Exhibit 4.1
================================================================================
BANC OF AMERICA FUNDING CORPORATION,
as Depositor,
WELLS FARGO BANK, N.A.,
as Master Servicer and Securities Administrator,
and
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
POOLING AND SERVICING AGREEMENT
Dated January 31, 2006
Mortgage Pass-Through Certificates
Series 2006-1
================================================================================
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS
Section 1.01
Defined
Terms....................................................................5
Section 1.02
Interest
Calculations...........................................................42
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01
Conveyance of Mortgage
Loans....................................................42
Section 2.02
Acceptance by the Trustee or Custodian of the Mortgage
Loans....................47
Section 2.03
Representations, Warranties and Covenants of the Master
Servicer................51
Section 2.04
Representations and Warranties of the Depositor as to the Mortgage
Loans........52
Section 2.05
Designation of Interests in the
REMICs..........................................53
Section 2.06
Designation of Start-up
Day.....................................................53
Section 2.07
REMIC Certificate Maturity
Date.................................................53
Section 2.08
Execution and Delivery of
Certificates..........................................54
ARTICLE III
ADMINISTRATION AND MASTER SERVICING OF MORTGAGE LOANS
Section 3.01
Master Servicing of the Mortgage
Loans..........................................54
Section 3.02
Monitoring of
Servicers.........................................................55
Section 3.03
Fidelity Bond; Errors and Omissions
Insurance...................................57
Section 3.04
Access to Certain
Documentation.................................................57
Section 3.05
Maintenance of Primary Mortgage Insurance Policy;
Claims........................57
Section 3.06
Rights of the Depositor, the Securities Administrator and the
Trustee
in Respect of the Master
Servicer...........................................58
Section 3.07
Trustee to Act as Master
Servicer...............................................58
Section 3.08
Servicer Custodial Accounts and Escrow
Accounts.................................58
Section 3.09
Collection of Mortgage Loan Payments; Master Servicer Custodial
Account; Certificate Account and Reserve
Fund...............................59
Section 3.10
Access to Certain Documentation and Information Regarding the
Mortgage
Loans..............................................................63
Section 3.11
Permitted Withdrawals from the Certificate Account and the Master
Servicer Custodial
Account..................................................63
Section 3.12
Maintenance of Hazard Insurance and Other
Insurance.............................64
Section 3.13
Presentment of Claims and Collection of
Proceeds................................65
Section 3.14
Enforcement of Due-On-Sale Clauses; Assumption
Agreements.......................65
Section 3.15
Realization Upon Defaulted Mortgage Loans; REO
Property.........................65
Section 3.16
Trustee to Cooperate; Release of Mortgage
Files.................................67
- i -
Section 3.17
Documents, Records and Funds in Possession of the Master Servicer
to
be Held for the
Trustee.....................................................68
Section 3.18
Master Servicer
Compensation....................................................68
Section 3.19
Advances........................................................................69
Section 3.20
Annual Statement as to
Compliance...............................................69
Section 3.21
Assessments of Compliance and Attestation
Reports...............................70
Section 3.22
Reports to the
Commission.......................................................72
ARTICLE IV
MASTER SERVICER'S CERTIFICATE
Section 4.01
Master Servicer's
Certificate...................................................77
ARTICLE V
PAYMENTS AND STATEMENTS TO CERTIFICATEHOLDERS; REMIC ADMINISTRATION
Section 5.01
Distributions...................................................................77
Section 5.02
Priorities of
Distributions.....................................................78
Section 5.03
Allocation of
Losses............................................................90
Section 5.04
Statements to
Certificateholders................................................92
Section 5.05
Tax Returns and Reports to
Certificateholders...................................95
Section 5.06
Tax Matters
Person..............................................................96
Section 5.07
Rights of the Tax Matters Person in Respect of the Securities
Administrator.....96
Section 5.08
REMIC Related
Covenants.........................................................97
Section 5.09
Determination of
LIBOR..........................................................98
Section 5.10
Master Servicer, Securities Administrator and Trustee
Indemnification...........99
ARTICLE VI
THE CERTIFICATES
Section 6.01
The
Certificates................................................................99
Section 6.02
Registration of Transfer and Exchange of
Certificates..........................100
Section 6.03
Mutilated, Destroyed, Lost or Stolen
Certificates..............................104
Section 6.04
Persons Deemed
Owners..........................................................105
ARTICLE VII
THE DEPOSITOR AND THE MASTER SERVICER
Section 7.01
Respective Liabilities of the Depositor and the Master
Servicer................105
Section 7.02
Merger or Consolidation of the Depositor or the Master
Servicer................105
Section 7.03
Limitation on Liability of the Depositor, the Master Servicer and
Others.......106
Section 7.04
Depositor and Master Servicer Not to
Resign....................................107
- ii -
ARTICLE VIII
DEFAULT
Section 8.01
Events of
Default..............................................................107
Section 8.02
Remedies of
Trustee............................................................109
Section 8.03
Directions by Certificateholders and Duties of Trustee During Event
of Default.109
Section 8.04
Action upon Certain Failures of the Master Servicer and upon Event
of Default..109
Section 8.05
Trustee to Act; Appointment of
Successor.......................................110
Section 8.06
Notification to
Certificateholders.............................................111
ARTICLE IX
THE TRUSTEE AND THE SECURITIES ADMINISTRATOR
Section 9.01
Duties of Trustee and Securities
Administrator.................................111
Section 9.02
Certain Matters Affecting the Trustee and the Securities
Administrator.........114
Section 9.03
Neither Trustee nor Securities Administrator Liable for
Certificates or
Mortgage
Loans.............................................................116
Section 9.04
Trustee and Securities Administrator May Own
Certificates......................117
Section 9.05
Eligibility Requirements for Trustee and the Securities
Administrator..........117
Section 9.06
Resignation and Removal of Trustee and the Securities
Administrator............118
Section 9.07
Successor Trustee or Securities
Administrator..................................119
Section 9.08
Merger or Consolidation of Trustee or Securities
Administrator.................119
Section 9.09
Appointment of Co-Trustee or Separate
Trustee..................................120
Section 9.10
Authenticating
Agents..........................................................121
Section 9.11
Securities Administrator's Fees and Expenses and Trustee's Fees and
Expenses...121
Section 9.12
Appointment of
Custodian.......................................................122
Section 9.13
Paying
Agents..................................................................123
Section 9.14
Limitation of
Liability........................................................124
Section 9.15
Trustee or Securities Administrator May Enforce Claims Without
Possession of
Certificates.................................................124
Section 9.16
Suits for
Enforcement..........................................................124
Section 9.17
Waiver of Bond
Requirement.....................................................124
Section 9.18
Waiver of Inventory, Accounting and Appraisal
Requirement......................124
ARTICLE X
TERMINATION
Section 10.01
Termination upon Purchase or Liquidation of All Mortgage
Loans.................124
Section 10.02
Additional Termination
Requirements............................................127
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01
Amendment......................................................................127
- iii -
Section 11.02
Recordation of Agreement;
Counterparts.........................................129
Section 11.03
Limitation on Rights of
Certificateholders.....................................129
Section 11.04
Governing
Law..................................................................130
Section 11.05
Notices........................................................................130
Section 11.06
Severability of
Provisions.....................................................131
Section 11.07
Certificates Nonassessable and Fully
Paid......................................131
Section 11.08
Access to List of
Certificateholders...........................................131
Section 11.09
Recharacterization.............................................................132
Section 11.10
Regulation AB Compliance; Intent of the Parties;
Reasonableness................132
- iv -
EXHIBITS
Exhibit 1-A-1
Form of Face of Class 1-A-1 Certificate
Exhibit 1-A-2
Form of Face of Class 1-A-2 Certificate
Exhibit 1-A-3
Form of Face of Class 1-A-3 Certificate
Exhibit 1-A-4
Form of Face of Class 1-A-4 Certificate
Exhibit 1-A-5
Form of Face of Class 1-A-5 Certificate
Exhibit 1-A-6
Form of Face of Class 1-A-6 Certificate
Exhibit 1-A-7
Form of Face of Class 1-A-7 Certificate
Exhibit 1-A-8
Form of Face of Class 1-A-8 Certificate
Exhibit 1-A-9
Form of Face of Class 1-A-9 Certificate
Exhibit 1-A-10
Form of Face of Class 1-A-10 Certificate
Exhibit 1-A-11
Form of Face of Class 1-A-11 Certificate
Exhibit 1-A-12
Form of Face of Class 1-A-12 Certificate
Exhibit 1-A-13
Form of Face of Class 1-A-13 Certificate
Exhibit 1-A-14
Form of Face of Class 1-A-14 Certificate
Exhibit 1-A-15
Form of Face of Class 1-A-15 Certificate
Exhibit 1-A-16
Form of Face of Class 1-A-16 Certificate
Exhibit 1-A-17
Form of Face of Class 1-A-17 Certificate
Exhibit 1-A-18
Form of Face of Class 1-A-18 Certificate
Exhibit 1-A-19
Form of Face of Class 1-A-19 Certificate
Exhibit 1-A-20
Form of Face of Class 1-A-20 Certificate
Exhibit 1-A-21
Form of Face of Class 1-A-21 Certificate
Exhibit 1-A-22
Form of Face of Class 1-A-22 Certificate
Exhibit 1-A-23
Form of Face of Class 1-A-23 Certificate
Exhibit 1-A-24
Form of Face of Class 1-A-24 Certificate
Exhibit 1-A-25
Form of Face of Class 1-A-25 Certificate
Exhibit 1-A-26
Form of Face of Class 1-A-26 Certificate
Exhibit 1-A-27
Form of Face of Class 1-A-27 Certificate
Exhibit 1-A-28
Form of Face of Class 1-A-28 Certificate
Exhibit 2-A-1
Form of Face of Class 2-A-1 Certificate
Exhibit 2-A-2
Form of Face of Class 2-A-2 Certificate
Exhibit 3-A-1
Form of Face of Class 3-A-1 Certificate
Exhibit 3-A-2
Form of Face of Class 3-A-2 Certificate
Exhibit 3-A-R
Form of Face of Class 3-A-R Certificate
Exhibit X-IO
Form of Face of Class X-IO Certificate
Exhibit X-PO
Form of Face of Class X-PO Certificate
Exhibit B-1
Form of Face of Class B-1 Certificate
Exhibit B-2
Form of Face of Class B-2 Certificate
Exhibit B-3
Form of Face of Class B-3 Certificate
Exhibit B-4
Form of Face of Class B-4 Certificate
Exhibit B-5
Form of Face of Class B-5 Certificate
Exhibit B-6
Form of Face of Class B-6 Certificate
Exhibit X-B-1
Form of Face of Class X-B-1 Certificate
Exhibit X-B-2
Form of Face of Class X-B-2 Certificate
Exhibit X-B-3
Form of Face of Class X-B-3 Certificate
Exhibit X-B-4
Form of Face of Class X-B-4 Certificate
- v -
Exhibit X-B-5
Form of Face of Class X-B-5 Certificate
Exhibit X-B-6
Form of Face of Class X-B-6 Certificate
Exhibit C
Form of Reverse of all Certificates
Exhibit D-1
Loan Group 1 Mortgage Loan Schedule
Exhibit D-2
Loan Group 2 Mortgage Loan Schedule
Exhibit D-3
Loan Group 3 Mortgage Loan Schedule
Exhibit E
Request for Release of Documents
Exhibit F
Form of Certification of Establishment of Account
Exhibit G-1
Form of Transferor's Certificate
Exhibit G-2A
Form 1 of Transferee's Certificate
Exhibit G-2B
Form 2 of Transferee's Certificate
Exhibit H
Form of Transferee Representation Letter for ERISA
Restricted Certificates
Exhibit I
Form of Affidavit Regarding Transfer of Residual Certificate
Exhibit J
List of Recordation States
Exhibit K
Form of Initial Certification
Exhibit L
Form of Final Certification
Exhibit M
Form of Sarbanes-Oxley Certification
Exhibit N
Form of Securities Administrator's Certification
Exhibit O
Principal Balance Schedules
Exhibit P
Form of Yield Maintenance Agreement
Exhibit Q
Relevant Servicing Criteria
Exhibit R
Additional Form 10-D Disclosure
Exhibit S
Additional Form 10-K Disclosure
Exhibit T
Form 8-K Disclosure
Exhibit U
Form of Back-up Certification
- vi -
POOLING AND SERVICING AGREEMENT
THIS POOLING AND SERVICING AGREEMENT, dated January 31, 2006, is
hereby
executed by and among BANC OF AMERICA FUNDING CORPORATION, as
depositor
(together with its permitted successors and assigns, the
"Depositor"), WELLS
FARGO BANK, N.A., as master servicer (together with its permitted
successors and
assigns, in such capacity, the "Master Servicer") and as securities
administrator (together with its permitted successors and assigns,
in such
capacity, the "Securities Administrator"), and U.S. BANK NATIONAL
ASSOCIATION,
as trustee (together with its permitted successors and assigns, the
"Trustee").
W I T N E S S E T H
T H A T:
In consideration of the mutual agreements herein contained, the
Depositor,
the Master Servicer, the Securities Administrator and the Trustee
agree as
follows:
PRELIMINARY STATEMENT
In exchange for the Certificates, the Depositor hereby conveys the
Trust
Estate to the Trustee to create the Trust. The Trust Estate for
federal income
tax purposes shall be treated as three real estate mortgage
investment conduits
(the "Upper-Tier REMIC," the "Intermediate Lower-Tier REMIC" and
the "Lower-Tier
REMIC," respectively, and each a "REMIC"). The Uncertificated
Lower-Tier
Interests will represent the "regular interests" and the Class LR
Interest shall
be the "residual interest" in the Lower-Tier REMIC for purposes of
the REMIC
Provisions. The Uncertificated Lower-Tier Interests shall
constitute the assets
of the Intermediate Lower-Tier REMIC. The Uncertificated
Intermediate Lower-Tier
Interests shall constitute the "regular interests" and the Class
ILR Interest
shall be the "residual interest" in the Intermediate Lower-Tier
REMIC. The
Uncertificated Intermediate Lower-Tier Interests shall constitute
the assets of
the Upper-Tier REMIC. The Senior Certificates (other than the Class
3-A-R
Certificate, the Class X-IO Certificates and the Class X-PO
Certificates), the
Components, the Class B Certificates and the Class X-B Certificates
are referred
to collectively as the "Regular Certificates" and shall constitute
"regular
interests" in the Upper-Tier REMIC for purposes of the REMIC
Provisions. The
Class UR Interest shall be the "residual interest" in the
Upper-Tier REMIC for
purposes of the REMIC Provisions. The Class 3-A-R Certificate shall
represent
beneficial ownership of the Class LR Interest, the Class ILR
Interest and the
Class UR Interest. The "latest possible maturity date" for federal
income tax
purposes of all interests created hereby will be the REMIC
Certificate Maturity
Date.
The following table sets forth characteristics of the Certificates
and the
Components, together with the minimum denominations and integral
multiples in
excess thereof in which the Classes of Certificates shall be
issuable:
INTEGRAL
INITIAL CLASS
PASS-
MULTIPLES IN
CERTIFICATE BALANCE
THROUGH
MINIMUM
EXCESS OF
CLASSES
OR NOTIONAL AMOUNT
RATE
DENOMINATION
MINIMUM
Class 1-A-1
$ 12,759,000.00
5.750%
$
1,000
$1
Class 1-A-2
$
3,320,000.00
5.750%
$
1,000
$1
Class 1-A-3
$
579,000.00
5.750%
$
1,000
$1
Class 1-A-4
$
4,342,000.00
5.750%
$
1,000
$1
Class 1-A-5
$
2,000,000.00
5.500%
$
1,000
$1
Class 1-A-6
$
2,000,000.00
6.000%
$
1,000
$1
Class 1-A-7
$
118,000.00
5.750%
$
1,000
$1
Class 1-A-8
$
1,057,000.00
5.750%
$
1,000
$1
Class 1-A-9
$
1,000,000.00
5.750%
$
1,000
$1
Class 1-A-10
$ 18,759,000.00
5.750%
$
1,000
$1
Class 1-A-11
$
1,524,000.00
5.750%
$
1,000
$1
Class 1-A-12
$
3,701,000.00
5.750%
$
1,000
$1
Class 1-A-13
$
1,008,000.00
5.250%
$
1,000
$1
Class 1-A-14
$
1,008,000.00
6.250%
$
1,000
$1
Class 1-A-15
$
775,000.00
5.750%
$
1,000
$1
Class 1-A-16
$
775,000.00
5.750%
$
1,000
$1
Class 1-A-17
$
775,000.00
5.750%
$
1,000
$1
Class 1-A-18
$
3,000,000.00
5.500%
$
1,000
$1
Class 1-A-19
$
3,000,000.00
6.000%
$
1,000
$1
Class 1-A-20
$ 28,000,000.00
(1)
$
1,000
$1
Class 1-A-21
(2)
(3)
$1,000,000
N/A
Class 1-A-22
$
2,621,000.00
5.750%
$
1,000
$1
Class 1-A-23
$ 50,178,000.00
5.750%
$
1,000
$1
Class 1-A-24
$
6,023,000.00
5.750%
$
1,000
$1
Class 1-A-25
$ 41,542,000.00
5.750%
$
1,000
$1
Class 1-A-26
(4)
5.750%
$1,000,000
N/A
Class 1-A-27
$ 27,041,000.00
5.500%
$
1,000
$1
Class 1-A-28
$ 35,000,000.00
5.300%
$
1,000
$1
Class 2-A-1
$105,137,000.00
5.500%
$
1,000
$1
Class 2-A-2
$
4,324,000.00
5.500%
$
1,000
$1
Class 3-A-1
$ 92,989,000.00
5.500%
$
1,000
$1
Class 3-A-2
$
3,373,000.00
5.500%
$
1,000
$1
Class 3-A-R
$
100.00
5.500%
$
100
N/A
Class B-1
$
2,923,000.00
5.500%
$
25,000
$1
Class B-2
$
687,000.00
5.500%
$
25,000
$1
Class B-3
$
344,000.00
5.500%
$
25,000
$1
Class B-4
$
229,000.00
5.500%
$
25,000
$1
Class B-5
$
172,000.00
5.500%
$
25,000
$1
Class B-6
$
172,580.00
5.500%
$
25,000
$1
Class X-IO
(5)
(5)
$1,000,000
$1
Class X-PO
(6)
(6)
$
25,000
$1
- 2 -
INTEGRAL
INITIAL CLASS
PASS-
MULTIPLES IN
CERTIFICATE BALANCE
THROUGH
MINIMUM
EXCESS OF
CLASSES
OR NOTIONAL AMOUNT
RATE
DENOMINATION
MINIMUM
Class X-B-1
$
7,535,000.00
(7)
$
25,000
$1
Class X-B-2
$
2,021,000.00
(7)
$
25,000
$1
Class X-B-3
$
1,287,000.00
(7)
$
25,000
$1
Class X-B-4
$
735,000.00
(7)
$
25,000
$1
Class X-B-5
$
551,000.00
(7)
$
25,000
$1
Class X-B-6
$
735,601.00
(7)
$
25,000
$1
INITIAL COMPONENT
INTEGRAL
BALANCE OR
PASS-
MULTIPLES IN
COMPONENT NOTIONAL
THROUGH
MINIMUM
EXCESS OF
COMPONENTS
AMOUNT
RATE
DENOMINATION
MINIMUM
Class 1-X-IO
(8)
5.500%
N/A
N/A
Class 2-X-IO
(8)
5.500%
N/A
N/A
Class 3-X-IO
(8)
5.500%
N/A
N/A
Class 1-X-PO
$
6,067,117.00
(9)
N/A
N/A
Class 2-X-PO
$
614,964.00
(9)
N/A
N/A
Class 3-X-PO
$
341,832.00
(9)
N/A
N/A
_______________________
(1)
During the initial Interest Accrual Period, interest will accrue on
the
Class 1-A-20 Certificates at the rate of 5.390% per annum. During
each
Interest Accrual Period thereafter, interest will accrue on the
Class
1-A-20 Certificates at a per annum rate equal to (i) 0.900% plus
(ii)
LIBOR, subject to a minimum rate of 0.900% and a maximum rate of
5.750%. In
addition, the Class 1-A-20 Certificates will be entitled to amounts
received under a yield maintenance agreement.
(2)
The Class 1-A-21 Certificates are Interest Only Certificates, have
no class
balance and will bear interest on their notional amount (initially
approximately $28,000,000).
(3)
During the initial Interest Accrual Period, interest will accrue on
the
Class 1-A-21 Certificates at the rate of 0.360% per annum. During
each
Interest Accrual Period thereafter, interest will accrue on the
Class
1-A-21 Certificates at a per annum rate equal to (i) 4.850% minus
(ii)
LIBOR, subject to a minimum rate of 0.000% and a maximum rate of
4.850%.
(4)
The Class 1-A-26 Certificates are Interest Only Certificates, have
no class
balance and will bear interest on their notional amount (initially
approximately $3,914,825).
(5)
The Class X-IO Certificates are Interest Only Certificates and will
be
deemed for purposes of distributions of interest to consist of
three
Components: the Class 1-X-IO, Class 2-X-IO and Class 3-X-IO
Components. The
Components of a class are not severable. The initial notional
amount of the
Class X-IO Certificates will be approximately $9,635,484.
(6)
The Class X-PO Certificates are Principal Only Certificates and
will be
deemed for purposes of distributions of principal to consist of
three
Components: the Class 1-X-PO, Class 2-X-PO and Class 3-X-PO
Components. The
Components of a class are not severable. The initial class balance
of the
Class X-PO Certificates will be approximately $7,023,913.
(7)
Interest will accrue on the Class X-B Certificates for each
Distribution
Date at a per annum rate equal to the weighted average (based on
the Group
Subordinate Amount for Loan Group 1 and Loan Group 3) of (i) with
respect
to Loan Group 1, 5.750% and (ii) with respect to Loan Group 3,
5.500%. For
the initial Distribution Date in February 2006, this rate is
expected to
approximately 5.68183% per annum.
- 3 -
(8)
The Class 1-X-IO, Class 2-X-IO and Class 3-X-IO Components are
Interest
Only Components, have no component balance and will bear interest
on their
notional amounts (initially approximately $3,484,085, $3,237,156
and
$2,914,243, respectively).
(9)
The Class 1-X-PO, Class 2-X-PO and Class 3-X-PO Components are
Principal
Only Components and will not be entitled to distributions in
respect of
interest.
- 4 -
ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms. Whenever used in this Agreement, the
following
words and phrases, unless the context otherwise requires, shall
have the
meanings specified in this Article:
10-K Filing Deadline: As defined in Section 3.22(c).
1933 Act: The Securities Act of 1933, as amended.
Accretion Termination Date: The earlier to occur of (i) the
Distribution
Date following the Distribution Date on which the Class Certificate
Balance of
the Class 1-A-20 Certificates has been reduced to zero or (ii) the
related
Senior Credit Support Depletion Date.
Accrued Certificate Interest: For any Distribution Date and each
interest-bearing Class (other than the Class X-IO Certificates),
one month's
interest accrued during the related Interest Accrual Period at the
applicable
Pass-Through Rate on the applicable Class Certificate Balance or
Notional
Amount. For any Distribution Date and the Class X-IO Certificates,
the sum of
the Accrued Component Interest for each Class IO Component.
Accrued Component Interest: For any Distribution Date and each
interest-bearing Component, one month's interest accrued during the
related
Interest Accrual Period at the applicable Pass-Through Rate on the
related
Notional Amount.
Additional Form 10-D Disclosure: As defined in Section 3.22(b).
Additional Form 10-K Disclosure: As defined in Section 3.22(c).
Additional Servicer: A Subcontractor engaged by the Master Servicer
or the
Securities Administrator that is a "servicer" within the meaning of
Item 1101 of
Regulation AB and meets the criteria in Item 1108(a)(2)(i) though
(iii) of
Regulation AB.
Adjusted Pool Amount: With respect to any Distribution Date and
Loan
Group, the Cut-off Date Pool Principal Balance of the Mortgage
Loans of such
Loan Group minus the sum of (i) all amounts in respect of principal
received in
respect of the Mortgage Loans in such Loan Group (including,
without limitation,
amounts received as Monthly Payments, Periodic Advances, Principal
Prepayments,
Liquidation Proceeds and Substitution Adjustment Amounts) and
distributed to
Holders of the Certificates of the Related Group on such
Distribution Date and
all prior Distribution Dates and (ii) the principal portion of all
Realized
Losses (other than Debt Service Reductions) incurred on the
Mortgage Loans in
such Loan Group from the Cut-off Date through the end of the month
preceding
such Distribution Date.
Adjusted Pool Amount (Non-PO Portion): With respect to any
Distribution
Date and Loan Group, the difference between the Adjusted Pool
Amount and the
Adjusted Pool Amount (PO Portion) for such Loan Group.
- 5 -
Adjusted Pool Amount (PO Portion): With respect to any Distribution
Date
and Loan Group, the sum of the amount, calculated as follows, with
respect to
each Outstanding Mortgage Loan in such Loan Group: the product of
(i) the PO
Percentage for such Mortgage Loan and (ii) the remainder of (A) the
Cut-off Date
Principal Balance of such Mortgage Loan minus (B) the sum of (x)
all amounts in
respect of principal received in respect of such Mortgage Loan
(including,
without limitation, amounts received as Monthly Payments, Periodic
Advances,
Principal Prepayments, Liquidation Proceeds and Substitution
Adjustment Amounts)
and distributed to Holders of the Certificates of the Related Group
on such
Distribution Date and all prior Distribution Dates and (y) the
principal portion
of any Realized Loss (other than a Debt Service Reduction) incurred
on such
Mortgage Loan from the Cut-off Date through the end of the month
preceding such
Distribution Date.
Advance: A Periodic Advance or a Servicing Advance.
Advance Date: As to any Distribution Date and each Mortgage Loan,
the
Business Day preceding the related Remittance Date.
Agreement: This Pooling and Servicing Agreement together with all
amendments hereof and supplements hereto.
Appraised Value: With respect to any Mortgaged Property, either (i)
the
lesser of (a) the appraised value determined in an appraisal
obtained by the
originator at origination of such Mortgage Loan or, in certain
cases, an
automated valuation model (if applicable) or tax assessed value and
(b) the
sales price for such property, except that, in the case of Mortgage
Loans the
proceeds of which were used to refinance an existing mortgage loan,
the
Appraised Value of the related Mortgaged Property is the appraised
value thereof
determined in an appraisal obtained at the time of refinancing or,
in certain
cases, an automated valuation model (if applicable) or tax assessed
value, or
(ii) the appraised value determined in an appraisal made at the
request of a
Mortgagor subsequent to origination in order to eliminate the
Mortgagor's
obligation to keep a Primary Mortgage Insurance Policy in force.
Assessment of Compliance: As defined in Section 3.21(a).
Assignment of Mortgage: An individual assignment of the Mortgage,
notice
of transfer or equivalent instrument in recordable form, sufficient
under the
laws of the jurisdiction wherein the related Mortgaged Property is
located to
give record notice of the sale of the Mortgage.
Attestation Report: As defined in Section 3.21(b).
Authenticating Agents: As defined in Section 9.10.
Back-up Certification: As defined in Section 3.22(e).
BAFC: Banc of America Funding Corporation.
BAMCC: Banc of America Mortgage Capital Corporation.
- 6 -
BANA: Bank of America, National Association, a national banking
association, or its successor in interest.
BANA Servicing Agreement: The Servicing Agreement, dated January
31, 2006,
by and between BAFC, as depositor, and BANA, as servicer.
Book-Entry Certificate: All Classes of Certificates other than the
Physical Certificates.
Business Day: Any day other than (i) a Saturday or a Sunday or (ii)
a day
on which banking institutions in the State of North Carolina, the
State of New
York, the states in which the servicing offices of any Servicer are
located, the
state or states in which the master servicing offices of the Master
Servicer are
located or the state or states in which the Corporate Trust Offices
of the
Trustee and the Securities Administrator are located are required
or authorized
by law or executive order to be closed.
Buy-Down Account: The separate Eligible Account or Accounts created
and
maintained by a Servicer pursuant to Section 3.08.
Buy-Down Agreement: An agreement governing the application of
Buy-Down
Funds with respect to a Buy-Down Mortgage Loan.
Buy-Down Funds: Money advanced by a builder, seller or other
interested
party to reduce a Mortgagor's monthly payment during the initial
years of a
Buy-Down Mortgage Loan.
Buy-Down Mortgage Loan: Any Mortgage Loan in respect of which,
pursuant to
a Buy-Down Agreement, the monthly interest payments made by the
related
Mortgagor will be less than the scheduled monthly interest payments
on such
Mortgage Loan, with the resulting difference in interest payments
being provided
from Buy-Down Funds.
Calculated Principal Distribution: As defined in Section 5.03(d).
Certificate: Any of the Banc of America Funding Corporation
Mortgage
Pass-Through Certificates, Series 2006-1 that are issued pursuant
to this
Agreement.
Certificate Account: The Eligible Account created and maintained by
the
Securities Administrator pursuant to Section 3.09(b) in the name of
the
Securities Administrator, on behalf of the Trustee, for the benefit
of the
Certificateholders and designated "Wells Fargo Bank, N.A., as
Securities
Administrator for U.S. Bank National Association, as Trustee, in
trust for
registered holders of Banc of America Funding Corporation Mortgage
Pass-Through
Certificates, Series 2006-1." The Certificate Account shall be
deemed to consist
of four sub-accounts; one for Loan Groups 1 and 3 and one for Loan
Group 2, a
third sub-account referred to herein as the Intermediate Lower-Tier
Certificate
Sub-Account and a fourth sub-account referred to herein as the
Upper-Tier
Certificate Sub-Account. Funds in the Certificate Account shall be
held in trust
for the Holders of the Certificates for the uses and purposes set
forth in this
Agreement.
Certificate Balance: With respect to any Certificate (other than
the Class
1-A-21, 1-A-26 and Class X-IO 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 product of the
- 7 -
Percentage Interest of such Certificate and the Class Certificate
Balance of the
Class of Certificates of which such Certificate is a part. The
Class 1-A-21,
1-A-26 and Class X-IO Certificates have no Certificate Balance.
Certificate Custodian: Initially, Wells Fargo Bank, N.A.;
thereafter any
other Certificate Custodian acceptable to the Depository and
selected by the
Securities Administrator.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person
who is the beneficial owner of a Book-Entry Certificate. With
respect to any
Definitive Certificate, the Certificateholder of such Certificate.
Certificate Register: The register maintained pursuant to Section
6.02.
Certificate Registrar: The registrar appointed pursuant to Section
6.02.
Certificateholder: 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, the Master Servicer or any affiliate thereof shall
be deemed not
to be outstanding and the Percentage Interest and Voting Rights
evidenced
thereby shall not be taken into account in determining whether the
requisite
amount of Percentage Interests or Voting Rights, as the case may
be, necessary
to effect any such consent has been obtained, unless such entity is
the
registered owner of the entire Class of Certificates, provided that
the
Securities Administrator shall not be responsible for knowing that
any
Certificate is registered in the name of an affiliate of the
Depositor or the
Master Servicer unless one of its Responsible Officers has actual
knowledge
thereof.
Class: As to the Certificates, the Class 1-A-1, Class 1-A-2, Class
1-A-3,
Class 1-A-4, Class 1-A-5, Class 1-A-6, Class 1-A-7, Class 1-A-8,
Class 1-A-9,
Class 1-A-10, Class 1-A-11, Class 1-A-12, Class 1-A-13, Class
1-A-14, Class
1-A-15, Class 1-A-16, Class 1-A-17, Class 1-A-18, Class 1-A-19,
Class 1-A-20,
Class 1-A-21, Class 1-A-22, Class 1-A-23, Class 1-A-24, Class
1-A-25, Class
1-A-26, Class 1-A-27, Class 1-A-28, Class 2-A-1, Class 2-A-2, Class
3-A-1, Class
3-A-2, Class 3-A-R, Class B-1, Class B-2, Class B-3, Class B-4,
Class B-5, Class
B-6, Class X-B-1, Class X-B-2, Class X-B-3, Class X-B-4, Class
X-B-5, Class
X-B-6, Class X-IO and Class X-PO Certificates, as the case may be.
Class 1-A-21 Notional Amount: As to any Distribution Date and the
Class
1-A-21 Certificates, the Class Certificate Balance of the Class
1-A-20
Certificates.
Class 1-A-22 Accrual Distribution Amount: As to any Distribution
Date, an
amount equal to the amounts allocated but not currently
distributable to the
Class 1-A-22 Certificates in respect of interest in respect of
Section
5.02(a)(i).
Class 1-A-26 Notional Amount: As to any Distribution Date and the
Class
1-A-26 Certificates, the sum of approximately 7.8260857143% of the
Class
Certificate Balance of the Class 1-A-28 Certificates and
approximately
4.3478236752% of the Class Certificate Balance of the Class 1-A-27
Certificates.
- 8 -
Class 1-X-IO Notional Amount: With respect to each Distribution
Date and
the Class 1-X-IO Component, an amount equal to the product of (i)
the aggregate
of the Stated Principal Balances of the Group 1 Premium Mortgage
Loans as of the
Due Date in the month preceding the month of such Distribution Date
and (ii) a
fraction, (a) the numerator of which is equal to the weighted
average of the Net
Mortgage Interest Rates of the Group 1 Premium Mortgage Loans
(based on the
Stated Principal Balances of the Group 1 Premium Mortgage Loans as
of the due
date in the month preceding the month of such Distribution Date)
minus 5.750%
and (b) the denominator of which is equal to 5.500%.
Class 2-A-1 Loss Amount: With respect to any Distribution Date
after the
Senior Credit Support Depletion Date, the amount, if any, by which
the Class
Certificate Balance of the Class 2-A-1 Certificates would be
reduced as a result
of the allocation of any reduction pursuant to Section 5.03(b) to
such Class,
without regard to the operation of Section 5.03(e).
Class 2-A-2 Loss Allocation Amount: With respect to any
Distribution Date
after the Senior Credit Support Depletion Date, the lesser of (a)
the Class
Certificate Balance of the Class 2-A-2 Certificates with respect to
such
Distribution Date prior to any reduction for the Class 2-A-2 Loss
Allocation
Amount and (b) the Class 2-A-1 Loss Amount with respect to such
Distribution
Date.
Class 2-X-IO Notional Amount: With respect to each Distribution
Date and
the Class 2-X-IO Component, an amount equal to the product of (i)
the aggregate
of the Stated Principal Balances of the Group 2 Premium Mortgage
Loans as of the
Due Date in the month preceding the month of such Distribution Date
and (ii) a
fraction, (a) the numerator of which is equal to the weighted
average of the Net
Mortgage Interest Rates of the Group 2 Premium Mortgage Loans
(based on the
Stated Principal Balances of the Group 2 Premium Mortgage Loans as
of the due
date in the month preceding the month of such Distribution Date)
minus 5.500%
and (b) the denominator of which is equal to 5.500%.
Class 3-A-1 Loss Amount: With respect to any Distribution Date
after the
Senior Credit Support Depletion Date, the amount, if any, by which
the Class
Certificate Balance of the Class 3-A-1 Certificates would be
reduced as a result
of the allocation of any reduction pursuant to Section 5.03(b) to
such Class,
without regard to the operation of Section 5.03(e).
Class 3-A-2 Loss Allocation Amount: With respect to any
Distribution Date
after the Senior Credit Support Depletion Date, the lesser of (a)
the Class
Certificate Balance of the Class 3-A-2 Certificates with respect to
such
Distribution Date prior to any reduction for the Class 3-A-2 Loss
Allocation
Amount and (b) the Class 3-A-2 Loss Amount with respect to such
Distribution
Date.
Class 3-X-IO Notional Amount: With respect to each Distribution
Date and
the Class 3-X-IO Component, an amount equal to the product of (i)
the aggregate
of the Stated Principal Balances of the Group 3 Premium Mortgage
Loans as of the
Due Date in the month preceding the month of such Distribution Date
and (ii) a
fraction, (a) the numerator of which is equal to the weighted
average of the Net
Mortgage Interest Rates of the Group 3 Premium Mortgage Loans
(based on the
Stated Principal Balances of the Group 3 Premium Mortgage Loans as
of the due
- 9 -
date in the month preceding the month of such Distribution Date)
minus 5.500%
and (b) the denominator of which is equal to 5.500%.
Class X-IO Notional Amount: With respect to any Distribution Date,
an
amount equal to the sum of the Class 1-X-IO Notional Amount, the
Class 2-X-IO
Notional Amount and the Class 3-X-IO Notional Amount for such
Distribution Date.
Class B Certificates: The Class B-1, Class B-2, Class B-3, Class
B-4,
Class B-5 and Class B-6 Certificates.
Class Certificate Balance: With respect to any Class of
Certificates
(other than the Class 1-A-21, Class 1-A-26, Class X-IO and Class
X-PO
Certificates) and any date of determination, and subject to Section
5.03(f), the
Initial Class Certificate Balance of such Class minus (A) the sum
of (i) all
distributions of principal made with respect thereto (including in
the case of a
Class of Class B Certificates, any principal otherwise payable to
such Class of
Class B Certificates used to pay any Class PO Deferred Amounts),
(ii) all
reductions in Class Certificate Balance previously allocated
thereto pursuant to
Section 5.03(b) and (iii) in the case of the Class 2-A-2 and Class
3-A-2
Certificates, any reduction allocated thereto pursuant to Section
5.03(e) plus
(B) the sum of (i) all increases in Class Certificate Balance
previously
allocated thereto pursuant to Section 5.03(b) and (ii) in the case
of the Class
2-A-2 and Class 3-A-2 Certificates, any increases allocated thereto
pursuant to
Section 5.03(e). The Class Certificate Balance of the Class X-PO
Certificates as
of any date of determination shall equal the sum of the Component
Balances of
the Class PO Components. The Class 1-A-21, Class 1-A-26 and Class
X-IO
Certificates are Interest Only Certificates and have no Class
Certificate
Balance.
Class Interest Shortfall: For any Distribution Date and each
interest-bearing Class (other than the Class X-IO Certificates),
the amount by
which Accrued Certificate Interest for such Class (as reduced
pursuant to
Section 5.02(c)) exceeds the amount of interest actually
distributed on such
Class on such Distribution Date pursuant to clause (i) of the
definition of
"Interest Distribution Amount." As to any Distribution Date and the
Class X-IO
Certificates, the sum of the Component Interest Shortfalls for the
Class IO
Components.
Class IO Component: Any of the Class 1-X-IO Component, the Class
2-X-IO
Component or the Class 3-X-IO Component.
Class PO Component: Any of the Class 1-X-PO Component, the Class
2-X-PO
Component or the Class 3-X-PO Component.
Class PO Deferred Amount: As to any Distribution Date and each
Class PO
Component, the sum of the amounts by which the Component Balance of
such Class
PO Component will be reduced on such Distribution Date or has been
reduced on
prior Distribution Dates as a result of Section 5.03(b) less the
sum of (a) the
Class PO Recoveries with respect to the Related Loan Group for
prior
Distribution Dates and (b) the amounts distributed to such Class PO
Component
pursuant to Section 5.02(a)(iii) on prior Distribution Dates.
Class PO Recovery: As to any Distribution Date and Loan Group, the
lesser
of (a) (i) in the case of Group 1, the Class PO Deferred Amount for
the Class
1-X-PO Component for such Distribution Date, (ii) in the case of
Group 2, the
Class PO Deferred Amount for the Class 2-X-
- 10 -
PO Component for such Distribution Date and (iii) in the case of
Group 3, the
Class PO Deferred Amount for the Class 3-X-PO Component for such
Distribution
Date and (b) an amount equal to the sum, as to each Mortgage Loan
in such Loan
Group as to which there has been a Recovery received during the
calendar month
preceding the month of such Distribution Date, of the product of
(x) the PO
Percentage with respect to such Mortgage Loan and (y) the amount of
the Recovery
received during the calendar month preceding the month of such
Distribution Date
with respect to such Mortgage Loan.
Class Unpaid Interest Shortfall: As to any Distribution Date and
each
interest-bearing Class (other than the Class X-IO Certificates),
the amount by
which the aggregate Class Interest Shortfalls for such Class on
prior
Distribution Dates exceeds the amount of interest actually
distributed on such
Class on such prior Distribution Dates pursuant to clause (ii) of
the definition
of "Interest Distribution Amount." As to any Distribution Date and
the Class
X-IO Certificates, the sum of the Component Unpaid Interest
Shortfalls for the
Class IO Components.
Class X-B Certificates: The Class X-B-1, Class X-B-2, Class X-B-3,
Class
X-B-4, Class X-B-5 and Class X-B-6 Certificates.
Closing Date: January 31, 2006.
Code: The Internal Revenue Code of 1986, as amended.
Commission: The U.S. Securities and Exchange Commission.
Compensating Interest: With respect to any Distribution Date and
Servicer,
an amount equal to the lesser of (a) the aggregate Servicing Fee
payable to such
Servicer for the Mortgage Loans serviced by such Servicer as of the
Due Date of
the month preceding the month of such Distribution Date and (b) the
aggregate of
the Prepayment Interest Shortfalls on the Mortgage Loans serviced
by such
Servicer resulting from Principal Prepayments on such Mortgage
Loans during the
calendar month preceding the month of such Distribution Date;
provided, however,
that Compensating Interest for any Distribution Date payable by RFC
will be
capped at 1/12th of 0.125% of the aggregate Stated Principal
Balance of the
Mortgage Loans serviced by RFC (calculated as of the Remittance
Date relating to
such Distribution Date).
Compliance Statement: As defined in Section 3.20.
Component: Any of the Class IO Components or Class PO Components.
Component Balance: With respect to any Class PO Component and any
date of
determination, the Initial Component Balance of such Component
minus the sum of
(i) all distributions of principal made with respect thereto and
(ii) all
reductions in the related Component Balance previously allocated
thereto
pursuant to Section 5.03(b). The Class IO Components are interest
only
Components and have no Component Balance.
Component Interest Distribution Amount: For any Distribution Date
and any
Class IO Component, the sum of (i) the Accrued Component Interest
for such
Component and (ii) any Component Unpaid Interest Shortfall for such
Component.
The Class PO Components are principal only Components and are not
entitled to
distributions of interest.
- 11 -
Component Interest Shortfall: For any Distribution Date and any
Class IO
Component, the amount by which Accrued Component Interest for such
Component
exceeds the amount of interest actually distributed on such
Component on such
Distribution Date pursuant to clause (i) of the definition of
"Component
Interest Distribution Amount."
Component Notional Amount: As of any Distribution Date, any of the
Class
1-X-IO Notional Amount, Class 2-X-IO Notional Amount or Class
3-X-IO Notional
Amount.
Component Unpaid Interest Shortfall: As to any Distribution Date
and any
Class IO Component, the amount by which the aggregate Component
Interest
Shortfall for such Component on prior Distribution Dates exceeds
the amount of
interest actually distributed on such Component on such prior
Distribution Dates
pursuant to clause (ii) of the definition of "Component Interest
Distribution
Amount."
Cooperative: A private, cooperative housing corporation which owns
or
leases land and all or part of a building or buildings, including
apartments,
spaces used for commercial purposes and common areas therein and
whose board of
directors authorizes, among other things, the sale of Cooperative
Stock.
Cooperative Apartment: A dwelling unit in a multi-dwelling building
owned
or leased by a Cooperative, which unit the Mortgagor has an
exclusive right to
occupy pursuant to the terms of a proprietary lease or occupancy
agreement.
Cooperative Lease: With respect to a Cooperative Loan, the
proprietary
lease or occupancy agreement with respect to the Cooperative
Apartment occupied
by the Mortgagor and relating to the related Cooperative Stock,
which lease or
agreement confers an exclusive right to the holder of such
Cooperative Stock to
occupy such apartment.
Cooperative Loans: Any of the Mortgage Loans made in respect of a
Cooperative Apartment, evidenced by a Mortgage Note and secured by
(i) a
Security Agreement, (ii) the related Cooperative Stock Certificate,
(iii) an
assignment or mortgage of the Cooperative Lease, (iv) financing
statements and
(v) a stock power (or other similar instrument), and ancillary
thereto, a
Recognition Agreement, each of which was transferred and assigned
to the Trust
pursuant to Section 2.01.
Cooperative Stock: With respect to a Cooperative Loan, the single
outstanding class of stock, partnership interest or other ownership
instrument
in the related Cooperative.
Cooperative Stock Certificate: With respect to a Cooperative Loan,
the
stock certificate or other instrument evidencing the related
Cooperative Stock.
Corporate Trust Office: With respect to the Trustee, the office of
the
Trustee, which office at the date of the execution of this
instrument is located
at 209 South LaSalle Street, Suite 300, Chicago, Illinois 60604,
Attention:
Corporate Trust Services, BAFC, Series 2006-1, or at such other
address as the
Trustee may designate from time to time by notice to the
Certificateholders, the
Depositor, the Securities Administrator and the Master Servicer.
With respect to
the Securities Administrator, the principal corporate trust office
of the
Securities Administrator at which at any particular time its
corporate trust
business with respect to this
- 12 -
Agreement is conducted, which office at the date of the execution
of this
instrument is located at 9062 Old Annapolis Road, Columbia,
Maryland 21045-1951,
Attention: Corporate Trust Services - BAFC 2006-1, and for
certificate transfer
purposes is located at Sixth Street and Marquette Avenue,
Minneapolis, Minnesota
55479, Attention: Corporate Trust Services - BAFC 2006-1, or at
such other
address as the Securities Administrator may designate from time to
time by
notice to the Certificateholders, the Depositor, the Trustee and
the Master
Servicer.
Corresponding Upper-Tier Class, Classes or Component: As to the
following
Uncertificated Intermediate Lower-Tier Interests, the Corresponding
Upper-Tier
Class, Classes or Component, as follows:
-----------------------------------------------------------------------------------------------------------
UNCERTIFICATED
CORRESPONDING UPPER-TIER
INTERMEDIATE LOWER-TIER INTEREST
CLASS, CLASSES OR COMPONENT
-----------------------------------------------------------------------------------------------------------
Class 1-A-IT1 Interest
Class 1-A-1, Class 1-A-2, Class 1-A-3, Class 1-A-4, Class 1-A-5,
Class 1-A-6, Class 1-A-7, Class 1-A-8, Class 1-A-9, Class 1-A-10,
Class 1-A-11, Class 1-A-12, Class 1-A-13, Class 1-A-14,
Class 1-A-15, Class 1-A-16, Class 1-A-17, Class 1-A-18, Class
1-A-19,
Class 1-A-22, Class 1-A-23, Class 1-A-24 and Class 4-A-25
Certificates
-----------------------------------------------------------------------------------------------------------
Class 1-A-IT2 Interest
Class 1-A-20 and Class 1-A-21 Certificates
-----------------------------------------------------------------------------------------------------------
Class 1-A-IT3 Interest
Class 1-A-26, Class 1-A-27 and Class 1-A-28 Certificates
-----------------------------------------------------------------------------------------------------------
Class 1-ITIO Interest
Class 1-IO Component
-----------------------------------------------------------------------------------------------------------
Class 1-ITPO Interest
Class 1-PO Component
-----------------------------------------------------------------------------------------------------------
Class 2-A-IT1 Interest
Class 2-A-1 and Class 2-A-2 Certificates
-----------------------------------------------------------------------------------------------------------
Class 2-ITIO Interest
Class 2-IO Component
-----------------------------------------------------------------------------------------------------------
Class 2-ITPO Interest
Class 2-PO Component
-----------------------------------------------------------------------------------------------------------
Class 3-IT1 Interest
Class 3-A-1 and Class 3-A-2 Certificates
-----------------------------------------------------------------------------------------------------------
Class 3-ITIO Interest
Class 3-IO Component
-----------------------------------------------------------------------------------------------------------
Class 3-ITPO Interest
Class 3-PO Component
-----------------------------------------------------------------------------------------------------------
Class 3-A-ITR Interest
Class 3-A-R Certificate
-----------------------------------------------------------------------------------------------------------
Class B-IT1 Interest
Class B-1 Certificates
-----------------------------------------------------------------------------------------------------------
- 13 -
-----------------------------------------------------------------------------------------------------------
UNCERTIFICATED
CORRESPONDING UPPER-TIER
INTERMEDIATE LOWER-TIER INTEREST
CLASS, CLASSES OR COMPONENT
-----------------------------------------------------------------------------------------------------------
Class B-IT2 Interest
Class B-2 Certificates
-----------------------------------------------------------------------------------------------------------
Class B-IT3 Interest
Class B-3 Certificates
-----------------------------------------------------------------------------------------------------------
Class B-IT4 Interest
Class B-4 Certificates
-----------------------------------------------------------------------------------------------------------
Class B-IT5 Interest
Class B-5 Certificates
-----------------------------------------------------------------------------------------------------------
Class B-IT6 Interest
Class B-6 Certificates
-----------------------------------------------------------------------------------------------------------
Class X-B-IT1 Interest
Class X-B-1 Certificates
-----------------------------------------------------------------------------------------------------------
Class X-B-IT2 Interest
Class X-B-2 Certificates
-----------------------------------------------------------------------------------------------------------
Class X-B-IT3 Interest
Class X-B-3 Certificates
-----------------------------------------------------------------------------------------------------------
Class X-B-IT4 Interest
Class X-B-4 Certificates
-----------------------------------------------------------------------------------------------------------
Class X-B-IT5 Interest
Class X-B-5 Certificates
-----------------------------------------------------------------------------------------------------------
Class X-B-IT6 Interest
Class X-B-6 Certificates
-----------------------------------------------------------------------------------------------------------
Counterparty: BANA.
Crossed Groups: Loan Group 1 and Loan Group 3.
Crossed Group Aggregate Subordinate Percentage: As to any
Distribution
Date, the aggregate Class Certificate Balance of the X-B
Certificates divided by
the aggregate Pool Stated Principal Balance (Non-PO Portion) for
Loan Group 1
and Loan Group 3.
Crossed Group Total Senior Percentage: With respect to any
Distribution
Date, the percentage, carried six places rounded up, obtained by
dividing (x)
the aggregate Class Certificate Balance of the Group 1 Senior
Certificates and
the Group 3 Senior Certificates by (y) the aggregate Pool Stated
Principal
Balance (Non-PO Portion) for Loan Group 1 and Loan Group 3 with
respect to such
Distribution Date.
Custodian: Initially, the Trustee and thereafter any custodian
appointed
by the Trustee pursuant to Section 9.12. A Custodian may (but need
not) be the
Trustee or any Person directly or indirectly controlling or
controlled by or
under common control of either of them. None of the Master
Servicer, any
Servicer or the Depositor, or any Person directly or indirectly
controlling or
controlled by or under common control with any such Person may be
appointed
Custodian.
- 14 -
Customary Servicing Procedures: With respect to (i) any Servicer,
procedures (including collection procedures) that a Servicer
customarily employs
and exercises in servicing and administering mortgage loans for its
own account
and which are in accordance with accepted mortgage servicing
practices of
prudent lending institutions servicing mortgage loans of the same
type as the
Mortgage Loans in the jurisdictions in which the related Mortgaged
Properties
are located and (ii) the Master Servicer, those master servicing
procedures that
constitute customary and usual standards of practice of prudent
mortgage loan
master servicers.
Cut-off Date: January 1, 2006.
Cut-off Date Pool Principal Balance: For each Loan Group, the
aggregate of
the Cut-off Date Principal Balances of the Mortgage Loans in such
Loan Group
which is $267,328,659 for Loan Group 1, $114,603,544 for Loan Group
2 and
$100,211,992 for Loan Group 3.
Cut-off Date Principal Balance: As to any Mortgage Loan, the unpaid
principal balance thereof as of the close of business on the
Cut-off Date,
reduced by all installments of principal due on or prior thereto
whether or not
paid.
Debt Service Reduction: As to any Mortgage Loan and any
Determination
Date, the excess of (i) the Monthly Payment due on the related Due
Date under
the terms of such Mortgage Loan over (ii) the amount of the monthly
payment of
principal and/or interest required to be paid with respect to such
Due Date by
the Mortgagor as established by a court of competent jurisdiction
(pursuant to
an order which has become final and nonappealable) as a result of a
proceeding
initiated by or against the related Mortgagor under the Bankruptcy
Code, as
amended from time to time (11 U.S.C.); provided that no such excess
shall be
considered a Debt Service Reduction so long as (a) the Servicer of
such Mortgage
Loan is pursuing an appeal of the court order giving rise to any
such
modification and (b)(1) such Mortgage Loan is not in default with
respect to
payment due thereunder in accordance with the terms of such
Mortgage Loan as in
effect on the Cut-off Date or (2) Monthly Payments are being
advanced by the
applicable Servicer, the Master Servicer or the Trustee, as
applicable, in
accordance with the terms of such Mortgage Loan as in effect on the
Cut-off
Date.
Debt Service Reduction Mortgage Loan: Any Mortgage Loan that became
the
subject of a Debt Service Reduction.
Defective Mortgage Loan: Any Mortgage Loan which is required to be
cured,
repurchased or substituted for pursuant to Sections 2.02 or 2.04.
Deficient Valuation: As to any Mortgage Loan and any Determination
Date,
the excess of (i) the then outstanding indebtedness under such
Mortgage Loan
over (ii) the secured valuation thereof established by a court of
competent
jurisdiction (pursuant to an order which has become final and
nonappealable) as
a result of a proceeding initiated by or against the related
Mortgagor under the
Bankruptcy Code, as amended from time to time (11 U.S.C.), pursuant
to which
such Mortgagor retained such Mortgaged Property; provided that no
such excess
shall be considered a Deficient Valuation so long as (a) the
applicable Servicer
is pursuing an appeal of the court order giving rise to any such
modification
and (b)(1) such Mortgage Loan is not in default with respect to
payments due
thereunder in accordance with the terms of such Mortgage
- 15 -
Loan as in effect on the Cut-off Date or (2) Monthly Payments are
being advanced
by the applicable Servicer, the Master Servicer or the Trustee, as
applicable,
in accordance with the terms of such Mortgage Loan as in effect on
the Cut-off
Date.
Definitive Certificates: As defined in Section 6.02(c)(iii).
Depositor: Banc of America Funding Corporation, a Delaware
corporation, or
its successor in interest, as depositor of the Trust Estate.
Depository: The Depository Trust Company, the nominee of which is
Cede &
Co., as the registered Holder of the Book-Entry Certificates or any
successor
thereto appointed in accordance with this Agreement. The Depository
shall at all
times be a "clearing corporation" as defined in Section 8-102(3) of
the Uniform
Commercial Code of the State of New York.
Depository Participant: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository
effects
book-entry transfers and pledges of securities deposited with the
Depository.
Determination Date: With respect to any Distribution Date and for
each
Servicer, as defined in the applicable Servicing Agreement.
Discount Mortgage Loan: Any Group 1 Discount Mortgage Loan, Group 2
Discount Mortgage Loan or Group 3 Discount Mortgage Loan.
Distribution Date: The 25th day of each month beginning in February
2006
(or, if such day is not a Business Day, the next Business Day).
Document Transfer Event: The 60th day following the day on which
either
(i) Wells Fargo Bank is no longer the Servicer of any of the
Mortgage Loans
purchased by the Sponsor from Wells Fargo Bank, N.A. or (ii) the
senior,
unsecured long-term debt rating of Wells Fargo & Company is
less than "BBB-" by
Fitch.
Due Date: As to any Distribution Date and each Mortgage Loan, the
first
day in the calendar month of such Distribution Date.
EDGAR: The Commission's Electronic Data Gathering and Retrieval
System.
Eligible Account: Any of (i) an account or accounts maintained with
a
federal or state chartered depository institution or trust company
the
short-term unsecured debt obligations of which (or, in the case of
a depository
institution or trust company that is the principal subsidiary of a
holding
company, the debt obligations of such holding company) have the
highest
short-term ratings of each Rating Agency at the time any amounts
are held on
deposit therein, or (ii) an account or accounts in a depository
institution or
trust company in which such accounts are insured by the FDIC (to
the limits
established by the FDIC) and the uninsured deposits in which
accounts are
otherwise secured such that, as evidenced by an Opinion of Counsel
delivered to
the Trustee, the Securities Administrator and to each Rating
Agency, the
Certificateholders have a claim with respect to the funds in such
account or a
perfected first priority security interest against any collateral
(which shall
be limited to Permitted Investments) securing such funds that
- 16 -
is superior to claims of any other depositors or creditors of the
depository
institution or trust company in which such account is maintained,
or (iii) a
trust account or accounts maintained with the trust department of a
federal or
state chartered depository institution or trust company (including
the Trustee
and the Securities Administrator), acting in its fiduciary capacity
or (iv) any
other account acceptable to each Rating Agency. Eligible Accounts
may bear
interest and may include, if otherwise qualified under this
definition, accounts
maintained with the Trustee or the Securities Administrator.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA Restricted Certificates: Any of the Class 3-A-R, Class B-4,
Class
B-5, Class B-6, Class X-B-4, Class X-B-5 and Class X-B-6
Certificates.
Escrow Account: As defined in Section 3.08.
Escrow Payments: The amounts constituting taxes, assessments,
Primary
Mortgage Insurance Policy premiums, fire and hazard insurance
premiums and other
payments as may be required to be escrowed by the Mortgagor with
the mortgagee
pursuant to the terms of any Mortgage Note or Mortgage.
Events of Default: As defined in Section 8.01.
Excess Funds: With respect to the Reserve Fund and for any
Distribution
Date, the amount by which (a) the Yield Maintenance Agreement
Payments for prior
Distribution Dates and any other amounts deposited in the Reserve
Fund exceed
(b) the amount actually paid from the Reserve Fund with respect to
(i) Yield
Maintenance Amounts for such prior Distribution Dates and (ii)
Yield Maintenance
Amount Shortfalls for such prior Distribution Dates.
Excess Proceeds: With respect to any Liquidated Mortgage Loan, the
amount,
if any, by which the sum of any Liquidation Proceeds of such
Mortgage Loan
received in the calendar month in which such Mortgage Loan became a
Liquidated
Mortgage Loan, net of any amounts previously reimbursed to the
applicable
Servicer as Nonrecoverable Advance(s) with respect to such Mortgage
Loan
pursuant to Section 3.11(a)(iv), exceeds (i) the unpaid principal
balance of
such Liquidated Mortgage Loan as of the Due Date in the month in
which such
Mortgage Loan became a Liquidated Mortgage Loan plus (ii) accrued
interest at
the Mortgage Interest Rate from the Due Date as to which interest
was last paid
or for which a Periodic Advance was made (and not reimbursed) up to
the Due Date
applicable to the Distribution Date immediately following the
calendar month
during which such liquidation occurred.
Exchange Act: The Securities Exchange Act of 1934, as amended.
FDIC: The Federal Deposit Insurance Corporation, or any successor
thereto.
Final Distribution Date: The Distribution Date on which the final
distribution in respect of the Certificates will be made pursuant
to Section
10.01.
- 17 -
Financial Market Service: Bloomberg Financial Service and any other
financial information provider designated by the Depositor by
written notice to
the Securities Administrator.
FIRREA: The Financial Institutions Reform, Recovery and Enforcement
Act of
1989, as amended.
Fitch: Fitch Ratings, or any successor thereto.
Form 8-K Disclosure Information: As defined in Section 3.22(d).
Fractional Interest:
As defined in Section 5.02(d).
GMACM: GMAC Mortgage Corporation, in its capacity as Servicer under
the
GMACM Servicing Agreement.
GMACM Servicing Agreement: Collectively, the Master Flow Sale and
Servicing Agreement, dated as of August 1, 2003, by and between
BANA and GMACM,
as amended by (i) that certain Global Amendment to Sale and
Servicing
Agreements, dated as of September 1, 2005, by and among GMACM,
BAMCC and BANA,
(ii) that certain Regulation AB Compliance Addendum to the Master
Flow Sale and
Servicing Agreement, dated as of January 1, 2006, by and between
GMACM and BANA
and (iii) the Assignment, Assumption and Recognition Agreement,
dated January
31, 2006, by and among BANA, the Depositor, the Trustee, the Master
Servicer and
GMACM.
Group: Any of Group 1, Group 2 or Group 3.
Group 1: The Group 1 Senior Certificates, the Class 1-X-IO
Component and
the Class 1-X-PO Component.
Group 1 Discount Mortgage Loan: Any Group 1 Mortgage Loan with a
Net
Mortgage Interest Rate as of the Cut-off Date that is less than
5.750% per
annum.
Group 1 Mortgage Loan: Each Mortgage Loan listed on Exhibit D-1
hereto.
Group 1 Premium Mortgage Loan: Any Group 1 Mortgage Loan with a Net
Mortgage Interest Rate as of the Cut-off Date that is greater than
or equal to
5.750% per annum.
Group 1 Senior Certificates: The Class 1-A-1, Class 1-A-2, Class
1-A-3,
Class 1-A-4, Class 1-A-5, Class 1-A-6, Class 1-A-7, Class 1-A-8,
Class 1-A-9,
Class 1-A-10, Class 1-A-11, Class 1-A-12, Class 1-A-13, Class
1-A-14, Class
1-A-15, Class 1-A-16, Class 1-A-17, Class 1-A-18, Class 1-A-19,
Class 1-A-20,
Class 1-A-21, Class 1-A-22, Class 1-A-23, Class 1-A-24, Class
1-A-25, Class
1-A-26, Class 1-A-27 and Class 1-A-28 Certificates.
Group 2: The Group 2 Senior Certificates, the Class 2-X-IO
Component and
the Class 2-X-PO Component.
- 18 -
Group 2 Discount Mortgage Loan: Any Group 2 Mortgage Loan with a
Net
Mortgage Interest Rate as of the Cut-off Date that is less than
5.500% per
annum.
Group 2 Mortgage Loan: Each Mortgage Loan listed on Exhibit D-2
hereto.
Group 2 Premium Mortgage Loan: Any Group 2 Mortgage Loan with a Net
Mortgage Interest Rate as of the Cut-off Date that is greater than
or equal to
5.500% per annum.
Group 2 Senior Certificates: The Class 2-A-1 and Class 2-A-2
Certificates.
Group 2 Total Senior Percentage: With respect to any Distribution
Date,
the percentage, carried six places rounded up, obtained by dividing
(x) the
aggregate Class Certificate Balance of the Group 2 Senior
Certificates by (y)
the aggregate Pool Stated Principal Balance (Non-PO Portion) for
Loan Group 2
with respect to such Distribution Date.
Group 3: The Group 3 Senior Certificates, the Class 3-X-IO
Component and
the Class 3-X-PO Component.
Group 3 Discount Mortgage Loan: Any Group 3 Mortgage Loan with a
Net
Mortgage Interest Rate as of the Cut-off Date that is less than
5.500% per
annum.
Group 3 Mortgage Loan: Each Mortgage Loan listed on Exhibit D-3
hereto.
Group 3 Premium Mortgage Loan: Any Group 3 Mortgage Loan with a Net
Mortgage Interest Rate as of the Cut-off Date that is greater than
or equal to
5.500% per annum.
Group Subordinate Amount: For any Distribution Date and any Loan
Group is
equal to the excess of the Pool Principal Balance (Non-PO Portion)
for such Loan
Group over the aggregate class balance of the Senior Certificates
of such Group
immediately prior to such date.
Holder: A Certificateholder.
Independent: When used with respect to any specified Person means
such a
Person who (i) is in fact independent of the Depositor, the
Trustee, the
Securities Administrator, the Master Servicer and the Servicers,
(ii) does not
have any direct financial interest or any material indirect
financial interest
in the Depositor, the Trustee, the Securities Administrator, the
Master Servicer
or the Servicers or in an affiliate of any of them, and (iii) is
not connected
with the Depositor, the Trustee, the Securities Administrator, the
Master
Servicer or the Servicers as an officer, employee, promoter,
underwriter,
trustee, partner, director or person performing similar functions.
Initial Class Certificate Balance: As to each Class of Certificates
(other
than the Class 1-A-21, Class 1-A-26 and Class X-IO Certificates),
the Class
Certificate Balance set forth in the Preliminary Statement. The
Class 1-A-21,
Class 1-A-26 and Class X-IO Certificates are Interest Only
Certificates and have
no Initial Class Certificate Balance.
Initial Component Balance: As to each Class PO Component, the
Component
Balance set forth in the Preliminary Statement.
- 19 -
Initial Notional Amount: As to each Class of Interest Only
Certificates,
the Notional Amount set forth in the Preliminary Statement.
Insurance Policy: With respect to any Mortgage Loan included in the
Trust
Estate, any Primary Mortgage Insurance Policy or any other
insurance policy
(including any policy covering any Mortgage Loan or Mortgaged
Property,
including without limitation, any hazard insurance policy required
pursuant to
Section 3.12, any title insurance policy described in Section 2.01
and any
Federal Housing Administration insurance policies and Department of
Veterans
Affairs insurance policies), including all riders and endorsements
thereto in
effect, including any replacement policy or policies for any
Insurance Policies.
Insurance Proceeds: Proceeds paid by an insurer pursuant to any
Insurance
Policy, in each case other than any amount included in such
Insurance Proceeds
in respect of Insured Expenses.
Insured Expenses: Expenses covered by an Insurance Policy or any
other
insurance policy with respect to the Mortgage Loans.
Interest Accrual Period: As to any Distribution Date and each Class
of
interest-bearing Certificates (other than the Class 1-A-20, Class
1-A-21 and
Class X-IO Certificates) and each Class IO Component, the period
from and
including the first day of the calendar month preceding the
calendar month of
such Distribution Date to but not including the first day of the
calendar month
of such Distribution Date. As to any Distribution Date and each
Class 1-A-20,
Class 1-A-21 or Class X-IO Certificates, the period from and
including the
25th day of the calendar month preceding the calendar month of such
Distribution
Date to and including the 24th day of the calendar month of such
Distribution
Date.
Interest Distribution Amount: For any Distribution Date and each
interest-bearing Class (other than the Class X-IO Certificates) and
each Class
IO Component, the sum of (i) the Accrued Certificate Interest or
Accrued
Component Interest, subject to reduction pursuant to Section
5.02(c) and (ii)
any Class Unpaid Interest Shortfall for such Class or Component
Unpaid Interest
Shortfall for such Component.
Interest Only Certificates: Any Class of Certificates entitled to
distributions of interest, but no distributions of principal. The
Class 1-A-21,
Class 1-A-26 and Class X-IO Certificates are the only Classes of
Interest Only
Certificates.
Intermediate Lower-Tier Certificate Sub-Account: The sub-account of
the
Certificate Account designated by the Securities Administrator
pursuant to
Section 3.09(i).
Intermediate Lower-Tier Distribution Amount: As defined in Section
5.02(a).
Intermediate Lower-Tier REMIC: As defined in the Preliminary
Statement,
the assets of which consist of the Uncertificated Lower-Tier
Interests and such
amounts as shall from time to time be deemed held in the
Intermediate Lower-Tier
Certificate Sub-Account.
LIBOR: As to any Distribution Date, the arithmetic mean of the
London
Interbank offered rate quotations for one-month U.S. Dollar
deposits, as
determined by the Securities Administrator in accordance with
Section 5.09.
- 20 -
LIBOR Business Day: Any Business Day on which banks are open for
dealing
in foreign currency and exchange in London, England and the City of
New York.
LIBOR Certificates: Any of the Class 1-A-20 or Class 1-A-21
Certificates.
Liquidated Mortgage Loan: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) that was
liquidated in the
calendar month preceding the month of such Distribution Date and as
to which the
applicable Servicer has certified (in accordance with the
applicable Servicing
Agreement) that it has received all proceeds it expects to receive
in connection
with the liquidation of such Mortgage Loan including the final
disposition of an
REO Property.
Liquidation Proceeds: Amounts, including Insurance Proceeds,
received in
connection with the partial or complete liquidation of defaulted
Mortgage Loans,
whether through trustee's sale, foreclosure sale or otherwise or
amounts
received in connection with any condemnation or partial release of
a Mortgaged
Property and any other proceeds received in connection with an REO
Property,
less the sum of related unreimbursed Servicing Fees and Advances.
Loan Group: Any of Loan Group 1, Loan Group 2 or Loan Group 3.
Loan Group 1: The Group 1 Mortgage Loans.
Loan Group 2: The Group 2 Mortgage Loans.
Loan Group 3: The Group 3 Mortgage Loans.
Loan-to-Value Ratio: With respect to any Mortgage Loan and any date
of
determination, the fraction, expressed as a percentage, the
numerator of which
is the outstanding principal balance of the related Mortgage Loan
at origination
and the denominator of which is the Appraised Value of the related
Mortgaged
Property.
Losses: As defined in Section 5.10(a).
Lower-Tier Distribution Amount: As defined in Section 5.02(a).
Lower-Tier REMIC: As defined in the Preliminary Statement, the
assets of
which consist of the Mortgage Loans, such amounts as shall from
time to time be
held in the Certificate Account (other than amounts held in respect
of the
Intermediate Lower-Tier Certificate Sub-Account or the Upper-Tier
Certificate
Sub-Account), the insurance policies, if any, relating to a
Mortgage Loan and
property which secured a Mortgage Loan and which has been acquired
by
foreclosure or deed in lieu of foreclosure.
Lower-Tier REMICs: The Lower-Tier REMIC and the Intermediate
Lower-Tier
REMIC.
Master Servicer: Wells Fargo Bank, N.A., and its
successors-in-interest
and, if a successor master servicer is appointed hereunder, such
successor, as
master servicer.
- 21 -
Master Servicer Custodial Account: The Eligible Account created and
maintained by the Master Servicer pursuant to Section 3.09 in the
name of the
Master Servicer for the benefit of the Certificateholders and
designated "Wells
Fargo Bank, N.A., as Master Servicer, in trust for the registered
holders of
Banc of America Funding Corporation Mortgage Pass-Through
Certificates, Series
2006-1."
Master Servicer Custodial Account Reinvestment Income: For each
Distribution Date, all income and gains net of any losses realized
since the
preceding Distribution Date from Permitted Investments of funds in
the Master
Servicer Custodial Account.
Master Servicing Officer: Any officer of the Master Servicer
involved in,
or responsible for, the administration and master servicing of the
Mortgage
Loans whose name appears on a list of servicing officers furnished
to the
Securities Administrator by the Master Servicer, as such list may
from time to
time be amended.
Master Servicing Transfer Costs: All reasonable costs and expenses
(including attorney's fees) incurred by the Trustee or a successor
master
servicer in connection with the transfer of master servicing or
servicing from a
predecessor master servicer, including, without limitation, any
costs or
expenses associated with the complete transfer of all master
servicing data or
servicing data and the completion, correction or manipulation of
such master
servicing data or servicing data as may be required by the Trustee
or successor
master servicer to correct any errors or insufficiencies in the
master servicing
data or servicing data or otherwise to enable the Trustee or a
successor master
servicer to master service or service, as the case may be, the
applicable
Mortgage Loans properly and effectively.
MERS: As defined in Section 2.01(b)(iii).
Monthly 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.
Monthly Statement: As defined in Section 5.04(b).
Moody's: Moody's Investors Service, Inc., or any successor thereto.
Mortgage: The mortgage, deed of trust or other instrument creating
a first
lien on a Mortgaged Property securing a Mortgage Note or creating a
first lien
on a leasehold interest.
Mortgage File: The mortgage documents listed in Section 2.01
pertaining to
a particular Mortgage Loan and any additional documents required to
be added to
the Mortgage File pursuant to this Agreement.
Mortgage Interest Rate: As to any Mortgage Loan, the per annum rate
of
interest at which interest accrues on the principal balance of such
Mortgage
Loan in accordance with the terms of the related Mortgage Note.
- 22 -
Mortgage Loan Purchase Agreement: The Mortgage Loan Purchase
Agreement,
dated January 31, 2006, between BANA, as seller and sponsor, and
the Depositor,
as purchaser.
Mortgage Loan Schedule: The list of Mortgage Loans (as from time to
time
amended by the Master Servicer to reflect the addition of
Substitute Mortgage
Loans and the deletion of Defective Mortgage Loans pursuant to the
provisions of
this Agreement) transferred to the Trustee as part of the Trust
Estate and from
time to time subject to this Agreement, attached hereto as Exhibit
D-1, Exhibit
D-2 and Exhibit D-3, setting forth the following information with
respect to
each Mortgage Loan: (i) the Mortgage Loan identifying number; (ii)
a code
indicating whether the Mortgaged Property is owner-occupied; (iii)
the property
type for each Mortgaged Property; (iv) the original months to
maturity or the
remaining months to maturity from the Cut-off Date; (v) the
Loan-to-Value Ratio
at origination; (vi) the Mortgage Interest Rate; (vii) the date on
which the
first Monthly Payment was due on the Mortgage Loan, and, if such
date is not the
Due Date currently in effect, such Due Date; (viii) the stated
maturity date;
(ix) the amount of the Monthly Payment as of the Cut-off Date; (x)
the
paid-through date; (xi) the original principal amount of the
Mortgage Loan;
(xii) the principal balance of the Mortgage Loan as of the close of
business on
the Cut-off Date, after application of payments of principal due on
or before
the Cut-off Date, whether or not collected, and after deduction of
any payments
collected of scheduled principal due after the Cut-off Date; (xiii)
a code
indicating the purpose of the Mortgage Loan; (xiv) a code
indicating the
documentation style; (xv) a code indicating the initial Servicer;
(xvi) the
Appraised Value; (xvii) the closing date of the Mortgage Loan; and
(xviii) a
code indicating whether the Mortgage Loan has a prepayment premium.
With respect
to the Mortgage Loans in the aggregate, the Mortgage Loan Schedule
shall set
forth the following information, as of the Cut-off Date: (i) the
number of
Mortgage Loans; (ii) the current aggregate outstanding principal
balance of the
Mortgage Loans; (iii) the weighted average Mortgage Interest Rate
of the
Mortgage Loans; and (iv) the weighted average months to maturity of
the Mortgage
Loans.
Mortgage Loans: Such of the mortgage loans transferred and assigned
to the
Trustee pursuant to Section 2.01 as from time to time are held as a
part of the
Trust Estate (including any Substitute Mortgage Loans and REO
Property), the
Mortgage Loans originally so held being identified in the Mortgage
Loan
Schedule.
Mortgage Note: The originally executed note or other evidence of
indebtedness evidencing the indebtedness of a Mortgagor under a
Mortgage Loan,
together with all riders thereto and amendments thereof.
Mortgaged Property: The underlying property securing a Mortgage
Loan,
which may include Cooperative Stock or residential long-term
leases.
Mortgagor: The obligor on a Mortgage Note.
National City Mortgage: National City Mortgage Co.
National City Mortgage Servicing Agreement: Collectively, the
Master
Sponsor's Warranties and Servicing Agreement, dated as of September
1, 2003, by
and between BANA (as successor in interest to BAMCC) and National
City Mortgage,
as amended by (i) Amendment No. 1, dated as of July 1, 2004, by and
among BAMCC,
National City Mortgage and BANA,
- 23 -
(ii) the Master Assignment, Assumption and Recognition Agreement,
dated as of
July 1, 2004, by and among BAMCC, National City Mortgage, BANA and
Wachovia
Bank, National Association, (iii) Amendment No. 2, dated as of
October 1, 2004,
by and between National City Mortgage and BANA, (iv) Amendment No.
3, dated as
of August 11, 2005, by and between National City Mortgage and BANA,
(v) that
certain Regulation AB Compliance Addendum to the Master Sponsor's
Warranties and
Servicing Agreement, dated as of January 1, 2006, by and between
National City
Mortgage and BANA, (vi) those certain Assignment and Conveyance
Agreements,
dated October 5, 2005, October 20, 2005 and December 20, 2005 and
(vii) the
Assignment Assumption and Recognition Agreement, dated January 31,
2006, by and
among BANA, the Depositor, the Trustee and National City Mortgage.
Net Mortgage Interest Rate: As to any Mortgage Loan and
Distribution Date,
such Mortgage Loan's Mortgage Interest Rate thereon on the first
day of the
calendar month preceding the month of such Distribution Date
reduced by the
Servicing Fee Rate for such Mortgage Loan.
Non-PO Percentage: As to any Discount Mortgage Loan, a fraction
(expressed
as a percentage), the numerator of which is the Net Mortgage
Interest Rate as of
the Cut-off Date of such Discount Mortgage Loan and the denominator
of which is
5.750% for each Group 1 Discount Mortgage Loan, 5.500% for each
Group 2 Mortgage
Loan and 5.500% for each Group 3 Mortgage Loan. As to any Mortgage
Loan that is
not a Discount Mortgage Loan, 100%.
Non-PO Principal Amount: As to any Distribution Date and Loan
Group, the
sum of (i) the sum of the applicable Non-PO Percentage of (a) the
principal
portion of each Monthly Payment due on each Mortgage Loan in such
Loan Group on
the related Due Date (net of unreimbursed Advances and other
amounts as to which
the related Servicer is entitled to be reimbursed pursuant to the
applicable
Servicing Agreement), (b) the Stated Principal Balance, as of the
date of
repurchase, of (i) each Mortgage Loan in such Loan Group that was
repurchased by
a Servicer pursuant to the applicable Servicing Agreement as of
such
Distribution Date, (ii) each Mortgage Loan in such Loan Group
repurchased by the
Sponsor pursuant to the Mortgage Loan Purchase Agreement or a
Purchase
Obligation as of such Distribution Date, (iii) each Mortgage Loan
in such Loan
Group repurchased by the Depositor pursuant to Section 2.04 or (iv)
each
Mortgage Loan in such Loan Group purchased by the Master Servicer
pursuant to
Section 10.01, (c) any Substitution Adjustment Amount (net of
unreimbursed
Advances and other amounts as to which the related Servicer is
entitled to be
reimbursed pursuant to the applicable Servicing Agreement) in
connection with a
Defective Mortgage Loan in such Loan Group received during the
calendar month
preceding the month of such Distribution Date, (d) any Liquidation
Proceeds
allocable to recoveries of principal of Mortgage Loans in such Loan
Group that
are not yet Liquidated Mortgage Loans received by a Servicer during
the calendar
month preceding the month of such Distribution Date, (e) with
respect to each
Mortgage Loan in such Loan Group that became a Liquidated Mortgage
Loan during
the calendar month preceding the month of such Distribution Date,
the amount of
Liquidation Proceeds (excluding Excess Proceeds) allocable to
principal received
by a Servicer with respect to such Mortgage Loan during such period
and (f) with
respect to each Mortgage Loan, all Principal Prepayments on the
Mortgage Loans
in such Loan Group received by a Servicer during the calendar month
preceding
the month of such Distribution Date; and (ii) the Non-PO Recovery
with respect
to such Loan Group for such Distribution Date.
- 24 -
Non-PO Recovery: As to any Distribution Date and Loan Group, the
amount of
all Recoveries received with respect to such Loan Group during the
calendar
month preceding the month of such Distribution Date less the Class
PO Recovery
with respect to such Loan Group for such Distribution Date.
Non-Supported Interest Shortfalls: As to any Distribution Date, the
amount, if any, by which the aggregate of Prepayment Interest
Shortfalls exceeds
the aggregate Compensating Interest for such Distribution Date.
Non-U.S. Person: A Person other than a U.S. Person.
Nonrecoverable Advance: Any portion of an Advance previously made
or
proposed to be made in respect of a Mortgage Loan which has not
been previously
reimbursed and which, in the good faith judgment of the applicable
Servicer will
not or, in the case of a proposed Advance, would not be ultimately
recoverable
from the related Mortgagor, related Liquidation Proceeds, Insurance
Proceeds or
other recoveries in respect of the related Mortgage Loan.
Notional Amount: With respect to (a) the Class 1-A-21 Certificates
and any
date of determination, the Class 1-A-21 Notional Amount, (b) the
Class 1-A-26
Certificates and any date of determination, the Class 1-A-26
Notional Amount and
(c) the Class X-IO Certificates and any date of determination, the
Class X-IO
Notional Amount.
NYCEMA: A New York Consolidation, Extension and Modification
Agreement.
Offered Certificates: The Senior, Class B-1, Class B-2, Class B-3,
Class
X-B-1, Class X-B-2 and Class X-B-3 Certificates.
Officer's Certificate: A certificate signed by the Chairman of the
Board,
Vice Chairman of the Board, President or a Vice President and by
the Treasurer,
the Secretary or one of the Assistant Treasurers or Assistant
Secretaries, or
any other duly authorized officer of the Depositor or the Master
Servicer, as
the case may be, and delivered to the Trustee or the Securities
Administrator,
as required in this Agreement.
Opinion of Counsel: A written opinion of counsel acceptable to the
Trustee
if such opinion is delivered to the Trustee, or acceptable to the
Securities
Administrator if such opinion is delivered to the Securities
Administrator, who
may be counsel for the Depositor or the Master Servicer, except
that any opinion
of counsel relating to the qualification of the Trust Estate as
three REMICs or
compliance with the REMIC Provisions must be an opinion of
Independent counsel.
Original Fractional Interest: With respect to each of the following
Classes of Subordinate Certificates, the corresponding percentage
described
below, as of the Closing Date:
Class B-1
1.41%
Class B-2
0.80%
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Class B-3
0.50%
Class B-4
0.30%
Class B-5
0.15%
Class B-6
0.00%
Class X-B-1
1.48%
Class X-B-2
0.92%
Class X-B-3
0.56%
Class X-B-4
0.36%
Class X-B-5
0.20%
Class X-B-6
0.00%
Original Subordinate Certificate Balance: $17,392,181.
OTS: The Office of Thrift Supervision.
Outstanding Mortgage Loan: As to any Due Date, a Mortgage Loan
which was
not the subject of a Principal Prepayment in Full, which did not
become a
Liquidated Mortgage Loan prior to such Due Date and which was not
purchased from
the Trust prior to such Due Date pursuant to Sections 2.02 or 2.04.
Ownership Interest: As to any Certificate, any ownership or
security
interest in such Certificate, including any interest in such
Certificate as the
Holder thereof and any other interest therein, whether direct or
indirect, legal
or beneficial, as owner or as pledgee.
PAC Certificates: The Class 1-A-7, Class 1-A-8, Class 1-A-9, Class
1-A-13,
Class 1-A-14, Class 1-A-23, Class 1-A-24, Class 1-A-25, Class
1-A-27 and Class
1-A-28 Certificates.
PAC Group I: The Class 1-A-23, Class 1-A-24, Class 1-A-25, Class
1-A-27
and Class 1-A-28 Certificates.
PAC Group I Principal Amount: As to any Distribution Date and PAC
Group I,
the amount, if any, that would reduce the aggregate Class
Certificate Balance of
PAC Group I to the applicable balance shown in the applicable table
set forth in
Exhibit O with respect to such Distribution Date.
PAC Group II: The Class 1-A-7, Class 1-A-8, Class 1-A-9, Class
1-A-13,
Class 1-A-14 Certificates.
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PAC Group II Principal Amount: As to any Distribution Date and PAC
Group
II, the amount, if any, that would reduce the aggregate Class
Certificate
Balance of PAC Group II to the applicable balance shown in the
applicable table
set forth in Exhibit O with respect to such Distribution Date.
Pass-Through Rate: As to each Class of interest-bearing
Certificates and
each interest-bearing Component, the per annum rate set forth or
described in
the Preliminary Statement.
Payahead Amount: As to any Distribution Date and Mortgage Loan,
early
prepayments of scheduled installments of principal and interest
made by a
Mortgagor during the calendar month preceding the month of such
Distribution
Date that are intended by such Mortgagor to be applied on
subsequent Due Dates.
Paying Agent: As defined in Section 9.13.
Percentage Interest: As to any Certificate, the percentage obtained
by
dividing the initial Certificate Balance of such Certificate (or
the initial
notional amount for the Class 1-A-21, Class 1-A-26 and Class X-IO
Certificates)
by the Initial Class Certificate Balance or Initial Notional
Amount, as
applicable, of the Class of which such Certificate is a part.
Periodic Advance: With respect to each Servicer, shall have the
meaning
given to term "Monthly Advance" in the applicable Servicing
Agreement.
Permitted Investments: One or more of the following:
(i)
obligations of or guaranteed as to principal and interest by
the United States, Freddie Mac, Fannie Mae or any agency or
instrumentality of the United States when such obligations are
backed by
the full faith and credit of the United States; provided that such
obligations of Freddie Mac or Fannie Mae shall be limited to senior
debt
obligations and mortgage participation certificates other than
investments
in mortgage-backed or mortgage participation securities with yields
evidencing extreme sensitivity to the rate of principal payments on
the
underlying mortgages, which shall not constitute Permitted
Investments
hereunder;
(ii)
repurchase agreements on obligations specified in clause (i)
maturing not more than one month from the date of acquisition
thereof with
a corporation incorporated under the laws of the United States or
any
state thereof rated not lower than "F1" by Fitch and "A-1+" by
S&P;
(iii)
federal funds, certificates of deposit, demand deposits,
time deposits and 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 of any U.S. depository institution or trust company
incorporated under the laws of the United States or any state
thereof,
rated not lower than "F1" by Fitch and "A-1+" by S&P;
- 27 -
(iv)
commercial paper (having original maturities of not more
than 365 days) of any corporation incorporated under the laws of
the
United States or any state thereof which is rated not lower than
"F1" by
Fitch and "A-1+" by S&P;
(v)
investments in money market funds (including funds of the
Securities Administrator or its affiliates, or funds for which an
affiliate of the Securities Administrator acts as advisor, as well
as
funds for which the Securities Administrator and its affiliates may
receive compensation) rated "AAA" by Fitch (if rated by Fitch) and
"AAAm
G" by S&P or otherwise approved in writing by each Rating
Agency; and
(vi)
other obligations or securities that are acceptable to each
Rating Agency and, as evidenced by an Opinion of Counsel obtained
by the
Master Servicer or Securities Administrator, as the case may be,
will not
affect the qualification of the Trust Estate as three separate
REMICs;
provided, however, that no instrument shall be a Permitted
Investment if it
represents either (a) the right to receive only interest payments
with respect
to the underlying debt instrument or (b) the right to receive both
principal and
interest payments derived from obligations underlying such
instrument and the
principal and interest with respect to such instrument provide a
yield to
maturity greater than 120% of the yield to maturity at par of such
underlying
obligations.
Permitted Transferee: Any Person other than (i) the United States,
or any
State or any 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
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) (except
certain farmers' cooperatives described in Code Section 521), (iv)
rural
electric and telephone cooperatives described in Code Section
1381(a)(2)(C), (v)
a Person with respect to whom the income on a Residual Certificate
is allocable
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, and (vi)
any other Person so designated by the Master Servicer based on an
Opinion of
Counsel to the effect that any transfer to such Person may cause
the Trust or
any other Holder of a Residual Certificate to incur tax liability
that would not
be imposed other than on account of such transfer. The terms
"United States,"
"State" and "international organization" shall have the meanings
set forth in
Code Section 7701 or successor provisions.
Person: Any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company,
trust,
unincorporated organization or government or any agency or
political subdivision
thereof.
PHH: PHH Mortgage Corporation, or its successor in interest.
PHH Servicing Agreement: Collectively, the Mortgage Loan Flow
Purchase,
Sale and Servicing Agreement, dated as of August 1, 2005, by and
among BANA, as
purchaser, PHH, as a seller and servicer, and Bishop's Gate
Residential Mortgage
Trust, as a seller, (ii) Amendment No. 1, dated as of October 17,
2005, by and
among BANA, PHH and Bishop's Gate Residential Mortgage Trust, (iii)
that certain
Regulation AB Compliance Addendum, dated as of January 1,
- 28 -
2006, by and between BANA and PHH, (iv) the related Warranty Bill
of Sale, dated
August 31, 2005, and (v) the Assignment, Assumption and Recognition
Agreement,
dated January 31, 2006, among BANA, the Depositor, the Master
Servicer, the
Trustee, PHH and Bishop's Gate Residential Mortgage Trust.
Physical Certificates: The Class 3-A-R, Class B-4, Class B-5, Class
B-6,
Class X-B-4, Class X-B-5 and Class X-B-6 Certificates.
Plan: As defined in Section 6.02(e).
Pool Distribution Amount: As to any Distribution Date and Loan
Group, the
excess of (a) the sum of (i) the aggregate of (A) the interest
portion of any
Monthly Payment on a Mortgage Loan in such Loan Group and the
principal portion
of any Monthly Payment on a Mortgage Loan in such Loan Group due on
the Due Date
in the month in which such Distribution Date occurs and which is
received prior
to the related Determination Date and (B) all Periodic Advances
made by a
Servicer (or the Master Servicer or the Trustee, as applicable) in
respect of
such Loan Group and payments of Compensating Interest allocable to
such Loan
Group made by the applicable Servicer in respect of such Loan Group
and such
Distribution Date deposited to the Master Servicer Custodial
Account pursuant to
Section 3.09(e)(iii); (ii) all Liquidation Proceeds (other than
Excess Proceeds)
received on the Mortgage Loans in such Loan Group during the
calendar month
preceding the month of such Distribution Date and deposited to the
Master
Servicer Custodial Account pursuant to Section 3.09(e)(iii); (iii)
all Principal
Prepayments received on the Mortgage Loans in such Loan Group
during the
calendar month preceding the month of such Distribution Date and
deposited to
the Master Servicer Custodial Account pursuant to Section
3.09(e)(i) during such
period; (iv) in connection with any Mortgage Loans that are
Defective Mortgage
Loans in such Loan Group, the aggregate of the Purchase Prices and
Substitution
Adjustment Amounts remitted on the related Remittance Date pursuant
to Section
3.09(e)(vii); (v) any other amounts in the Master Servicer
Custodial Account
deposited therein pursuant to Section 3.09(e)(iv), (v), (viii),
(ix), and (x) in
respect of such Distribution Date and such Loan Group; (vi) any
Reimbursement
Amount required to be included pursuant to Section 5.02(a); and
(vii) any Non-PO
Recovery with respect to such Distribution Date and Loan Group over
(b) any
amounts permitted to be withdrawn from the Master Servicer
Custodial Account
pursuant to clauses (i) through (viii), inclusive, of Section
3.11(a) in respect
of such Loan Group.
Pool Stated Principal Balance: As to any Distribution Date and Loan
Group,
the aggregate Stated Principal Balance of all Mortgage Loans in
such Loan Group
that were Outstanding Mortgage Loans immediately following the Due
Date in the
month preceding the month in which such Distribution Date occurs.
Pool Stated Principal Balance (Non-PO Portion): As to any
Distribution
Date and Loan Group, the sum of the product, for each Mortgage Loan
of such Loan
Group, of (a) the Non-PO Percentage of such Mortgage Loan
multiplied by (b) the
Stated Principal Balance of such Mortgage Loan that was an
Outstanding Mortgage
Loan immediately following the Due Date in the month preceding the
month in
which such Distribution Date occurs.
- 29 -
PO Percentage: As to any Discount Mortgage Loan, 100% minus the
Non-PO
Percentage for such Mortgage Loan. As to any Mortgage Loan that is
not a
Discount Mortgage Loan, 0%.
PO Principal Amount: As to any Distribution Date and Loan Group,
(i) the
sum of the applicable PO Percentage of (a) the principal portion of
each Monthly
Payment (net of unreimbursed Advances and other amounts as to which
the related
Servicer is entitled to be reimbursed pursuant to the applicable
Servicing
Agreement) due on each Mortgage Loan in such Loan Group on the
related Due Date;
(b) the Stated Principal Balance, as of the date of repurchase, of
(i) each
Mortgage Loan in such Loan Group that was repurchased by a Servicer
pursuant to
the applicable Servicing Agreement as of such Distribution Date,
(ii) each
Mortgage Loan in such Loan Group repurchased by the Sponsor
pursuant to the
Mortgage Loan Purchase Agreement or a Purchase Obligation as of
such
Distribution Date, (iii) each Mortgage Loan in such Loan Group
repurchased by
the Depositor pursuant to Section 2.04, or (iv) each Mortgage Loan
in each Loan
Group purchased by the Master Servicer pursuant to Section 10.01;
(c) any
Substitution Adjustment Amount (net of unreimbursed Advances and
other amounts
as to which the related Servicer is entitled to be reimbursed
pursuant to the
applicable Servicing Agreement)in connection with any Defective
Mortgage Loan in
such Loan Group received with respect to such Distribution Date;
(d) any
Liquidation Proceeds allocable to recoveries of principal of
Mortgage Loans in
such Loan Group that are not yet Liquidated Mortgage Loans received
by a
Servicer during the calendar month preceding the month of such
Distribution
Date; (e) with respect to each Mortgage Loan in such Loan Group
that became a
Liquidated Mortgage Loan during the calendar month preceding the
month of such
Distribution Date, the amount of Liquidation Proceeds (excluding
Excess
Proceeds) allocable to principal received by a Servicer with
respect to such
Mortgage Loan during such period; and (f) all Principal Prepayments
on the
Mortgage Loans in such Loan Group received by a Servicer during the
calendar
month preceding the month of such Distribution Date; and (ii) the
Class PO
Recovery with respect to such Loan Group for such Distribution
Date.
Premium Mortgage Loan: Any Group 1 Premium Mortgage Loan, Group 2
Premium
Mortgage Loan and Group 3 Premium Mortgage Loan.
Prepayment Interest Shortfall: As to any Distribution Date and each
Mortgage Loan subject to a Principal Prepayment received during the
calendar
month preceding the month of such Distribution Date, the amount, if
any, by
which one month's interest at the related Mortgage Interest Rate
(net of the
Servicing Fee Rate) on such Principal Prepayment exceeds the amount
of interest
paid in connection with such Principal Prepayment.
Primary Mortgage Insurance Policy: Each policy of primary mortgage
guaranty insurance or any replacement policy therefor with respect
to any
Mortgage Loan, in each case issued by an insurer acceptable to
Fannie Mae or
Freddie Mac.
Principal Only Certificates: Any Class of Certificates entitled to
distributions of principal, but to no distributions of interest.
The Class X-PO
Certificates are the only Principal Only Certificates.
- 30 -
Principal Prepayment: With respect to each Mortgage Loan, any
payment or
other recovery of principal on a Mortgage Loan (other than
Liquidation Proceeds
or Payaheads) which is received in advance of its scheduled Due
Date and 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 of the
entire
principal balance of a Mortgage Loan.
Private Certificates: The Class B-4, Class B-5, Class B-6, Class
X-B-4,
Class X-B-5 and Class X-B-6 Certificates.
Pro Rata Share: As to any Distribution Date and any Class of
Subordinate
Certificates that is not a Restricted Class, the portion of the
Subordinate
Principal Distribution Amounts allocable to such Class, equal to
the product of
the Subordinate Principal Distribution Amounts for such
Distribution Date and a
fraction, the numerator of which is the related Class Certificate
Balance
thereof and the denominator of which is the aggregate Class
Certificate Balance
of the Subordinate Certificates that are not Restricted Classes.
The Pro Rata
Share of a Restricted Class shall be 0%.
Purchase Obligation: An obligation of the Sponsor or the Depositor
to
purchase Mortgage Loans under the circumstances and in the manner
provided in
Section 2.02 or 2.04.
Purchase Price: With respect to each Mortgage Loan that was a
Defective
Mortgage Loan repurchased on any date pursuant to Section 2.02 or
2.04, an
amount equal to the sum of (i) the Stated Principal Balance of the
Mortgage
Loan, (ii) interest on such Stated Principal Balance at the
Mortgage Interest
Rate from the date on which interest has last been paid and
distributed through
the last day of the month in which such repurchase takes place and
(iii) any
costs and damages incurred by the Trust in connection with any
violation by such
repurchased Mortgage Loan of any predatory or abusive lending law,
less (x)
amounts received or advanced in respect of such repurchased
Mortgage Loan which
are being held in the applicable Servicer Custodial Account for
distribution in
the month of repurchase and (y) if the Person repurchasing such
Mortgage Loan is
servicing such Mortgage Loan under the related Servicing Agreement,
the
Servicing Fee for such Mortgage Loan.
Rate Determination Date: As to any Class of LIBOR Certificates, the
second
LIBOR Business Day prior to the beginning of the applicable
Interest Accrual
Period for such Class and such Distribution Date.
Rating Agency: Each of Fitch and Moody's. If either 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, the Master Servicer 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.
Realized Loss: With respect to each Liquidated Mortgage Loan, an
amount as
of the date of such liquidation, equal to (i) the unpaid principal
balance of
the Liquidated Mortgage Loan as
- 31 -
of the date of such liquidation, plus (ii) interest at the Net
Mortgage Interest
Rate from the Due Date as to which interest was last paid or
advanced (and not
reimbursed) to Certificateholders up to the Due Date in the month
in which
Liquidation Proceeds are required to be distributed on the Stated
Principal
Balance of such Liquidated Mortgage Loan from time to time, minus
(iii) the
Liquidation Proceeds, if any, received during the month in which
such
liquidation occurred, to the extent applied as recoveries of
interest at the Net
Mortgage Interest Rate and to principal of the Liquidated Mortgage
Loan. With
respect to each Mortgage Loan that has become the subject of a
Deficient
Valuation, if the principal amount due under the related Mortgage
Note has been
reduced, the difference between the principal balance of the
Mortgage Loan
outstanding immediately prior to such Deficient Valuation and the
principal
balance of the Mortgage Loan as reduced by the Deficient Valuation.
With respect
to each Mortgage Loan that has become the subject of a Debt Service
Reduction
and any Distribution Date, the amount, if any, by which the
principal portion of
the related Monthly Payment has been reduced.
Recognition Agreement: With respect to a Cooperative Loan, the
recognition
agreement between the Cooperative and the originator of such
Cooperative Loan.
Record Date: The last day of the month (or, if such day is not a
Business
Day, the preceding Business Day) preceding the month of the related
Distribution
Date.
Recovery: Any amount received on a Mortgage Loan subsequent to such
Mortgage Loan being determined to be a Liquidated Mortgage Loan.
Regular Certificates: As defined in the Preliminary Statement
hereto.
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 Red. Reg. 1,506, 1,531 (Jan. 7, 2005)) or
by the staff
of the Commission, or as may be provided by the Commission or its
staff from
time to time.
Reimbursement Amount: As defined in Section 2.02.
Related Group: For Loan Group 1, Group 1, for Loan Group 2, Group 2
and
for Loan Group 3, Group 3.
Related Loan Group: For Group 1, Loan Group 1, for Group 2, Loan
Group 2
and for Group 3, Loan Group 3.
Relevant Servicing Criteria: The Servicing Criteria applicable to
the
various parties, as set forth on Exhibit Q attached hereto. For
clarification
purposes, multiple parties can have responsibility for the same
Relevant
Servicing Criteria. With respect to a Servicing Function
Participant engaged by
the Master Servicer, the Securities Administrator, the Custodian or
any
Servicer, the term "Relevant Servicing Criteria" may refer to a
portion of the
Relevant Servicing Criteria applicable to such parties
- 32 -
Relief Act: The Servicemembers Civil Relief Act, as it may be
amended from
time to time.
Relief Act Reduction: With respect to any Distribution Date, for
any
Mortgage Loan as to which there has been a reduction in the amount
of interest
collectible thereon for the most recently ended calendar month as a
result of
the application of the Relief Act or comparable state legislation,
the amount,
if any, by which (i) interest collectible on such Mortgage Loan for
the most
recently ended calendar month is less than (ii) interest accrued
pursuant to the
terms of the Mortgage Note on the same principal amount and for the
same period
as the interest collectible on such Mortgage Loan for the most
recently ended
calendar month.
REMIC: A "real estate mortgage investment conduit" within the
meaning of
Section 860D of the Code. The Reserve Fund and the Yield
Maintenance Agreement
will not be assets of any REMIC created hereunder.
REMIC Certificate Maturity Date: The "latest possible maturity
date" of
the Regular Certificates as that term is defined in Section 2.07.
REMIC Provisions: Provisions of the federal income tax law relating
to
real estate mortgage investment conduits, which appear at Section
860A through
860G of Subchapter M of Chapter 1 of the Code, and related
provisions, and
regulations promulgated thereunder, as the foregoing may be in
effect from time
to time, as well as provisions of applicable state laws.
Remittance Date: The 18th day of each month beginning in February
2006
(or, if such day is not a Business Day, the preceding Business
Day).
REO Disposition Period: As defined in Section 3.15.
REO Proceeds: Proceeds, net of any related expenses of a Servicer
received
in respect of any REO Property (including, without limitation,
proceeds from the
rental of the related Mortgaged Property) which are received prior
to the final
liquidation of such Mortgaged Property.
REO Property: A Mortgaged Property acquired by a Servicer servicing
the
related Mortgage Loan on behalf of the Trust through foreclosure or
deed-in-lieu
of foreclosure in connection with a defaulted Mortgage Loan.
Reportable Event: As defined in Section 3.22(d).
Reporting Servicer: As defined in Section 3.22(c)(i).
Request for Release: The Request for Release submitted by a
Servicer to
the Custodian on behalf of the Trustee, as the case may be,
substantially in the
form attached hereto as Exhibit E.
Required Insurance Policy: With respect to any Mortgage Loan, any
insurance policy which is required to be maintained from time to
time under this
Agreement in respect of such Mortgage Loan.
- 33 -
Reserve Fund: The Eligible Account created and maintained by the
Securities Administrator pursuant to Section 3.09(d) in the name of
the
Securities Administrator, on behalf of the Trustee, for the benefit
of the
Holders of the Class 1-A-20 Certificates and designated "Wells
Fargo Bank, N.A.,
as Securities Administrator for U.S. Bank National Association, as
Trustee, in
trust for registered holders of Banc of America Funding Corporation
Mortgage
Pass-Through Certificates, Series 2006-1." Amounts on deposit in
the Reserve
Fund shall not be invested. The Reserve Fund shall not be an asset
of any REMIC
formed under this Agreement.
Residual Certificate: The Class 3-A-R Certificate.
Responsible Officer: When used with respect to the Trustee or the
Securities Administrator, any officer of the Corporate Trust
Department of the
Trustee or the Securities Administrator, as applicable, including
any Senior
Vice President, any Vice President, any Assistant Vice President,
any Assistant
Secretary, any Trust Officer or Assistant Trust Officer, or any
other officer of
the Trustee or Securities Administrator, as applicable, customarily
performing
functions similar to those performed by any of the above designated
officers and
having direct responsibility for the administration of this
Agreement.
Restricted Classes: As defined in Section 5.02(d).
RFC: Residential Funding Corporation, in its capacity as Servicer
under
the RFC Servicing Agreement.
RFC Servicing Agreement: Collectively, (i) the Standard Terms and
Provisions of Sale and Servicing Agreement, dated as of November 1,
2004, by and
between BANA and RFC, (ii) that certain Reference Agreement, dated
July 1, 2005,
by and between RFC and BANA, (iii) that certain Reference
Agreement, dated July
1, 2005, by and between RFC and BANA, (iv) that certain Reference
Agreement
(WH25A), dated September 1, 2005, by and between RFC and BANA, (v)
that certain
Reference Agreement (WH25B), dated as of September 1, 2005, by and
between RFC
and BANA, (vi) that certain Reference Agreement, dated October 1,
2005, by and
between RFC and BANA, (vii) that certain Regulation AB Compliance
Addendum,
dated as of January 1, 2006, by and between RFC and BANA and (viii)
the
Assignment, Assumption and Recognition Agreement, dated January 31,
2006, by and
among BANA, the Depositor, the Trustee, the Master Servicer and
RFC.
Sarbanes-Oxley Certification: As defined in Section 3.22(e).
Securities Administrator: Wells Fargo Bank, N.A., and its
successors-in-interest and, if a successor securities administrator
is appointed
hereunder, such successor, as securities administrator.
Security Agreement: With respect to a Cooperative Loan, the
agreement or
mortgage creating a security interest in favor of the originator of
the
Cooperative Loan in the related Cooperative Stock.
Senior Certificates: The Class 1-A-1, Class 1-A-2, Class 1-A-3,
Class
1-A-4, Class 1-A-5, Class 1-A-6, Class 1-A-7, Class 1-A-8, Class
1-A-9, Class
1-A-10, Class 1-A-11, Class 1-A-12, Class 1-A-13, Class 1-A-14,
Class 1-A-15,
Class 1-A-16, Class 1-A-17, Class 1-A-18,
- 34 -
Class 1-A-19, Class 1-A-20, Class 1-A-21, Class 1-A-22, Class
1-A-23, Class
1-A-24, Class 1-A-25, Class 1-A-26, Class 1-A-27, Class 1-A-28,
Class 2-A-1,
Class 2-A-2, Class 3-A-1, Class 3-A-2, Class 3-A-R, Class X-IO and
Class X-PO
Certificates.
Senior Credit Support Depletion Date: The date on which (i) with
respect
to the Group 1 Senior Certificates and the Group 3 Senior
Certificates, the
aggregate Class Certificate Balance of the Class X-B Certificates
has been
reduced to zero and (ii) with respect to the Group 2 Senior
Certificates, the
aggregate Class Certificate Balance of the Class B Certificates has
been reduced
to zero.
Senior Percentage: With respect to any Distribution Date and Loan
Group,
the percentage, carried to six places rounded up, obtained by
dividing (i) the
sum of the aggregate Class Certificate Balance of the Senior
Certificates of the
Related Group immediately prior to such Distribution Date, by (ii)
the Pool
Stated Principal Balance (Non-PO Portion) of such Loan Group for
such
Distribution Date.
Senior Prepayment Percentage: For any Distribution Date and Loan
Group
during the five (5) years beginning on the first Distribution Date,
100%. The
Senior Prepayment Percentage for any Loan Group and for any
Distribution Date
occurring on or after the fifth anniversary of the first
Distribution Date will,
except as provided herein, be as follows: for any Distribution Date
in the first
(1st) year thereafter, the Senior Percentage for such Loan Group
plus 70% of the
Subordinate Percentage for such Loan Group for such Distribution
Date; for any
Distribution Date in the second (2nd) year thereafter, the Senior
Percentage for
such Loan Group plus 60% of the Subordinate Percentage for such
Loan Group for
such Distribution Date; for any Distribution Date in the third
(3rd) year
thereafter, the Senior Percentage for such Loan Group plus 40% of
the
Subordinate Percentage for such Loan Group for such Distribution
Date; for any
Distribution Date in the fourth (4th) year thereafter, the Senior
Percentage for
such Loan Group plus 20% of the Subordinate Percentage for such
Loan Group for
such Distribution Date; and for any Distribution Date in the fifth
(5th) or
later years thereafter, the Senior Percentage for such Loan Group
for such
Distribution Date (unless on any of the foregoing Distribution
Dates, the
applicable Total Senior Percentage exceeds the initial Total Senior
Percentage
applicable for each Loan Group, in which case the Senior Prepayment
Percentage
for each Loan Group for such Distribution Date will once again
equal 100%).
Notwithstanding the foregoing, no decrease in the Senior Prepayment
Percentage
for a Loan Group will occur unless both of the Senior Step Down
Conditions are
satisfied.
Senior Principal Distribution Amount: As to any Distribution Date
and Loan
Group, the sum of (i) the Senior Percentage for such Loan Group of
the
applicable Non-PO Percentage of the amounts described in clauses
(i)(a) through
(d) of the definition of "Non-PO Principal Amount" for such
Distribution Date
and Loan Group and (ii) the Senior Prepayment Percentage for such
Loan Group of
(1) the applicable Non-PO Percentage of the amounts described in
clauses (i)(e)
and (f) and (2) the amount described in clause (ii) of the
definition of "Non-PO
Principal Amount" for such Distribution Date and Loan Group.
Senior Step Down Conditions: As of any Distribution Date and as to
which
any decrease in the Senior Prepayment Percentage for a Loan Group
applies, (i)
the outstanding principal balance of, in the case of Loan Group 1
and Loan Group
3, all Group 1 Mortgage Loans and
- 35 -
Group 3 Mortgage Loans, and in the case of Loan Group 2, all Group
2 Mortgage
Loans (including, for this purpose, any Mortgage Loans in
foreclosure, any REO
Property and any Mortgage Loan for which the Mortgagor has filed
for bankruptcy
after the Closing Date) delinquent 60 days or more (averaged over
the preceding
six month period), as a percentage of the aggregate Class
Certificate Balance
of, in the case of Loan Group 1 and Loan Group 3, the Class X-B
Certificates
and, in the case of the Loan Group 2, the Class B Certificates, is
not equal to
or greater than 50% or (ii) cumulative Realized Losses with respect
to such
Mortgage Loans as of the applicable Distribution Date do not exceed
the
percentages of the Original Subordinate Certificate Balance set
forth below:
PERCENTAGE OF
ORIGINAL SUBORDINATE
DISTRIBUTION DATE OCCURRING
CERTIFICATE BALANCE
---------------------------------------
------------------------
February 2011 through January 2012
30%
February 2012 through January 2013
35%
February 2013 through January 2014
40%
February 2014 through January 2015
45%
February 2015 and thereafter
50%
Servicer: Any of BANA, GMACM, National City Mortgage, PHH, RFC,
SunTrust,
Washington Mutual or Wells Fargo Bank, each in their capacity as a
servicer of
the Mortgage Loans, or any successor servicer appointed as herein
provided.
Servicer Custodial Accounts: The separate accounts created and
maintained
by each of the Servicers pursuant to the applicable Servicing
Agreement.
Servicing Advance: With respect to each Servicer, shall have the
meaning
given to the term "Servicing Advances" in the applicable Servicing
Agreement.
Servicing Agreements: Any of the BANA Servicing Agreement, GMACM
Servicing
Agreement, the National City Mortgage Servicing Agreement, the PHH
Servicing
Agreement, the RFC Servicing Agreement, the SunTrust Servicing
Agreement, the
Washington Mutual Servicing Agreement and the Wells Fargo Servicing
Agreement.
Servicing Criteria: The criteria set forth in paragraph (d) of Item
1122
of Regulation AB, as such may be amended from time to time
Servicing Fee: With respect to each Servicer, as defined in the
applicable
Servicing Agreement.
Servicing Fee Rate: With respect to each Mortgage Loan, as defined
in the
applicable Servicing Agreement.
- 36 -
Servicing File: With respect to each Mortgage Loan, as defined in
the
applicable Servicing Agreement.
Servicing Function Participant: Any Subcontractor utilized by the
Master
Servicer, the Securities Administrator or the Custodian that is
"participating
in the servicing function" within the meaning of Item 1122 of
Regulation AB.
Servicing Officer: With respect to each Servicer, as defined in the
related Servicing Agreement.
Servicing Transfer Costs: All reasonable costs and expenses of the
Master
Servicer or the Trustee, as applicable, related to any termination
of a
Servicer, appointment of a successor Servicer or the transfer and
assumption of
servicing by the Master Servicer or the Trustee, as applicable,
with respect to
any Servicing Agreement (including, without limitation, (i) all
legal costs and
expenses and all due diligence costs and expenses associated with
an evaluation
of the potential termination of the Servicer as a result of an
event of default
by such Servicer and (ii) any costs or expenses associated with the
complete
transfer of all servicing data and the completion, correction or
manipulation of
such servicing data as may be required by the Master Servicer or
the Trustee, as
applicable, to correct any errors or insufficiencies in the
servicing data or
otherwise to enable the Master Servicer or the Trustee, as
applicable, to
service the Mortgage Loans properly and effectively).
Similar Law: As defined in Section 6.02(e).
Sponsor: Bank of America, National Association, a national banking
association, or its successor in interest, as seller of the
Mortgage Loans under
the Mortgage Loan Purchase Agreement.
Stated Principal Balance: As to any Mortgage Loan and Due Date, the
unpaid
principal balance of such Mortgage Loan as of such date as
specified in the
amortization schedule at the time relating thereto (before any
adjustment to
such amortization schedule by reason of any moratorium or similar
waiver or
grace period) after giving effect to any previous partial Principal
Prepayments
and Liquidation Proceeds allocable to principal (other than with
respect to any
Liquidated Mortgage Loan) and to the payment of principal due on
such Due Date
and irrespective of any delinquency in payment by the related
Mortgagor, and
after giving effect to any Deficient Valuation.
Subcontractor: Any vendor, subcontractor or other Person that is
not
responsible for the overall servicing of Mortgage Loans but
performs one or more
discrete functions identified in Item 1122(d) of Regulation AB with
respect to
Mortgage Loans under the direction or authority of the Master
Servicer, the
Securities Administrator or the Custodian.
Subordinate Balance Ratio: As of any date of determination, the
ratio
among the principal balances of the Class 1-LS Interest and the
Class 3-LS
Interest to the ratio of the Group Subordinate Amounts of Loan
Group 1 and Loan
Group 3.
Subordinate Certificates: The Class B and Class X-B Certificates.
- 37 -
Subordinate Percentage: As of any Distribution Date and Loan Group,
100%
minus the Senior Percentage for such Loan Group for such
Distribution Date.
Subordinate Prepayment Percentage: As to any Distribution Date and
Loan
Group, 100% minus the Senior Prepayment Percentage for such Loan
Group and such
Distribution Date.
Subordinate Principal Distribution Amount: With respect to any
Distribution Date and Loan Group, an amount equal to the sum of (i)
the
Subordinate Percentage for such Loan Group of the applicable Non-PO
Percentage
of the amounts described in clauses (i)(a) through (d) of the
definition of
"Non-PO Principal Amount" for such Distribution Date and Loan Group
and (ii) the
Subordinate Prepayment Percentage for such Loan Group of the
applicable Non-PO
Percentage of the amounts described in clauses (i)(e)and (f) and
(2) the amount
described in clause (ii) of the definition of "Non-PO Principal
Amount" for such
Distribution Date and Loan Group.
Substitute Mortgage Loan: A Mortgage Loan substituted for a
Defective
Mortgage Loan which must, on the date of such substitution (i) have
a Stated
Principal Balance, after deduction of the principal portion of the
Monthly
Payment due in the month of substitution, not in excess of the
Stated Principal
Balance of the Defective Mortgage Loan; (ii) have a Net Mortgage
Interest Rate
not less than, and not more than 2% greater than that of the
Defective Mortgage
Loan; (iii) be of the same type as the Defective Mortgage Loan,
(iv) have a
Loan-to-Value Ratio not higher than that of the Defective Mortgage
Loan, (v)
have a credit score not less than that of the Defective Mortgage
Loan, (vi) have
a credit grade not lower in quality than that of the Defective
Mortgage Loan,
(vii) have a remaining term to maturity not greater than (and not
more than one
(1) year less than) that of the Defective Mortgage Loan; (viii)
have the same
lien priority as the Defective Mortgage Loan; and (ix) comply with
each Mortgage
Loan representation and warranty set forth in the Mortgage Loan
Purchase
Agreement, the Servicing Agreements and this Agreement. More than
one Substitute
Mortgage Loan may be substituted for a Defective Mortgage Loan if
such
Substitute Mortgage Loans meet the foregoing attributes in the
aggregate.
Substitution Adjustment Amount: As defined in Section 2.02.
SunTrust: SunTrust Mortgage, Inc.
SunTrust Servicing Agreement: Collectively, the Flow Sale and
Servicing
Agreement, dated as of February 1, 2004, by and between BANA (as
successor to
BAMCC) and SunTrust, as amended by (i) Amendment No. 1, dated as of
June 1,
2004, and Amendment No. 2, dated as of November 1, 2004, by and
between BANA and
SunTrust, (ii) the Master Assignment, Assumption and Recognition
Agreement,
dated September 1, 2004, by and between BANA (as successor to
BAMCC) and
SunTrust, (iii) that certain Regulation AB Compliance Addendum to
the Flow Sale
and Servicing Agreement, dated as of January 1, 2006, by and
between BANA and
SunTrust, (iv) that certain Memorandum of Sale, dated as of
November 22, 2005
and (v) the Assignment, Assumption and Recognition Agreement, dated
January 31,
2006, among BANA, BAFC, the Trustee, the Master Servicer and
SunTrust.
TAC Certificates: The Class 1-A-20 Certificates.
TAC Principal Amount: As to any Distribution Date and the TAC
Certificates, the amount, if any, that would reduce the Class
Certificate
Balance of the TAC Certificates to the
- 38 -
applicable balance shown in the applicable table set forth in
Exhibit O with
respect to such Distribution Date.
Tax Matters Person: Any person designated as "tax matters person"
in
accordance with Section 5.06 and the manner provided under Treasury
Regulation
ss. 1.860F-4(d) and Treasury Regulation ss. 301.6231(a)(7)-1.
Total Senior Percentage: Either the Crossed Group Total Senior
Percentage
or the Group 2 Total Senior Percentage.
Treasury Regulations: The final and temporary regulations
promulgated
under the Code by the U.S. Department of the Treasury.
Trust: The trust created by this Agreement, which shall be named
the "Banc
of America Funding 2006-1 Trust."
Trust Estate: The segregated pool of assets subject hereto,
constituting
the primary trust created hereby and to be administered hereunder,
with respect
to a portion of which three REMIC elections are to be made, such
entire Trust
Estate consisting of: (i) such Mortgage Loans as from time to time
are subject
to this Agreement, together with the Mortgage Files relating
thereto, and
together with all collections thereon and proceeds thereof, (ii)
any REO
Property, together with all collections thereon and proceeds
thereof, (iii) the
Trustee's rights with respect to the Mortgage Loans under all
insurance policies
required to be maintained pursuant to this Agreement and any
proceeds thereof,
(iv) the right to receive amounts, if any, payable on behalf of any
Mortgagor
from the Buy-Down Account relating to any Buy-Down Mortgage Loan,
(v) the
Depositor's rights under the Servicing Agreements and the Mortgage
Loan Purchase
Agreement (including any security interest created thereby) and
(vi) the
Servicer Custodial Accounts, the Master Servicer Custodial Account,
the Reserve
Fund and the Certificate Account and such assets that are deposited
therein from
time to time and any investments thereof, together with any and all
income,
proceeds and payments with respect thereto. The Buy-Down Account
shall not be
part of the Trust Estate.
Trustee: U.S. Bank National Association, and its
successors-in-interest
and, if a successor trustee is appointed hereunder, such successor,
as trustee.
Uncertificated Lower-Tier Interest: A regular interest in the
Lower-Tier
REMIC which is held as an asset of the Intermediate Lower-Tier
REMIC and is
entitled to monthly distributions as provided in Section 5.02(a)
hereof. Any of
the Class 1-L Interest, Class 1-LS Interest, Class 1-LPO Interest,
Class 1-LIO
Interest, Class 2-L Interest, Class 2-LPO Interest, Class 2-LIO
Interest, Class
3-L Interest, Class 3-LS Interest, Class 3-LPO Interest and Class
3-LIO Interest
are Uncertificated Lower-Tier Interests.
Uncertificated Intermediate Lower-Tier Interest: A regular interest
in the
Intermediate Lower-Tier REMIC which is held as an asset of the
Upper-Tier REMIC
and is entitled to monthly distributions as provided in Section
5.02(a) hereof.
Any of the Class 1-A-IT1 Interest, Class 1-A-IT2 Interest, Class
1-A-IT3
Interest, Class 1-ITIO Interest, Class 1-ITPO Interest, Class
2-A-IT1 Interest,
Class 2-ITIO Interest, Class 2-ITPO Interest, Class 3-A-IT1
Interest, Class
3-ITIO Interest, Class 3-ITPO Interest, Class 3-A-ITR Interest,
Class B-IT1
Interest , Class
- 39 -
B-IT2 Interest, Class B-IT3 Interest, Class B-IT4 Interest, Class
B-IT5
Interest, Class B-IT6 Interest, Class X-B-IT1 Interest, Class
X-B-IT2 Interest,
Class X-B-IT3 Interest, Class X-B-IT4 Interest, Class X-B-IT5
Interest and Class
X-B-IT6 Interest are Uncertificated Intermediate Lower-Tier
Interests.
Undercollateralized Amount: As defined in Section 5.02.
Undercollateralized Group: As defined in Section 5.02.
Uninsured Cause: Any cause of damage to a Mortgaged Property, the
cost of
the complete restoration of which is not fully reimbursable under
the hazard
insurance policies required to be maintained pursuant to Section
3.12.
Upper-Tier Certificate Sub-Account: The deemed sub-account of the
Certificate Account designated by the Securities Administrator
pursuant to
Section 3.09(i).
Upper-Tier REMIC: As defined in the Preliminary Statement, the
assets of
which consist of the Uncertificated Intermediate Lower-Tier
Interests and such
amounts as shall from time to time be deemed to be held in the
Upper-Tier
Certificate Sub-Account.
U.S. Person: A citizen or resident of the United States, a
corporation or
partnership (unless, in the case of a partnership, Treasury
Regulations are
adopted that provide otherwise) created or organized in or under
the laws of the
United States, any state thereof or the District of Columbia,
including an
entity treated as a corporation or partnership for federal income
tax purposes,
an estate whose income is subject to United States federal income
tax regardless
of its source, or a trust if a court within the United States is
able to
exercise primary supervision over the administration of such trust,
and one or
more such U.S. Persons have the authority to control all
substantial decisions
of such trust (or, to the extent provided in applicable Treasury
Regulations,
certain trusts in existence on August 20, 1996 which are eligible
to elect to be
treated as 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 Holder of the
Residual
Certificate, (b) 1% of all Voting Rights shall be allocated to the
Holders of
the Class 1-A-21 Certificates, (c) 1% of all Voting Rights shall be
allocated to
the Holders of the Class 1-A-26 Certificates, (d) 1% of all Voting
Rights shall
be allocated to the Holders of the Class X-IO Certificates and (d)
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.
Washington Mutual: Washington Mutual Bank.
Washington Mutual Servicing Agreement: Collectively, the Mortgage
Loan
Purchase and Sale Agreement (Amended and Restated), dated as of
July 1, 2003, by
and between Washington Mutual Bank and BANA, as amended by that
Mortgage Loan
Purchase and Sale Agreement (Amended and Restated), dated as of
July 1, 2003, by
and between Washington Mutual and BANA (as successor in interest to
BAMCC), as
amended by (i) the Master Assignment, Assumption and Recognition
Agreement,
dated as of July 1, 2004 (the "Master
- 40 -
AAR"), by and between BANA (as successor in interest to BAMCC) and
Washington
Mutual, (ii) that certain Regulation AB Amendment to the Mortgage
Loan Purchase
and Sale Agreement, dated as of December 1, 2005, by and among
Washington
Mutual, Washington Mutual Bank fsb and BANA, (iii) the Servicing
Agreement
(Amended and Restated), dated as of July 1, 2003, by and between
BANA (as
successor in interest to BAMCC) and Washington Mutual, as amended
by the Master
AAR and that certain Regulation AB Amendment to the Servicing
Agreement, dated
as of December 1, 2005, by and between Washington Mutual and BANA,
(iv) those
certain Term Sheets, dated as of November 22, 2005 and December 22,
2005, each
by and between Washington Mutual and BANA, and (v) the Assignment,
Assumption
and Recognition Agreement, dated January 31, 2006, by and among
BANA, the
Depositor, the Trustee, the Master Servicer and Washington Mutual.
Wells Fargo Bank: Wells Fargo Bank, N.A., in its capacity as
Servicer
under the Wells Fargo Servicing Agreement.
Wells Fargo Servicing Agreement: Collectively, the Mortgage Loan
Purchase
Agreement, dated as of March 1, 2005, by and between BANA and Wells
Fargo Bank,
the Master Sponsor's Warranties and Servicing Agreement, dated as
of March 1,
2005, by and between BANA and Wells Fargo Bank, as seller and
servicer, the
Amended and Restated Mortgage Loan Purchase Agreement, dated as of
December 1,
2005, by and between BANA and Wells Fargo Bank, the Amended and
Restated Master
Sponsor's Warranties and Servicing Agreement, dated as of December
1, 2005, by
and between BANA and Wells Fargo Bank, as seller and servicer,
those certain
Assignment and Conveyance Agreements, dated as of October 26, 2005
and December
15, 2005, each by and between Wells Fargo Bank and BANA, and the
Assignment,
Assumption and Recognition Agreement, dated January 31, 2006, by
and among BANA,
the Depositor, the Trustee, the Master Servicer and Wells Fargo
Bank.
Yield Maintenance Agreement: The yield maintenance agreement
between the
Securities Administrator, on behalf of the Trust, and the
Counterparty, which
will be primarily for the benefit of the Class 1-A-20 Certificates,
substantially in the form attached hereto as Exhibit P. The Yield
Maintenance
Agreement shall not be an asset of any REMIC formed under this
Agreement.
Yield Maintenance Agreement Payment: For any Distribution Date
prior to
and including the Distribution Date in May 2011, the amount, if
any, required to
be paid by the Counterparty to the Securities Administrator under
the Yield
Maintenance Agreement.
Yield Maintenance Amount: For any Distribution Date (other than the
Distribution Date in February 2006) prior to and including the
Distribution Date
in May 2011, an amount equal to the product of (a) the Class
Certificate Balance
of the Class 1-A-20 Certificates immediately prior to such
Distribution Date,
(b) the excess of (i) the lesser of 8.600% and LIBOR over (ii)
4.850% and (c)
one-twelfth.
Yield Maintenance Amount Shortfall: For any Distribution Date, the
amount,
if any, by which the Yield Maintenance Amount for such Distribution
Date exceeds
the sum of the Yield Maintenance Agreement Payment for such
Distribution Date
and any Excess Funds in the Reserve Fund.
- 41 -
Section 1.02 Interest Calculations. All calculations of interest
will be
made on a 360-day year consisting of twelve (12) 30-day months. All
dollar
amounts calculated hereunder shall be rounded to the nearest penny
with one-half
of one penny being rounded down.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS
ORIGINAL ISSUANCE OF CERTIFICATES
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 on behalf of the Trust
for the benefit
of the Certificateholders, without recourse, all the right, title
and interest
of the Depositor in and to the Mortgage Loans and the related
Mortgage Files,
including all interest and principal received on or with respect to
the Mortgage
Loans (other than payments of principal and interest due and
payable on the
Mortgage Loans on or before the Cut-off Date) and the Depositor's
rights under
the Mortgage Loan Purchase Agreement, including the rights of the
Depositor as
assignee of the Sponsor with respect to the Sponsor's rights under
the Servicing
Agreements. The foregoing sale, transfer, assignment and set over
does not and
is not intended to result in a creation of an assumption by the
Trustee of any
obligation of the Depositor or any other Person in connection with
the Mortgage
Loans or any agreement or instrument relating thereto, except as
specifically
set forth herein. It is agreed and understood by the parties hereto
that it is
not intended that any mortgage loan be included in the Trust that
is a
"High-Cost Home Loan" as defined in any of (i) the New Jersey Home
Ownership Act
effective November 27, 2003, (ii) the New Mexico Home Loan
Protection Act
effective January 1, 2004, (iii) the Massachusetts Predatory Home
Loan Practices
Act effective November 7, 2004 or (iv) the Indiana Home Loan
Practices Act,
effective January 1, 2005.
(b)
In connection with such transfer and assignment, the Depositor has
delivered or caused to be delivered to the Trustee, or a Custodian
on behalf of
the Trustee, for the benefit of the Certificateholders, the
following documents
or instruments with respect to each Mortgage Loan so assigned:
(i)
the original Mortgage Note, endorsed by manual or facsimile
signature in the following form: "Pay to the order of U.S. Bank
National
Association, as trustee for holders of Banc of America Funding
Corporation
Mortgage Pass-Through Certificates, Series 2006-1, without
recourse," with
all necessary intervening endorsements showing a complete chain of
endorsement from the originator to the Trustee (each such
endorsement
being sufficient to transfer all right, title and interest of the
party so
endorsing, as noteholder or assignee thereof, in and to that
Mortgage
Note) and, in the case of any Mortgage Loan originated in the State
of New
York documented by a NYCEMA, the NYCEMA, the new Mortgage Note, if
applicable, the consolidated Mortgage Note and the consolidated
Mortgage;
(ii)
except as provided below and other than with respect to the
Mortgage Loans purchased by the Sponsor from Wells Fargo Bank, the
original recorded Mortgage with evidence of a recording thereon, or
if any
such Mortgage has not been returned from the applicable recording
office
or has been lost, or if such public recording office retains
- 42 -
the original recorded Mortgage, a copy of such Mortgage certified
by the
applicable Servicer (which may be part of a blanket certification)
as
being a true and correct copy of the Mortgage;
(iii)
subject to the provisos at the end of this paragraph, a duly
executed Assignment of Mortgage to "U.S. Bank National Association,
as
trustee for the holders of Banc of America Funding Corporation
Mortgage
Pass-Through Certificates, Series 2006-1" (which may be included in
a
blanket assignment or assignments), together with, except as
provided
below and other than with respect to the Mortgage Loans purchased
by the
Sponsor from Wells Fargo Bank, originals of all interim recorded
assignments of such mortgage or a copy of such interim assignment
certified by the applicable Servicer (which may be part of a
blanket
certification) as being a true and complete copy of the original
recorded
intervening assignments of Mortgage (each such assignment, when
duly and
validly completed, to be in recordable form and sufficient to
effect the
assignment of and transfer to the assignee thereof, under the
Mortgage to
which the assignment relates); provided that, if the related
Mortgage has
not been returned from the applicable public recording office, such
Assignment of Mortgage may exclude the information to be provided
by the
recording office; and provided, further, if the related Mortgage
has been
recorded in the name of Mortgage Electronic Registration Systems,
Inc.
("MERS") or its designee, no Assignment of Mortgage in favor of the
Trustee will be required to be prepared or delivered and instead,
the
Master Servicer shall enforce the obligations of the applicable
Servicer
to take all actions as are necessary to cause the Trust to be shown
as the
owner of the related Mortgage Loan on the records of MERS for
purposes of
the system of recording transfers of beneficial ownership of
mortgages
maintained by MERS;
(iv)
the originals of all assumption, modification, consolidation
or extension agreements, if any, with evidence of recording
thereon, if
any;
(v)
other than with respect to the Mortgage Loans purchased by
the Sponsor from Wells Fargo Bank, any of (A) the original or
duplicate
original mortgagee title insurance policy and all riders thereto,
(B) a
title search showing no lien (other than standard exceptions) on
the
Mortgaged Property senior to the lien of the Mortgage or (C) an
opinion of
counsel of the type customarily rendered in the applicable
jurisdiction in
lieu of a title insurance policy;
(vi)
the original of any guarantee executed in connection with
the Mortgage Note;
(vii)
for each Mortgage Loan, if any, which is secured by a
residential long-term lease, a copy of the lease with evidence of
recording indicated thereon, or, if the lease is in the process of
being
recorded, a photocopy of the lease, certified by an officer of the
respective prior owner of such Mortgage Loan or by the applicable
title
insurance company, closing/settlement/escrow agent or company or
closing
attorney to be a true and correct copy of the lease transmitted for
recordation;
- 43 -
(viii)
the original of any security agreement, chattel mortgage or
equivalent document executed in connection with the Mortgage; and
(ix)
for each Mortgage Loan secured by Cooperative Stock (other
than with respect to any Mortgage Loan secured by Cooperative Stock
purchased by the Sponsor from Wells Fargo Bank), the originals of
the
following documents or instruments:
(A) The Cooperative Stock Certificate;
(B) The stock power executed in blank;
(C) The executed Cooperative Lease;
(D) The executed Recognition Agreement;
(E) The executed assignment of Recognition Agreement, if
any;
(F) The executed UCC-1 financing statement with evidence of
recording thereon; and
(G) Executed UCC-3 financing statements or other appropriate
UCC financing statements required by state law, evidencing a
complete and unbroken line from the mortgagee to the Trustee with
evidence of recording thereon (or in a form suitable for
recordation).
provided, however, that on the Closing Date, with respect to item
(iii), if an
Assignment of Mortgage is required to be recorded as set forth
below, the
Depositor has delivered to the Trustee or a Custodian on behalf of
the Trustee,
as the case may be, a copy of such Assignment of Mortgage in blank
rather than
in the name of the Trustee and has caused the applicable Servicer
to retain the
completed Assignment of Mortgage for recording as described below,
unless such
Mortgage has been recorded in the name of MERS or its designee. In
addition, if
the Depositor is unable to deliver or cause the delivery of any
original
Mortgage Note due to the loss of such original Mortgage Note, the
Depositor may
deliver a copy of such Mortgage Note, together with a lost note
affidavit, and
shall thereby be deemed to have satisfied the document delivery
requirements of
this Section 2.01(b).
If in connection with any Mortgage Loans, the Depositor cannot
deliver (A)
the Mortgage, (B) all interim recorded assignments, (C) all
assumption,
modification, consolidation or extension agreements, if any, or (D)
the lender's
title policy, if any, (together with all riders thereto), if
applicable,
satisfying the requirements of clause (ii), (iii), (iv) or (v)
above,
respectively, concurrently with the execution and delivery hereof
because such
document or documents have not been returned from the applicable
public
recording office in the case of clause (ii), (iii) or (iv) above,
or because the
title policy, if applicable, has not been delivered to any of the
related
Servicer, the Sponsor or the Depositor, as applicable, by the
applicable title
insurer, if any, in the case of clause (v) above, the Depositor
shall promptly
deliver or cause to be delivered to the Trustee or a Custodian on
behalf of the
Trustee, as the case may be, in the case of clause (ii), (iii) or
(iv) above,
such Mortgage, such interim assignment or such assumption,
modification,
consolidation or extension agreement, as the case may be, with
evidence of
- 44 -
recording indicated thereon upon receipt thereof from the public
recording
office, but in no event shall any such delivery of any such
documents or
instruments be made later than one (1) year following the Closing
Date, unless,
in the case of clause (ii), (iii) or (iv) above, there has been a
continuing
delay at the applicable recording office or, in the case of clause
(v), there
has been a continuing delay at the applicable insurer and the
Depositor has
delivered an Officer's Certificate to such effect to the Trustee.
The Depositor
shall forward or cause to be forwarded to the Trustee or a
Custodian, on behalf
of the Trustee, as the case may be, (1) from time to time
additional original
documents evidencing an assumption or modification of a Mortgage
Loan and (2)
any other documents required to be delivered by the Depositor, or
the applicable
Servicer to the Trustee or a Custodian on the Trustee's behalf, as
the case may
be. In the event that the original Mortgage is not delivered and in
connection
with the payment in full of the related Mortgage Loan the public
recording
office requires the presentation of a "lost instruments affidavit
and indemnity"
or any equivalent document, because only a copy of the Mortgage can
be delivered
with the instrument of satisfaction or reconveyance, the Depositor
shall
prepare, execute and deliver or cause to be prepared, executed and
delivered, on
behalf of the Trust, such a document to the public recording
office.
Upon discovery by the Depositor or notice from Wells Fargo Bank,
the
Master Servicer, the Securities Administrator or Trustee that a
Document
Transfer Event has occurred, the Depositor shall, with respect to
Mortgage Loans
purchased by the Sponsor from Wells Fargo Bank, deliver or cause to
be delivered
to the Trustee or a Custodian, on behalf of the Trustee, within 60
days copies
(which may be in electronic form mutually agreed upon by the
Depositor and the
Trustee or such Custodian) of the following additional documents or
instruments
to the Mortgage File with respect to each such Mortgage Loan;
provided, however,
that originals of such documents or instruments shall be delivered
to the
Trustee or a Custodian on behalf of the Trustee, as applicable, if
originals are
required under the law in which the related Mortgaged Property is
located in
order to exercise all remedies available to the Trust under
applicable law
following default by the related Mortgagor:
(1)
other than if the related Mortgage has been recorded in the
name of MERS or its designee, originals of all interim recorded
assignments of
such mortgage or a copy of such interim assignments certified by
Wells Fargo
Bank (which may be part of a blanket certification) as being a true
and complete
copy of the original recorded intervening assignments of Mortgage
(each such
assignment, when duly and validly completed, to be in recordable
form and
sufficient to effect the assignment of and transfer to the assignee
thereof,
under the Mortgage to which the assignment relates);
(2)
the original or a certified copy of the lender's title
insurance policy;
(3)
the original Mortgage with evidence of recording thereon, and
the original recorded power of attorney, if the Mortgage was
executed pursuant
to a power of attorney, with evidence of recording thereon or, if
such Mortgage
or power of attorney has been submitted for recording but has not
been returned
from the applicable public recording office, has been lost or is
not otherwise
available, a copy of such Mortgage or power of attorney, as the
case may be,
certified to be a true and complete copy of the original submitted
for
recording; and
- 45 -
(4)
for each Mortgage Loan secured by Cooperative Stock, the
originals of the following documents or instruments:
(A)
The Cooperative Stock Certificate;
(B)
The stock power executed in blank;
(C)
The executed Cooperative Lease;
(D)
The executed Recognition Agreement;
(E)
The executed assignment of Recognition Agreement,
if any;
(F)
The executed UCC-1 financing statement with evidence of
recording thereon; and
(G)
Executed UCC-3 financing statements or other
appropriate UCC financing statements required by state law,
evidencing a complete and unbroken line from the mortgagee to the
Trustee with evidence of recording thereon (or in a form suitable
for recordation).
With respect to each Mortgage Loan, as promptly as practicable
subsequent
to such transfer and assignment, the Master Servicer shall (except
for any
Mortgage which has been recorded in the name of MERS or its
designee) enforce
the obligations of the related Servicer pursuant to the related
Servicing
Agreement to (I) cause each Assignment of Mortgage to be in proper
form for
recording in the appropriate public office for real property
records within the
time period required in the applicable Servicing Agreement and (II)
at the
Depositor's expense, cause to be delivered for recording in the
appropriate
public office for real property records the Assignments of the
Mortgages to the
Trustee, except that, with respect to any Assignment of a Mortgage
as to which
the related Servicer has not received the information required to
prepare such
assignment in recordable form, such Servicer's obligation to do so
and to
deliver the same for such recording shall be as soon as practicable
after
receipt of such information and in accordance with the applicable
Servicing
Agreement.
No recording of an Assignment of Mortgage will be required in a
state if
either (i) the Depositor furnishes to the Trustee and the
Securities
Administrator an unqualified Opinion of Counsel reasonably
acceptable to the
Trustee and the Securities Administrator to the effect that
recordation of such
assignment is not necessary under applicable state law to preserve
the Trustee's
interest in the related Mortgage Loan against the claim of any
subsequent
transferee of such Mortgage Loan or any successor to, or creditor
of, the
Depositor or the originator of such Mortgage Loan or (ii) the
recordation of an
Assignment of Mortgage in such state is not required by either
Rating Agency in
order to obtain the initial ratings on the Certificates on the
Closing Date.
Exhibit J attached hereto sets forth the list of all states where
recordation is
required by any Rating Agency to obtain the initial ratings of the
Certificates.
The Securities Administrator and the Trustee may rely and shall be
protected in
relying upon the information contained in such Exhibit J.
- 46 -
In the case of Mortgage Loans that have been prepaid in full as of
the
Closing Date, the Depositor, in lieu of delivering the above
documents to the
Trustee, or a Custodian on the Trustee's behalf, will cause the
applicable
Servicer to remit to the Master Servicer for deposit in the Master
Servicer
Custodial Account the portion of such payment that is required to
be deposited
in the such account pursuant to Section 3.09.
Section 2.02 Acceptance by the Trustee or Custodian of the Mortgage
Loans.
Subject to the provisions of the following paragraph, the Trustee
declares that
it, or a Custodian as its agent, will hold the documents referred
to in Section
2.01 and the other documents delivered to it or a Custodian as its
agent, as the
case may be, constituting the Mortgage Files, and that it will hold
such other
assets as are included in the Trust Estate delivered to it, in
trust for the
exclusive use and benefit of all present and future
Certificateholders. Upon
execution and delivery of this document, the Trustee shall deliver
or cause a
Custodian to deliver to the Depositor and the Master Servicer a
certification in
the form attached hereto as Exhibit K (the "Initial Certification")
to the
effect that, except as may be specified in a list of exceptions
attached
thereto, such Person has received the original Mortgage Note
relating to each of
the Mortgage Loans listed on the Mortgage Loan Schedule.
Within 90 days after the execution and delivery of this Agreement,
the
Trustee shall review, or cause a Custodian, on behalf of the
Trustee, to review,
the Mortgage Files in such Person's possession, and shall deliver
to the
Depositor and the Master Servicer a certification in the form
attached hereto as
Exhibit L (the "Final Certification") to the effect that, as to
each Mortgage
Loan listed in the Mortgage Loan Schedule, except as may be
specified in a list
of exceptions attached to such Final Certification, such Mortgage
File contains
all of the items required to be delivered pursuant to Section
2.01(b). In
performing any such review, the Trustee or a Custodian, as the case
may be, may
conclusively rely on the purported genuineness of any such document
and any
signature thereon.
If, in the course of such review, a Custodian finds any document
constituting a part of a Mortgage File which does not meet the
requirements of
Section 2.01 or is omitted from such Mortgage File or if the
Depositor, the
Master Servicer, the Trustee, a Custodian or the Securities
Administrator
discovers a breach by a Servicer or the Sponsor of any
representation, warranty
or covenant under the Servicing Agreements or the Mortgage Loan
Purchase
Agreement in respect of any Mortgage Loan and such breach
materially adversely
affects the interest of the Certificateholders in the related
Mortgage Loan
(provided that any such breach that causes the Mortgage Loan not to
be a
"qualified mortgage" within the meaning of Section 860G(a)(3) of
the Code shall
be deemed to materially and adversely affect the interests of the
Certificateholders), then such party shall promptly so notify the
Master
Servicer, the Sponsor, such Servicer, the Securities Administrator,
the Trustee
and the Depositor of such failure to meet the requirements of
Section 2.01 or of
such breach and request that the applicable Servicer or the
Sponsor, as
applicable, deliver such missing documentation or cure such defect
or breach
within 90 days of its discovery or its receipt of notice of any
such failure to
meet the requirements of Section 2.01 or of such breach. If the
Trustee receives
written notice that the Sponsor or the applicable Servicer, as
applicable, has
not delivered such missing document or cured such defect or breach
in all
material respects during such period, the Trustee, on behalf of the
Trust, shall
enforce the applicable Servicer's or Sponsor's obligation, as the
case may be,
under the applicable Servicing Agreement or the Mortgage Loan
Purchase
Agreement, as applicable, and cause the applicable
- 47 -
Servicer or Sponsor, as applicable, to either (a) other than in the
case of RFC,
PHH and Washington Mutual, substitute for the related Mortgage Loan
a Substitute
Mortgage Loan, which substitution shall be accomplished in the
manner and
subject to the conditions set forth below or (b) purchase such
Mortgage Loan
from the Trust at the Purchase Price for such Mortgage Loan;
provided, however,
that in no event shall such a substitution occur more than two
years from the
Closing Date; provided, further, that such substitution or
repurchase must occur
within 90 days of when such defect was discovered if such defect
will cause the
Mortgage Loan not to be a "qualified mortgage" within the meaning
of Section
860G(a)(3) of the Code.
Notwithstanding any contrary provision of this Agreement, no
substitution
pursuant to this Section 2.02 shall be made more than 90 days after
the Closing
Date unless the Depositor delivers to the Securities Administrator
an Opinion of
Counsel, which Opinion of Counsel shall not be at the expense of
either the
Trustee, the Securities Administrator or the Trust Estate,
addressed to the
Trustee and the Securities Administrator, to the effect that such
substitution
will not (i) result in the imposition of the tax on "prohibited
transactions" on
any REMIC created hereunder or contributions after the Start-up
Day, as defined
in Sections 860F(a)(2) and 860G(d) of the Code, respectively or
(ii) cause any
REMIC created hereunder to fail to qualify as a REMIC at any time
that any
Certificates are outstanding.
It is understood that the scope of the Trustee's review (or a
Custodian's
review on its behalf) of the Mortgage Files is limited solely to
confirming that
the documents listed in Section 2.01 have been received and further
confirming
that any and all documents delivered pursuant to Section 2.01
appear on their
face to have been executed and relate to the applicable Mortgage
Loans
identified in the related Mortgage Loan Schedule based solely upon
the review of
items (i) and (xi) in the definition of Mortgage Loan Schedule.
Neither the
Trustee nor any Custodian shall have any responsibility for
determining whether
any document is valid and binding, whether the text of any
assignment or
endorsement is in proper or recordable form, whether any document
has been
recorded in accordance with the requirements of any applicable
jurisdiction, or
whether a blanket assignment is permitted in any applicable
jurisdiction.
If the Trustee receives written notice from the Depositor, the
Master
Servicer or the Securities Administrator of a breach of any
representation or
warranty of a related Servicer or the Sponsor, the Trustee, on
behalf of the
Trust, shall enforce the rights of the Trust under the Servicing
Agreements and
the Mortgage Loan Purchase Agreement for the benefit of the
Certificateholders.
If the Trustee receives written notice from the Depositor, the
Master Servicer
or the Securities Administrator of a breach of the representations
or warranties
with respect to the Mortgage Loans set forth in a Servicing
Agreement, the
Trustee, on behalf of the Trust, shall enforce the right of the
Trust to be
indemnified for such breach of representation or warranty. In
addition, if the
Trustee receives written notice from the Depositor, the Master
Servicer or the
Securities Administrator of a breach of a representation with
respect to a
Mortgage Loan set forth in clauses (k) or (o) of paragraph 3 of the
Mortgage
Loan Purchase Agreement that occurs as a result of a violation of
an applicable
predatory or abusive lending law, the Trustee, on behalf of the
Trust, shall
enforce the right of the Trust to reimbursement by the Sponsor for
all costs or
damages incurred by the Trust as a result of the violation of such
law (such
amount, the "Reimbursement Amount"), but in the case of a breach of
a
representation set forth in clauses (k) or (o) of paragraph 3 of
the Mortgage
Loan Purchase Agreement, only to the extent the applicable Servicer
does not so
reimburse the Trust. It is understood and agreed that, except for
- 48 -
any indemnification provided in the Servicing Agreements and the
payment of any
Reimbursement Amount, the obligation of a Servicer or the Sponsor
to cure or to
repurchase (or, other than in the case of RFC, PHH and Washington
Mutual, to
substitute for) any Mortgage Loan as to which a document is
missing, a material
defect in a constituent document exists or as to which such a
breach has
occurred and is continuing shall constitute the sole remedy against
a Servicer
or the Sponsor in respect of such omission, defect or breach
available to the
Trustee on behalf of the Trust and the Certificateholders.
With respect to the representations and warranties relating to the
Mortgage Loans set forth in the Mortgage Loan Purchase Agreement
that are made
to the best of the Sponsor's knowledge or as to which the Sponsor
had no
knowledge, if it is discovered by the Depositor, the Master
Servicer or the
Trustee that the substance of such representation or warranty is
inaccurate and
such inaccuracy materially and adversely affects the interest of
the
Certificateholders in the related Mortgage Loan then,
notwithstanding the
Sponsor's lack of knowledge with respect to the substance of such
representation
or warranty being inaccurate at the time the representation or
warranty was
made, such inaccuracy shall be deemed a breach of the applicable
representation
or warranty.
It is understood and agreed that the representations and warranties
relating to the Mortgage Loans set forth in the Mortgage Loan
Purchase Agreement
shall survive delivery of the Mortgage Files to the Trustee or a
Custodian on
the Trustee's behalf and shall inure to the benefit of the
Certificateholders
notwithstanding any restrictive or qualified endorsement or
assignment. It is
understood and agreed that the obligations of the Sponsor set forth
in this
Section 2.02 to cure, substitute for or repurchase a Mortgage Loan
pursuant to
the Mortgage Loan Purchase Agreement constitute the sole remedies
available to
the Certificateholders and to the Trustee on their behalf
respecting a breach of
the representations and warranties contained in the Mortgage Loan
Purchase
Agreement.
The representations and warranties of each Servicer with respect to
the
applicable Mortgage Loans in the related Servicing Agreement, which
have been
assigned to the Trustee hereunder, were made as of the date
specified in such
Servicing Agreement. To the extent that any fact, condition or
event with
respect to a Mortgage Loan constitutes a breach of both (i) a
representation or
warranty of a Servicer under the related Servicing Agreement and
(ii) a
representation or warranty of the Sponsor under the Mortgage Loan
Purchase
Agreement, the only right or remedy of the Trustee or of any
Certificateholder
shall be the Trustee's right, on behalf of the Trust, to enforce
the obligations
of the applicable Servicer under any applicable representation or
warranty made
by it. It is hereby acknowledged that the Sponsor shall have no
obligation or
liability with respect to any breach of a representation or
warranty made by it
with respect to the Mortgage Loans if the fact, condition or event
constituting
such breach also constitutes a breach of a representation or
warranty made by
the applicable Servicer in the applicable Servicing Agreement,
without regard to
whether such Servicer fulfills its contractual obligations in
respect of such
representation or warranty. It is hereby further acknowledged that
the Depositor
shall have no obligation or liability with respect to any breach of
any
representation or warranty with respect to the Mortgage Loans
(except as set
forth in Section 2.04) under any circumstances.
- 49 -
With respect to each Substitute Mortgage Loan the Sponsor shall
deliver to
the Trustee (or a Custodian on behalf of the Trustee), for the
benefit of the
Certificateholders, the Mortgage Note, the Mortgage, the related
Assignment of
Mortgage (except for any Mortgage which has been recorded in the
name of MERS or
its designee), and such other documents and agreements as are
otherwise required
by Section 2.01, with the Mortgage Note endorsed and the Mortgage
assigned as
required by Section 2.01. No substitution is permitted to be made
in any
calendar month after the Determination Date for such month. Monthly
Payments due
with respect to any such Substitute Mortgage Loan in the month of
substitution
shall not be part of the Trust Estate. For the month of
substitution,
distributions to Certificateholders will include the Monthly
Payment due for
such month on any Defective Mortgage Loan for which the Sponsor or
a Servicer
(other than RFC, PHH and Washington Mutual) has substituted a
Substitute
Mortgage Loan.
The Master Servicer shall amend the Mortgage Loan Schedule for the
benefit
of the Certificateholders to reflect the removal of each Mortgage
Loan that has
become a Defective Mortgage Loan and the substitution of the
Substitute Mortgage
Loan or Loans and the Master Servicer shall deliver the amended
Mortgage Loan
Schedule to the Securities Administrator, the Trustee and any
Custodian. Upon
such substitution of a Mortgage Loan by the Sponsor or a Servicer
(other than
RFC, PHH and Washington Mutual), each Substitute Mortgage Loan
shall be subject
to the terms of this Agreement in all respects, the Sponsor shall
be deemed to
have made to the Trustee with respect to such Substitute Mortgage
Loan, as of
the date of substitution, the representations and warranties made
pursuant to
paragraph 4 of the Mortgage Loan Purchase Agreement and the
applicable Servicer
shall be deemed to have made to the Trustee with respect to such
Substitute
Mortgage Loan, as of the date of substitution, the mortgage loan
representations
and warranties made pursuant to the applicable Servicing Agreement.
Upon any
such substitution and the deposit to the Master Servicer Custodial
Account of
any required Substitution Adjustment Amount (as described in the
next paragraph)
and receipt by the Trustee of a Request for Release, the Trustee
shall release,
or shall direct a Custodian to release, the Mortgage File relating
to such
Defective Mortgage Loan to applicable Person and shall execute and
deliver at
such Person's direction such instruments of transfer or assignment
prepared by
such Person, without recourse, as shall be necessary to vest title
in such
Person or its designee to the Trustee's interest in any Defective
Mortgage Loan
substituted for pursuant to this Section 2.02.
For any month in which Sponsor or a Servicer (other than RFC, PHH
and
Washington Mutual) substitutes one or more Substitute Mortgage
Loans for one or
more Defective Mortgage Loans, the amount (if any) by which the
aggregate
principal balance of all such Substitute Mortgage Loans substituted
by such
Person in a Loan Group as of the date of substitution is less than
the aggregate
Stated Principal Balance of all such Defective Mortgage Loans in a
Loan Group
substituted by such Person (after application of the principal
portion of the
Monthly Payments due in the month of substitution) (the
"Substitution Adjustment
Amount" for such Loan Group) plus an amount equal to the aggregate
of any
unreimbursed Advances with respect to such Defective Mortgage Loans
shall be
remitted by such Person to the Master Servicer for deposit to the
Master
Servicer Custodial Account on or before the 18th day of the month
succeeding the
calendar month during which the related Mortgage Loan is required
to be
purchased or replaced hereunder.
- 50 -
The Trustee shall retain or shall cause a Custodian to retain, as
applicable, possession and custody of each Mortgage File in
accordance with and
subject to the terms and conditions set forth herein. The Master
Servicer shall
cause to be promptly delivered to the Trustee or a Custodian on
behalf of the
Trustee, as the case may be, upon the execution or, in the case of
documents
requiring recording, receipt thereof, the originals of such other
documents or
instruments constituting the Mortgage File as come into the Master
Servicer's
possession from time to time.
Neither the Trustee nor any Custodian shall be under any duty or
obligation (i) to inspect, review or examine any such documents,
instruments,
certificates or other papers to determine that they are genuine,
enforceable, or
appropriate for the represented purpose or that they are other than
what they
purport to be on their face or (ii) to determine whether any
Mortgage File
should include any of the documents specified in Section
2.01(b)(iv), (vi),
(vii), (viii) and (ix). In connection with making the
certifications required
hereunder, to the extent a title search or opinion of counsel has
been provided
in lieu of a title policy for any Mortgage Loan, the Trustee or a
Custodian on
its behalf, as applicable, shall only be responsible for confirming
that a title
search or opinion of counsel has been provided for such Mortgage
Loan.
Section 2.03 Representations, Warranties and Covenants of the
Master
Servicer.
The Master Servicer hereby makes the following representations and
warranties to the Depositor, the Securities Administrator and the
Trustee, as of
the Closing Date:
(i)
The Master Servicer is a national banking association duly
chartered and validly existing in good standing under the laws of
the
United States of America and has all licenses necessary to carry on
its
business as now being conducted and is licensed, qualified and in
good
standing in each of the states where a Mortgaged Property securing
a
Mortgage Loan is located if the laws of such state require
licensing or
qualification in order to conduct business of the type conducted by
the
Master Servicer. The Master Servicer has power and authority to
execute
and deliver this Agreement and to perform in accordance herewith;
the
execution, delivery and performance of this Agreement (including
all
instruments of transfer to be delivered pursuant to this Agreement)
by the
Master Servicer and the consummation of the transactions
contemplated
hereby have been duly and validly authorized. This Agreement,
assuming due
authorization, execution and delivery by the other parties hereto,
evidences the valid, binding and enforceable obligation of the
Master
Servicer, subject to applicable law except as enforceability may be
limited by (A) bankruptcy, insolvency, liquidation, receivership,
moratorium, reorganization or other similar laws affecting the
enforcement
of the rights of creditors and (B) general principles of equity,
whether
enforcement is sought in a proceeding in equity or at law. All
requisite
corporate action has been taken by the Master Servicer to make this
Agreement valid and binding upon the Master Servicer in accordance
with
its terms.
(ii)
No consent, approval, authorization or order is required for
the transactions contemplated by this Agreement from any court,
governmental agency or body, or federal or state regulatory
authority
having jurisdiction over the Master Servicer
- 51 -
is required or, if required, such consent, approval, authorization
or
order has been or will, prior to the Closing Date, be obtained.
(iii)
The consummation of the transactions contemplated by this
Agreement are in the ordinary course of business of the Master
Servicer
and will not result in the breach of any term or provision of the
charter
or by-laws of the Master Servicer or result in the breach of any
term or
provision of, or conflict with or constitute a default under or
result in
the acceleration of any obligation under, any agreement, indenture
or loan
or credit agreement or other instrument to which the Master
Servicer or
its property is subject, or result in the violation of any law,
rule,
regulation, order, judgment or decree to which the Master Servicer
or its
property is subject.
(iv)
There is no action, suit, proceeding or investigation
pending or, to the best knowledge of the Master Servicer,
threatened
against the Master Servicer which, either individually or in the
aggregate, would result in any material adverse change in the
business,
operations, financial condition, properties or assets of the Master
Servicer, or in any material impairment of the right or ability of
the
Master Servicer to carry on its business substantially as now
conducted or
which would draw into question the validity of this Agreement or
the
Mortgage Loans or of any action taken or to be taken in connection
with
the obligations of the Master Servicer contemplated herein, or
which would
materially impair the ability of the Master Servicer to perform
under the
terms of this Agreement.
The representations and warranties made pursuant to this Section
2.03
shall survive delivery of the respective Mortgage Files to the
Trustee for the
benefit of the Certificateholders.
Section 2.04 Representations and Warranties of the Depositor as to
the
Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee with
respect
to the Mortgage Loans or each Mortgage Loan, as the case may be, as
of the date
hereof or such other date set forth herein that as of the Closing
Date:
(i)
Immediately prior to the transfer and assignment
contemplated herein, the Depositor was the sole owner and holder of
the
Mortgage Loans. The Mortgage Loans were not assigned or pledged by
the
Depositor and the Depositor had good and marketable title thereto,
and the
Depositor had full right to transfer and sell the Mortgage Loans to
the
Trustee free and clear of any encumbrance, participation interest,
lien,
equity, pledge, claim or security interest and had full right and
authority subject to no interest or participation in, or agreement
with
any other party to sell or otherwise transfer the Mortgage Loans.
(ii)
As of the Closing Date, the Depositor has transferred all
right, title and interest in the Mortgage Loans to the Trustee on
behalf
of the Trust.
(iii)
As of the Closing Date, the Depositor has not transferred
the Mortgage Loans to the Trustee on behalf of the Trust with any
intent
to hinder, delay or defraud any of its creditors.
- 52 -
It is understood and agreed that the representations and warranties
set
forth in this Section 2.04 shall survive delivery of the respective
Mortgage
Files to the Trustee or the related Custodian and shall inure to
the benefit of
the Trustee, notwithstanding any restrictive or qualified
endorsement or
assignment.
Upon discovery by any of the Depositor, the Master Servicer, the
Securities Administrator or the Trustee that any of the
representations and
warranties set forth in this Section 2.04 is not accurate (referred
to herein as
a "breach") and that such breach materially and adversely affects
the interests
of the Certificateholders in the related Mortgage Loan, the party
discovering
such breach shall give prompt written notice to the other parties;
provided that
any such breach that causes the Mortgage Loan not to be a
"qualified mortgage"
within the meaning of Section 860G(a)(3) of the Code shall be
deemed to
materially and adversely affect the interests of the
Certificateholders. Within
90 days of its discovery or its receipt of notice of any such
breach, the
Depositor shall cure such breach in all material respects or shall
either (i)
repurchase the Mortgage Loan or any property acquired in respect
thereof from
the Trustee at a price equal to the Purchase Price or (ii) if
within two years
of the Closing Date, substitute for such Mortgage Loan in the
manner described
in Section 2.02; provided that if the breach would cause the
Mortgage Loan to be
other than a "qualified mortgage" as defined in Section 860G(a)(3)
of the Code,
any such repurchase or substitution must occur within 90 days from
the date the
breach was discovered. The Purchase Price of any repurchase
described in this
paragraph and the Substitution Adjustment Amount, if any shall be
remitted to
the Master Servicer for deposit to the Master Servicer Custodial
Account. It is
understood and agreed that, except with respect to the second
preceding
sentence, the obligation of the Depositor to repurchase or
substitute for any
Mortgage Loan or Mortgaged Property as to which such a breach has
occurred and
is continuing shall constitute the sole remedy respecting such
breach available
to Certificateholders, or to the Trust and the Trustee on behalf of
Certificateholders, and such obligation shall survive until
termination of the
Trust hereunder.
Section 2.05 Designation of Interests in the REMICs. The Depositor
hereby
designates the Classes of Senior Certificates (other than the Class
3-A-R, Class
X-IO and Class X-PO Certificates), the Components and the Classes
of Subordinate
Certificates as "regular interests" and the Class UR Interest as
the single
class of "residual interest" in the Upper-Tier REMIC for the
purposes of Code
Sections 860G(a)(1) and 860G(a)(2), respectively. The Depositor
hereby further
designates (i) the Uncertificated Intermediate Lower-Tier Interests
as classes
of "regular interests" and the Class ILR Interest as the single
class of
"residual interest" in the Intermediate Lower-Tier REMIC and (ii)
the
Uncertificated Lower-Tier Interests as classes of "regular
interests" and the
Class LR Interest as the single class of "residual interest" in the
Lower-Tier
REMIC for the purposes of Code Sections 860G(a)(1) and 860G(a)(2),
respectively.
Section 2.06 Designation of Start-up Day. The Closing Date is
hereby
designated as the "start-up day" of each of the Upper-Tier REMIC,
the
Intermediate Lower-Tier REMIC and Lower-Tier REMIC within the
meaning of Section
860G(a)(9) of the Code.
Section 2.07 REMIC Certificate Maturity Date. Solely for purposes
of
satisfying Section 1.860G-1(a)(4)(iii) of the Treasury Regulations,
the "latest
possible maturity date" of the regular interests in the Upper-Tier
REMIC, the
Intermediate Lower-Tier REMIC and the Lower-Tier REMIC is February
25, 2036.
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Section 2.08 Execution and Delivery of Certificates. The Securities
Administrator (i) acknowledges the issuance of and hereby declares
that it holds
the Uncertificated Lower-Tier Interests on behalf of the
Intermediate Lower-Tier
REMIC and the Certificateholders and that it holds the
Uncertificated
Intermediate Lower-Tier Interests on behalf of the Upper-Tier REMIC
and the
Certificateholders and (ii) has executed and delivered to or upon
the order of
the Depositor, in exchange for the Mortgage Loans, Uncertificated
Lower-Tier
Interests and Uncertificated Intermediate Lower-Tier Interests,
together with
all other assets included in the definition of "Trust Estate,"
receipt of which
is hereby acknowledged, Certificates in authorized denominations
which, together
with the Uncertificated Intermediate Lower-Tier Interests and the
Uncertificated
Lower-Tier Interests, evidence ownership of the entire Trust
Estate.
ARTICLE III
ADMINISTRATION AND MASTER SERVICING
OF MORTGAGE LOANS
Section 3.01 Master Servicing of the Mortgage Loans. For and on
behalf of
the Certificateholders, the Master Servicer shall supervise,
monitor and oversee
the obligations of the Servicers to service and administer their
respective
Mortgage Loans in accordance with the terms of the applicable
Servicing
Agreement and shall have full power and authority to do any and all
things which
it may deem necessary or desirable in connection with such master
servicing and
administration. In performing its obligations hereunder, the Master
Servicer
shall act in a manner consistent with this Agreement, subject to
the prior
sentence, and with Customary Servicing Procedures. Furthermore, the
Master
Servicer shall oversee and consult with each Servicer as necessary
from
time-to-time to carry out the Master Servicer's obligations
hereunder, shall
receive, review and evaluate all reports, information and other
data provided to
the Master Servicer by each Servicer and shall cause each Servicer
to perform
and observe the covenants, obligations and conditions to be
performed or
observed by such Servicer under the applicable Servicing Agreement.
The Master
Servicer shall independently and separately monitor each Servicer's
servicing
activities with respect to each related Mortgage Loan, reconcile
the results of
such monitoring with such information provided in the previous
sentence on a
monthly basis and coordinate corrective adjustments to the
Servicers' and the
Master Servicer's records, and based on such reconciled and
corrected
information, prepare the Master Servicer's Certificate and any
other information
and statements required hereunder. The Master Servicer shall
reconcile the
results of its Mortgage Loan monitoring with the actual remittances
of the
Servicers to the Master Servicer Custodial Account pursuant to the
applicable
Servicing Agreements.
Continuously from the date hereof until the termination of the
Trust, the
Master Servicer shall enforce the obligations of the Servicers to
collect all
payments due under the terms and provisions of the Mortgage Loans
when the same
shall become due and payable to the extent such procedures shall be
consistent
with the applicable Servicing Agreement.
The relationship of the Master Servicer (and of any successor to
the
Master Servicer as master servicer under this Agreement) to the
Trustee and the
Securities Administrator under this Agreement is intended by the
parties to be
that of an independent contractor and not that of a joint venturer,
partner or
agent.
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Section 3.02 Monitoring of Servicers. (a) The Master Servicer shall
be
responsible for reporting to the Trustee, the Securities
Administrator and the
Depositor the compliance by each Servicer with its duties under the
related
Servicing Agreement. In the review of each Servicer's activities,
the Master
Servicer may rely upon an officer's certificate of the Servicer
with regard to
such Servicer's compliance with the terms of its Servicing
Agreement. In the
event that the Master Servicer, in its judgment, determines that a
Servicer
should be terminated in accordance with its Servicing Agreement, or
that a
notice should be sent pursuant to such Servicing Agreement with
respect to the
occurrence of an event that, unless cured, would constitute grounds
for such
termination, the Master Servicer shall notify the Depositor, the
Securities
Administrator and the Trustee thereof and the Master Servicer shall
issue such
notice or take such other action as it deems appropriate.
(b)
The Master Servicer, for the benefit of the Trust and the
Certificateholders, shall enforce the obligations of each Servicer
under the
related Servicing Agreement, and shall, in the event that a
Servicer fails to
perform its obligations in accordance with the related Servicing
Agreement,
subject to the preceding paragraph, terminate the rights and
obligations of such
Servicer thereunder and act as successor Servicer of the related
Mortgage Loans
under the applicable Servicing Agreement (except that, in the case
of the
termination of Wells Fargo Bank as a Servicer under the Wells Fargo
Servicing
Agreement, the Trustee shall, subject to the preceding paragraph,
terminate the
rights and obligations of Wells Fargo Bank thereunder, including as
provided in
Section 3.19, and either act as successor Servicer of the related
Mortgage Loans
under the Wells Fargo Servicing Agreement or appoint a successor
Servicer of the
related Mortgage Loans under the Wells Fargo Servicing Agreement,
and the
Trustee shall be entitled to comparable rights and protections as
the Trustee
would be provided under Section 3.07 and Section 8.05 if it acted
as successor
Master Servicer) or cause the Trustee to enter in to a new
Servicing Agreement
with a successor Servicer selected by the Master Servicer (except,
in the case
of the Wells Fargo Servicing Agreement, the Trustee shall select
the successor
Servicer); provided, however, it is understood and acknowledged by
the parties
hereto that there will be a period of transition (not to exceed 90
days) before
the actual servicing functions can be fully transferred to such
successor
Servicer. Such enforcement, including, without limitation, the
legal prosecution
of claims, termination of Servicing Agreements and the pursuit of
other
appropriate remedies, shall be in such form and carried out to such
an extent
and at such time as the Master Servicer, in its good faith business
judgment,
would require were it the owner of the related Mortgage Loans. The
Master
Servicer shall pay the costs of such enforcement at its own
expense, and shall
be reimbursed therefor only (i) from a general recovery resulting
from such
enforcement to the extent, if any, that such recovery exceeds all
amounts due in
respect of the related Mortgage Loans or (ii) from a specific
recovery of costs,
expenses or attorneys fees against the party whom such enforcement
is directed,
provided that the Master Servicer and the Trustee, as applicable,
shall not be
required to prosecute or defend any legal action except to the
