section 4.05; provided,
however, that
immediately following the Distribution Date on which a Subsequent
Recovery is
distributed, the Class Certificate Balances of any Class or Classes
of
Certificates that have been previously reduced by Applied Realized
Loss Amounts
will be increased, in order of seniority, by the amount of the
Subsequent
Recovery distributed on such Distribution Date (up to the amount of
Unpaid
Realized Loss Amount for such Class or Classes for such
Distribution Date). The
Class P, Class X and Class R Certificates have no Certificate
Balance.
Certificate Owner: With respect to a Book-Entry Certificate,
the
Person who is the beneficial owner of such Book-Entry
Certificate.
Certificate Register: The register maintained pursuant to
Section
5.02.
Certificateholder or Holder: The Person in whose name a
Certificate
is registered in the Certificate Register, 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 NIM
Insurer 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 the Preliminary Statement.
Class A Certificates: As specified in the Preliminary
Statement.
Class A Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the aggregate Class
Certificate Balances of
the Class A Certificates immediately prior to such Distribution
Date over (ii)
the lesser of (A) 71.20% of the aggregate Stated Principal Balance
of the
Mortgage Loans for such Distribution Date and (B) the excess, if
any, of the
aggregate Stated Principal Balance of the Mortgage Loans for such
Distribution
Date over $4,031,874.
Class A-1 Certificates: All Certificates bearing the class
designation of "Class A-1".
Class A-2 Certificates: All Certificates bearing the class
designation of "Class A-2".
Class A-3 Certificates: All Certificates bearing the class
designation of "Class A-3".
Class B Cap Agreement: The interest rate cap agreement, dated May
3,
2006, between the Cap Provider and the Securities Administrator,
relating to the
Class B Certificates, a copy of which is attached hereto as Exhibit
U.
Class B Certificates: As specified in the Preliminary
Statement.
Class B-1 Certificates: All Certificates bearing the class
designation of "Class B-1".
Class B-1 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate
Class
Certificate Balances of the Class A Certificates (after taking into
account the
distribution of the Class A Principal Distribution Amount for such
Distribution
Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution
Amount for such Distribution Date), (C) the Class Certificate
Balance of the
Class M-2 Certificates (after taking into account the distribution
of the Class
M-2 Principal Distribution Amount for such Distribution Date), (D)
the Class
Certificate Balance of the Class M-3 Certificates (after taking
into account the
distribution of the Class M-3 Principal Distribution Amount for
such
Distribution Date) and (E) the Class Certificate Balance of the
Class B-1
Certificates immediately prior to such Distribution Date over (ii)
the lesser of
(A) 96.90% of the aggregate Stated Principal Balance of the
Mortgage Loans for
such Distribution Date and (B) the excess, if any, of the aggregate
Stated
Principal Balance of the Mortgage Loans for such Distribution Date
over
$4,031,874.
Class B-2 Certificates: All Certificates bearing the class
designation of "Class B-2".
Class B-2 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate
Class
Certificate Balances of the Class A Certificates (after taking into
account the
distribution of the Class A Principal Distribution Amount for such
Distribution
Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution
Amount for such Distribution Date), (C) the Class Certificate
Balance of the
Class M-2 Certificates (after taking into account the distribution
of the Class
M-2 Principal Distribution Amount for such Distribution Date), (D)
the Class
Certificate Balance of the Class M-3 Certificates (after taking
into account the
distribution of the Class M-3 Principal Distribution Amount for
such
Distribution Date), (E) the Class Certificate Balance of the Class
B-1
Certificates (after taking into account the distribution of the
Class B-1
Principal Distribution Amount for such Distribution Date) and (I)
the Class
Certificate Balance of the Class B-2 Certificates immediately prior
to such
Distribution Date over (ii) the lesser of (A) 98.00% of the
aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date
and (B) the
excess, if any, of the aggregate Stated Principal Balance of the
Mortgage Loans
for such Distribution Date over $4,031,874.
Class B-3 Certificates: All Certificates bearing the class
designation of "Class B-3".
Class B-3 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate
Class
Certificate Balances of the Class A Certificates (after taking into
account the
distribution of the Class A Principal Distribution Amount for such
Distribution
Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution
Amount for such Distribution Date), (C) the Class Certificate
Balance of the
Class M-2 Certificates (after taking into account the distribution
of the Class
M-2 Principal Distribution Amount for such Distribution Date), (D)
the Class
Certificate Balance of the Class M-3 Certificates (after taking
into account the
distribution of the Class M-3 Principal Distribution Amount for
such
Distribution Date), (E) the Class Certificate Balance of the Class
B-1
Certificates (after taking into account the distribution of the
Class B-1
Principal Distribution Amount for such Distribution Date), (I) the
Class
Certificate Balance of the Class B-2 Certificates (after taking
into account the
distribution of the Class B-2 Principal Distribution Amount for
such
Distribution Date) and (J) the Class Certificate Balance of the
Class B-3
Certificates immediately prior to such Distribution Date over (ii)
the lesser of
(A) 99.00% of the aggregate Stated Principal Balance of the
Mortgage Loans for
such Distribution Date and (B) the excess, if any, of the aggregate
Stated
Principal Balance of the Mortgage Loans for such Distribution Date
over
$4,031,874.
Class Certificate Balance: With respect to any Class and as to
any
date of determination, the aggregate of the Certificate Balances of
all
Certificates of such Class as of such date.
Class IO Interest: As specified in the Preliminary Statement.
Class IO Shortfalls: As defined in Section 8.13. For the
avoidance
of doubt, the Class IO Shortfall for any Distribution Date shall
equal the
amount payable to the Class X Certificates in respect of amounts
due to the Swap
Provider on such Distribution Date (other than Defaulted Swap
Termination
Payments) in excess of the amount payable on the Class X Interest
(prior to
reduction for any Basis Risk Payments or Swap Termination Payments)
on such
Distribution Date, all as further provided in Section 8.13.
Class LT-R Interest: The sole class of "residual interest" in
the
Lower Tier REMIC evidenced by the Class R Certificates.
Class M Cap Agreement: The interest rate cap agreement, dated May
3,
2006, between the Cap Provider and the Securities Administrator,
relating to the
Class M Certificates, a copy of which is attached hereto as Exhibit
T.
Class M Certificates: As specified in the Preliminary
Statement.
Class M-1 Certificates: All Certificates bearing the class
designation of "Class M-1".
Class M-1 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate
Class
Certificate Balances of the Class A Certificates (after taking into
account the
distribution of the Class A Principal Distribution Amount for such
Distribution
Date), and (B) the Class Certificate Balance of the Class M-1
Certificates
immediately prior to such Distribution Date over (ii) the lesser of
(A) 83.60%
of the aggregate Stated Principal Balance of the Mortgage Loans for
such
Distribution Date and (B) the excess, if any, of the aggregate
Stated Principal
Balance of the Mortgage Loans for such Distribution Date over
$4,031,874.
Class M-2 Certificates: All Certificates bearing the class
designation of "Class M-2".
Class M-2 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate
Class
Certificate Balances of the Class A Certificates (after taking into
account the
distribution of the Class A Principal Distribution Amount for such
Distribution
Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution
Amount for such Distribution Date) and (C) the Class Certificate
Balance of the
Class M-2 Certificates immediately prior to such Distribution Date
over (ii) the
lesser of (A) 92.90% of the aggregate Stated Principal Balance of
the Mortgage
Loans for such Distribution Date and (B) the excess, if any, of the
aggregate
Stated Principal Balance of the Mortgage Loans for such
Distribution Date over
$4,031,874.
Class M-3 Certificates: All Certificates bearing the class
designation of "Class M-3".
Class M-3 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate
Class
Certificate Balances of the Class A Certificates (after taking into
account the
distribution of the Class A Principal Distribution Amount for such
Distribution
Date), (B) the Class Certificate Balance of the Class M-1
Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution
Amount for such Distribution Date), (C) the Class Certificate
Balance of the
Class M-2 Certificates (after taking into account the distribution
of the Class
M-2 Principal Distribution Amount for such Distribution Date) and
(D) the Class
Certificate Balance of the Class M-3 Certificates immediately prior
to such
Distribution Date over (ii) the lesser of (A) 95.50% of the
aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date
and (B) the
excess, if any, of the aggregate Stated Principal Balance of the
Mortgage Loans
for such Distribution Date over $4,031,874.
Class P Certificates: All Certificates bearing the class
designation
of "Class P".
Class PT1-R Interest: The residual interest in Pooling Tier
REMIC-1
as described in the Preliminary Statement and the related footnote
thereto.
Class PT2-R Interest: The residual interest in Pooling Tier
REMIC-2
as described in the Preliminary Statement and the related footnote
thereto.
Class R Certificates: All Certificates bearing the class
designation
of "Class R".
Class UT-R Interest: The sole class of "residual interest" in
the
Upper Tier REMIC evidenced by the Class R Certificate.
Class X Certificates: All Certificates bearing the class
designation
of "Class X".
Class X Distributable Amount: On any Distribution Date, the sum
of
(i) as a distribution in respect of interest, the amount of
interest that has
accrued on the Class X Interest (as set forth in the Preliminary
Statement) and
not applied as an Extra Principal Distribution Amount on such
Distribution Date,
plus any such accrued interest remaining undistributed from prior
Distribution
Dates, plus (without duplication), (ii) as a distribution in
respect of
principal, any portion of the principal balance of the Class X
Interest which is
distributable as a Subordination Reduction Amount, minus (iii) any
Swap
Termination Payment or any amounts paid from the Excess Reserve
Fund Account to
pay any Basis Risk Carry Forward Amount.
Class X Interest: The Upper Tier REMIC Regular Interest
represented
by the Class X Certificates as specified and described in the
Preliminary
Statement and the related footnote thereto.
Closing Date: May 3,
2006.
Closing Date Deposit Amount: $528,418.02 (all of which is
allocable
to principal) deposited by the Depositor into the Distribution
Account on the
Closing Date.
Code: The Internal Revenue Code of 1986, including any successor
or
amendatory provisions.
Collection Account: As defined in Section 3.10(a).
Commission: The United States Securities and Exchange
Commission.
Compensating Interest: For any Distribution Date, the lesser of
(a)
the amount, if any, by which the Prepayment Interest Shortfall, if
any, for such
Distribution Date, with respect to voluntary Principal Prepayments
(excluding
any payments made upon liquidation of any Mortgage Loan) exceeds
all Prepayment
Interest Excesses for such Distribution Date, and (b) the amount of
the
Servicing Fee payable to the Servicer for such Distribution
Date.
Condemnation Proceeds: All awards or settlements in respect of
a
Mortgaged Property, whether permanent or temporary, partial or
entire, by
exercise of the power of eminent domain or condemnation.
Convertible Mortgage Loan: Any individual Adjustable Rate
Mortgage
Loan purchased pursuant to this Agreement which contains a
provision whereby the
Mortgagor is permitted to convert the Adjustable Rate Mortgage Loan
to a Fixed
Rate Mortgage Loan in accordance with the terms of the related
Mortgage Note.
Corporate Trust Office: (i) When used with respect to the
Trustee,
the designated office of the Trustee at which at any particular
time its
corporate trust business with respect to this Agreement is
administered, which
office at the date of the execution of this Agreement is located at
209 South
LaSalle Street, Suite 300, Chicago, Illinois 60604, Attention:
Corporate Trust
Services, SABR 2006-NC1, and which is the office to which notices
to and
correspondence with the Trustee should be directed, and (ii) when
used with
respect to the Securities Administrator, the designated office of
the Securities
Administrator located (i) for purposes of Certificate transfers, at
Wells Fargo
Center, Sixth Street and Marquette Avenue, Minneapolis, Minnesota
55479,
Attention: Client Manager - SABR 2006-NC1 and (ii) for all other
purposes, at
9062 Old Annapolis Road, Columbia, Maryland 21045, Attention:
Client
Manager-SABR 2006-NC1, facsimile no. (410) 715-2380, and which is
the address to
which notices to and correspondence with the Securities
Administrator should be
directed.
Corresponding Class: The class of interests in the Lower Tier
REMIC
or Upper Tier REMIC created under this Agreement that corresponds
to the Class
of interests in the other such REMIC, as applicable, or to a Class
of
Certificates in the manner set out below:
Corresponding
Corresponding
Corresponding
Lower Tier REMIC
Upper Tier REMIC
Class of
Class Designation
Regular Interest
Certificates
-----------------
---------------------------------------- ------------
Class
LT-A-1
Class A-1
Class A-1
Class
LT-A-2
Class A-2
Class A-2
Class
LT-A-3
Class A-3
Class A-3
Class
LT-M-1
Class M-1
Class M-1
Class
LT-M-2
Class M-2
Class M-2
Class
LT-M-3
Class M-3
Class M-3
Class
LT-B-1
Class B-1
Class B-1
Class
LT-B-2
Class B-2
Class B-2
Class
LT-B-3
Class B-3
Class B-3
N/A
Class X
Class X
Corresponding Pooling Tier REMIC-1 Regular Interest: As described
in
the Preliminary Statement.
Corresponding Pooling Tier REMIC-2 IO Interest: As described in
the
Preliminary Statement.
Corresponding Scheduled Crossover Distribution Date: The
Distribution Date in the month and year specified in the
Preliminary Statement
corresponding to a Pooling Tier REMIC-2 IO Interest.
Corresponding Upper Tier REMIC Regular Interest: As defined in
the
Preliminary Statement.
Covered Loan: A Mortgage Loan categorized as Covered pursuant
to
Appendix E of Standard & Poor's Glossary.
Cumulative Loss Percentage: With respect to any Distribution
Date,
the percentage equivalent of a fraction, the numerator of which is
the aggregate
amount of Realized Losses incurred from the Cut-off Date to the
last day of the
calendar month preceding the month in which such Distribution Date
occurs and
the denominator of which is the Cut-off Date Pool Principal Balance
of the
Mortgage Loans.
Cumulative Loss Trigger Event: If, with respect to any
Distribution
Date, the quotient (expressed as a percentage) of (x) the aggregate
amount of
Realized Losses incurred since the Cut-off Date through the last
day of the
related Due Period, divided by (y) the Cut-off Date Pool Principal
Balance,
exceeds the applicable Cumulative Loss Percentages set forth below
with respect
to such Distribution Date:
<TABLE>
<CAPTION>
Distribution Date
Occurring
In
Cumulative Loss Percentage
---------------------------
----------------------------------------------------------
<S>
<C>
May 2008 through April 2009 1.200% for the first month,
plus an additional 1/12th of
1.500% for each month thereafter (e.g., 1.950% in November
2008)
May 2009 through April 2010 2.700% for the first month,
plus an additional 1/12th of
1.550% for each month thereafter (e.g., 3.475% in November
2009)
May 2010 through April 2011 4.250% for the first month,
plus an additional 1/12th of
1.250% for each month thereafter (e.g., 4.875% in November
2010)
May 2011 through April 2012 5.500% for the first month,
plus an additional 1/12th of
0.250% for each month thereafter (e.g., 5.625% in November
2011)
May 2012 and thereafter
5.750%
</TABLE>
Custodial Agreement: The Custodial Agreement among the Sponsor,
the
Responsible Party, New Century Mortgage Corporation and Deutsche
Bank National
Trust Company, dated as of January 1, 2006.
Custodial File: As defined in Section 2.01(b).
Custodian: Wells Fargo Bank, National Association, and its
successors and assigns, in its capacity as Custodian hereunder, and
if any
successor custodian is appointed hereunder, such successor.
Cut-off Date: April 1, 2006.
Cut-off Date Pool Principal Balance: The aggregate Stated
Principal
Balances of all Mortgage Loans as of the Cut-off Date.
Cut-off Date Principal Balance: As to any Mortgage Loan, the
Stated
Principal Balance thereof as of the close of business on the
Cut-off Date.
Data Tape Information: With respect to each Mortgage Loan, the
following information as of the Cut-off Date provided by the
Responsible Party
to the Sponsor: (1) the Responsible Party's Mortgage Loan
identifying number;
(2) the Mortgagor's name; (3) the street address of the Mortgaged
Property
including the city, state and zip code; (4) a code indicating
whether the
Mortgagor is self-employed; (5) as to each Mortgage Loan, the
Stated Principal
Balance as of the Cut-off Date; (6) the Index; (7) a code
indicating whether the
Mortgaged Property is owner-occupied; (8) the number and type of
residential
units constituting the Mortgaged Property; (9) the original stated
months to
maturity; (10) the original amortization months to maturity; (11)
the stated
maturity date; (12) the amount of the Scheduled Payment as of the
Cut-off Date;
(13) the first date on which the Scheduled Payment was due on the
Mortgage Loan
and, if such date is not consistent with the Due Date currently in
effect, such
Due Date; (14) the "paid through date" based on payments received
from the
related Mortgagor; (15) the original principal amount of the
Mortgage Loan; (16)
with respect to each Adjustable Rate Mortgage Loan, the Minimum
Mortgage Rate;
(17) with respect to each Adjustable Rate Mortgage Loan, the
Maximum Mortgage
Rate; (18) with respect to each Adjustable Rate Mortgage Loan, the
initial
Periodic Mortgage Rate Cap; (19) with respect to each Adjustable
Rate Mortgage
Loan, the subsequent Periodic Mortgage Rate Cap; (20) with respect
to each
Adjustable Rate Mortgage Loan, the first payment Adjustment Date
immediately
following the Cut-off Date; (21) with respect to each Adjustable
Rate Mortgage
Loan, the first Interest Rate Adjustment Date immediately following
the Cut-off
Date; (22) with respect to each Adjustable Rate Mortgage Loan, the
Gross Margin;
(23) with respect to each Adjustable Rate Mortgage Loan, the
Mortgage Rate
adjustment period; (24) the type of Mortgage Loan (i.e., Fixed Rate
or
Adjustable Rate Mortgage Loan); (25) lien position (i.e.,
First-Lien or
Second-Lien Mortgage Loan); (26) a code indicating the purpose of
the loan
(i.e., purchase, rate and term refinance, equity take-out
refinance); (27) the
credit risk score (FICO score); (28) the loan credit grade
classification (as
described in the underwriting guidelines); (29) the Mortgage Rate
at
origination; (30) the value of the Mortgaged Property; (31) a code
indicating
the term and amount of Prepayment Charges applicable to such
Mortgage Loan
(including any prepayment penalty term), if any; (32) with respect
to each
Mortgage Loan, the Loan-to-Value Ratio at origination; (33) the
documentation
level; (34) the date of origination; (35) a code indicating whether
the Mortgage
Loan is a Balloon Loan; (36) the Due Date for the first Scheduled
Payment; (37)
the original Scheduled Payment due; (38) the debt-to-income ratio
with respect
to the Mortgage Loan; (39) the Mortgage Rate calculation method
(i.e., 30/360,
simple interest, other); (40) a code indicating whether the
Mortgage Loan is
Home Loan; (41) appraisal verification (Y/N); and (42) type of
appraisal
verification, if any. With respect to the Mortgage Loans in the
aggregate, the
Data Tape Information shall set forth the following information, as
of the
Cut-off Date: (1) the number of Mortgage Loans; (2) the current
aggregate
outstanding principal balance of the Mortgage Loans; (3) the
weighted average
Mortgage Rate of the Mortgage Loans; and (4) the weighted average
maturity of
the Mortgage Loans.
DBRS: Dominion Bond Rating Service. If DBRS is designated as a
Rating Agency in the Preliminary Statement, for purposes of Section
11.05(c) the
address for notices to DBRS shall be Dominion Bond Rating Service,
55 Broadway,
15th Floor, New York, New York 10006, Attention: Quincy Tang, or
such other
address as DBRS may hereafter furnish to the Depositor, the
Trustee, the
Securities Administrator and the Servicer.
Debt Service Reduction: With respect to any Mortgage Loan, a
reduction by a court of competent jurisdiction in a proceeding
under the United
States Bankruptcy Code in the Scheduled Payment for such Mortgage
Loan which
became final and non-appealable, except such a reduction resulting
from a
Deficient Valuation or any reduction that results in a permanent
forgiveness of
principal.
Deemed Material and Adverse Representation: Each representation
and
warranty identified as such on Schedule III to this Agreement.
Defaulted Swap Termination Payment: Any Swap Termination
Payment
required to be paid by the Trust to the Swap Provider pursuant to
the Interest
Rate Swap Agreement as a result of an Event of Default (as defined
in the
Interest Rate Swap Agreement) with respect to which the Swap
Provider is the
defaulting party or a Termination Event (as defined in the Interest
Rate Swap
Agreement) (other than Illegality or a Tax Event that is not a Tax
Event Upon
Merger (each as defined in the Interest Rate Swap Agreement )) with
respect to
which the Swap Provider is the sole Affected Party (as defined in
the Interest
Rate Swap Agreement).
Deficient Valuation: With respect to any Mortgage Loan, a
valuation
of the related Mortgaged Property by a court of competent
jurisdiction in an
amount less than the then outstanding principal balance of the
Mortgage Loan,
which valuation results from a proceeding initiated under the
United States
Bankruptcy Code.
Definitive Certificates: Any Certificate evidenced by a
Physical
Certificate and any Certificate issued in lieu of a Book-Entry
Certificate
pursuant to Section 5.02(e).
Delay Certificates: As specified in the Preliminary Statement.
Deleted Mortgage Loan:
As defined in Section 2.03.
Delinquency Trigger Event: With respect to any Distribution
Date,
the circumstances in which the quotient (expressed as a percentage)
of (x) the
rolling three month average of the Stated Principal Balances of 60+
Day
Delinquent Mortgage Loans, divided by (y) the aggregate Stated
Principal Balance
of the Mortgage Loans, as of the last day of the related Due
Period, equals or
exceeds 42.00% of the prior period's Senior Enhancement
Percentage.
Denomination: With respect to each Certificate, the amount set
forth
on the face thereof as the "Initial Certificate Balance of this
Certificate" or
the Percentage Interest appearing on the face thereof.
Depositor: Securitized Asset Backed Receivables LLC, a Delaware
limited liability company, and its successors in interest.
Depository: The initial Depository shall be The Depository
Trust
Company, the nominee of which is CEDE & Co., as the registered
Holder of the
Book-Entry Certificates. The Depository shall at all times be a
"clearing
corporation" as defined in Section 8-102(a)(5) of the Uniform
Commercial Code of
the State of New York.
Depository Institution: Any depository institution or trust
company,
including the Trustee and the Securities Administrator, that (a) is
incorporated
under the laws of the United States of America or any State
thereof, (b) is
subject to supervision and examination by federal or state banking
authorities
and (c) has outstanding unsecured commercial paper or other
short-term unsecured
debt obligations that are rated "P-1" by Moody's, "F1+" by Fitch,
"A-1" by
Standard & Poor's and, if rated by DBRS, "R-1" by DBRS (in each
case, to the
extent they are designated as Rating Agencies in the Preliminary
Statement).
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.
Determination Date: With respect to each Remittance Date, the
15th
day (or if such day is not a Business Day, the immediately
preceding Business
Day) in the calendar month in which such Remittance Date
occurs.
Disqualified Non-U.S. Person: With respect to a Class R
Certificate,
(i) any Non-U.S. Person or agent thereof other than a Non-U.S.
Person that holds
the Class R Certificate in connection with the conduct of a trade
or business
within the United States and has furnished the transferor and the
Securities
Administrator with an effective IRS Form W-8ECI, (ii) any domestic
entity
classified as a partnership under the Code, any of its direct or
indirect
partners (other than through a U.S. corporation) which are
Disqualified Non-U.S.
Persons, unless such Person described in (i) or (ii) above has
delivered to both
the transferor, the Securities Administrator and the Trustee an
opinion of a
nationally recognized tax counsel to the effect that the transfer
of the Class R
Certificate to it is in accordance with the requirements of the
Code and the
regulations promulgated thereunder and that such transfer of the
Class R
Certificate will not be disregarded for federal income tax
purposes.
Distribution Account: The separate Eligible Account created and
maintained by the Securities Administrator pursuant to Section
3.07(d) in the
name of the Securities Administrator for the benefit of the
Certificateholders
and designated "Wells Fargo Bank, National Association in trust for
registered
holders of Securitized Asset Backed Receivables LLC Trust 2006-NC1
Mortgage
Pass-Through Certificates, Series 2006-NC1". Funds in the
Distribution Account
shall be held in trust for the Certificateholders for the uses and
purposes set
forth in this Agreement.
Distribution Account Deposit Date: As to any Distribution Date,
12:00 noon New York City time on the third Business Day immediately
preceding
such Distribution Date.
Distribution Date: The 25th day of each calendar month, or if
such
day is not a Business Day, the next succeeding Business Day,
commencing in May
2006.
Document Certification and Exception Report: The report attached
to Exhibit F hereto.
Due Date: The day of the month on which the Scheduled Payment is
due
on a Mortgage Loan, exclusive of any days of grace.
Due Period: With respect to any Distribution Date, the period
commencing on the second day of the calendar month preceding the
month in which
such Distribution Date occurs and ending on the first day of the
calendar month
in which such Distribution Date occurs.
Eligible Account: Either (i) an account maintained with a federal
or
state-chartered depository institution or trust company that
complies with the
definition of Eligible Institution, (ii) an account maintained with
the
corporate trust department of a federal depository institution
or
state-chartered depository institution subject to regulations
regarding
fiduciary funds on deposit similar to Title 12 of the U.S. Code of
Federal
Regulation Section 9.10(b), which, in either case, has corporate
trust powers
and is acting in its fiduciary capacity or (iii) any other account
acceptable to
the NIM Insurer and to each Rating Agency. Eligible Accounts may
bear interest,
and may include, if otherwise qualified under this definition,
accounts
maintained with the Securities Administrator. Each Eligible Account
shall be a
separate account.
Eligible Institution: A federal or state-chartered depository
institution or trust company the commercial paper, short-term debt
obligations,
or other short-term deposits of which are rated "A-1+" by Standard
& Poor's if
the amounts on deposit are to be held in the account for no more
than 365 days
(or at least "A-2" by Standard & Poor's if the amounts on
deposit are to be held
in the account for no more than 30 days), or the long-term
unsecured debt
obligations of which are rated at least "AA-" by Standard &
Poor's if the
amounts on deposit are to be held in the account for no more than
365 days, and
the commercial paper, short-term debt obligations or other
short-term deposits
of which are rated at least "P-1" by Moody's and "F1+" by Fitch (or
a comparable
rating if another Rating Agency is specified by the Depositor by
written notice
to the Servicer and the Securities Administrator) (in each case, to
the extent
they are designated as Rating Agencies in the Preliminary
Statement).
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA-Qualifying Underwriting: A best efforts or firm
commitment
underwriting or private placement that meets the requirements of
Prohibited
Transaction Exemption ("PTE") 2002-41, 67 Fed. Reg. 54487 (2002)
(or any
successor thereto), or any substantially similar administrative
exemption
granted by the U.S. Department of Labor.
ERISA-Restricted Certificate: As specified in the Preliminary
Statement.
Escrow Account: The Eligible Account or Accounts established
and
maintained pursuant to Section 3.09(b).
Escrow Payments: As defined in Section 3.09(b).
Event of Default: As defined in Section 7.01.
Excess Reserve Fund Account: The separate Eligible Account
created
and maintained by the Securities Administrator pursuant to Sections
3.07(b) and
3.07(c) in the name of the Securities Administrator for the benefit
of the
Regular Certificateholders and designated "Wells Fargo Bank,
National
Association in trust for registered holders of Securitized Asset
Backed
Receivables LLC Trust 2006-NC1, Mortgage Pass-Through Certificates,
Series
2006-NC1". Funds in the Excess Reserve Fund Account shall be held
in trust for
the Regular Certificateholders for the uses and purposes set forth
in this
Agreement. Amounts on deposit in the Excess Reserve Fund Account
shall not be
invested.
Excess Subordinated Amount: With respect to any Distribution
Date,
the excess, if any, of (a) the Subordinated Amount on such
Distribution Date
over (b) the Specified Subordinated Amount for such Distribution
Date.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Expense Fee Rate: As to each Mortgage Loan, a per annum rate
equal
to the sum of the Servicing Fee Rate, the Securities Administrator
Fee Rate and
the Loan Performance Advisor Fee Rate.
Expense Fees: As to each Mortgage Loan, the sum of the
Servicing
Fee, the Securities Administrator Fee and the Loan Performance
Advisor Fee.
Extra Principal Distribution Amount: As of any Distribution
Date,
the lesser of (x) the related Total Monthly Excess Spread for such
Distribution
Date and (y) the related Subordination Deficiency for such
Distribution Date.
Fannie Mae: The Federal National Mortgage Association, or any
successor thereto.
Fannie Mae Guides: The Fannie Mae Sellers' Guide and the Fannie
Mae
Servicers' Guide and all amendments or additions thereto.
FDIC: The Federal Deposit Insurance Corporation, or any
successor
thereto.
Final Recovery Determination: With respect to any defaulted
Mortgage
Loan or any REO Property (other than a Mortgage Loan or REO
Property purchased
by the Responsible Party as contemplated by this Agreement), a
determination
made by the Servicer that all Insurance Proceeds, Condemnation
Proceeds,
Liquidation Proceeds and other payments or recoveries which the
Servicer, in its
reasonable good faith judgment, expects to be finally recoverable
in respect
thereof have been so recovered. The Servicer shall maintain
records, prepared by
a Servicing Officer, of each Final Recovery Determination made
thereby.
Final Scheduled Distribution Date: The Final Scheduled
Distribution
Date for each Class of Certificates is the Distribution Date
occurring in March
2036.
Fitch: Fitch, Inc., or any successor thereto. If Fitch is
designated
as a Rating Agency in the Preliminary Statement, for purposes of
Section
11.05(c) the address for notices to Fitch shall be Fitch, Inc., One
State Street
Plaza, New York, New York 10004, Attention: MBS Monitoring -
Securitized Asset
Backed Receivables LLC Trust 2006-NC1, or such other address as
Fitch may
hereafter furnish to the Depositor, the Securities Administrator,
the Trustee
and the Servicer.
Fixed Rate Mortgage Loan: A fixed rate Mortgage Loan.
Form 8-K Disclosure Information: As defined in Section 8.12(g).
Freddie Mac: The Federal Home Loan Mortgage Corporation, 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.
Gross Margin: With respect to each Adjustable Rate Mortgage
Loan,
the fixed percentage amount set forth in the related Mortgage Note
to be added
to the applicable Index to determine the Mortgage Rate.
High Cost Loan: A Mortgage Loan (a) covered by the Home
Ownership
and Equity Protection Act of 1994, (b) classified as a "high cost
home,"
"threshold," "covered," "high risk home," or "predatory" loan under
any other
applicable federal, state or local law (or a similarly classified
loan using
different terminology under a law imposing heightened regulatory
scrutiny or
additional legal liability for residential mortgage loans having
high interest
rates, points and/or fees) or (c) a Mortgage Loan categorized as
High Cost
pursuant to Appendix E of Standard & Poor's Glossary.
Home Loan: A Mortgage Loan categorized as Home Loan pursuant to
Appendix E of Standard & Poor's Glossary.
Indenture: An indenture relating to the issuance of notes secured
by
the Class X Certificates and/or the Class P Certificates (or any
portion
thereof) which may or may not be guaranteed by the NIM Insurer.
Index: As to each Adjustable Rate Mortgage Loan, the index from
time
to time in effect for the adjustment of the Mortgage Rate set forth
as such on
the related Mortgage Note.
Initial Certification:
As defined in Section 2.02.
Insurance and Indemnity Agreement: The insurance and indemnity
agreement, dated as of May 3, 2006, among the NIM Insurer, Barclays
Bank PLC,
the Depositor, the NIM Issuer, the Trustee, the co-trustee for the
NIM
Securities and the NIM Trustee.
Insurance Policy: With respect to any Mortgage Loan included in
the
Trust Fund, any insurance policy, including all riders and
endorsements thereto
in effect, including any replacement policy or policies for any
Insurance
Policies, including, without limitation, the Pool Policy.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds
of
insurance policies (including the Pool Policy) insuring the
Mortgage Loan or the
related Mortgaged Property.
Interest Accrual Period: With respect to each Class of
Non-Delay
Certificates and the Corresponding Class of Lower Tier REMIC
Regular Interests
and any Distribution Date, the period commencing on the
Distribution Date
occurring in the month preceding the month in which the current
Distribution
Date occurs and ending on the day immediately preceding the current
Distribution
Date (or, in the case of the first Distribution Date, the period
from and
including the Closing Date to but excluding such first Distribution
Date). For
purposes of computing interest accruals on each Class of Non-Delay
Certificates,
each Interest Accrual Period has the actual number of days in such
month and
each year is assumed to have 360 days.
Interest Rate Adjustment Date: With respect to each Adjustable
Rate
Mortgage Loan, the date, specified in the related Mortgage Note and
the Mortgage
Loan Schedule, on which the Mortgage Rate is adjusted.
Interest Rate Cap Payment: With respect to each Cap Agreement
and
for any Distribution Date, the amount, if any, required to be paid
by the Cap
Provider on such Distribution Date under such Cap Agreement.
Interest Rate Swap Agreement: The interest rate swap agreement,
dated as of May 3, 2006 between the Swap Provider and the
Securities
Administrator, a copy of which is attached hereto as Exhibit T.
Interest Remittance Amount: With respect to any Distribution
Date
and the Mortgage Loans, that portion of Available Funds
attributable to interest
relating to Mortgage Loans.
Investment Account: As defined in Section 3.12(a).
IRS: The Internal
Revenue Service.
Late Collections: With respect to any Mortgage Loan and any Due
Period, all amounts received after the Determination Date
immediately following
such Due Period, whether as late payments of Scheduled Payments or
as Insurance
Proceeds, Condemnation Proceeds, Liquidation Proceeds, Subsequent
Recoveries or
otherwise, which represent late payments or collections of
principal and/or
interest due (without regard to any acceleration of payments under
the related
Mortgage and Mortgage Note) but delinquent for such Due Period and
not
previously recovered.
LIBOR: With respect to any Interest Accrual Period for the
LIBOR
Certificates, the rate determined by the Securities Administrator
on the related
LIBOR Determination Date on the basis of the offered rate for
one-month U.S.
dollar deposits as such rate appears on Telerate Page 3750 as of
11:00 a.m.
(London time) on such date; provided, that if such rate does not
appear on
Telerate Page 3750, the rate for such date will be determined on
the basis of
the rates at which one-month U.S. dollar deposits are offered by
the Reference
Banks at approximately 11:00 a.m. (London time) on such date to
prime banks in
the London interbank market. In such event, the Securities
Administrator shall
request the principal London office of each of the Reference Banks
to provide a
quotation of its rate. If at least two such quotations are
provided, the rate
for that date will be the arithmetic mean of the quotations
(rounded upwards if
necessary to the nearest whole multiple of 1/16%). If fewer than
two quotations
are provided as requested, the rate for that date will be the
arithmetic mean of
the rates quoted by major banks in New York City, selected by the
Securities
Administrator (after consultation with the Depositor), at
approximately 11:00
a.m. (New York City time) on such date for one-month U.S. dollar
loans to
leading European banks.
LIBOR Certificates: As specified in the Preliminary Statement.
LIBOR Determination Date: With respect to any Interest Accrual
Period for the LIBOR Certificates, the second London Business Day
preceding the
commencement of such Interest Accrual Period.
Liquidated Mortgage Loan: With respect to any Distribution Date,
a
defaulted Mortgage Loan (including any REO Property) which was
liquidated in the
calendar month preceding the month of such Distribution Date and as
to which the
Servicer has certified to the Trustee that it has received all
amounts it
expects to receive in connection with the liquidation of such
Mortgage Loan
including the final disposition of an REO Property.
Liquidation Proceeds: Cash received in connection with the
liquidation of a Liquidated Mortgage Loan, whether through a
trustee's sale,
foreclosure sale or otherwise.
Loan Performance
Advisor:
OfficeTiger
Global
Real Estate
Services Inc., a Delaware corporation, and its successors in interest,
and if
a successor loan performance advisor is appointed hereunder, such
successor.
Loan Performance Advisor Agreement: The Loan Performance
Advisor
Agreement, dated as of February 1, 2005, by and between the Sponsor
and the Loan
Performance Advisor.
Loan Performance Advisor Fee: As to any Distribution Date, an
amount
equal to the product of (a) one-twelfth of the Loan Performance
Advisor Fee Rate
and (b) the aggregate Stated Principal Balance of the Mortgage
Loans as of the
preceding Distribution Date or, in the case of the first
Distribution Date, the
aggregate Stated Principal Balance of the Mortgage Loans as of the
Cut-off Date;
provided, however that the Loan Performance Advisor Fee for any
Distribution
Date shall not be lower than $1,500.
Loan Performance Advisor Fee Rate: With respect to each
Mortgage
Loan, either (a) 0.015% per annum or (b) if the Loan Performance
Advisor Fee is
the amount calculated pursuant to the proviso in the definition of
"Loan
Performance Advisor Fee", a per annum rate determined by dividing
such fee by
the average of the aggregate Stated Principal Balance of the
Mortgage Loans as
of the preceding Distribution Date.
Loan-to-Value Ratio or LTV: As of any date and as to any
Mortgage
Loan, the ratio (expressed as a percentage) of the outstanding
principal balance
of the Mortgage Loan to (a) in the case of a purchase, the lesser
of (i) the
sale price of the Mortgaged Property and (ii) the lesser of (y) its
appraised
value at the time of sale or (z) the appraised value determined by
a review
appraisal conducted by the Responsible Party, or (b) in the case of
a
refinancing or modification, the lesser of (i) the appraised value
of the
Mortgaged Property at the time of the refinancing or modification
or (ii) the
appraised value determined by a review appraisal conducted by the
Responsible
Party.
London Business Day: Any day on which dealings in deposits of
United
States dollars are transacted in the London interbank market.
Lower Tier REMIC Interest Rate: As described in the Preliminary
Statement.
Lower Tier REMIC Regular Interest: Each of the Class LT-A-1,
Class
A-2, Class LT-A-3, Class LT-M-1, Class LT-M-2, Class LT-M-3, Class
LT-B-1, Class
LT-B-2, Class LT-B-3, Class LT-IO and Class LT-Accrual Interests as
described in
the Preliminary Statement.
Lower Tier REMIC: As described in the Preliminary Statement.
Lower Tier REMIC Principal Amount: The principal balance of
each
Lower Tier REMIC Regular Interest, determined as set forth in the
Preliminary
Statement. The Lower Tier REMIC Principal Amount shall be computed
to at least
eight (8) decimal places.
Lower Tier REMIC Net WAC Rate: A per annum variable rate equal
to
the weighted average of the Pooling Tier REMIC-2 Interest Rates of
the Pooling
Tier REMIC-2 Regular Interests (other than the Pooling Tier REMIC-2
IO
Interests).
Majority Class X Certificateholder: The Holder or Holders of a
majority of the Percentage Interests in the Class X
Certificates.
Maximum Mortgage Rate: With respect to each Adjustable Rate
Mortgage
Loan, a rate that (i) is set forth on the Data Tape Information and
in the
related Mortgage Note and (ii) is the maximum interest rate to
which the
Mortgage Rate on such Adjustable Rate Mortgage Loan may be
increased during the
lifetime of such Adjustable Rate Mortgage Loan.
Minimum Mortgage Rate: With respect to each Adjustable Rate
Mortgage
Loan, a rate that (i) is set forth on the Data Tape Information and
in the
related Mortgage Note and (ii) is the minimum interest rate to
which the
Mortgage Rate on such Adjustable Rate Mortgage Loan may be
decreased during the
lifetime of such Adjustable Rate Mortgage Loan.
Monthly
Statement:
The
statement
delivered
to the
Certificateholders pursuant to Section 4.03.
Moody's: Moody's Investors Service, Inc. If Moody's is designated
as
a Rating Agency in the Preliminary Statement, for purposes of
Section 11.05(c)
the address for notices to Moody's shall be Moody's Investors
Service, Inc., 99
Church Street, New York, New York 10007, Attention: Residential
Mortgage
Pass-Through Group, or such other address as Moody's may hereafter
furnish to
the Depositor, the Securities Administrator, the Trustee and the
Servicer.
Mortgage: The
mortgage, deed of trust or other instrument
identified on the Mortgage Loan Schedule as securing a Mortgage
Note.
Mortgage File:
The items pertaining to a particular Mortgage
Loan contained in either the Servicing File or Custodial File.
Mortgage Loan: An individual Mortgage Loan that is the subject
of
this Agreement, each Mortgage Loan originally sold and subject to
this Agreement
being identified on the Mortgage Loan Schedule, which Mortgage Loan
includes,
without limitation, the Mortgage File, the Scheduled Payments,
Principal
Prepayments, Liquidation Proceeds, Subsequent Recoveries,
Condemnation Proceeds,
Insurance Proceeds, REO Disposition proceeds, Prepayment Charges,
and all other
rights, benefits, proceeds and obligations arising from or in
connection with
such Mortgage Loan, excluding replaced or repurchased Mortgage
Loans.
Mortgage Loan Schedule: A schedule of Mortgage Loans delivered
to
the Trustee and the Securities Administrator and referred to as
Schedule I, such
schedule setting forth the Data Tape Information with respect to
each Mortgage
Loan.
Mortgage Note: The note or other evidence of the indebtedness of
a
Mortgagor under a Mortgage Loan.
Mortgage Rate: The annual rate of interest borne on a Mortgage
Note,
which shall be adjusted from time to time in the case of an
Adjustable Rate
Mortgage Loan.
Mortgage Rate Caps: With respect to an Adjustable Rate Mortgage
Loan, the Periodic Mortgage Rate Cap, the Maximum Mortgage Rate,
and the Minimum
Mortgage Rate for such Mortgage Loan.
Mortgaged Property: With respect to each Mortgage Loan, the
real
property (or leasehold estate, if applicable) identified on the
Mortgage Loan
Schedule as securing repayment of the debt evidenced by the related
Mortgage
Note.
Mortgagor: The obligor(s) on a Mortgage Note.
Net Monthly Excess Cash Flow: For any Distribution Date, the
amount
remaining for distribution pursuant to Section 4.02(a)(iii) (before
giving
effect to distributions pursuant to such subsection).
Net Prepayment Interest Shortfall: For any Distribution Date,
the
amount by which the sum of the Prepayment Interest Shortfalls for
such
Distribution Date exceeds Compensating Interest payments made with
respect to
such Distribution Date.
Net Swap Payment: With respect to any Distribution Date, any
net
payment (other than a Swap Termination Payment) payable by the
Trust to the Swap
Provider on the related Fixed Rate Payer Payment Date (as defined
in the
Interest Rate Swap Agreement).
Net Swap Receipt: With respect to any Distribution Date, any
net
payment (other than a Swap Termination Payment) made by the Swap
Provider to the
Trust on the related Floating Rate Payer Payment Date (as defined
in the
Interest Rate Swap Agreement), or any amount withdrawn from the
reserve account
referred to in the third full paragraph of Section 4.06 that is
required under
that paragraph be treated as a Net Swap Receipt for purposes of
determining the
distributions from the Swap Account.
Net WAC Rate Cap: With respect to the Mortgage Loans as of any
Distribution Date, the product of a per annum rate equal to (i) the
weighted
average of the Adjusted Net Mortgage Rates for the Mortgage Loans
then in effect
on the beginning of the related Due Period, minus the product of
(A) the Net
Swap Payment plus any Swap Termination Payment (other than a
Defaulted Swap
Termination Payment) made to the Swap Provider, if any, expressed
as a
percentage equal to a fraction, the numerator of which is equal to
the Net Swap
Payment plus any Swap Termination Payment (other than a Defaulted
Swap
Termination Payment) made to the Swap Provider and the denominator
of which is
equal to the aggregate Stated Principal Balance of the Mortgage
Loans at the
beginning of such Due Period and (B) 12 and (ii) a fraction, the
numerator of
which is 30 and the denominator of which is the actual number of
days in the
related Interest Accrual Period. With respect to the first Due
Period and first
Distribution Date only, the Net WAC Cap shall be reduced by a
fraction, the
numerator of which is the Closing Date Deposit Amount and the
denominator of
which is the Cut-off Date Pool Principal Balance.
NIM Insurer: Radian Insurance Inc., a Pennsylvania stock
insurance
company, and its successors in interest.
NIM Issuer: The entity established as the issuer of the NIM
Securities.
NIM Securities: Any debt securities secured or otherwise backed
by
some or all of the Class X and Class P Certificates that are rated
by any Rating
Agency.
NIM Trustee: The trustee for the NIM Securities.
Non-Delay Certificates: As specified in the Preliminary
Statement.
Non-Permitted Transferee: A Person other than a Permitted
Transferee.
Nonrecoverable P&I Advance: Any P&I Advance previously made
or
proposed to be made in respect of a Mortgage Loan or REO Property
that, in the
good faith business judgment of the Servicer, will not or, in the
case of a
proposed P&I Advance, would not be ultimately recoverable from
related Late
Collections on such Mortgage Loan or REO Property as provided
herein.
Nonrecoverable Servicing Advance: Any Servicing Advances
previously
made or proposed to be made in respect of a Mortgage Loan or REO
Property,
which, in accordance with Accepted Servicing Practices, will not
or, in the case
of a proposed Servicing Advance, would not be ultimately
recoverable from
related Late Collections.
Non-U.S. Person: A person that is not a U.S. Person.
Notice of Final Distribution: The notice to be provided pursuant
to
Section 10.02 to the effect that final distribution on any of the
Certificates
shall be made only upon presentation and surrender thereof.
Offered Certificates: As specified in the Preliminary
Statement.
Officer's Certificate: A certificate signed by an officer of
the
Servicer with responsibility for the servicing of the Mortgage
Loans and listed
on a list delivered to the Trustee and the Securities Administrator
pursuant to
this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be
in-house counsel for the Servicer or any Subservicer, reasonably
acceptable to
the Persons to whom such opinion is to be delivered in accordance
with the
provisions of this Agreement, provided, that any Opinion of Counsel
relating to
(a) qualification of any Trust REMIC or (b) compliance with the
REMIC
Provisions, must be (unless otherwise stated in such Opinion of
Counsel) an
opinion of counsel who (i) is in fact independent of the Servicer
of the
Mortgage Loans, (ii) does not have any material direct or indirect
financial
interest in the Servicer of the Mortgage Loans or in an Affiliate
of the
Servicer and (iii) is not connected with the Servicer of the
Mortgage Loans as
an officer, employee, director or person performing similar
functions.
Optional Termination Date: The date determined as follows:
(i) the Majority Class X Certificateholder (as evidenced
on the
Certificate Register), pursuant to Section 10.01, may cause
the Optional Termination Date to occur on any Distribution Date
on
which the aggregate Stated Principal Balance of the Mortgage
Loans,
as of the last day of the related Due Period, is equal to 10%
or
less of the Cut-off Date Pool Principal Balance; and
(ii) to the extent that the Majority Class X
Certificateholder has not exercised its option as stated in
clause
(i) above, the NIM Insurer, pursuant to Section 10.01, may, at
its
option, cause the Optional Termination Date to occur on any
Distribution Date on which the aggregate Stated Principal Balance
of
the Mortgage Loans, as of the last day of the related Due Period,
is
equal to 5% or less of the Cut-off Date Pool Principal Balance.
OTS: Office of Thrift
Supervision, and any successor thereto.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore executed and
authenticated under
this Agreement except:
(i) Certificates theretofore canceled by the Securities
Administrator or delivered to the Securities Administrator for
cancellation; and
(ii) Certificates in exchange for which or in lieu of
which other Certificates have been executed and delivered by
the
Securities Administrator pursuant to this Agreement.
Outstanding Mortgage Loan: As of any Due Date, a Mortgage Loan
with
a Stated Principal Balance greater than zero which was not the
subject of a
Principal Prepayment in Full prior to such Due Date and which did
not become a
Liquidated Mortgage Loan prior to such Due Date.
Ownership Interest: As to any Residual 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.
P&I Advance: As to any Mortgage Loan or REO Property, any
advance
made by the Servicer in respect of any Remittance Date representing
the
aggregate of all payments of principal and interest, net of the
Servicing Fee,
that were due during the related Due Period on the Mortgage Loans
and that were
delinquent on the related Determination Date, plus certain amounts
representing
assumed payments not covered by any current net income on the
Mortgaged
Properties acquired by foreclosure or deed in lieu of foreclosure
as determined
pursuant to Section 4.01.
Pass-Through Margin: With respect to each Class of Regular
Certificates, the following percentages: Class A-1 Certificates,
0.060%; Class
A-2 Certificates, 0.160%; Class A-3 Certificates, 0.270%; Class
M-1
Certificates, 0.300%; Class M-2 Certificates, 0.440%; Class M-3
Certificates,
0.530%; Class B-1 Certificates, 1.000%; Class B-2 Certificates,
1.100%; and
Class B-3 Certificates, 2.000%. On the first Distribution Date
after the
Optional Termination Date, the Pass-Through Margins shall increase
to: Class A-1
Certificates, 0.120%; Class A-2 Certificates, 0.320%; Class A-3
Certificates,
0.540%; Class M-1 Certificates, 0.450%; Class M-2 Certificates,
0.660%; Class
M-3 Certificates, 0.795%; Class B-1 Certificates, 1.500%; Class
B-2
Certificates, 1.650%; and Class B-3 Certificates, 3.000%.
Pass-Through Rate: For each Class of Certificates, each Class
of
Upper Tier REMIC Regular Interest and each Class of Lower Tier
REMIC Regular
Interest, the per annum rate set forth or calculated in the manner
described in
the Preliminary Statement.
PCAOB: The Public Company Accounting Oversight Board.
Percentage Interest: As to any Certificate, the percentage
interest
evidenced thereby in distributions required to be made on the
related Class,
such percentage interest being set forth on the face thereof or
equal to the
percentage obtained by dividing the Denomination of such
Certificate by the
aggregate of the Denominations of all Certificates of the same
Class.
Periodic Mortgage Rate Cap: With respect to an Adjustable Rate
Mortgage Loan, the periodic limit on each Mortgage Rate adjustment
as set forth
in the related Mortgage Note.
Permitted Investments: Any one or more of the following
obligations
or securities acquired at a purchase price of not greater than par,
regardless
of whether issued by the Servicer, the Trustee, the Securities
Administrator,
the NIM Insurer or any of their respective Affiliates:
(i) direct obligations of, or obligations fully guaranteed as
to timely payment of principal and interest by, the United States
or
any agency or instrumentality thereof, provided such obligations
are
backed by the full faith and credit of the United States;
(ii) demand and time deposits in, certificates of deposit of,
or bankers' acceptances (which shall each have an original
maturity
of not more than 90 days and, in the case of bankers'
acceptances,
shall in no event have an original maturity of more than 365 days
or
a remaining maturity of more than 30 days) denominated in
United
States dollars and issued by, any Depository Institution and
rated
"F1+" by Fitch, "A-1+" by S&P, "P-1" by Moody's and "R-1 by
DBRS (in
each case, to the extent they are designated as Rating Agencies
in
the
Preliminary Statement);
(iii) repurchase obligations with respect to any security
described in clause (i) above entered into with a Depository
Institution (acting as principal);
(iv) securities bearing interest or sold at a discount that
are issued by any corporation incorporated under the laws of
the
United States of America or any state thereof and that are rated
by
S&P and Moody's (in each case, to the extent they are
designated as
Rating Agencies in the Preliminary Statement), and by each
other
Rating Agency that rates such securities in its highest
long-term
unsecured rating categories at the time of such investment or
contractual commitment providing for such investment;
(v) commercial paper (including both non-interest-bearing
discount obligations and interest-bearing obligations payable
on
demand or on a specified date not more than 30 days after the
date
of acquisition thereof) that is rated by S&P and Moody's (in
each
case, to the extent they are designated as Rating Agencies in
the
Preliminary Statement), and by each other Agency that rates
such
securities in its highest short-term unsecured debt rating
available
at the time of such investment;
(vi) units of money market funds, including money market funds
managed or advised by the Depositor, the Trustee, the
Securities
Administrator or an Affiliate thereof, that have been rated "Aaa"
by
Moody's, "AAAm" or "AAAm-G" by Standard & Poor's and, if rated
by
Fitch, at least "AAA" by Fitch and "R-1" by DBRS (in each case,
to
the extent they are designated as Rating Agencies in the
Preliminary
Statement); and
(vii) if previously confirmed in writing to the Securities
Administrator and consented to by the NIM Insurer, any other
demand,
money market or time deposit, or any other obligation, security
or
investment, as may be acceptable to each of the Rating Agencies as
a
permitted investment of funds backing "Aaa" or "AAA" rated
securities;
provided, however, that no instrument described hereunder shall
evidence either
the right to receive (a) only interest with respect to the
obligations
underlying such instrument or (b) both principal and interest
payments derived
from obligations underlying such instrument and the interest and
principal
payments with respect to such instrument provide a yield to
maturity at par
greater than 120% of the yield to maturity at par of the underlying
obligations.
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)
which 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
any Residual Certificate, (iv) rural electric and telephone
cooperatives
described in Section 1381(a)(2)(C) of the Code, (v) a Person that
is a
Disqualified Non-U.S. Person or a U.S. Person with respect to whom
income from a
Residual Certificate is attributable to a foreign permanent
establishment or
fixed base, within the meaning of an applicable income tax treaty,
of such
Person or any other U.S. Person, (vi) an "electing large
partnership" within the
meaning of Section 775 of the Code and (vii) any other Person so
designated by
the Depositor based upon an Opinion of Counsel that the Transfer of
an Ownership
Interest in a Residual Certificate to such Person may cause any
Trust REMIC to
fail to qualify as a REMIC at any time that the Certificates are
outstanding.
The terms "United States", "State" and "international organization"
shall have
the meanings set forth in Section 7701 of the Code or successor
provisions. A
corporation will not be treated as an instrumentality of the United
States or of
any State or political subdivision thereof for these purposes if
all of its
activities are subject to tax and, with the exception of Freddie
Mac, a majority
of its board of directors is not selected by such government
unit.
Person: Any individual, corporation, partnership, joint
venture,
association, limited liability company, joint-stock company,
trust,
unincorporated organization or government, or any agency or
political
subdivision thereof.
Physical Certificates: As specified in the Preliminary
Statement.
Pool Insurer: Radian Guaranty Inc., a Pennsylvania corporation,
and
its successors in interest.
Pool Policy: Policy
No. 06-043190, with respect to the Mortgage
Loans, issued by the Pool Insurer, a copy of which is attached
hereto as Exhibit
X and all endorsements thereto.
Pool Stated Principal Balance: As to any Distribution Date, the
aggregate of the Stated Principal Balances of the Mortgage Loans
for such
Distribution Date that were Outstanding Mortgage Loans on the Due
Date in the
related Due Period.
Pooling Tier REMIC-1: As described in the Preliminary
Statement.
Pooling Tier REMIC-1 Interest Rate: As described in the
Preliminary
Statement.
Pooling Tier REMIC-1 Net WAC Rate: With respect to the Mortgage
Loans as of any Distribution Date, a per annum rate equal to (a)
the weighted
average of the Adjusted Net Mortgage Rates then in effect on the
beginning of
the related Due Period on the Mortgage Loans multiplied by (b) 30
divided by the
actual number of days in the related Interest Accrual Period. With
respect to
the first Due Period and first Distribution Date only, the Pooling
Tier REMIC-1
Net WAC Rate shall be reduced by a fraction, the numerator of which
is the
Closing Date Deposit Amount and the denominator of which is the
Cut-off Date
Pool Principal Balance.
Pooling Tier REMIC-1 Principal Amount: As described in the
Preliminary Statement.
Pooling Tier REMIC-1 Regular Interest: As described in the
Preliminary Statement.
Pooling Tier REMIC-2: As described in the Preliminary
Statement.
Pooling Tier REMIC-2 Interest Rate: As described in the
Preliminary
Statement.
Pooling Tier REMIC-2 IO Interest: Any of the Pooling Tier
REMIC-2
Regular Interests with the designation "IO" in its name.
Pooling Tier REMIC-2 IO Notional Balance: As described in the
Preliminary Statement.
Pooling Tier REMIC-2 Principal Amount: As described in the
Preliminary Statement.
Pooling Tier REMIC-2 Regular Interest: As described in the
Preliminary Statement.
Prepayment Charge: Any prepayment premium, penalty or charge
collected by the Servicer with respect to a Mortgage Loan from a
Mortgagor in
connection with any Principal Prepayment pursuant to the terms of
the related
Mortgage Note.
Prepayment Interest Excess: With respect to any Distribution
Date,
any interest collected by the Servicer with respect to any Mortgage
Loan
serviced by the Servicer as to which a Principal Prepayment in Full
occurs from
the 1st day of the month through the 15th day of the month in which
such
Distribution Date occurs and that represents interest that accrues
from the 1st
day of such month to the date of such Principal Prepayment in
Full.
Prepayment Interest Shortfall: With respect to any Distribution
Date, the sum of, for each Mortgage Loan that was, during the
portion of the
related Prepayment Period from the first day of such Prepayment
Period through
the last day of the month preceding the month in which such
Distribution Date
occurs, the subject of a Principal Prepayment which is not
accompanied by an
amount equal to one month of interest that would have been due on
such Mortgage
Loan on the Due Date that occurs during such Prepayment Period and
which was
applied by the Servicer to reduce the outstanding principal balance
of such
Mortgage Loan on a date preceding such Due Date, an amount equal to
the product
of (a) the Mortgage Rate net of the Servicing Fee Rate for such
Mortgage Loan,
(b) the amount of the Principal Prepayment for such Mortgage Loan,
(c) 1/360 and
(d) the number of days commencing on the date on which such
Principal Prepayment
was applied and ending on the last day of the calendar month in
which the
related Prepayment Period begins.
Prepayment Period: With respect to any Distribution Date and
any
Principal Prepayments in Full, the period from and including the
16th day of the
month preceding the month in which such Distribution Date occurs
(or, in the
case of the first Distribution Date, from the Cut-off Date) to and
including the
15th day of the month in which such Distribution Date occurs. With
respect to
each Distribution Date and Principal Prepayments that are not
Principal
Prepayments in Full, the calendar month preceding the month in
which the related
Distribution Date occurs.
Principal Distribution Amount: For any Distribution Date, the sum
of
(i) the Basic Principal Distribution Amount for such Distribution
Date and (ii)
the Extra Principal Distribution Amount for such Distribution
Date.
Principal Prepayment: Any full or partial payment or other
recovery
of principal on a Mortgage Loan (including upon liquidation of a
Mortgage Loan)
which is received in advance of its scheduled Due Date, excluding
any Prepayment
Charge thereon and which is not accompanied by an amount of
interest
representing scheduled interest due on any date or dates in any
month or months
subsequent to the month of prepayment.
Principal Prepayment in Full: Any Principal Prepayment made by
a
Mortgagor of the entire principal balance of a Mortgage Loan.
Principal Remittance Amount: With respect to any Distribution
Date,
the amount equal to the sum of the following amounts (without
duplication) with
respect to the related Due Period: (i) each Scheduled Payment of
principal on a
Mortgage Loan due during such Due Period and received by the
Servicer on or
prior to the related Determination Date or advanced by the Servicer
for the
related Remittance Date, (ii) all Principal Prepayments received
during the
related Prepayment Period; (iii) all net Liquidation Proceeds,
Condemnation
Proceeds and Insurance Proceeds on the Mortgage Loans allocable to
principal,
and all Subsequent Recoveries, actually collected by the Servicer
during the
related Prepayment Period; (iv) the portion of the Repurchase Price
allocable to
principal with respect to each Mortgage Loan repurchased on or
prior to the
related Determination Date; (v) all Substitution Adjustment Amounts
allocable to
principal with respect to the substitutions of Mortgage Loans that
occur on or
prior to the related Determination Date; (vi) the allocable portion
of the
proceeds received with respect to the termination of the Trust Fund
pursuant to
clause (a) of Section 10.01 (to the extent such proceeds relate to
principal)
and (vii) with respect to the Distribution Date in May 2006 only,
the Closing
Date Deposit Amount.
Private Certificates: As specified in the Preliminary
Statement.
Prospectus Supplement: The Prospectus Supplement, dated April
27,
2006, relating to the Offered Certificates.
PTCE 95-60: As defined in Section 5.02(b).
PUD: A planned unit development.
Purchase Agreement: The Mortgage Loan Purchase Agreement, dated
as
of January 1, 2006, between the Responsible Party and the
Sponsor.
Rating Agency: Each of the Rating Agencies specified in the
Preliminary Statement. If such organization or a successor is no
longer in
existence, "Rating Agency" shall be such nationally recognized
statistical
rating organization, or other comparable Person, as is designated
by the
Depositor, notice of which designation shall be given to the
Trustee and the
Securities Administrator. References herein to a given rating or
rating category
of a Rating Agency shall mean such rating category without giving
effect to any
modifiers. For purposes of Section 11.05(c), the addresses for
notices to each
Rating Agency shall be the address specified therefor in the
definition
corresponding to the name of such Rating Agency, or such other
address as such
Rating Agency may hereafter furnish to the Depositor, the
Securities
Administrator, the Trustee and the Servicer.
Realized Losses: With respect to any date of determination and
any
Liquidated Mortgage Loan, the amount, if any, by which (a) the
unpaid principal
balance of such Liquidated Mortgage Loan together with accrued and
unpaid
interest thereon exceeds (b) the Liquidation Proceeds with respect
thereto net
of the expenses incurred by the Servicer in connection with the
liquidation of
such Liquidated Mortgage Loan and net of the amount of unreimbursed
Servicing
Advances with respect to such Liquidated Mortgage Loan.
Record Date: With respect to any Distribution Date, the close
of
business on the Business Day immediately preceding such
Distribution Date;
provided, however, that, for any Certificate issued in definitive
form, the
Record Date shall be the close of business on the last Business Day
of the month
preceding the month in which such applicable Distribution Date
occurs.
Reference Bank: As
defined in Section 4.04.
Regular Certificates: As specified in the Preliminary
Statement.
Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be
amended from
time to time, and subject to such clarification and interpretation
as have been
provided by the Commission in the adopting release (Asset-Backed
Securities,
Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531
(January 7, 2005))
or by the staff of the Commission, or as may be provided by the
Commission or
its staff from time to time.
Relief Act Interest Shortfall: With respect to any Distribution
Date
and any Mortgage Loan, any reduction in the amount of interest
collectible on
such Mortgage Loan for the most recently ended Due Period as a
result of the
application of the Servicemembers Civil Relief Act or any similar
state
statutes.
REMIC: A "real estate mortgage investment conduit" within the
meaning of Section 860D of the Code.
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 regulations promulgated thereunder, as the foregoing may be in
effect from
time to time as well as provisions of applicable state laws.
Remittance Date: With respect to any Distribution Date, the
third
Business Day immediately preceding such Distribution Date.
REO Disposition: The final sale by the Servicer of any REO
Property.
REO Imputed Interest: As to any REO Property, for any period,
an
amount equivalent to interest (at the Mortgage Rate net of the
Servicing Fee
Rate that would have been applicable to the related Mortgage Loan
had it been
outstanding) on the unpaid principal balance of the Mortgage Loan
as of the date
of acquisition thereof (as such balance is reduced pursuant to
Section 3.17 by
any income from the REO Property treated as a recovery of
principal).
REO Mortgage Loan: A Mortgage Loan where title to the related
Mortgaged Property has been obtained by the Servicer in the name of
the Trustee
on behalf of the Certificateholders.
REO Property: A Mortgaged Property acquired by the Trust Fund
through foreclosure or deed-in-lieu of foreclosure in connection
with a
defaulted Mortgage Loan.
Reportable Event: As
defined in Section 8.12(g).
Repurchase Price: With respect to any Mortgage Loan, an amount
equal
to the sum of (i) the unpaid principal balance of such Mortgage
Loan as of the
date of repurchase, (ii) interest on such unpaid principal balance
of such
Mortgage Loan at the Mortgage Rate from the last date through which
interest has
been paid to the end of the month in which such repurchase occurs,
(iii) all
unreimbursed Servicing Advances and (iv) all expenses incurred by
the Securities
Administrator arising out of the Securities Administrator's
enforcement of the
applicable Person's repurchase obligation hereunder.
Request for Release: The Request for Release submitted by the
Servicer to the Custodian, substantially in the form of Exhibit
J.
Residual Certificates: As specified in the Preliminary
Statement.
Responsible Officer: When used with respect to the Trustee or
the
Securities Administrator, any vice president, any assistant vice
president, any
assistant secretary, any assistant treasurer, any associate, or any
other
officer of the Trustee or the Securities Administrator customarily
performing
functions similar to those performed by any of the above designated
officers who
at such time shall be officers 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 and who shall have direct
responsibility for the
administration of this Agreement.
Responsible Party: NC Capital Corporation, a California
corporation,
and its successors in interest.
Rule 144A Letter: As defined in Section 5.02(b).
Sarbanes Certification: As defined in Section 8.12(c).
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
which, unless otherwise specified herein, shall give effect to any
related Debt
Service Reduction and any Deficient Valuation that affects the
amount of the
monthly payment due on such Mortgage Loan.
Securities Act: The Securities Act of 1933, as amended.
Securities Administrator: Wells Fargo Bank, National Association,
a
national banking association, and its successors and assigns, in
its capacity as
Securities Administrator hereunder and, if a successor securities
administrator
is appointed hereunder, such successor.
Securities Administrator Fee: With respect to any Distribution
Date,
an amount equal to the product of (a) one-twelfth of the
Securities
Administrator Fee Rate and (b) the Stated Principal Balance of the
Mortgage
Loans as of the prior Distribution Date (or as of the Cut-off Date
in the case
of the first Distribution Date).
Securities Administrator Fee Rate: With respect to each
Mortgage
Loan, 0.002% per annum.
Senior Enhancement Percentage: With respect to any Distribution
Date, the percentage obtained by dividing (x) the sum of (i) the
aggregate Class
Certificate Balance of the Subordinated Certificates and (ii) the
Subordinated
Amount (in each case after taking into account the distribution of
the Principal
Distribution Amount and any principal payments on such Classes from
the Swap
Account for such Distribution Date) by (y) the aggregate Stated
Principal
Balance of the Mortgage Loans for such Distribution Date.
Senior Specified Enhancement Percentage: As of any date of
determination, 28.80%.
Servicer: Wells Fargo Bank, National Association, a national
banking
association, and its successors in interest, and if a successor
servicer is
appointed hereunder, such successor.
Servicer Remittance Report: As defined in Section 4.03(d).
Servicing Advances: The reasonable "out-of-pocket" costs and
expenses (including legal fees) incurred by the Servicer in the
performance of
its servicing obligations in connection with a default, delinquency
or other
unanticipated event, including, but not limited to, the cost of (i)
the
preservation, restoration, inspection and protection of a Mortgaged
Property,
(ii) any enforcement or judicial proceedings, including
foreclosures and
litigation, in respect of a particular Mortgage Loan, (iii) the
management
(including reasonable fees in connection therewith) and liquidation
of any REO
Property and (iv) the performance of its obligations under Sections
3.01, 3.09,
3.13 and 3.15. The Servicing Advances shall also include any
reasonable
"out-of-pocket" costs and expenses (including legal fees) incurred
by the
Servicer in connection with executing and recording instruments of
satisfaction,
deeds of reconveyance or Assignments of Mortgage in connection with
any
satisfaction or foreclosure in respect of any Mortgage Loan to the
extent not
recovered from the Mortgagor or otherwise payable under this
Agreement. The
Servicer shall not be required to make any Nonrecoverable Servicing
Advances.
Servicing Criteria: The "servicing criteria" set forth in Item
1122(d) of Regulation AB, which as of the Closing Date are listed
on Exhibit P
hereto.
Servicing Fee: With respect to each Mortgage Loan and for any
calendar month, an amount equal to one-twelfth of the product of
(a) the
Servicing Fee Rate and (b) the Stated Principal Balance of such
Mortgage Loan.
Such fee shall be payable monthly for any month during which the
Mortgage Loan
is serviced by the Servicer under this Agreement. The Servicing Fee
is payable
solely from the interest portion (including recoveries with respect
to interest
from Liquidation Proceeds, Subsequent Recoveries, Insurance
Proceeds,
Condemnation Proceeds and proceeds received with respect to REO
Properties) of
such Scheduled Payment collected by the Servicer, or as otherwise
provided under
Section 3.11.
Servicing Fee Rate: With respect to each Mortgage Loan, 0.50%.
Servicing File: With respect to each Mortgage Loan, the file
retained by the Servicer consisting of originals or copies of all
documents in
the Mortgage File which are not delivered to the Custodian in the
Custodial File
and copies of the Mortgage Loan Documents set forth in Exhibit K
hereto.
Servicing Function Participant: As defined in Section 3.23(a).
Servicing Officer: Any employee or officer of the Servicer
involved
in, or responsible for, the administration and servicing of the
Mortgage Loans
whose name and facsimile signature appear on a list of servicing
officers
furnished to the Trustee and the Securities Administrator by the
Servicer on the
Closing Date pursuant to this Agreement, as such list may from time
to time be
amended.
Similar Law: As
defined in Section 5.02(b).
60+ Day Delinquent Mortgage Loan: Each Mortgage Loan with respect
to
which any portion of a Scheduled Payment is, as of the last day of
the prior Due
Period, two months or more past due (without giving effect to any
grace period),
each Mortgage Loan in foreclosure, each Mortgage Loan related to
REO Property
and each Mortgage Loan where the related Mortgagor has filed for
bankruptcy.
Specified Subordinated Amount: Prior to the Stepdown Date, an
amount
equal to 0.50% of the Cut-off Date Pool Principal Balance. On and
after the
Stepdown Date, an amount equal to 1.00% of the aggregate Stated
Principal
Balance of the Mortgage Loans for such Distribution Date, subject,
until the
Class Certificate Balance of each Class of LIBOR Certificates has
been reduced
to zero, to a minimum amount equal to 0.50% of the aggregate Stated
Principal
Balance of the Mortgage Loans as of the Cut-off Date; provided,
however, that
if, on any Distribution Date, a Trigger Event exists, the Specified
Subordinated
Amount shall not be reduced to the applicable percentage of the
then current
aggregate Stated Principal Balance of the Mortgage Loans until the
Distribution
Date on which a Trigger Event no longer exists. When the Class
Certificate
Balance of each Class of LIBOR Certificates has been reduced to
zero, the
Specified Subordinated Amount will thereafter equal zero.
Sponsor: Sutton Funding LLC, a Delaware limited liability
company,
and its successors in interest.
Standard & Poor's: Standard & Poor's Ratings Services, a
division of
The McGraw-Hill Companies, Inc. If Standard & Poor's is
designated as a Rating
Agency in the Preliminary Statement, for purposes of Section
11.05(c) the
address for notices to Standard & Poor's shall be Standard
& Poor's, 55 Water
Street, New York, New York 10041, Attention: Residential Mortgage
Surveillance
Group - Securitized Asset Backed Receivables LLC Trust 2006-NC1, or
such other
address as Standard & Poor's may hereafter furnish to the
Depositor, the
Securities Administrator, the Trustee and the Servicer.
Standard & Poor's Glossary: The Standard & Poor's
LEVELS(R)
Glossary, as may be in effect from time to time.
Startup Day: The
Closing Date.
Stated Principal Balance: As to each Mortgage Loan and as of
any
date of determination, (i) the principal balance of the Mortgage
Loan at the
Cut-off Date after giving effect to payments of principal due on or
before such
date (whether or not received), minus (ii) all amounts previously
remitted to
the Securities Administrator with respect to the related Mortgage
Loan
representing payments or recoveries of principal including advances
in respect
of scheduled payments of principal. For purposes of any
Distribution Date, the
Stated Principal Balance of any Mortgage Loan will give effect to
any scheduled
payments of principal received by the Servicer on or prior to the
related
Determination Date or advanced by the Servicer for the related
Remittance Date
and any unscheduled principal payments and other unscheduled
principal
collections received during the related Prepayment Period, and the
Stated
Principal Balance of any Mortgage Loan that has prepaid in full or
has been
liquidated during the related Prepayment Period shall be zero.
Stepdown Date: The later to occur of (i) the earlier to occur of
(a)
the Distribution Date in May 2009 and (b) the Distribution Date
following the
Distribution Date on which the aggregate Class Certificate Balances
of the Class
A Certificates have been reduced to zero and (ii) the first
Distribution Date on
which the Senior Enhancement Percentage (calculated for this
purpose only after
taking into account payments of principal on the Mortgage Loans
applied to
reduce the Stated Principal Balance of the Mortgage Loans for the
applicable
Distribution Date but prior to any applications of Principal
Distribution Amount
to the Certificates on such Distribution Date) is greater than or
equal to the
Senior Specified Enhancement Percentage.
Subcontractor: Any third-party or Affiliated vendor,
subcontractor
or other Person utilized by the Servicer, a Subservicer or the
Securities
Administrator, as applicable, that is not responsible for the
overall servicing
(as "servicing" is commonly understood by participants in the
mortgage-backed
securities market) of Mortgage Loans but performs one or more
discrete functions
identified in Item 1122(d) of Regulation AB with respect to any of
the Mortgage
Loans.
Subordinated Amount: As of any Distribution Date, the excess,
if
any, of (a) the aggregate Stated Principal Balance of the Mortgage
Loans for
such Distribution Date over (b) the aggregate of the Class
Certificate Balances
of the LIBOR Certificates as of such Distribution Date (after
giving effect to
the payment of the Principal Remittance Amount on such Certificates
on such
Distribution Date).
Subordinated Certificates: As specified in the Preliminary
Statement.
Subordination Deficiency: With respect to any Distribution Date,
the
excess, if any, of (a) the Specified Subordinated Amount applicable
to such
Distribution Date over (b) the Subordinated Amount applicable to
such
Distribution Date.
Subordination Reduction Amount: With respect to any
Distribution
Date, an amount equal to the lesser of (a) the Excess Subordinated
Amount and
(b) the Net Monthly Excess Cash Flow.
Subsequent Recovery: With respect to any Mortgage Loan or
related
Mortgaged Property that became a Liquidated Mortgage Loan or was
otherwise
disposed of, all amounts received in respect of such Liquidated
Mortgage Loan
after an Applied Realized Loss Amount related to such Mortgage Loan
or Mortgaged
Property is allocated to reduce the Class Certificate Balance of
any Class of
Subordinated Certificates. Any Subsequent Recovery that is received
during a
Prepayment Period will be included as part of the Principal
Remittance Amount
for the related Distribution Date.
Subservicer: Any Person that services Mortgage Loans on behalf
of
the Servicer or any Subservicer and is responsible for the
performance (whether
directly or through Subservicers or Subcontractors) of a
substantial portion of
the material servicing functions required to be performed by the
Servicer under
this Agreement, with respect to some or all of the Mortgage Loans,
that are
identified in Item 1122(d) of Regulation AB.
Subservicing Account: As defined in Section 3.08.
Subservicing Agreements: As defined in Section 3.02(a).
Substitute Mortgage Loan: A Mortgage Loan substituted by the
Responsible Party 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 J, (i) have a Stated Principal Balance, after deduction
of all
Scheduled Payments due in the month of substitution, not in excess
of the Stated
Principal Balance of the Deleted Mortgage Loan; (ii) be accruing
interest at a
rate not lower than and not more than 1% higher than that of the
Deleted
Mortgage Loan; (iii) have a remaining term to maturity not greater
than (and not
more than one year less than) that of the Deleted Mortgage Loan;
(iv) be of the
same type as the Deleted Mortgage Loan; and (v) comply with each
representation
and warranty set forth in Section 2.03.
Substitution Adjustment Amount: As defined in Section 2.03.
Swap Account: The trust account created pursuant to Section 4.06
of
this Agreement consisting of the Interest Rate Swap Agreement, the
Class IO
Interest and the right to receive Class IO Shortfalls, subject to
the obligation
to pay amounts specified in Section 4.06.
Swap LIBOR: With respect to any Distribution Date (and the
related
Interest Accrual Period), the product of (i) USD-LIBOR-BBA (as used
in the
Interest Rate Swap Agreement), (ii) two, and (iii) the quotient of
(a) the
actual number of days in the Interest Accrual Period for the LIBOR
Certificates
divided by (b) 30.
Swap Provider: Barclays Bank PLC, a bank authorized and regulated
by
the United Kingdom's Financial Services Authority and a member of
the London
Stock Exchange, and its successors in interest.
Swap Termination Payment: Any payment payable by the Trust or
the
Swap Provider upon termination of the Interest Rate Swap Agreement
as a result
of an Event of Default (as defined in the Interest Rate Swap
Agreement) or a
Termination Event (as defined in the Interest Rate Swap
Agreement).
Tax Matters Person: The Holder of the Class R Certificates
designated as "tax matters person" of each Trust REMIC, in the
manner provided
under Treasury Regulations Section 1.860F-4(d) and Treasury
Regulations Section
301.6231(a)(7)-1.
Tax Service Contract: As defined in Section 3.09(a).
Telerate Page 3750: The display page currently so designated on
the
Bridge Telerate Service (or such other page as may replace that
page on that
service for displaying comparable rates or prices).
Termination Price: As defined in Section 10.01.
Total Monthly Excess Spread: As to any Distribution Date, an
amount
equal to the excess, if any, of (i) the interest on the Mortgage
Loans (other
than Prepayment Interest Excesses) received by the Servicer on or
prior to the
related Determination Date or advanced by the Servicer for the
related
Remittance Date (net of Expense Fees) over (ii) the sum of (A) the
amounts
payable to the Certificates pursuant to Section 4.02(a)(i) on such
Distribution
Date, (B) any Net Swap Payments to the Swap Provider and (C) any
Swap
Termination Payment (other than a Defaulted Swap Termination
Payment) to the
Swap Provider.
Transfer: Any direct or indirect transfer or sale of any
Ownership
Interest in a Residual Certificate.
Transfer Affidavit: As defined in Section 5.02(c).
Transferor Certificate: As defined in Section 5.02(b).
Trigger Event: Either a Cumulative Loss Trigger Event or a
Delinquency Trigger Event.
Trust: The express
trust created hereunder in Section 2.01(c).
Trust Fund: The corpus of the trust created hereunder consisting
of
(i) the Mortgage Loans and all interest and principal with respect
thereto
received on or after the related Cut-off Date, other than such
amounts which
were due on the Mortgage Loans on or prior to the related Cut-off
Date; (ii) the
Collection Account, Excess Reserve Fund Account, the Distribution
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 Cap
Agreements;
(v) the Interest Rate Swap Agreement; (vi) the Swap Account; (vii)
the Pool
Policy;(viii) the Closing Date Deposit Amount; (ix) the Assignment
Agreement;
and (x) all proceeds of the conversion, voluntary or involuntary,
of any of the
foregoing.
Trust REMIC: Any of Pooling Tier REMIC-1, Pooling Tier REMIC-2,
the
Lower Tier REMIC or the Upper Tier REMIC, as applicable.
Trustee: U.S. Bank National Association, a national banking
association, and its successors in interest and, if a successor
trustee is
appointed hereunder, such successor.
Underwriters' Exemption: Any exemption listed under footnote 1
of,
and amended by, Prohibited Transaction Exemption 2002-41, 67 Fed.
Reg. 54487
(2002), or any successor exemption.
Underwriting Guidelines: The underwriting guidelines attached to
the
Purchase Agreement.
Unpaid Interest Amount: As of any Distribution Date and any Class
of
Certificates, the sum of (a) the portion of the Accrued Certificate
Interest
Distribution Amount from Distribution Dates prior to the current
Distribution
Date remaining unpaid immediately prior to the current Distribution
Date and (b)
interest on the amount in clause (a) above at the applicable
Pass-Through Rate
(to the extent permitted by applicable law).
Unpaid Realized Loss Amount: With respect to any Class of
Subordinated Certificates and as to any Distribution Date, is the
excess of (i)
the Applied Realized Loss Amounts with respect to such Class over
(ii) the sum
of (a) all distributions in reduction of such Applied Realized Loss
Amounts on
all previous Distribution Dates, and (b) the amount by which the
Class
Certificate Balance of such Class has been increased due to the
distribution of
any Subsequent Recoveries on all previous Distribution Dates. Any
amounts
distributed to a Class of Subordinated Certificates in respect of
any Unpaid
Realized Loss Amount will not be applied to reduce the Class
Certificate Balance
of such Class.
Upper Tier Carry Forward Amount: With respect to each Class of
LIBOR
Certificates, as of any Distribution Date, the sum of (A) if on
such
Distribution Date the Upper Tier REMIC Interest Rate for the
Corresponding Class
of Upper Tier REMIC Regular Interest is based upon the Upper Tier
REMIC Net WAC
Rate, the excess, if any, of (i) the Accrued Certificate Interest
Distribution
Amount such Class of LIBOR Certificates would otherwise be entitled
to receive
on such Distribution Date taking into account the Net WAC Rate Cap,
over (ii)
the Accrued Certificate Interest Distribution Amount such Class of
Upper Tier
REMIC Regular Interest on such Distribution Date taking into
account the Upper
Tier REMIC Net WAC Rate and (B) the Upper Tier Carry Forward Amount
for such
Class of Certificates for all previous Distribution Dates not
previously paid,
together with interest thereon at a rate equal to the applicable
Upper Tier
REMIC Interest Rate for such Class of Certificates for such
Distribution Date,
without giving effect to the Upper Tier REMIC Net WAC Rate.
Upper Tier REMIC: As described in the Preliminary Statement.
Upper Tier REMIC Net WAC Rate: For any Distribution Date, the
weighted average of the Lower Tier REMIC Interest Rate of the Lower
Tier REMIC
Regular Interests (other than the Class LT-IO Interest), weighted
on the basis
of the Lower Tier REMIC Principal Amounts.
Upper Tier REMIC Regular Interest: As described in the
Preliminary
Statement.
U.S. Person: (i) A citizen or resident of the United States; (ii)
a
corporation (or entity treated as a corporation for tax purposes)
created or
organized in the United States or under the laws of the United
States or of any
State thereof, including, for this purpose, the District of
Columbia; (iii) a
partnership (or entity treated as a partnership for tax purposes)
organized in
the United States or under the laws of the United States or of any
State
thereof, including, for this purpose, the District of Columbia
(unless provided
otherwise by future Treasury regulations); (iv) an estate whose
income is
includible in gross income for United States income tax purposes
regardless of
its source; or (v) 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 U.S. Persons have authority to control substantial decisions
of the trust.
Notwithstanding the last clause of the preceding sentence, to the
extent
provided in Treasury regulations, certain trusts in existence on
August 20,
1996, and treated as U.S. Persons prior to such date, may elect to
continue to
be U.S. Persons.
Voting Rights: The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. As of any date
of
determination, (a) 1% of all Voting Rights shall be allocated to
the Class X
Certificates, if any (such Voting Rights to be allocated among the
holders of
Certificates of each such Class in accordance with their respective
Percentage
Interests), (b) 1% of all Voting Rights shall be allocated to the
Class P
Certificates, if any, and (c) the remaining Voting Rights shall be
allocated
among Holders of the remaining Classes of Certificates in
proportion to the
Certificate Balances of their respective Certificates on such
date.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
Section 2.01 Conveyance of Mortgage Loans. (a) The Depositor,
concurrently with the execution and delivery hereof, hereby sells,
transfers,
assigns, sets over and otherwise conveys to the Trustee for the
benefit of the
Certificateholders, without recourse, all the right, title and
interest of the
Depositor in and to the Trust Fund, and the Trustee, on behalf of
the Trust,
hereby accepts the Trust Fund. On the Closing Date, the Depositor
shall pay,
without any right of reimbursement from the Trust, to the Cap
Provider the
"Fixed Amount" (as defined in the related Cap Agreement) due and
payable to the
Cap Provider pursuant to the terms of each Cap Agreement. On the
Closing Date,
the Sponsor shall pay, without any right of reimbursement from the
Trust, to the
Pool Insurer the one-time, upfront premium due and payable to the
Pool Insurer
pursuant to the terms of Pool Policy.
(b) In connection with the transfer and assignment of each
Mortgage
Loan, the Depositor shall, pursuant to Section 2.02, deliver or
cause to be
delivered to the Custodian for the benefit of the
Certificateholders the
following documents or instruments with respect to each Mortgage
Loan so
assigned:
(i) the original Mortgage Note bearing all intervening
endorsements
showing a
complete chain of endorsement from the originator to the last
endorsee,
endorsed "Pay to the order of _____________, without recourse"
and signed
(which may be by facsimile signature) in the name of the last
endorsee
by an authorized officer. To the extent that there is no room
on
the face
of the Mortgage Notes for endorsements, the endorsement may be
contained
on an allonge;
(ii) the original of any guarantee executed in connection with
the
Mortgage
Note;
(iii) the original Mortgage with evidence of recording thereon or
a
certified
true copy of such Mortgage submitted for recording. If, in
connection
with any Mortgage Loan, the original Mortgage cannot be
delivered
with evidence of recording thereon on or prior to the Closing
Date
because of a delay caused by the public recording office where
such
Mortgage
has been delivered for recordation or because such Mortgage has
been lost
or because such public recording office retains the original
recorded
Mortgage, the Responsible Party shall deliver or cause to be
delivered
to the Custodian a photocopy of such Mortgage, together with
(A)
in the
case of a delay caused by the public recording office, an
Officer's
Certificate of the Responsible Party (or certified by the title
company,
escrow
agent, or closing attorney) stating that such Mortgage has been
dispatched
to the appropriate public recording office for recordation and
that the
original recorded Mortgage or a copy of such Mortgage certified
by such
public recording office to be a true and complete copy of the
original
recorded Mortgage will be promptly delivered to the Custodian
upon
receipt thereof by the Responsible Party; or (B) in the case of
a
Mortgage
where a public recording office retains the original recorded
Mortgage
or in the case where a Mortgage is lost after recordation in a
public
recording office, a copy of such Mortgage certified by such
public
recording
office to be a true and complete copy of the original recorded
Mortgage;
(iv) the originals of all assumption, modification,
consolidation
and
extension agreements, if any, with evidence of recording
thereon;
(v) the original Assignment of Mortgage for each Mortgage Loan
endorsed
in blank;
(vi) the originals of all intervening assignments of Mortgage
(if
any)
evidencing a complete chain of assignment from the applicable
originator
to the last endorsee with evidence of recording thereon, or if
any such
intervening assignment has not been returned from the
applicable
recording
office or has been lost or if such public recording office
retains
the original recorded assignments of Mortgage, the Responsible
Party
shall deliver or cause to be delivered a photocopy of such
intervening assignment, together with (A) in the case of a delay
caused by
the public
recording office, an Officer's Certificate of the Responsible
Party or a
certificate from an escrow company, a title company or a
closing
attorney stating that such intervening assignment of Mortgage
has
been
dispatched to the appropriate public recording office for
recordation
and that
such original recorded intervening assignment of Mortgage or a
copy of
such intervening assignment of Mortgage certified by the
appropriate public recording office to be a true and complete copy
of the
original recorded
intervening assignment of Mortgage will be promptly
delivered
to the Custodian upon receipt thereof by the Responsible Party;
or (B) in
the case of an intervening assignment where a public recording
office
retains the original recorded intervening assignment or in the
case
where an
intervening assignment is lost after recordation in a public
recording
office, a copy of such intervening assignment certified by such
public
recording office to be a true and complete copy of the original
recorded
intervening assignment;
(vii) the original mortgagee title insurance policy or, in the
event
such
original title policy is unavailable, a certified true copy of
the
related
policy binder or commitment for title certified to be true and
complete
by the title insurance company;
(viii) the original or, if unavailable, a copy of any security
agreement,
chattel mortgage or equivalent document executed in connection
with the
Mortgage (if provided); and
(ix) if any of the above documents has been executed by a
person
holding a
power of attorney, an original or photocopy of such power
certified
by the Responsible Party to be a true and correct copy of the
original.
To the extent not previously delivered to the Sponsor pursuant
to
the Purchase Agreement, the Responsible Party shall promptly upon
receipt from
the respective recording office cause to be delivered to the
Custodian the
original recorded document described in (iii), (iv) and (vi)
above.
From time to time, the Responsible Party, the Depositor or the
Servicer, as applicable, shall forward to the Custodian, additional
original
documents and additional documents evidencing an assumption,
modification,
consolidation or extension of a Mortgage Loan, in accordance with
the terms of
this Agreement upon receipt of such documents. All such mortgage
documents held
by the Custodian as to each Mortgage Loan shall constitute the
"Custodial File".
To the extent not previously delivered to the Sponsor pursuant
to
the Purchase Agreement, on or prior to the Closing Date, the
Responsible Party
shall deliver to the Custodian, Assignments of Mortgages, in blank,
for each
Mortgage Loan. No later than thirty (30) Business Days following
the later of
the Closing Date and the date of receipt by the Servicer of the
complete
recording information for a Mortgage, the Servicer shall promptly
submit or
cause to be submitted for recording, at the expense of the
Responsible Party and
at no expense to the Trust Fund, the Custodian or the Depositor, in
the
appropriate public office for real property records, each
Assignment of Mortgage
referred to in Section 2.01(b)(v). Notwithstanding the foregoing,
however, for
administrative convenience and facilitation of servicing and to
reduce closing
costs, the Assignments of Mortgage shall not be required to be
completed and
submitted for recording with respect to any Mortgage Loan if the
Custodian and
each Rating Agency have received an Opinion of Counsel, at the
expense of the
Trust and satisfactory in form and substance to the Custodian and
each Rating
Agency, to the effect that the recordation of such Assignments of
Mortgage in
any specific jurisdiction is not necessary to protect the Trustee's
interest in
the related Mortgage Note. If the Assignment of Mortgage is to be
recorded, the
Mortgage shall be assigned by the Responsible Party, at the expense
of the
Responsible Party, to "U.S. Bank National Association, as trustee
under the
Pooling and Servicing Agreement dated as of April 1, 2006,
Securitized Asset
Backed Receivables LLC Trust 2006-NC1". In the event that any such
Assignment of
Mortgage is lost or returned unrecorded because of a defect
therein, the
Responsible Party shall promptly cause to be delivered a substitute
Assignment
of Mortgage to cure such defect and thereafter cause each such
assignment to be
duly recorded at no expense to the Trust Fund.
In the event that such original or copy of any document
submitted
for recordation to the appropriate public recording office is not
so delivered
to the Custodian within 180 days (or such other time period as may
be required
by any Rating Agency) following the Closing Date, and in the event
that the
Responsible Party does not cure such failure within 30 days of
discovery or
receipt of written notification of such failure from the Depositor,
the related
Mortgage Loan shall, upon the request of the Depositor, be
repurchased by the
Responsible Party at the price and in the manner specified in
Section 2.03. The
foregoing repurchase obligation shall not apply in the event that
the
Responsible Party cannot deliver such original or copy of any
document submitted
for recordation to the appropriate public recording office within
the specified
period due to a delay caused by the recording office in the
applicable
jurisdiction; provided, that the Responsible Party shall instead
deliver a
recording receipt of such recording office or, if such recording
receipt is not
available, an officer's certificate of an officer of the
Responsible Party,
confirming that such document has been accepted for recording.
Notwithstanding anything to the contrary contained in this
Section
2.01, in those instances where the public recording office retains
or loses the
original Mortgage or assignment after it has been recorded, the
obligations of
the Responsible Party shall be deemed to have been satisfied upon
delivery by
the Responsible Party to the Custodian, prior to the Closing Date
of a copy of
such Mortgage or assignment, as the case may be, certified (such
certification
to be an original thereof) by the public recording office to be a
true and
complete copy of the recorded original thereof.
(c) The Depositor does hereby establish, pursuant to the
further
provisions of this Agreement and the laws of the State of New York,
an express
trust (the "Trust") to be known, for convenience, as "Securitized
Asset Backed
Receivables LLC Trust 2006-NC1" and U.S. Bank National Association
is hereby
appointed as Trustee in accordance with the provisions of this
Agreement. The
parties hereto acknowledge and agree that it is the policy and
intention of the
Trust to acquire only Mortgage Loans meeting the requirements set
forth in this
Agreement, including without limitation, the representation and
warranty set
forth in paragraph (ccc) of Schedule III. The Trust's fiscal year
is the
calendar year.
(d) The Trust shall have the capacity, power and authority, and
the
Trustee on behalf of the Trust is hereby authorized, to accept the
sale,
transfer, assignment, set over and conveyance by the Depositor to
the Trust of
all the right, title and interest of the Depositor in and to the
Trust Fund
(including, without limitation, the Mortgage Loans and the Interest
Rate Swap
Agreement) pursuant to Section 2.01(a). The Securities
Administrator on behalf
of the Trust is hereby authorized to enter into the Cap Agreements
and the
Interest Rate Swap Agreement. The Trustee is hereby authorized and
directed to
enter into the Insurance and Indemnity Agreement. In so doing, the
Trustee shall
be entitled to all of the rights, protections and benefits given to
the Trustee
under Article VIII hereof.
Section 2.02 Acceptance by the Trustee of the Mortgage Loans.
The
Depositor shall cause the Mortgage Loan files with respect to the
Mortgage Loans
held under the Custodial Agreement to be transferred to the
Custodian within 30
days of the Closing Date. Upon receipt, the Custodian will hold
such documents
and the other documents delivered to it pursuant to Section 2.01,
in trust for
the exclusive use and benefit of all present and future
Certificateholders.
Within 30 days after the Closing Date, the Custodian shall be
required to deliver via facsimile (with original to follow the next
Business
Day) to the Depositor and the NIM Insurer an Initial Certification
in the form
annexed hereto as Exhibit E ("Initial Certification"), certifying
receipt of a
Mortgage Note and Assignment of Mortgage for each Mortgage Loan.
The Custodian
shall not be responsible to verify the validity, sufficiency or
genuineness of
any document in any Custodial File. The Custodian shall maintain
possession of
the related Mortgage Notes in the States of Minnesota, California
or Utah,
unless otherwise permitted by the Rating Agencies.
Within 90 days after the receipt of the Custodial Files, the
Custodian shall ascertain that all documents identified in the
Document
Certification and Exception Report in the form attached hereto as
Exhibit F are
in its possession, and shall deliver to the Depositor, the NIM
Insurer and the
Servicer a Document Certification and Exception Report, in the form
annexed
hereto as Exhibit F, to the effect that, as to each Mortgage Loan
listed in the
Mortgage Loan Schedule (other than any Mortgage Loan paid in full
or any
Mortgage Loan specifically identified in such certification as an
exception and
not covered by such certification): (i) all documents identified in
the Document
Certification and Exception Report and required to be reviewed by
it are in its
possession; (ii) such documents have been reviewed by it and appear
regular on
their face and relate to such Mortgage Loan; (iii) based on its
examination and
only as to the foregoing documents, the information set forth in
items (1), (2),
(3), (15), (22) and (29) of the Data Tape Information respecting
such Mortgage
Loan is correct; and (iv) each Mortgage Note has been endorsed as
provided in
Section 2.01 of this Agreement. The Custodian shall not be
responsible to verify
the validity, sufficiency or genuineness of any document in any
Custodial File.
The Custodian shall retain possession and custody of each
Custodial
File in accordance with and subject to the terms and conditions set
forth
herein. The Servicer shall promptly deliver to the Custodian, upon
the execution
or receipt thereof, the originals of such other documents or
instruments
constituting the Custodial File as come into the possession of the
Servicer from
time to time.
The Responsible Party shall deliver to the Servicer copies of
all
trailing documents required to be included in the Custodial File at
the same
time the original or certified copies thereof are delivered to the
Custodian,
including but not limited to such documents as the title insurance
policy and
any other Mortgage Loan documents upon return from the public
recording office.
The documents shall be delivered by the Responsible Party at the
Responsible
Party's expense to the Servicer.
Section 2.03 Representations, Warranties and Covenants of the
Responsible Party and the Servicer; Remedies for Breaches of
Representations and
Warranties with Respect to the Mortgage Loans. (a) Wells Fargo
Bank, National
Association hereby makes the representations and warranties set
forth in
Schedule II hereto to the Depositor, the NIM Insurer and the
Trustee, as of the
Closing Date.
(b) NC Capital Corporation, in its capacity as Responsible
Party,
hereby makes the representations and warranties, set forth in
Schedule III and
Schedule IV hereto, to the Depositor, the Securities Administrator,
the NIM
Insurer and the Trustee, as of the Closing Date. The Depositor
hereby makes the
representations and warranties set forth in Schedule V hereto to
the Trustee and
Securities Administrator as of the dates set forth in such
Schedule.
(c) It is understood and agreed by the Servicer and the
Responsible
Party that the representations and warranties set forth in this
Section 2.03
shall survive the transfer of the Mortgage Loans by the Depositor
to the Trustee
on the Closing Date, and shall inure to the benefit of the
Depositor and the
Trustee notwithstanding any restrictive or qualified endorsement on
any Mortgage
Note or Assignment of Mortgage or the examination or failure to
examine any
Mortgage File. Upon discovery by any of the Responsible Party, the
Securities
Administrator, the Depositor, the Trustee, the Custodian, the NIM
Insurer or the
Servicer of a breach of any of the foregoing representations and
warranties, the
party discovering such breach shall give prompt written notice to
the others.
(d) Within 30 days of the earlier of either discovery by or
notice
to the Responsible Party that any Mortgage Loan does not conform to
the
requirements as determined in the Custodian's review of the related
Custodial
File or within 60 days of the earlier of either discovery by or
notice to the
Responsible Party of any breach of a representation or warranty set
forth in
Section 2.03(b) that materially and adversely affects the value of
any Mortgage
Loan or the interest of the Trustee, or the Certificateholders
therein, the
Responsible Party shall use its best efforts to cause to be
remedied a material
defect in a document constituting part of a Mortgage File or
promptly to cure
such breach in all material respects and, if such defect or breach
cannot be
remedied, the Responsible Party shall, at the Depositor's option as
specified in
writing and provided to the Responsible Party, the Securities
Administrator, the
Custodian, the NIM Insurer and the Trustee, (i) if such 30- or
60-day period, as
applicable, expires prior to the second anniversary of the Closing
Date, remove
such Mortgage Loan (a "Deleted Mortgage Loan") from the Trust Fund
and
substitute in its place a Substitute Mortgage Loan, in the manner
and subject to
the conditions set forth in this Section 2.03; or (ii) repurchase
such Mortgage
Loan at the Repurchase Price; provided, however, that any such
substitution
pursuant to clause (i) above shall not be effected prior to the
delivery to the
Custodian of a Request for Release substantially in the form of
Exhibit J, and
the delivery of the Mortgage File to the Custodian for any such
Substitute
Mortgage Loan. Notwithstanding the foregoing, a breach (i) which
causes a
Mortgage Loan not to constitute a "qualified mortgage" within the
meaning of
Section 860G(a)(3) of the Code, (ii) by the Responsible Party of
any of the
representations and warranties identified as a Deemed Material and
Adverse
Representation on Schedule III will be deemed automatically to
materially and
adversely affect the value of such Mortgage Loan and the interests
of the
Trustee and Certificateholders in such Mortgage Loan. In the event
that the
Securities Administrator receives notice of a breach by the
Responsible Party of
any of the representations and warranties identified as a Deemed
Material and
Adverse Representation on Schedule III, the Securities
Administrator shall give
notice of such breach to the Responsible Party and request the
Responsible Party
to repurchase the Mortgage Loan at the Repurchase Price within
sixty (60) days
of receipt by the Responsible Party of such notice. The Responsible
Party shall
repurchase each such Mortgage Loan within 60 days of the earlier of
discovery or
receipt of notice with respect to each such Mortgage Loan.
(e) With respect to any Substitute Mortgage Loan or Loans, the
Responsible Party shall deliver to the Custodian for the benefit of
the
Certificateholders the Mortgage Note, the Mortgage, the related
assignment of
the Mortgage, and such other documents and agreements as are
required by Section
2.01, with the Mortgage Note endorsed and the Mortgage assigned as
required by
Section 2.01. No substitution under this Agreement is permitted to
be made with
respect to any Distribution Date after the end of the related
Prepayment Period.
Scheduled Payments due with respect to Substitute Mortgage Loans in
the Due
Period of substitution shall not be part of the Trust Fund and will
be retained
by the Responsible Party on the next succeeding Distribution Date.
For the Due
Period of substitution, distributions to Certificateholders will
include the
Scheduled Payment due on any Deleted Mortgage Loan for such Due
Period and
thereafter the Responsible Party shall be entitled to retain all
amounts
received in respect of such Deleted Mortgage Loan.
(f) The Servicer shall amend the Mortgage Loan Schedule for the
benefit of the Certificateholders to reflect the removal of such
Deleted
Mortgage Loan and the substitution of the Substitute Mortgage Loan
or Loans and
the Servicer shall deliver the amended Mortgage Loan Schedule to
the Trustee,
the Securities Administrator and the NIM Insurer. Upon such
substitution, the
Substitute Mortgage Loan or Loans shall be subject to the terms of
this
Agreement in all respects, and the Responsible Party shall be
deemed to have
made with respect to such Substitute Mortgage Loan or Loans, as of
the date of
substitution, the representations and warranties made pursuant to
Section
2.03(b) with respect to such Mortgage Loan. Upon any such
substitution and the
deposit to the Collection Account of the amount required to be
deposited therein
in connection with such substitution as described in the following
paragraph,
the Custodian shall release the Mortgage File held for the benefit
of the
Certificateholders relating to such Deleted Mortgage Loan to the
Responsible
Party and shall execute and deliver at the Responsible Party's
direction such
instruments of transfer or assignment prepared by the Responsible
Party, in each
case without recourse, as shall be necessary to vest title in the
Responsible
Party, of the Trustee's interest in any Deleted Mortgage Loan
substituted for
pursuant to this Section 2.03.
(g) For any month in which the Responsible Party substitutes one
or
more Substitute Mortgage Loans for one or more Deleted Mortgage
Loans, the
Servicer will determine the amount (if any) by which the aggregate
unpaid
principal balance of all such Substitute Mortgage Loans as of the
date of
substitution is less than the aggregate unpaid principal balance of
all such
Deleted Mortgage Loans. The amount of such shortage plus an amount
equal to the
aggregate of any unreimbursed Advances with respect to such Deleted
Mortgage
Loans (collectively, the "Substitution Adjustment Amount") shall be
remitted by
the Responsible Party to the Servicer for deposit into the
Collection Account on
or before the Distribution Account Deposit Date for the
Distribution Date in the
month succeeding the calendar month during which the related
Mortgage Loan
became required to be purchased or replaced hereunder.
(h) In addition to such repurchase or substitution obligation
referred to in Section 2.03(d), the Responsible Party shall
indemnify the
Depositor, any of its Affiliates, the Servicer, the Trustee, the
Securities
Administrator, the NIM Insurer and the Trust and hold such parties
harmless
against any losses, damages, penalties, fines, forfeitures,
reasonable and
necessary legal fees and related costs, judgments and other costs
and expenses
(including, without limitation, any taxes payable by the Trust)
resulting from
any third party claim, demand, defense or assertion based on or
grounded upon,
or resulting from, a breach by the Responsible Party of any of
its
representations and warranties or obligations contained in this
Agreement.
(i) [Reserved.]
(j) In the event that a Mortgage Loan shall have been
repurchased
pursuant to this Agreement, the proceeds from such repurchase shall
be deposited
by the Servicer in the Collection Account pursuant to Section 3.10
on or before
the Distribution Account Deposit Date for the Distribution Date in
the month
following the month during which the Responsible Party became
obligated to
repurchase or replace such Mortgage Loan and upon such deposit of
the Repurchase
Price, and receipt of a Request for Release in the form of Exhibit
J hereto, the
Custodian shall release the related Custodial File held for the
benefit of the
Certificateholders to such Person as directed by the Servicer, and
the Trustee
shall execute and deliver at such Person's direction such
instruments of
transfer or assignment prepared by such Person, in each case
without recourse,
as shall be necessary to transfer title from the Trustee. In
accordance with
Section 11.05(b), the Securities Administrator shall promptly
notify each Rating
Agency of a purchase of a Mortgage Loan pursuant to this Section
2.03.
It is understood and agreed that the obligation of the
Responsible
Party under this Agreement to cure, repurchase or substitute any
Mortgage Loan
as to which a breach of a representation and warranty has occurred
and is
continuing, together with any related indemnification obligations
of the
Responsible Party set forth in Section 2.03(h), shall constitute
the sole
remedies against such Person respecting such breach available
to
Certificateholders, the Depositor and any of its Affiliates, or the
Trustee on
their behalf.
The provisions of this Section 2.03 shall survive delivery of
the
respective Custodial Files to the Custodian for the benefit of
the
Certificateholders.
Section 2.04 [Reserved].
Section 2.05 Execution 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
executed and delivered to or upon the order of the Depositor, the
Certificates
in authorized Denominations evidencing directly or indirectly the
entire
ownership of the 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.
Section 2.06 REMIC Matters. The Preliminary Statement sets forth
the
designations for federal income tax purposes of all interests
created hereby.
The "Startup Day" of each Trust REMIC for purposes of the REMIC
Provisions shall
be the Closing Date. The "latest possible maturity date" of the
regular
interests in each Trust REMIC is the Distribution Date occurring in
March 2036,
which is the Distribution Date in the month following the month in
which the
latest Mortgage Loan maturity date occurs.
Amounts distributable to the Class X Certificates (prior to any
reduction for any Basis Risk Payment, Net Swap Payment or Swap
Termination
Payment), exclusive of any amounts received from the Swap Provider,
shall be
deemed paid from the Upper Tier REMIC in respect of the Class X
Interest and the
Class IO Interest to the Holders of the Class X Certificates prior
to
distribution of any Basis Risk Payments to the LIBOR Certificates
or Net Swap
Payments or Swap Termination Payment to the Swap Provider.
For federal income tax purposes, any amount distributed on the
LIBOR
Certificates on any Distribution Date in excess of the amount
distributable on
their Corresponding Class of Upper Tier Regular Interest on such
Distribution
Date shall be treated as having been paid from the Excess Reserve
Fund Account
or the Swap Account, as applicable, and any amount distributable on
such
Corresponding Class of Upper Tier Regular Interest on such
Distribution Date in
excess of the amount distributable on the Corresponding Class of
LIBOR
Certificates on such Distribution Date shall be treated as having
been paid to
the Swap Account, all pursuant to and as further provided in
Section 8.13.
Section 2.07 Representations and Warranties of the Depositor.
The
Depositor hereby represents, warrants and covenants to the Trustee,
the Servicer
and the NIM Insurer that as of the date of this Agreement or as of
such date
specifically provided herein:
(a) The Depositor is a limited liability company duly
organized,
validly existing and in good standing under the laws of the State
of Delaware;
(b) The Depositor has the power and authority to convey the
Mortgage
Loans and to execute, deliver and perform, and to enter into and
consummate
transactions contemplated by, this Agreement;
(c) This Agreement has been duly and validly authorized,
executed
and delivered by the Depositor, all requisite company action having
been taken,
and, assuming the due authorization, execution and delivery hereof
by the other
parties hereto, constitutes or will constitute the legal, valid and
binding
agreement of the Depositor, enforceable against the Depositor in
accordance with
its terms, except as such enforcement may be limited by bankruptcy,
insolvency,
reorganization, moratorium or other similar laws relating to or
affecting the
rights of creditors generally, and by general equity principles
(regardless of
whether such enforcement is considered in a proceeding in equity or
at law);
(d) No consent, approval, authorization or order of, or
registration
or filing with, or notice to, any governmental authority or court
is required
for the execution, delivery and performance of or compliance by the
Depositor
with this Agreement or the consummation by the Depositor of any of
the
transactions contemplated hereby, except as have been received or
obtained on or
prior to the Closing Date;
(e) None of the execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby or thereby, or
the
fulfillment of or compliance with the terms and conditions of this
Agreement,
(i) conflicts or will conflict with or results or will result in a
breach of, or
constitutes or will constitute a default or results or will result
in an
acceleration under (A) the certificate of formation or limited
liability company
agreement of the Depositor, or (B) of any term, condition or
provision of any
material indenture, deed of trust, contract or other agreement or
instrument to
which the Depositor or any of its subsidiaries is a party or by
which it or any
of its subsidiaries is bound; (ii) results or will result in a
violation of any
law, rule, regulation, order, judgment or decree applicable to the
Depositor of
any court or governmental authority having jurisdiction over the
Depositor or
its subsidiaries; or (iii) results in the creation or imposition of
any lien,
charge or encumbrance which would have a material adverse effect
upon the
Mortgage Loans or any documents or instruments evidencing or
securing the
Mortgage Loans;
(f) There are no actions, suits or proceedings before or against
or
investigations of, the Depositor pending, or to the knowledge of
the Depositor,
threatened, before any court, administrative agency or other
tribunal, and no
notice of any such action, which, in the Depositor's reasonable
judgment, might
materially and adversely affect the performance by the Depositor of
its
obligations under this Agreement, or the validity or enforceability
of this
Agreement;
(g) The Depositor is not in default with respect to any order
or
decree of any court or any order, regulation or demand of any
federal, state,
municipal or governmental agency that would materially and
adversely affect its
performance hereunder; and
(h) Immediately prior to the transfer and assignment by the
Depositor to the Trustee on the Closing Date, the Depositor had
good title to,
and was the sole owner of each Mortgage Loan, free of any interest
of any other
Person, and the Depositor has transferred all right, title and
interest in each
Mortgage Loan to the Trustee. The transfer of the Mortgage Note and
the Mortgage
as and in the manner contemplated by this Agreement is sufficient
either (i)
fully to transfer to the Trustee, for the benefit of the
Certificateholders, all
right, title, and interest of the Depositor thereto as note holder
and mortgagee
or (ii) to grant to the Trustee, for the benefit of the
Certificateholders, the
security interest referred to in Section 11.04.
It is understood and agreed that the representations, warranties
and
covenants set forth in this Section 2.07 shall survive delivery of
the
respective Custodial Files to the Custodian, and shall inure to the
benefit of
the Trustee.
Section 2.08 Rights of the NIM Insurer. Each of the rights of
the
NIM Insurer set forth in this Agreement shall exist so long as (i)
the NIM
Insurer guaranteed certain payments with respect to any class of
NIM Securities
issued pursuant to the Indenture and (ii) any such class of notes
guaranteed by
the NIM Insurer remains outstanding or the NIM Insurer is owed
amounts in
respect of its guarantee of payment on such class of NIM
Securities; provided,
however, the NIM Insurer shall not have any rights hereunder
(except pursuant to
Section 11.01 and any rights to indemnification hereunder in the
case of clause
(ii) below) so long as (i) the NIM Insurer has not guaranteed
certain payments
with respect to a class of NIM Securities issued pursuant to the
Indenture or
(ii) any default has occurred and is continuing under the insurance
policy
issued by the NIM Insurer pursuant to which such payments on such
class or
classes of NIM Securities are guaranteed.
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01 Servicer to Service Mortgage Loans. (a) For and on
behalf of the Certificateholders, the Servicer shall service and
administer the
Mortgage Loans in accordance with the terms of this Agreement and
the respective
Mortgage Loans and, to the extent consistent with such terms, in
the same manner
in which it services and administers similar mortgage loans for its
own
portfolio, giving due consideration to customary and usual
standards of practice
of mortgage lenders and loan servicers administering similar
mortgage loans but
without regard to:
(i) any relationship that the Servicer, any Subservicer or any
Affiliate
of the Servicer or any Subservicer may have with the related
Mortgagor;
(ii) the ownership or non-ownership of any Certificate by the
Servicer
or any Affiliate of the Servicer;
(iii) the Servicer's obligation to make P&I Advances or
Servicing
Advances;
or
(iv) the Servicer's or any Subservicer's right to receive
compensation for its services hereunder or with respect to any
particular
transaction.
To the extent consistent with the foregoing, if the Servicer
shall
seek to maximize the timely and complete recovery of principal and
interest on
the Mortgage Notes. Subject only to the above-described servicing
standards and
the terms of this Agreement and of the respective Mortgage Loans,
the Servicer
shall have full power and authority, acting alone or through
Subservicers as
provided in Section 3.02, to do or cause to be done any and all
things in
connection with such servicing and administration which it may deem
necessary or
desirable. Without limiting the generality of the foregoing, the
Servicer in its
own name or in the name of a Subservicer is hereby authorized and
empowered by
the Trustee when the Servicer believes it appropriate in its best
judgment in
accordance with Accepted Servicing Practices, to execute and
deliver any and all
instruments of satisfaction or cancellation, or of partial or full
release or
discharge, and all other comparable instruments, with respect to
the Mortgage
Loans and the Mortgaged Properties and to institute foreclosure
proceedings or
obtain a deed-in-lieu of foreclosure so as to convert the ownership
of such
properties, and to hold or cause to be held title to such
properties, on behalf
of the Trustee. The Servicer shall at its own expense be
responsible for
preparing and recording all lien releases and mortgage
satisfactions in
accordance with state and local regulations. The Servicer shall
service and
administer the Mortgage Loans in accordance with applicable state
and federal
law and shall provide to the Mortgagors any reports required to be
provided to
them thereby. The Servicer shall also comply in the performance of
this
Agreement with all reasonable rules and requirements of each
insurer under any
standard hazard insurance policy. Subject to Section 3.16, the
Trustee shall
execute, at the written request of the Servicer, and furnish to the
Servicer and
any Subservicer such documents provided to the Trustee as are
necessary or
appropriate to enable the Servicer or any Subservicer to carry out
their
servicing and administrative duties hereunder, and the Trustee
hereby grants to
the Servicer, and this Agreement shall constitute, a power of
attorney to carry
out such duties including a power of attorney to take title to
Mortgaged
Properties after foreclosure on behalf of the Trustee. The Trustee
shall execute
a separate power of attorney, furnished to it by the Servicer, in
favor of the
Servicer for the purposes described herein to the extent necessary
or desirable
to enable the Servicer to perform its duties hereunder. The Trustee
shall not be
liable for the actions of the Servicer or any Subservicers under
such powers of
attorney and shall be indemnified by Servicer for any costs,
liabilities or
expenses incurred by the Trustee in connection with the Servicer's
misuse of
such power of attorney.
(b) Subject to Section 3.09(b), 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 timely payment
of taxes and
assessments on the Mortgaged Properties, which advances shall be
Servicing
Advances reimbursable in the first instance from related
collections from the
Mortgagors pursuant to Section 3.09(b), and further as provided in
Section 3.11.
Any cost incurred by the Servicer or by Subservicers in effecting
the timely
payment of taxes and assessments on a Mortgaged Property shall not
be added to
the unpaid principal balance of the related Mortgage Loan,
notwithstanding that
the terms of such Mortgage Loan so permit.
(c) Notwithstanding anything in this Agreement to the contrary,
the
Servicer may not make any future advances with respect to a
Mortgage Loan
(except as provided in Section 4.01 and except for Servicing
Advances) and the
Servicer shall not (i) (unless, subject to the last sentence of
this Section
3.01(c), the Mortgagor is in default with respect to the Mortgage
Loan or such
default is, in the judgment of the Servicer, reasonably
foreseeable) permit any
modification with respect to any Mortgage Loan that would change
the Mortgage
Rate, reduce or increase the principal balance (except for
reductions resulting
from actual payments of principal) or change the final maturity
date on such
Mortgage Loan (except for a reduction of interest payments
resulting from the
application of the Servicemembers Civil Relief Act or any similar
state
statutes) or (ii) permit any modification, waiver or amendment of
any term of
any Mortgage Loan that would both (A) effect an exchange or
reissuance of such
Mortgage Loan under Section 1001 of the Code (or final, temporary
or proposed
Treasury regulations promulgated thereunder) and (B) cause any
Trust REMIC to
fail to qualify as a REMIC under the Code or the imposition of any
tax on
"prohibited transactions" or "contributions after the startup day"
under the
REMIC Provisions, or (iii) except as provided in Section 3.07(a),
waive any
Prepayment Charges. With respect to any modification referred to in
clause (i)
above, in the event the Mortgagor is in default with respect to the
Mortgage
Loan or such default is, in the judgment of the Servicer,
reasonably
foreseeable, the Servicer shall give written notice to the NIM
Insurer prior to
any such modification. The NIM Insurer's prior written consent
shall be required
for any such modification if the aggregate number of outstanding
Mortgage Loans
which have been modified exceeds 5% of the number of Mortgage Loans
as of the
Cut-off Date. The Servicer may perform such modification if the
Servicer does
not receive notice from the NIM Insurer stating that such
modification requires
the consent of the NIM Insurer, as set forth above, within three
(3) Business
Days after receipt by the NIM Insurer of such Servicer's
notice.
(d) The Servicer may delegate its responsibilities under this
Agreement; provided, however, that no such delegation shall release
the Servicer
from the responsibilities or liabilities arising under this
Agreement.
Section 3.02 Subservicing Agreements between the Servicer and
Subservicers. (a) The Servicer may enter into subservicing
agreements with
Subservicers for the servicing and administration of the Mortgage
Loans
("Subservicing Agreements"). The Servicer represents and warrants
to the other
parties hereto that no Subservicing Agreement is in effect as of
the Closing
Date with respect to any Mortgage Loans required to be serviced by
it hereunder.
The Servicer shall give notice to the Depositor, the Securities
Administrator,
the NIM Insurer and the Trustee of any such Subservicer and
Subservicing
Agreement, which notice shall contain all information (including
without
limitation a copy of the Subservicing Agreement and any amendments
or
modifications thereof) reasonably necessary to enable the
Securities
Administrator, pursuant to Section 8.12(g), to accurately and
timely report the
event under Item 6.02 of Form 8-K pursuant to the Exchange Act (if
such reports
under the Exchange Act are required to be filed under the Exchange
Act). No
Subservicing Agreement shall be effective (i) until 30 days after
such written
notice is received by the Depositor, the Securities Administrator,
the NIM
Insurer and the Trustee and (ii) unless the NIM Insurer shall have
consented to
such Subservicing Agreement. The Trustee shall not be required to
review or
consent to such Subservicing Agreements and shall have no liability
in
connection therewith.
(b) The Servicer shall cause any Subservicer engaged by the
Servicer
(or by any Subservicer) for the benefit of the Depositor, the
Securities
Administrator and the Trustee to comply with the provisions of this
Section 3.02
and with Sections 3.22, 3.23, 6.02 and 6.05 of this Agreement to
the same extent
as if such Subservicer were the Servicer, and to provide the
information
required with respect to such Subservicer under Section 8.12 of
this Agreement.
The Servicer shall be responsible for obtaining from each such
Subservicer and
delivering to applicable Persons any servicer compliance statement
required to
be delivered by such Subservicer under Section 3.22 and any
assessment of
compliance report and related accountant's attestation required to
be delivered
by such Subservicer under Section 3.23, in each case as and when
required to be
delivered.
(c) Subject to the conditions set forth in this Section 3.02(c),
the
Servicer and any Subservicer engaged by the Servicer is permitted
to utilize one
or more Subcontractors to perform certain of its obligations
hereunder. The
Servicer shall promptly upon request provide to the Depositor a
written
description (in form and substance satisfactory to the Depositor)
of the role
and function of each Subcontractor utilized by the Servicer or any
such
Subservicer, specifying, not later than the date specified for
delivery of the
annual report on assessment of compliance set forth in Section
3.23(b) (i) the
identity of each such Subcontractor, if any, that is "participating
in the
servicing function" within the meaning of Item 1122 of Regulation
AB, and (ii)
which elements of the Servicing Criteria will be addressed in
assessments of
compliance provided by each Subcontractor identified pursuant to
clause (i) of
this paragraph. As a condition to the utilization by the Servicer
or any such
Subservicer of any Subcontractor determined to be "participating in
the
servicing function" within the meaning of Item 1122 of Regulation
AB, the
Servicer shall cause any such Subcontractor used by the Servicer
(or by any such
Subservicer) for the benefit of the Depositor and the Securities
Administrator
to comply with the provisions of Section 3.23 of this Agreement to
the same
extent as if such Subcontractor were the Servicer. The Servicer
shall be
responsible for obtaining from each such Subcontractor and
delivering to the
applicable Persons any assessment of compliance report and related
accountant's
attestation required to be delivered by such Subcontractor under
Section 3.23,
in each case as and when required to be delivered.
Notwithstanding the foregoing, if the Servicer engages a
Subcontractor in connection with the performance of any of its
duties under this
Agreement, the Servicer shall be responsible for determining
whether such
Subcontractor is a "servicer" within the meaning of Item 1101 of
Regulation AB
and whether any such affiliate or third-party vendor meets the
criteria in Item
1108(a)(2)(i) through (iii) of Regulation AB. If the Servicer
determines,
pursuant to the preceding sentence, that such Subcontractor is a
"servicer"
within the meaning of Item 1101 of Regulation AB and meets the
criteria in Item
1108(a)(2)(i) through (iii) of Regulation AB, then such
Subcontractor shall be
deemed to be a Subservicer for purposes of this Agreement, the
engagement of
such Subservicer shall not be effective unless and until notice is
given
pursuant to Section 3.02(a).
Section 3.03 Successor Subservicers. The Servicer, with the
consent
of the NIM Insurer, shall be entitled to terminate any Subservicing
Agreement
and the rights and obligations of any Subservicer pursuant to any
Subservicing
Agreement in accordance with the terms and conditions of such
Subservicing
Agreement; provided, however, that the termination, resignation or
removal of a
Subservicer shall be not be effective until 30 days after written
notice is
received by both the Depositor and the Securities Administrator
that contains
all information reasonably necessary to enable the Securities
Administrator,
pursuant to Section 8.12(g), to accurately and timely report the
event under
Item 6.02 of Form 8-K pursuant to the Exchange Act (if such reports
under the
Exchange Act are required to be filed under the Exchange Act). In
the event of
termination of any Subservicer, all servicing obligations of such
Subservicer
shall be assumed simultaneously by the Servicer without any act or
deed on the
part of such Subservicer or the Servicer, and the Servicer either
shall service
directly the related Mortgage Loans or shall enter into a
Subservicing Agreement
with a successor Subservicer which qualifies under Section
3.02.
Any Subservicing Agreement shall include the provision that
such
agreement may be immediately terminated by the Depositor or the
Trustee without
fee, in accordance with the terms of this Agreement, in the event
that the
Servicer shall, for any reason, no longer be the Servicer
(including termination
due to an Event of Default).
Section 3.04 Liability of the Servicer. Notwithstanding 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 primarily liable to the Trustee for the servicing
and
administering of the Mortgage Loans in accordance with the
provisions of Section
3.01 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. The
Servicer shall be entitled to enter into any agreement with a
Subservicer for
indemnification of the Servicer by such Subservicer and nothing
contained in
this Agreement shall be deemed to limit or modify such
indemnification.
Section 3.05 No Contractual Relationship between Subservicers
and
the Trustee, the Securities Administrator or the NIM Insurer. Any
Subservicing
Agreement that may be entered into and any transactions or services
relating to
the Mortgage Loans involving a Subservicer in its capacity as such
shall be
deemed to be between the Subservicer and the Servicer alone, and
the Trustee (or
any successor Servicer), the Securities Administrator or the NIM
Insurer shall
not be deemed a party thereto and shall have no claims, rights,
obligations,
duties or liabilities with respect to the Subservicer except as set
forth in
Section 3.06. The Servicer shall be solely liable for all fees owed
by it to any
Subservicer, irrespective of whether the Servicer's compensation
pursuant to
this Agreement is sufficient to pay such fees.
Section 3.06 Assumption or Termination of Subservicing Agreements
by
Trustee. In the event the Servicer at any time shall for any reason
no longer be
the Servicer (including by reason of the occurrence of an Event of
Default), the
Trustee, or its designee or the successor Servicer if the successor
is not the
Trustee, shall thereupon assume all of the rights and obligations
of the
Servicer under each Subservicing Agreement that the Servicer may
have entered
into, with copies thereof provided to the Trustee or the successor
Servicer if
the successor is not the Trustee, prior to the Trustee or the
successor Servicer
if the successor is not the Trustee, assuming such rights and
obligations,
unless the Trustee elects to terminate any Subservicing Agreement
in accordance
with its terms as provided in Section 3.03.
Upon such assumption, the Trustee, its designee or the
successor
servicer shall be deemed, subject to Section 3.03, to have assumed
all of the
Servicer's interest therein and to have replaced the Servicer as a
party to each
Subservicing Agreement to the same extent as if each Subservicing
Agreement had
been assigned to the assuming party, except that (i) the Servicer
shall not
thereby be relieved of any liability or obligations under any
Subservicing
Agreement that arose before it ceased to be the Servicer and (ii)
none of the
Depositor, the Trustee, their designees or any successor Servicer
shall be
deemed to have assumed any liability or obligation of the Servicer
that arose
before it ceased to be the Servicer.
The Servicer at its expense shall, upon request of the Trustee,
its
designee or the successor Servicer deliver to the assuming party
all documents
and records relating to each Subservicing Agreement and the
Mortgage Loans then
being serviced and an accounting of amounts collected and held by
or on behalf
of it, and otherwise use its best efforts to effect the orderly and
efficient
transfer of the Subservicing Agreements to the assuming party.
Section 3.07 Collection of Certain Mortgage Loan Payments. (a)
The
Servicer shall make reasonable efforts to collect all payments
called for under
the terms and provisions of the Mortgage Loan and the Pool Policy,
and shall, to
the extent such procedures shall be consistent with this Agreement
and the terms
and provisions of any applicable Insurance Policies, follow such
collection
procedures as it would follow with respect to mortgage loans
comparable to the
Mortgage Loans and held for its own account. Consistent with the
foregoing and
Accepted Servicing Practices, the Servicer may (i) waive any late
payment charge
or, if applicable, any penalty interest, or (ii) extend the Due
Dates for the
Scheduled Payments due on a Mortgage Note for a period of not
greater than 360
days; provided, 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. In the event of
any such
arrangement pursuant to clause (ii) above, the Servicer shall make
timely
advances on such Mortgage Loan during such extension pursuant to
Section 4.01
and in accordance with the amortization schedule of such Mortgage
Loan without
modification thereof by reason of such arrangements, subject to
Section 4.01(d)
pursuant to which the Servicer shall not be required to make any
such advances
that are Nonrecoverable P&I Advances. Notwithstanding the
foregoing, the
Servicer may waive, in whole or in part, a Prepayment Charge only
under the
following circumstances: (i) such waiver relates to a default or a
reasonably
foreseeable default and would, in the reasonable judgment of the
Servicer,
maximize recovery of total proceeds taking into account the value
of such
Prepayment Charge and the related Mortgage Loan or (ii) such
Prepayment Charge
is not permitted to be collected by applicable law. If a Prepayment
Charge is
waived other than as permitted by the prior sentence, then the
Servicer is
required to pay the amount of such waived Prepayment Charge, for
the benefit of
the Holders of the Class P Certificates, by depositing such amount
into the
Collection Account from its own funds, without any right of
reimbursement
therefor, together with and at the time that the amount prepaid on
the related
Mortgage Loan is required to be deposited into the Collection
Account; provided,
however, that the Servicer shall not have an obligation to pay the
amount of any
uncollected Prepayment Charge if the failure to collect such amount
is the
direct result of inaccurate or incomplete information on the
Mortgage Loan
Schedule in effect at such time.
(b) (i) The Securities Administrator shall establish and
maintain
the Excess Reserve Fund Account, on behalf of the Class X
Certificateholders, to
receive any Basis Risk Payment and any Interest Rate Cap Payment
and to secure
their limited recourse obligation to pay to the LIBOR
Certificateholders Basis
Risk Carry Forward Amounts (prior to using any Net Swap Receipts).
For the
avoidance of doubt, any Basis Risk Carry Forward Amounts shall be
paid to the
LIBOR Certificates first from the Excess Reserve Fund Account and
then from the
Swap Account.
(ii) On each Distribution Date, the Securities Administrator
shall
deposit
the amount of any Basis Risk Payment and any Interest Rate Cap
Payment
for such date into the Excess Reserve Fund Account.
(c) (i) On each Distribution Date on which there exists a Basis
Risk
Carry Forward Amount on any Class of Certificates, the Securities
Administrator
shall (1) withdraw from the Distribution Account and deposit in the
Excess
Reserve Fund Account, as set forth in Section 4.02(a)(iii)(M), the
lesser of (x)
the Class X Distributable Amount (without regard to the reduction
in the
definition thereof with respect to the Basis Risk Payment or
Defaulted Swap
Termination Payments (to the extent remaining after the
distributions specified
in Sections 4.02(a)(iii)(A)-(P)) and (y) the aggregate Basis Risk
Carry Forward
Amounts for such Distribution Date and (2) withdraw from the Excess
Reserve Fund
Account amounts necessary to pay to such Class or Classes of
Certificates the
Basis Risk Carry Forward Amount. Such payments shall be allocated
to those
Classes and paid in the priority set forth in Sections
4.02(a)(iii)(P)-(O).
(ii) The Securities Administrator shall account for the Excess
Reserve
Fund Account as an asset of a grantor trust under subpart E,
Part
I of
subchapter J of the Code and not as an asset of any REMIC
created
pursuant
to this Agreement. The beneficial owners of the Excess Reserve
Fund
Account are the Class X
