EXHIBIT 99.1
------------
The Pooling and Servicing Agreement
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EXECUTION COPY
===========================
CWALT, INC.,
Depositor
COUNTRYWIDE HOME LOANS, INC.,
Seller
PARK GRANADA LLC,
Seller
PARK MONACO INC.,
Seller
PARK SIENNA LLC,
Seller
COUNTRYWIDE HOME LOANS SERVICING LP,
Master Servicer
and
THE BANK OF NEW YORK,
Trustee
-----------------------------------
POOLING AND SERVICING AGREEMENT
Dated as of November 1, 2006
-----------------------------------
ALTERNATIVE LOAN TRUST 2006-OC10
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2006-OC10
===========================
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TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS
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SECTION 1.01.
Defined
Terms.....................................................................12
SECTION 1.02. Certain
Interpretive
Provisions...................................................50
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND
WARRANTIES
SECTION 2.01.
Conveyance of Mortgage
Loans......................................................51
SECTION 2.02.
Acceptance by Trustee of the Mortgage
Loans.......................................57
SECTION 2.03.
Representations, Warranties and Covenants of the Sellers and Master
Servicer......61
SECTION 2.04.
Representations and Warranties of the Depositor as to the Mortgage
Loans..........64
SECTION 2.05.
Delivery of Opinion of Counsel in Connection with
Substitutions...................64
SECTION 2.06.
Execution and Delivery of
Certificates............................................65
SECTION 2.07.
REMIC
Matters.....................................................................65
SECTION 2.08.
Covenants of the Master
Servicer..................................................65
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
SECTION 3.01.
Master Servicer to Service Mortgage
Loans.........................................66
SECTION 3.02.
Subservicing; Enforcement of the Obligations of
Subservicers......................67
SECTION 3.03.
Rights of the Depositor, the NIM Insurer and the Trustee in Respect
of the Master
Servicer..........................................................................67
SECTION 3.04.
Trustee to Act as Master
Servicer.................................................68
SECTION 3.05.
Collection of Mortgage Loan Payments; Certificate Account;
Distribution Account;
Carryover Reserve Fund; Principal Reserve Fund; the Pre-funding
Account; the
Capitalized Interest
Account......................................................68
SECTION 3.06.
Collection of Taxes, Assessments and Similar Items; Escrow
Accounts...............73
SECTION 3.07.
Access to Certain Documentation and Information Regarding the
Mortgage Loans......73
SECTION 3.08.
Permitted Withdrawals from the Certificate Account, the
Distribution Account, the
Carryover Reserve Fund and the Principal Reserve
Fund.............................74
SECTION 3.09.
Maintenance of Hazard Insurance; Maintenance of Primary Insurance
Policies........76
SECTION 3.10.
Enforcement of Due-on-Sale Clauses; Assumption
Agreements.........................77
SECTION 3.11.
Realization Upon Defaulted Mortgage Loans; Repurchase of Certain
Mortgage Loans...78
SECTION 3.12.
Trustee to Cooperate; Release of Mortgage
Files...................................82
SECTION 3.13.
Documents, Records and Funds in Possession of Master Servicer to be
Held for the
Trustee...........................................................................83
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SECTION 3.14.
Servicing
Compensation............................................................83
SECTION 3.15.
Access to Certain
Documentation...................................................84
SECTION 3.16.
Annual Statement as to
Compliance.................................................84
SECTION 3.17.
Errors and Omissions Insurance; Fidelity
Bonds....................................84
SECTION 3.18.
Notification of
Adjustments.......................................................85
SECTION 3.19.
The Swap
Contract.................................................................85
SECTION 3.20.
Prepayment
Charges................................................................87
ARTICLE IV DISTRIBUTIONS AND ADVANCES BY THE MASTER SERVICER
SECTION 4.01.
Advances..........................................................................89
SECTION 4.02.
Priorities of
Distribution........................................................90
SECTION 4.03.
[Reserved]........................................................................95
SECTION 4.04.
[Reserved]........................................................................95
SECTION 4.05.
[Reserved]........................................................................95
SECTION 4.06.
Monthly Statements to
Certificateholders..........................................95
SECTION 4.07.
Determination of Pass-Through Rates for COFI
Certificates.........................96
SECTION 4.08.
Determination of Pass-Through Rates for LIBOR
Certificates........................97
SECTION 4.09.
Swap Trust and Swap
Account.......................................................98
ARTICLE V THE CERTIFICATES
SECTION 5.01.
The
Certificates.................................................................100
SECTION 5.02.
Certificate Register; Registration of Transfer and Exchange of
Certificates......101
SECTION 5.03.
Mutilated, Destroyed, Lost or Stolen
Certificates................................106
SECTION 5.04.
Persons Deemed
Owners............................................................106
SECTION 5.05.
Access to List of Certificateholders' Names and
Addresses........................106
SECTION 5.06.
Maintenance of Office or
Agency..................................................107
ARTICLE VI THE
DEPOSITOR AND THE MASTER SERVICER
SECTION 6.01.
Respective Liabilities of the Depositor and the Master
Servicer..................108
SECTION 6.02.
Merger or Consolidation of the Depositor or the Master
Servicer..................108
SECTION 6.03.
Limitation on Liability of the Depositor, the Sellers, the Master
Servicer, the
NIM Insurer and
Others...........................................................108
SECTION 6.04.
Limitation on Resignation of Master
Servicer.....................................109
ARTICLE VII DEFAULT
SECTION 7.01.
Events of
Default................................................................110
SECTION 7.02.
Trustee to Act; Appointment of
Successor.........................................112
SECTION 7.03.
Notification to
Certificateholders...............................................113
ARTICLE VIII CONCERNING THE TRUSTEE
SECTION 8.01.
Duties of
Trustee................................................................114
SECTION 8.02.
Certain Matters Affecting the
Trustee............................................115
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SECTION 8.03.
Trustee Not Liable for Certificates or Mortgage
Loans............................116
SECTION 8.04.
Trustee May Own
Certificates.....................................................116
SECTION 8.05.
Trustee's Fees and
Expenses......................................................116
SECTION 8.06.
Eligibility Requirements for
Trustee.............................................117
SECTION 8.07.
Resignation and Removal of
Trustee...............................................117
SECTION 8.08.
Successor
Trustee................................................................118
SECTION 8.09.
Merger or Consolidation of
Trustee...............................................119
SECTION 8.10.
Appointment of Co-Trustee or Separate
Trustee....................................119
SECTION 8.11.
Tax
Matters......................................................................121
SECTION 8.12.
Monitoring of
Significance
Percentage............................................123
ARTICLE IX TERMINATION
SECTION 9.01.
Termination upon Liquidation or Purchase of all Mortgage
Loans...................125
SECTION 9.02.
Final Distribution on the
Certificates...........................................125
SECTION 9.03.
Additional Termination
Requirements..............................................127
SECTION 9.04.
Auction of the Mortgage Loans and REO
Properties.................................128
ARTICLE X MISCELLANEOUS PROVISIONS
SECTION 10.01.
Amendment........................................................................132
SECTION 10.02.
Recordation of Agreement;
Counterparts...........................................133
SECTION 10.03.
Governing
Law....................................................................134
SECTION 10.04.
Intention of
Parties.............................................................134
SECTION 10.05.
Notices..........................................................................135
SECTION 10.06.
Severability of
Provisions.......................................................137
SECTION 10.07.
Assignment.......................................................................137
SECTION 10.08.
Limitation on Rights of
Certificateholders.......................................137
SECTION 10.09.
Inspection and Audit
Rights......................................................138
SECTION 10.10.
Certificates Nonassessable and Fully
Paid........................................138
SECTION 10.11.
[Reserved].......................................................................138
SECTION 10.12.
Protection of
Assets.............................................................138
SECTION 10.13.
Rights of NIM
Insurer............................................................138
ARTICLE XI EXCHANGE ACT REPORTING
SECTION 11.01.
Filing
Obligations...............................................................139
SECTION 11.02.
Form 10-D
Filings................................................................140
SECTION 11.03.
Form 8-K
Filings.................................................................141
SECTION 11.04.
Form 10-K
Filings................................................................141
SECTION 11.05.
Sarbanes-Oxley
Certification.....................................................142
SECTION 11.06.
Form 15
Filing...................................................................142
SECTION 11.07.
Report on Assessment of Compliance and
Attestation...............................142
SECTION 11.08.
Use of Subservicers and
Subcontractors...........................................144
SECTION 11.09.
Amendments.......................................................................145
SECTION 11.10.
Reconciliation of
Accounts.......................................................145
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SCHEDULES
Schedule I:
Mortgage Loan
Schedule.............................................................S-I-1
Schedule II-A:
Representations and Warranties of
Countrywide...................................S-II-A-1
Schedule II-B:
Representations and Warranties of Park
Granada..................................S-II-B-1
Schedule II-C:
Representations and Warranties of Park
Monaco...................................S-II-C-1
Schedule III-A:
Representations and Warranties of Countrywide as to all of the
Mortgage
Loans.................................................................S-III-A-1
Schedule III-B:
Representations and Warranties of Countrywide as to the
Countrywide
Mortgage
Loans.................................................................S-III-B-1
Schedule III-C:
Representations and Warranties of Park Granada as to the Park
Granada
Mortgage
Loans.................................................................S-III-C-1
Schedule III-D:
Representations and Warranties of Park Monaco as to the Park
Monaco
Mortgage
Loans.................................................................S-III-D-1
Schedule III-E:
Representations and Warranties of Park Sienna as to the Park
Sienna
Mortgage
Loans.................................................................S-III-E-1
Schedule IV:
Representations and Warranties of the Master
Servicer.............................S-IV-1
Schedule V:
Principal Balance Schedules [if
applicable]........................................S-V-1
Schedule VI:
Form of Monthly Master Servicer
Report............................................S-VI-1
Schedule VII:
Prepayment Charge
Schedule.......................................................S-VII-1
EXHIBITS
Exhibit A:
Form of Senior Certificate (excluding Notional Amount
Certificates)..................A-1
Exhibit B:
Form of Subordinated
Certificate.....................................................B-1
Exhibit C-1:
Form of Class A-R
Certificate......................................................C-1-1
Exhibit C-2:
Form of Class P
Certificate........................................................C-2-1
Exhibit C-3
Form of Class C
Certificate........................................................C-3-1
Exhibit D:
Form of Notional Amount
Certificate..................................................D-1
Exhibit E:
Form of Reverse of
Certificates......................................................E-1
Exhibit F-1:
Form of Initial Certification of Trustee (Initial Mortgage
Loans)..................F-1-1
Exhibit F-2:
Form of Initial Certification of Trustee (Supplemental
Mortgage
Loans)....................................................................F-2-1
Exhibit G-1:
Form of Delay Delivery Certification of Trustee (Initial
Mortgage
Loans)....................................................................G-1-1
Exhibit G-2:
Form of Delay Delivery Certification of Trustee (Supplemental
Mortgage
Loans)....................................................................G-2-1
Exhibit H-1:
Form of Final Certification of Trustee (Initial Mortgage
Loans)....................H-1-1
Exhibit H-2:
Form of Final Certification of Trustee (Supplemental
Mortgage
Loans)....................................................................H-2-1
Exhibit I:
Form of Transfer
Affidavit...........................................................I-1
Exhibit J-1:
Form of Transferor Certificate
(Residual)..........................................J-1-1
Exhibit J-2:
Form of Transferor Certificate
(Private)...........................................J-2-1
Exhibit K:
Form of Investment Letter [Non-Rule
144A]............................................K-1
Exhibit L-1:
Form of Rule 144A
Letter...........................................................L-1-1
Exhibit L-2:
Form ERISA Letter (Covered
Certificates)...........................................L-2-1
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Exhibit M:
Form of Request for Release (for
Trustee)............................................M-1
Exhibit N:
Form of Request for Release of Documents (Mortgage Loan - Paid
in Full, Repurchased and
Replaced)...................................................N-1
Exhibit O:
[Reserved]...........................................................................O-1
Exhibit P:
Form of Supplemental Transfer
Agreement..............................................P-1
Exhibit Q:
Standard & Poor's LEVELS(R) Version 5.7 Glossary Revised,
Appendix
E...........................................................................Q-1
Exhibit R:
Form of Swap
Contract................................................................R-1
Exhibit S-1:
Form of Swap Contract Assignment
Agreement.........................................S-1-1
Exhibit S-2:
Form of Swap Contract
Administration
Agreement.....................................S-2-1
Exhibit T:
Form of Officer's Certificate with respect to
Prepayments............................T-1
Exhibit U:
Monthly
Statement....................................................................U-1
Exhibit V-1:
Form of Performance Certification
(Subservicer)....................................V-1-1
Exhibit V-2:
Form of Performance Certification
(Trustee)........................................V-2-1
Exhibit W:
Form of Servicing Criteria to be Addressed in Assessment of
Compliance
Statement............................................................................W-1
Exhibit X:
List of Item 1119
Parties............................................................X-1
Exhibit Y:
Form of Sarbanes-Oxley Certification (Replacement Master
Servicer)...................Y-1
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THIS
POOLING AND SERVICING AGREEMENT, dated as of November 1, 2006,
among
CWALT, INC., a Delaware corporation, as depositor (the
"Depositor"), COUNTRYWIDE
HOME LOANS, INC. ("Countrywide"), a New York corporation, as a
seller (a
"Seller"), PARK GRANADA LLC ("Park Granada"), a Delaware limited
liability
company, as a seller (a "Seller"), PARK MONACO INC. ("Park
Monaco"), a Delaware
corporation, as a seller (a "Seller"), PARK SIENNA LLC ("Park
Sienna"), a
Delaware limited liability company, as a seller (a "Seller"),
COUNTRYWIDE HOME
LOANS SERVICING LP, a Texas limited partnership, as master servicer
(the "Master
Servicer"), and THE BANK OF NEW YORK, a banking corporation
organized under the
laws of the State of New York, as trustee (the "Trustee").
WITNESSETH THAT
In
consideration of the mutual agreements contained in this Agreement,
the
parties to this Agreement agree as follows:
PRELIMINARY STATEMENT
The
Depositor is the owner of the Trust Fund that is hereby conveyed
to
the Trustee in return for the Certificates. The Trust Fund
(excluding the
Pre-funding Account, the Capitalized Interest Account and the
Carryover Reserve
Fund) for federal income tax purposes will consist of three REMICs
(the "Swap-IO
REMIC," the " Strip REMIC" and the "Master REMIC"). Each
Certificate, other than
the Class A-R Certificate, will represent ownership of one or more
regular
interests in the Master REMIC for purposes of the REMIC Provisions.
The Class
A-R Certificate will represent ownership of the sole class of
residual interest
in each of the Swap-IO REMIC, the Strip REMIC and the Master REMIC.
The Master
REMIC will hold as assets the several classes of uncertificated
Strip REMIC
Interests (other than the STR-A-R Interest). Each Strip REMIC
Interest (other
than the STR-A-R Interest) is hereby designated as a regular
interest in the
Strip REMIC. The Strip REMIC will hold as assets the several
classes of
uncertificated Swap-IO REMIC Interests (other than the SWR-A-R
Interest). Each
Swap-IO REMIC Interest (other than the SWR-A-R Interest) is hereby
designated as
a regular interest in the Swap-IO REMIC. The Swap-IO REMIC will
hold as assets
all property of the Trust Fund (excluding the Pre-funding Account,
the
Capitalized Interest Account and the Carryover Reserve Fund). The
latest
possible maturity date of all REMIC regular interests created in
this Agreement
shall be the Latest Possible Maturity Date.
The Swap
Trust, the Swap Contract and the Swap Account will not
constitute
any part of any REMIC.
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SWAP-IO REMIC:
The
Swap-IO REMIC Interests will have the principal balances and
pass-through rates as set forth below:
SWAP-IO REMIC Interests Initial
Principal Balance(1)
Pass-Through Rate
-----------------------
----------------------------
-----------------
SWR-1A
$
2,819,054.15
(2)
SWR-1B
$
2,819,054.15
(3)
SWR-2A
$
3,159,887.67
(2)
SWR-2B
$
3,159,887.67
(3)
SWR-3A
$
3,494,814.73
(2)
SWR-3B
$
3,494,814.73
(3)
SWR-4A
$
3,778,807.75
(2)
SWR-4B
$
3,778,807.75
(3)
SWR-5A
$
3,771,999.94
(2)
SWR-5B
$
3,771,999.94
(3)
SWR-6A
$
4,094,118.63
(2)
SWR-6B
$
4,094,118.63
(3)
SWR-7A
$
4,406,637.77
(2)
SWR-7B
$
4,406,637.77
(3)
SWR-8A
$
4,708,295.81
(2)
SWR-8B
$
4,708,295.81
(3)
SWR-9A
$
4,997,864.85
(2)
SWR-9B
$
4,997,864.85
(3)
SWR-10A
$
5,274,159.69
(2)
SWR-10B
$
5,274,159.69
(3)
SWR-11A
$
5,534,651.06
(2)
SWR-11B
$
5,534,651.06
(3)
SWR-12A
$
5,660,648.81
(2)
SWR-12B
$
5,660,648.81
(3)
SWR-13A
$
5,778,351.38
(2)
SWR-13B
$
5,778,351.38
(3)
SWR-14A
$
5,887,226.93
(2)
SWR-14B
$
5,887,226.93
(3)
SWR-15A
$
5,986,764.58
(2)
SWR-15B
$
5,986,764.58
(3)
SWR-16A
$
6,076,496.69
(2)
SWR-16B
$
6,076,496.69
(3)
SWR-17A
$
6,156,001.33
(2)
SWR-17B
$
6,156,001.33
(3)
SWR-18A
$
6,224,904.82
(2)
SWR-18B
$
6,224,904.82
(3)
SWR-19A
$
6,194,001.98
(2)
SWR-19B
$
6,194,001.98
(3)
SWR-20A
$
6,158,195.07
(2)
SWR-20B
$
6,158,195.07
(3)
SWR-21A
$
6,116,663.44
(2)
2
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SWAP-IO REMIC Interests Initial
Principal Balance(1)
Pass-Through Rate
-----------------------
----------------------------
-----------------
SWR-21B
$
6,116,663.44
(3)
SWR-22A
$
5,937,755.73
(2)
SWR-22B
$
5,937,755.73
(3)
SWR-23A
$
8,392,426.49
(2)
SWR-23B
$
8,392,426.49
(3)
SWR-24A
$
8,001,998.53
(2)
SWR-24B
$
8,001,998.53
(3)
SWR-25A
$
7,630,904.30
(2)
SWR-25B
$
7,630,904.30
(3)
SWR-26A
$
7,278,145.26
(2)
SWR-26B
$
7,278,145.26
(3)
SWR-27A
$
6,942,776.44
(2)
SWR-27B
$
6,942,776.44
(3)
SWR-28A
$
6,623,902.84
(2)
SWR-28B
$
6,623,902.84
(3)
SWR-29A
$
4,837,558.73
(2)
SWR-29B
$
4,837,558.73
(3)
SWR-30A
$
4,682,152.03
(2)
SWR-30B
$
4,682,152.03
(3)
SWR-31A
$
4,531,756.23
(2)
SWR-31B
$
4,531,756.23
(3)
SWR-32A
$
4,386,209.03
(2)
SWR-32B
$
4,386,209.03
(3)
SWR-33A
$
4,245,354.31
(2)
SWR-33B
$
4,245,354.31
(3)
SWR-34A
$
4,255,095.20
(2)
SWR-34B
$
4,255,095.20
(3)
SWR-35A
$
4,399,691.01
(2)
SWR-35B
$
4,399,691.01
(3)
SWR-36A
$
4,235,932.55
(2)
SWR-36B
$
4,235,932.55
(3)
SWR-37A
$
4,078,647.66
(2)
SWR-37B
$
4,078,647.66
(3)
SWR-38A
$
3,927,562.71
(2)
SWR-38B
$
3,927,562.71
(3)
SWR-39A
$
3,782,416.41
(2)
SWR-39B
$
3,782,416.41
(3)
SWR-40A
$
3,561,187.57
(2)
SWR-40B
$
3,561,187.57
(3)
SWR-41A
$
3,264,202.84
(2)
SWR-41B
$
3,264,202.84
(3)
SWR-42A
$
3,157,461.76
(2)
SWR-42B
$
3,157,461.76
(3)
SWR-43A
$
3,054,221.66
(2)
3
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SWAP-IO REMIC Interests Initial
Principal Balance(1)
Pass-Through Rate
-----------------------
----------------------------
-----------------
SWR-43B
$
3,054,221.66
(3)
SWR-44A
$
2,954,367.28
(2)
SWR-44B
$ 2,954,367.28
(3)
SWR-45A
$
2,857,787.16
(2)
SWR-45B
$
2,857,787.16
(3)
SWR-46A
$
2,763,566.43
(2)
SWR-46B
$
2,763,566.43
(3)
SWR-47A
$
2,672,030.78
(2)
SWR-47B
$
2,672,030.78
(3)
SWR-48A
$ 2,584,768.58
(2)
SWR-48B
$
2,584,768.38
(3)
SWR-49A
$
2,500,364.38
(2)
SWR-49B
$
2,500,364.58
(3)
SWR-50A
$ 69,268,251.48
(2)
SWR-50B
$ 69,268,251.48
(3)
SWR-Support
(1)
(5)
SWR-P
$ 100.00
(6)
SW-A-R
(7)
(7)
---------------
(1) Scheduled
principal, prepayments and Realized Losses will be allocated
first, to
the SWR-Support Interest and second, to the numbered classes
sequentially (from lowest to highest). Amounts so allocated to a
numbered
class
shall be further allocated among the "A" and "B" components of
such
numbered
class pro-rata until the entire class is reduced to zero.
(2) Prior to the
51st Distribution Date, a rate equal to twice the Pool Tax
Cap less
10.00% per annum. On and after the 51st Distribution Date a
rate
equal to
the Pool Tax Cap. The "Pool Tax Cap" means the weighted average
of the
Adjusted Net Mortgage Rates of all the Mortgage Loans.
(3) Prior to the
51st Distribution Date, a rate equal to the lesser of (i)
10.00% per
annum and (ii) twice the Pool Tax Cap. On and after the 51st
Distribution Date, a rate equal to the Pool Tax Cap.
(4) On the
Closing Date and on each Distribution Date, following the
allocation
of Principal Amounts and Realized Losses, the principal balance
in respect
of the SWR-Support Interest will equal the excess of (i) the
sum of (A)
the principal balance of the Mortgage Loans (as of the end of
the Due
Period, reduced by principal prepayments received after the Due
Period
that are to be distributed on the Distribution Date related to
the
Due
Period) and (B) the amount (if any) in the Pre-Funding Account
over
(ii) the
principal balance in respect of the remaining Swap-IO REMIC
Interests
other than the SWR-P and the SWR-A-R Interests.
(5) A rate equal
to the Pool Tax Cap.
(6) On each
Distribution Date the Class SWR-P Interest is entitled to all
Prepayment
Charges collected with respect to the Mortgage Loans. It pays
no
interest.
4
<PAGE>
(7) The Class
SW-A-R Interest is the sole class of residual interest in the
Swap-IO
REMIC. It has no principal and pays no principal or interest.
On each
Distribution Date, the Available Funds shall be payable with
respect to the Swap-IO REMIC Interests in the following manner:
(1)
Interest. Interest is to be distributed with respect to each
Swap-IO
REMIC Interest at the rate, or according to the formulas, described
above.
(2)
Principal. Principal Distribution Amounts shall be allocated among
the
Swap-IO REMIC Interests as described above.
(3)
Prepayment Penalties. All Prepayment Charges are allocated to
the
SWR-P Interest.
STRIP REMIC:
The Strip
REMIC Regular Interests will have the principal balances,
pass-through rates and Corresponding Classes of Certificates as set
forth in the
following table:
<TABLE>
<CAPTION>
------------------------------- ----------------------------
------------------------- -------------------------------
Pass-Through
Corresponding Class
of
STRIP REMIC Interests
Initial Principal Balance
Rate
Certificates
------------------------------- ----------------------------
------------------------- -------------------------------
<S>
<C>
<C>
<C>
STR-1-A
(1)
(2)
Class 1-A
------------------------------- ----------------------------
------------------------- -------------------------------
STR-2-A-1
(1)
(2)
Class 2-A-1
------------------------------- ----------------------------
------------------------- -------------------------------
STR-2-A-2A
(1)
(2)
Class 2-A-2A
------------------------------- ----------------------------
------------------------- -------------------------------
STR-2-A-2B
(1)
(2)
Class 2-A-2B
------------------------------- ----------------------------
------------------------- -------------------------------
STR-2-A-3
(1)
(2)
Class 2-A-3
------------------------------- ----------------------------
------------------------- -------------------------------
STR-M-1
(1)
(2)
Class M-1
------------------------------- ----------------------------
------------------------- -------------------------------
STR-M-2
(1)
(2)
Class M-2
------------------------------- ----------------------------
------------------------- -------------------------------
STR-M-3
(1)
(2)
Class M-3
------------------------------- ----------------------------
------------------------- -------------------------------
STR-M-4
(1)
(2)
Class M-4
------------------------------- ----------------------------
------------------------- -------------------------------
STR-M-5
(1)
(2)
Class M-5
------------------------------- ----------------------------
------------------------- -------------------------------
STR-M-6
(1)
(2)
Class M-6
------------------------------- ----------------------------
------------------------- -------------------------------
STR-M-7
(1)
(2)
Class M-7
------------------------------- ----------------------------
------------------------- -------------------------------
STR-M-8
(1)
(2)
Class M-8
------------------------------- ----------------------------
------------------------- -------------------------------
STR-$100
$100
(3)
A-R
------------------------------- ----------------------------
------------------------- -------------------------------
STR-C-OC
(4)
(2)
N/A
------------------------------- ----------------------------
------------------------- -------------------------------
STR-C-Swap-IO
(5)
(5)
N/A
------------------------------- ----------------------------
------------------------- -------------------------------
STR-P
$100
(6)
P
------------------------------- ----------------------------
------------------------- -------------------------------
STR-A-R
(7)
(7)
N/A
------------------------------- ----------------------------
------------------------- -------------------------------
</TABLE>
(1) This Strip REMIC Interest has a principal balance that is
initially equal to
100% of its corresponding Certificate Class issued by the Master
REMIC.
Principal payments, both scheduled and prepaid, Realized Losses and
Subsequent
Recoveries attributable to the SWAP-IO
5
<PAGE>
REMIC Interests held by the Strip REMIC will be allocated to this
class to
maintain its size relative to its corresponding Certificate
Class.
(2) On each Distribution Date, the pass through rate will equal the
"Strip REMIC
Cap." The Strip REMIC Cap will equal the weighted average of the
pass through
rates of the Swap-IO REMIC Interests (other than the Class SWR-P
and Class
SWR-A-R Interests) treating each "B" Interest the cardinal number
of which (for
example, SWR-1B, SWR-2B, SWR-3B, etc.,) is not less than the
ordinal number of
the Distribution Date (first Distribution Date, second Distribution
Date, third
Distribution Date, etc., ) as capped at a rate equal to the product
of (i) 2 and
(ii) LIBOR.
(3) This Strip REMIC Interest pays no interest.
(4) This Strip REMIC Interest has a principal balance that is
initially equal to
100% of the Overcollateralized Amount. Principal payments, both
scheduled and
prepaid, Realized Losses and Subsequent Recoveries attributable to
the Swap-IO
REMIC Interests held by the Strip REMIC will be allocated to this
class to
maintain its size relative to the Overcollateralized Amount.
(5) For each Distribution Date, the STR-C-Swap-IO Interest is
entitled to
receive from each Swap REMIC "B" Interest the cardinal number of
which (for
example, SWR-1B, SWR-2B, SWR-3B, etc.,) is not less than the
ordinal number of
the Distribution Date (first Distribution Date, second Distribution
Date, third
Distribution Date, etc.) the interest accruing on such interest in
excess of a
per annum rate equal to the product of (i) 2 and (ii) LIBOR.
(6) The STR-P Interest is entitled to all amounts payable with
respect to the
SWR-P Interest. It pays no interest.
(7) The STR-A-R Interest is the sole class of residual interest in
the Strip
REMIC. It has no principal balance and pays no principal or
interest.
On each
Distribution Date, the Interest Funds and the Principal
Distribution Amount payable with respect to the Swap-IO Interests
shall be
payable with respect to the Strip REMIC Interests in the following
manner:
(1)
Interest. Interest is to be distributed with respect to each
Strip
REMIC Interest at the rate, or according to the formulas, described
above.
(2) Principal. Principal Distribution Amounts shall be allocated
among the Strip
REMIC Interests as described above.
(3) Prepayment Penalties. All Prepayment Charges are allocated to
the STR-P
Interest.
Master REMIC:
The Master
REMIC Certificates will have the original certificate principal
balances and pass-through rates as set forth in the following
table:
6
<PAGE>
Original Class
Class
Certificate Balance
Pass-Through Rate
-----
-------------------
-----------------
Class 1-A
$165,209,000
(1)
Class 2-A-1
$235,018,000
(1)
Class 2-A-2A
$266,090,000
(1)
Class 2-A-2B
$29,566,000
(1)
Class 2-A-3
$50,926,000
(1)
Class M-1
$17,781,000
(1)
Class M-2
$14,952,000
(1)
Class M-3
$4,849,000
(1)
Class M-4
$4,849,000
(1)
Class M-5
$4,041,000
(1)
Class M-6
$4,041,000
(1)
Class M-7
$4,041,000
(1)
Class M-8
$4,041,000
(1)
Class C
(2)
(3)
Class P
$100
(4)
Class A-R
$100
(5)
---------------
(1) The Certificates will accrue interest at the related
Pass-Through Rates
identified in this Agreement. For federal income tax purposes,
including the
computation of the Class C Distributable Amount and entitlement to
Net Rate
Carryover the pass-through rate in respect of each Class 1
Certificate, Class 2
Certificate and Class M Certificate will be subject to a cap equal
to the Strip
REMIC Cap rather than the Net Rate Cap.
(2) For federal income tax purposes, the Class C Certificates will
be treated as
having a Certificate Principal Balance equal to the
Overcollateralized Amount.
(3 For each Interest Accrual Period the Class C Certificates are
entitled to an
amount (the "Class C Distributable Amount") equal to the sum of (a)
the interest
payable on the STR-C-Swap-IO Interest, (b) the interest payable on
the STR-C-OC
Interest and (c) a specified portion of the interest payable on the
Strip REMIC
Regular Interests (other than the STR-$100, STR-C and STR-P
Interests) equal to
the excess of the Pool Tax Cap over the weighted average interest
rate of the
Strip REMIC Regular Interests (other than the STR-$100, STR-C and
STR-P
Interests) with each such Class subject to a cap and a floor equal
to the
Pass-Through Rate of the Corresponding Master REMIC Class. The
Pass-Through Rate
of the Class C Certificates shall be a rate sufficient to entitle
it to an
amount equal to all interest accrued on the Mortgage Loans less the
interest
accrued on the other interests issued by the Master REMIC. The
Class C
Distributable Amount for any Distribution Date is payable from
current interest
on the Mortgage Loans and any Overcollateralization Reduction
Amount for that
Distribution Date.
(4) For each Distribution Date the Class P Certificates are
entitled to all
Prepayment Charges distributed with respect to the STR-P
Interest.
(5) The Class A-R Certificates represent the sole class of residual
interest in
each REMIC created hereunder. The Class A-R Certificates are not
entitled to
distributions of interest.
7
<PAGE>
The
foregoing REMIC structure is intended to cause all of the cash
from
the Mortgage Loans to flow through to the Master REMIC as cash flow
on REMIC
regular interests, without creating any shortfall--actual or
potential (other
than for credit losses)-- to any REMIC regular interest. It is not
intended that
the Class A-R Certificates be entitled to any cash flows pursuant
to this
Agreement except as provided in Section 4.02(b) hereunder.
8
<PAGE>
Set forth
below are designations of Classes or Components of Certificates
and other defined terms to the categories used in this
Agreement:
<TABLE>
<CAPTION>
<S>
<C>
Accretion Directed
Certificates........................
None.
Accretion Directed
Components..........................
None.
Accrual Certificates................
None.
Accrual Components..................
None.
Book-Entry Certificates.............
All Classes of Certificates other than the Physical
Certificates.
COFI Certificates...................
None.
Component Certificates..............
None.
Components..........................
For purposes of calculating distributions of principal and/or
interest,
the Component Certificates, if any, will be comprised of multiple
payment
components having the designations, Initial Component Balances
or
Notional Amounts, as applicable, and Pass-Through Rates set forth
below:
Initial Component
Designation
Principal Balance Pass-Through Rate
N/A
N/A
N/A
Delay Certificates..................
All interest-bearing Classes of Certificates other than the
Non-Delay
Certificates, if any.
ERISA-Restricted
Certificates........................
The Residual Certificates and the Private Certificates; and any
Certificate of a Class that does not have or no longer has a rating
of at
least BBB- or its equivalent from at least one Rating Agency.
Group 1 Certificates................
Group 1 Senior Certificates and the portions of the
Subordinated
Certificates related to Loan Group 1.
Group 1
Senior Certificates.................
The Class 1-A Certificates.
Group 2 Certificates........................Group 2 Senior
Certificates and the portions of the Subordinated
Certificates related to Loan Group 2.
9
<PAGE>
Group 2
Senior Certificates.................
The Class 2-A-1, Class 2-A-2A, Class 2-A-2B and Class 2-A-3
Certificates.
Inverse Floating Rate
Certificates........................
None.
LIBOR Certificates..................
The Class 1-A, Class 2-A-1, Class 2-A-2A, Class 2-A-2B, Class 2-A-3,
Class M-1, Class
M-2, Class M-3, Class M-4, Class M-5, Class M-6,
Class M-7 and Class M-8 Certificates.
Non-Delay Certificates..............
The LIBOR Certificates.
Notional Amount
Certificates........................
None.
Offered Certificates................
All Classes of Certificates other than the Private
Certificates.
Physical Certificates...............
The Private Certificates and the Residual Certificates.
Planned Principal Classes...........
None.
Planned Principal
Components..........................
None.
Principal Only Certificates.........
None.
Private Certificates................
The Class C and Class P Certificates.
Rating Agencies.....................
S&P and Moody's.
Regular Certificates................
All Classes of Certificates, other than the Residual
Certificates.
Residual Certificates...............
The Class A-R Certificates.
Scheduled Principal
Classes.............................
None.
Senior Certificates.................
The Class 1-A, Class 2-A-1, Class 2-A-2A, Class 2-A-2B and
Class
2-A-3 Certificates.
Subordinated Certificates ..........
The Class M-1, Class
M-2, Class M-3, Class
M-4, Class M-5, Class M-6,
Class M-7 and Class M-8 Certificates.
Targeted Principal
Classes.............................
None.
10
<PAGE>
Underwriter.........................
Countrywide Securities Corporation.
</TABLE>
With
respect to any of the foregoing designations as to which the
corresponding reference is "None," all defined terms and provisions
in this
Agreement relating solely to such designations shall be of no force
or effect,
and any calculations in this Agreement incorporating references to
such
designations shall be interpreted without reference to such
designations and
amounts. Defined terms and provisions in this Agreement relating to
statistical
rating agencies not designated above as Rating Agencies shall be of
no force or
effect.
If the sum of the aggregate Stated Principal Balances of the
Initial
Mortgage Loans in Loan Group 1 and Loan Group 2 on the Closing Date
is equal to
or greater than the sum of (x) the aggregate Class Certificate
Balance of the
Offered Certificates, as of such date, and (y) the
Overcollateralized Amount as
of the Closing Date, all references herein to "Aggregate
Supplemental Purchase
Amount", "Aggregate Supplemental Transfer Amount", "Capitalized
Interest
Account", "Capitalized Interest Requirement", "Funding Period",
"Funding Period
Distribution Date", "Remaining Pre-funded Amount", "Pre-funded
Amount",
"Supplemental Cut-off Date", "Pre-funding Account", "Supplemental
Mortgage
Loan", "Supplemental Transfer Agreement" and "Supplemental Transfer
Date" with
respect to that Loan Group shall be of no force or effect and all
provisions
herein related thereto shall similarly be of no force or
effect.
11
<PAGE>
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 following
meanings:
40-Year
Mortgage Loans: The Mortgage Loans that have original terms to
maturity of 40-years.
Acceptable
Bid Amount: Either (i) a bid equal to or greater than the
Minimum Auction Amount or (ii) the highest bid submitted by a
Qualified Bidder
in an auction if the Directing Certificateholder agrees to pay the
related
Auction Supplement Amount.
Account:
Any Escrow Account, the Certificate Account, the Distribution
Account, the Carryover Reserve Fund, the Principal Reserve Fund,
the Pre-funding
Account, the Capitalized Interest Account, the Swap Account or any
other account
related to the Trust Fund or the Mortgage Loans.
Accretion
Directed Classes: As specified in the Preliminary Statement.
Additional
Designated Information: As defined in Section 11.02.
Adjusted
Mortgage Rate: As to each Mortgage Loan, and at any time, the
per
annum rate equal to the Mortgage Rate less the Master Servicing Fee
Rate.
Adjusted
Net Mortgage Rate: As to each Mortgage Loan, and at any time,
the
per annum rate equal to the Mortgage Rate less the related Expense
Fee Rate.
Adjustment
Date: A date specified in each Mortgage Note as a date on which
the Mortgage Rate on the related Mortgage Loan will be
adjusted.
Advance:
As to each Loan Group, the payment required to be made by the
Master Servicer with respect to any Distribution Date pursuant to
Section 4.01,
the amount of any such payment being equal to the aggregate of
payments of
principal and interest (net of the Master Servicing Fee) on the
Mortgage Loans
in such Loan Group that were due on the related Due Date and not
received by the
Master Servicer as of the close of business on the related
Determination Date,
together with an amount equivalent to interest on each Mortgage
Loan as to which
the related Mortgaged Property is an REO Property, net of any net
income from
such REO Property, less the aggregate amount of any such delinquent
payments
that the Master Servicer has determined would constitute a
Nonrecoverable
Advance if advanced.
Aggregate
Supplemental Purchase Amount: With respect to any Supplemental
Transfer Date and Loan Group, the applicable "Aggregate
Supplemental Purchase
Amount" identified in the related Supplemental Transfer Agreement
for such Loan
Group, which shall be an estimate of the aggregate Stated Principal
Balances of
the Supplemental Mortgage Loans to be included in such Loan Group
identified in
such Supplemental Transfer Agreement.
12
<PAGE>
Aggregate
Supplemental Transfer Amount: With respect to any Supplemental
Transfer Date and Loan Group, the aggregate Stated Principal
Balance as of the
related Supplemental Cut-off Date of the Supplemental Mortgage
Loans to be
included in such Loan Group conveyed on such Supplemental Transfer
Date, as
listed on the revised Mortgage Loan Schedule delivered pursuant to
Section
2.01(f); provided, however, that such amount shall not exceed the
amount on
deposit in the Pre-funding Account allocated to purchasing
Supplemental Mortgage
Loans for such Loan Group.
Agreement:
This Pooling and Servicing Agreement and all amendments or
supplements this Pooling and Servicing Agreement.
Amount
Held for Future Distribution: As to any Distribution Date and
each
Loan Group, the aggregate amount held in the Certificate Account at
the close of
business on the related Determination Date on account of (i)
Principal
Prepayments received after the related Prepayment Period and
Liquidation
Proceeds and Subsequent Recoveries received in the month of such
Distribution
Date relating to such Loan Group and (ii) all Scheduled Payments
relating to
such Loan Group due after the related Due Date.
Applied
Realized Loss Amount: With respect to any Distribution Date and
the LIBOR Certificates, the sum of the Realized Losses which are to
be applied
in reduction of the Class Certificate Balances of any such Class of
Certificates
pursuant to this Agreement, which, in the case of the Subordinated
Certificates,
shall equal the amount, if any, by which the aggregate Class
Certificate Balance
of all LIBOR Certificates (after all distributions of principal on
such
Distribution Date) exceeds the sum of the aggregate Stated
Principal Balance of
the Mortgage Loans and the amount on deposit in the Pre-funding
Account as of
the Due Date in the month in which such Distribution Date occurs
(after giving
effect to Principal Prepayments and Liquidation Proceeds allocated
to principal
and Subsequent Recoveries received in the related Prepayment
Period). With
respect to the Group 1 Senior Certificates and any Distribution
Date on which
the aggregate Class Certificate Balance of the Subordinated
Certificates and
Class C Certificates is equal to zero, the amount, if any, by which
the Class
Certificate Balance of the Group 1 Senior Certificates (after all
distributions
of principal on such Distribution Date) exceeds the aggregate
Stated Principal
Balance of the Group 1 Mortgage Loans as of the Due Date in the
month in which
such Distribution Date occurs (after giving effect to Principal
Prepayments and
Liquidation Proceeds allocated to principal and Subsequent
Recoveries received
in the related Prepayment Period). With respect to each Class of
Group 2 Senior
Certificates and any Distribution Date on which the aggregate Class
Certificate
Balance of the Subordinated Certificates and Class C Certificates
is equal to
zero, the pro rata share (based on the Class Certificate Balance of
each such
Class) of the amount, if any, by which the aggregate Class
Certificate Balance
of the Group 2 Senior Certificates (after all distributions of
principal on such
Distribution Date) exceeds the aggregate Stated Principal Balance
of the Group 2
Mortgage Loans as of the Due Date in the month in which such
Distribution Date
occurs (after giving effect to Principal Prepayments and
Liquidation Proceeds
allocated to principal and Subsequent Recoveries received in the
related
Prepayment Period).
Appraised
Value: With respect to any Mortgage Loan, the Appraised Value
of
the related Mortgaged Property shall be: (i) with respect to a
Mortgage Loan
other than a Refinancing Mortgage Loan, the lesser of (a) the value
of the
Mortgaged Property based upon the appraisal made at the time of the
origination
of such Mortgage Loan and (b) the sales price of
13
<PAGE>
the Mortgaged Property at the time of the origination of such
Mortgage Loan;
(ii) with respect to a Refinancing Mortgage Loan other than a
Streamlined
Documentation Mortgage Loan, the value of the Mortgaged Property
based upon the
appraisal made-at the time of the origination of such Refinancing
Mortgage Loan;
and (iii) with respect to a Streamlined Documentation Mortgage
Loan, (a) if the
loan-to-value ratio with respect to the Original Mortgage Loan at
the time of
the origination thereof was 80% or less and the loan amount of the
new mortgage
loan is $650,000 or less, the value of the Mortgaged Property based
upon the
appraisal made at the time of the origination of the Original
Mortgage Loan and
(b) if the loan-to-value ratio with respect to the Original
Mortgage Loan at the
time of the origination thereof was greater than 80% or the loan
amount of the
new mortgage loan being originated is greater than $650,000, the
value of the
Mortgaged Property based upon the appraisal (which may be a
drive-by appraisal)
made at the time of the origination of such Streamlined
Documentation Mortgage
Loan.
Auction
Supplement Amount: As defined in Section 9.04(c).
Bankruptcy
Code: The United States Bankruptcy Reform Act of 1978, as
amended.
Bid
Determination Date: As defined in Section 9.04(b).
Book-Entry
Certificates: As specified in the Preliminary Statement.
Business
Day: Any day other than (i) a Saturday or a Sunday or (ii) a
day
on which banking institutions in the City of New York, New York, or
the States
of California or Texas or the city in which the Corporate Trust
Office of the
Trustee is located are authorized or obligated by law or executive
order to be
closed.
Capitalized Interest Account: The separate Eligible Account
designated as
such and created and maintained by the Trustee pursuant to Section
3.05(i)
hereof. The Capitalized Interest Account shall be treated as an
"outside reserve
fund" under applicable Treasury regulations and shall not be part
of the REMIC.
Except as provided in Section 3.05(i) hereof, any investment
earnings on the
amounts on deposit in the Capitalized Interest Account shall be
treated as owned
by the Depositor and will be taxable to the Depositor.
Capitalized Interest Requirement: With respect to each Funding
Period
Distribution Date and Loan Group, the excess, if any, of (a) the
sum of (1)
Current Interest for each Class of related Certificates in the
Certificate Group
related to such Loan Group for such Distribution Date, plus (2) the
Trustee Fee,
over (b) with respect to each Mortgage Loan in the related Loan
Group, (1) 1/12
of the product of the related Adjusted Mortgage Rate and the
related Stated
Principal Balance as of the related Due Date (prior to giving
effect to any
Scheduled Payment due on such Mortgage Loan on such Due Date). On
the Closing
Date, the amount deposited in the Capitalized Interest Account
shall be
$51,913.74.
Carryover
Reserve Fund: The separate Eligible Account created and
initially maintained by the Trustee pursuant to Section 3.05(g) in
the name of
the Trustee for the benefit of the Holders of the Offered
Certificates and
designated "The Bank of New York in trust for registered holders of
CWALT, Inc.,
Alternative Loan Trust 2006-OC10, Mortgage Pass-Through
Certificates, Series
2006-OC10." Funds in the Carryover Reserve Fund shall be held in
trust for the
Holders of the Offered Certificates for the uses and purposes set
forth in this
Agreement.
14
<PAGE>
Certificate: Any one of the Certificates executed by the Trustee
in
substantially the forms attached this Agreement as exhibits.
Certificate Account: The separate Eligible Account or Accounts
created and
maintained by the Master Servicer pursuant to Section 3.05 with a
depository
institution, initially Countrywide Bank, N.A., in the name of the
Master
Servicer for the benefit of the Trustee on behalf of
Certificateholders and
designated "Countrywide Home Loans Servicing LP in trust for the
registered
holders of Alternative Loan Trust 2006-OC10, Mortgage Pass-Through
Certificates
Series 2006-OC10."
Certificate Balance: With respect to any Certificate (other than
the Class
C Certificates) at any date, the maximum dollar amount of principal
to which the
Holder thereof is then entitled under this Agreement, such amount
being equal to
the Denomination of that Certificate (A) plus, with respect to the
LIBOR
Certificates, any increase to the Certificate Balance of such
Certificate
pursuant to Section 4.02 due to the receipt of Subsequent
Recoveries and (B)
minus the sum of (i) all distributions of principal previously made
with respect
to that Certificate and (ii) with respect to the LIBOR
Certificates, any Applied
Realized Loss Amounts allocated to such Certificate on previous
Distribution
Dates pursuant to Section 4.02 without duplication.
Certificate Group: The Group 1 Certificates or the Group 2
Certificates,
as the context requires.
Certificateholder or Holder: The person in whose name a Certificate
is
registered in the Certificate Register, except that, solely for the
purpose of
giving any consent pursuant to this Agreement, any Certificate
registered in the
name of the Depositor or any affiliate of the Depositor shall be
deemed not to
be Outstanding and the Percentage Interest evidenced thereby shall
not be taken
into account in determining whether the requisite amount of
Percentage Interests
necessary to effect such consent has been obtained; provided,
however, that if
any such Person (including the Depositor) owns 100% of the
Percentage Interests
evidenced by a Class of Certificates, such Certificates shall be
deemed to be
Outstanding for purposes of any provision of this Agreement (other
than the
second sentence of Section 10.01) that requires the consent of the
Holders of
Certificates of a particular Class as a condition to the taking of
any action
under this Agreement. The Trustee is entitled to rely conclusively
on a
certification of the Depositor or any affiliate of the Depositor in
determining
which Certificates are registered in the name of an affiliate of
the Depositor.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person
who is the beneficial owner of such Book-Entry Certificate. For the
purposes of
this Agreement, in order for a Certificate Owner to enforce any of
its rights
under this Agreement, it shall first have to provide evidence of
its beneficial
ownership interest in a Certificate that is reasonably satisfactory
to the
Trustee, the Depositor, and/or the Master Servicer, as
applicable.
Certificate Register: The register maintained pursuant to Section
5.02.
Certification Party: As defined in Section 11.05.
Certifying
Person: As defined in Section 11.05.
15
<PAGE>
Class: All
Certificates bearing the same class designation as set forth in
the Preliminary Statement.
Class C
Distributable Amount: As defined in the Preliminary Statement.
Class
Certificate Balance: With respect to any Class of Certificates
other
than the Class C Certificates and as to any date of determination,
the aggregate
of the Certificate Balances of all Certificates of such Class as of
such date.
With respect to the Class C Certificates and any Distribution Date,
the excess,
if any, of the aggregate Stated Principal Balance of the Mortgage
Loans as of
the Due Date in the prior calendar month (after giving effect to
Principal
Prepayments, the principal portion of any Liquidation Proceeds and
any
Subsequent Recoveries received in the Prepayment Period related to
that prior
Due Date) over the aggregate Class Certificate Balance of the
Offered
Certificates and the Class P Certificates immediately prior to that
Distribution
Date.
Class P
Certificate: Any Certificate designated as a "Class P
Certificate"
on the face thereof, in the form of Exhibit C-2 hereto,
representing the right
to distributions as set forth herein.
Class P
Principal Distribution Date: The first Distribution Date that
occurs after the end of the latest Prepayment Charge Period for all
Mortgage
Loans that have a Prepayment Charge.
Closing
Date: November 30, 2006.
Code: The
Internal Revenue Code of 1986, including any successor or
amendatory provisions.
COFI: The
Monthly Weighted Average Cost of Funds Index for the Eleventh
District Savings Institutions published by the Federal Home Loan
Bank of San
Francisco.
COFI
Certificates: As specified in the Preliminary Statement.
Commission:
The U.S. Securities and Exchange Commission.
Compensating Interest: As to any Distribution Date, an amount equal
to the
product of 50% and the aggregate Master Servicing Fee payable to
the Master
Servicer for that Distribution Date.
Component:
As specified in the Preliminary Statement.
Component
Balance: Not applicable.
Component
Certificates: As specified in the Preliminary Statement.
Component
Notional Amount: Not applicable.
Coop
Shares: Shares issued by a Cooperative Corporation.
16
<PAGE>
Cooperative Corporation: The entity that holds title (fee or an
acceptable
leasehold estate) to the real property and improvements
constituting the
Cooperative Property and which governs the Cooperative Property,
which
Cooperative Corporation must qualify as a Cooperative Housing
Corporation under
Section 216 of the Code.
Cooperative Loan: Any Mortgage Loan secured by Coop Shares and
a
Proprietary Lease.
Cooperative Property: The real property and improvements owned by
the
Cooperative Corporation, including the allocation of individual
dwelling units
to the holders of the Coop Shares of the Cooperative
Corporation.
Cooperative Unit: A single family dwelling located in a
Cooperative
Property.
Corporate
Trust Office: The designated office of the Trustee in the State
of New York at which at any particular time its corporate trust
business with
respect to this Agreement shall be administered, which office at
the date of the
execution of this Agreement is located at 101 Barclay Street, 8W,
New York, New
York 10286 (Attn: Mortgage-Backed Securities Group, CWALT, Inc.
Series
2006-OC10, facsimile no. (212) 815-3986), and which is the address
to which
notices to and correspondence with the Trustee should be
directed.
Countrywide: Countrywide Home Loans, Inc., a New York corporation
and its
successors and assigns, in its capacity as the seller of the
Countrywide
Mortgage Loans to the Depositor.
Countrywide Mortgage Loans: The Mortgage Loans identified as such
on the
Mortgage Loan Schedule for which Countrywide is the applicable
Seller.
Countrywide Servicing: Countrywide Home Loans Servicing LP, a
Texas
limited partnership and its successors and assigns.
Covered
Certificates: The LIBOR Certificates.
Cumulative
Loss Trigger Event: With respect to a Distribution Date on or
after the Stepdown Date, the aggregate amount of Realized Losses on
the Mortgage
Loans from (and including) the Cut-off Date to (and including) the
related Due
Date (reduced by the aggregate amount of Subsequent Recoveries
received from the
Cut-off Date through the Prepayment Period related to that Due
Date) exceeds the
applicable percentage, for such Distribution Date, of the sum of
the Initial
Cut-off Date Pool Principal Balance and the original Pre-funded
Amount as set
forth below:
<TABLE>
<CAPTION>
Distribution Date
Percentage
-----------------
----------
<S>
<C>
December 2008 - November 2009..........
0.25% with respect to December 2008, plus an additional 1/12th
of
0.40% for each month thereafter through November 2009
December 2009 - November 2010..........
0.65% with respect to December 2009, plus an additional 1/12th
of
0.50% for each month thereafter through
17
<PAGE>
Distribution Date
Percentage
-----------------
----------
November 2010
December 2010 - November 2011..........
1.15% with respect to December 2010, plus an additional 1/12th
of
0.50% for each month thereafter through November 2011
December 2011 - November 2012..........
1.65% with respect to December 2011, plus an additional 1/12th
of
0.30% for each month thereafter through November 2012
December 2012 - November 2013..........
1.95% with respect to December 2012, plus an additional 1/12th
of
0.05% for each month thereafter through November 2013
December 2013 and thereafter...........
2.00%
</TABLE>
Current
Interest: With respect to each Class of Offered Certificates
and
each Distribution Date, the interest accrued at the applicable
Pass-Through Rate
for the applicable Interest Accrual Period on the Class Certificate
Balance of
such Class immediately prior to such Distribution Date.
Cut-off
Date: In the case of any Initial Mortgage Loan, the Initial
Cut-off Date, and in the case of any Supplemental Mortgage Loan,
the related
Supplemental Cut-off Date.
Cut-off
Date Pool Principal Balance: An amount equal to the sum of (x)
the
Initial Cut-off Date Pool Principal Balance plus (y) the amount, if
any,
deposited in the Pre-funding Account on the Closing Date.
Debt
Service Reduction: With respect to any Mortgage Loan, a reduction
by
a court of competent jurisdiction in a proceeding under the
Bankruptcy Code in
the Scheduled Payment for such Mortgage Loan that became final
and
non-appealable, except such a reduction resulting from a Deficient
Valuation or
any reduction that results in a permanent forgiveness of
principal.
Defective
Mortgage Loan: Any Mortgage Loan that is required to be
repurchased pursuant to Section 2.02 or 2.03.
Deficient
Valuation: With respect to any Mortgage Loan, a valuation by a
court of competent jurisdiction of the Mortgaged Property in an
amount less than
the then-outstanding indebtedness under the Mortgage Loan, or any
reduction in
the amount of principal to be paid in connection with any Scheduled
Payment that
results in a permanent forgiveness of principal, which valuation or
reduction
results from an order of such court which is final and
non-appealable in a
proceeding under the Bankruptcy Code.
Definitive
Certificates: Any Certificate evidenced by a Physical
Certificate and any Certificate issued in lieu of a Book-Entry
Certificate
pursuant to Section 5.02(e).
Delay Certificates: As specified in the Preliminary Statement.
18
<PAGE>
Delay
Delivery Certification: As defined in Section 2.02(a).
Delay
Delivery Mortgage Loans: The Mortgage Loans for which all or a
portion of a related Mortgage File is not delivered to the Trustee
on the
Closing Date or Supplemental Transfer Date, as applicable. The
number of Delay
Delivery Mortgage Loans shall not exceed 50% of the aggregate
number of Initial
Mortgage Loans in each Loan Group and 90% of the Supplemental
Mortgage Loans in
each Loan Group conveyed on the related Supplemental Transfer Date.
To the
extent that Countrywide Servicing shall be in possession of any
Mortgage Files
with respect to any Delay Delivery Mortgage Loan, until delivery of
such
Mortgage File to the Trustee as provided in Section 2.01,
Countrywide Servicing
shall hold such files as Master Servicer hereunder, as agent and in
trust for
the Trustee.
Deleted Mortgage
Loan: As defined in Section 2.03(C).
Delinquency Trigger Event: With respect to a Distribution Date on
or after
the Stepdown Date, the Rolling Sixty-Day Delinquency Rate equals or
exceeds the
product of (x) the Senior Enhancement Percentage for such
Distribution Date and
(y) the applicable percentage listed below for the most senior
Class of
outstanding LIBOR Certificates:
Class
Percentage
-------------------------------------------
----------
Senior Certificates........................
42.00%
M-1........................................
59.00%
M-2........................................
89.75%
M-3........................................
108.00%
M-4........................................
135.75%
M-5........................................
172.50%
M-6........................................
236.25%
M-7........................................
375.50%
M-8........................................
911.75%
Delinquent: A Mortgage Loan is "delinquent" if any payment due
thereon is
not made pursuant to the terms of such Mortgage Loan by the close
of business on
the day such payment is scheduled to be due. A Mortgage Loan is "30
days
delinquent" if such payment has not been received by the close of
business on
the corresponding day of the month immediately succeeding the month
in which
such payment was due, or, if there is no such corresponding day
(e.g., as when a
30-day month follows a 31-day month in which a payment was due on
the 31st day
of such month), then on the last day of such immediately succeeding
month.
Similarly for "60 days delinquent," "90 days delinquent" and so
on.
Denomination: With respect to each Certificate, the amount set
forth on
the face of that Certificate as the "Initial Certificate Balance of
this
Certificate" or the "Initial Notional Amount of this Certificate"
or, if neither
of the foregoing, the Percentage Interest appearing on the face
thereof.
Depositor:
CWALT, Inc., a Delaware corporation, or its successor in
interest.
19
<PAGE>
Depository: The initial Depository shall be The Depository Trust
Company,
the nominee of which is CEDE & Co., as the registered Holder of
the Book-Entry
Certificates. The Depository shall at all times be a "clearing
corporation" as
defined in Section 8-102(a)(5) of the Uniform Commercial Code of
the State of
New York.
Depository
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: As to any Distribution Date, the 22nd day of
each
month or, if such 22nd day is not a Business Day, the next
preceding Business
Day; provided, however, that if such 22nd day or such Business Day,
whichever is
applicable, is less than two Business Days prior to the related
Distribution
Date, the Determination Date shall be the first Business Day that
is two
Business Days preceding such Distribution Date.
Directing
Certificateholder: As defined in Section 9.04(a).
Distribution Account: The separate Eligible Account created and
maintained
by the Trustee pursuant to Section 3.05(d) in the name of the
Trustee for the
benefit of the Certificateholders and designated "The Bank of New
York in trust
for registered holders of Alternative Loan Trust 2006-OC10,
Mortgage
Pass-Through Certificates, Series 2006-OC10." Funds in the
Distribution Account
shall be held in trust for the Certificateholders for the uses and
purposes set
forth in this Agreement.
Distribution Account Deposit Date: As to any Distribution Date,
12:30 p.m.
Pacific time on the Business Day immediately preceding such
Distribution Date.
Distribution Date: The 25th day of each calendar month after the
initial
issuance of the Certificates, or if such 25th day is not a Business
Day, the
next succeeding Business Day, commencing in December 2006.
Due Date:
With respect to a Mortgage Loan, the date on which Scheduled
Payments are due on that Mortgage Loan. With respect to any
Distribution Date,
the related Due Date is the first day of the calendar month in
which that
Distribution Date occurs.
Due
Period: Not applicable.
EDGAR: The
Commission's Electronic Data Gathering, Analysis 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 Moody's and one of the two highest short-term
ratings of
S&P, if S&P is a 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 and to each
20
<PAGE>
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 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 (a) the trust
department of a
federal or state chartered depository institution or (b) a trust
company, 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.
Eligible
Repurchase Month: As defined in Section 3.11.
Eligible EPD
Protected Mortgage Loan: A Mortgage Loan that (i) was
originated not more than one year prior to the Closing Date, (ii)
was purchased
by a Seller or one of its affiliates pursuant to a purchase
agreement containing
provisions under which the seller thereunder has become obligated
to repurchase
such Mortgage Loan from Countrywide due to a Scheduled Payment due
on or prior
to the first Scheduled Payment owing to the Trust Fund becoming
delinquent and
(iii) was not purchased through Countrywide Home Loan Inc.'s
Correspondent
Lending Division.
ERISA: The
Employee Retirement Income Security Act of 1974, as amended.
ERISA-Qualifying Underwriting: A best efforts or firm
commitment
underwriting or private placement that meets the requirements of
the
Underwriter's Exemption.
ERISA-Restricted Certificate: As specified in the Preliminary
Statement.
Escrow
Account: The Eligible Account or Accounts established and
maintained pursuant to Section 3.06(a).
Event of
Default: As defined in Section 7.01.
Excess
Cashflow: With respect to any Distribution Date the sum of (i)
the
amount remaining as set forth in Section 4.02(a)(iv)(B), (ii) the
amount
remaining as set forth in Section 4.02(b)(i)(C) or 4.02(b)(ii)(C),
as
applicable, in each case for such Distribution Date and (iii)
the
Overcollateralization Reduction Amount for that Distribution Date,
if any.
Excess
Overcollateralization Amount: With respect to any Distribution
Date, the excess, if any, of the Overcollateralized Amount for the
Distribution
Date over the Overcollateralization Target Amount for the
Distribution Date.
Excess
Proceeds: With respect to any Liquidated Mortgage Loan, the
amount,
if any, by which the sum of any Liquidation Proceeds received with
respect to
such Mortgage Loan during the calendar month in which such Mortgage
Loan became
a Liquidated Mortgage Loan plus any Subsequent Recoveries received
with respect
to such Mortgage Loan, net of any amounts previously reimbursed to
the Master
Servicer as Nonrecoverable Advance(s) with respect to such Mortgage
Loan
pursuant to Section 3.08(a)(iii), exceeds (i) the unpaid principal
balance of
such Liquidated Mortgage Loan as of the Due
21
<PAGE>
Date in the month in which such Mortgage Loan became a Liquidated
Mortgage Loan
plus (ii) accrued interest at the Mortgage Rate from the Due Date
as to which
interest was last paid or advanced (and not reimbursed) to
Certificateholders 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, and the
rules and regulations promulgated thereunder.
Exchange
Act Reports: Any reports on Form 10-D, Form 8-K and Form 10-K
required to be filed by the Depositor with respect to the Trust
Fund under the
Exchange Act.
Expense
Fee: As to each Mortgage Loan and any Distribution Date, the
product of the related Expense Fee Rate and its Stated Principal
Balance as of
that Distribution Date.
Expense
Fee Rate: As to each Mortgage Loan and any date of
determination,
the sum of (a) the related Master Servicing Fee Rate and (b) the
Trustee Fee
Rate.
Extra
Principal Distribution Amount: With respect to any Distribution
Date
and Loan Group, the product of (a) the lesser of (1) the
Overcollateralization
Deficiency Amount and (2) the Excess Cashflow available for payment
pursuant to
Section 4.02(c) and (b) a fraction, the numerator of which is the
Principal
Remittance Amount for such Loan Group and the denominator of which
is the sum of
the Principal Remittance Amounts for both Loan Groups.
FDIC: The
Federal Deposit Insurance Corporation, or any successor
thereto.
FHLMC: The
Federal Home Loan Mortgage Corporation, a corporate
instrumentality of the United States created and existing under
Title III of the
Emergency Home Finance Act of 1970, as amended, or any successor to
the Federal
Home Loan Mortgage Corporation.
Final
Certification: As defined in Section 2.02(a).
FIRREA:
The Financial Institutions Reform, Recovery, and Enforcement
Act
of 1989.
Fitch:
Fitch, Inc., or any successor thereto. If Fitch is designated as
a
Rating Agency in the Preliminary Statement, for purposes of Section
10.05(b) the
address for notices to Fitch shall be Fitch, Inc., One State Street
Plaza, New
York, New York 10004, Attention: Residential Mortgage Surveillance
Group, or
such other address as Fitch may hereafter furnish to the Depositor
and the
Master Servicer.
FNMA: The
Federal National Mortgage Association, a federally chartered
and
privately owned corporation organized and existing under the
Federal National
Mortgage Association Charter Act, or any successor to the Federal
National
Mortgage Association.
Form 10-D
Disclosure Item: With respect to any Person, any material
litigation or governmental proceedings pending (a) against such
Person, or (b)
against any of the Trust Fund, the Depositor, the Trustee, any
co-trustee, the
Master Servicer or any Subservicer, if such Person has actual
knowledge thereof.
Form 10-K
Disclosure Item: With respect to any Person, (a) any Form 10-D
Disclosure Item, and (b) any affiliations or relationships between
such Person
and any Item 1119 Party.
22
<PAGE>
Funding
Period: The period from the Closing Date until the earliest of
(i)
the date on which the amount on deposit in the Pre-funding Account
is less than
$150,000, or (ii) an Event of Default occurs or (iii) December 31,
2006.
Funding
Period Distribution Date: Each Distribution Date during the
Funding Period and, if the Funding Period ends after the
Distribution Date in a
month, the immediately succeeding Distribution Date.
Gross
Margin: The percentage set forth in the related Mortgage Note
for
the Mortgage Loans to be added to One-Year LIBOR for use in
determining the
Mortgage Rate on each Adjustment Date, and which is set forth in
the Mortgage
Loan Schedule.
Group 1
Mortgage Loans: The Mortgage Loans in Loan Group 1.
Group 1
Overcollateralization Reduction Amount: For any Distribution
Date,
the Overcollateralization Reduction Amount for such Distribution
Date multiplied
by a fraction, the numerator of which is the Principal Remittance
Amount for
Loan Group 1 for such Distribution Date, and the denominator of
which is the
aggregate Principal Remittance Amount for Loan Group 1 and Loan
Group 2 for such
Distribution Date.
Group 1
Principal Distribution Target Amount: For any Distribution
Date,
the excess of (1) the Class Certificate Balance of the Class 1-A
Certificates
immediately prior to such Distribution Date, over (2) the lesser of
(x) 84.80%
of the aggregate Stated Principal Balance of the Mortgage Loans in
Loan Group 1
as of the Due Date in the month of that Distribution Date (after
giving effect
to Principal Prepayments received in the related Prepayment Period)
and (y) the
aggregate Stated Principal Balance of the Mortgage Loans in Loan
Group 1 as of
the Due Date in the month of that Distribution Date (after giving
effect to
Principal Prepayments received in the related Prepayment Period)
minus 0.35% of
the sum of the aggregate Stated Principal Balance of the Mortgage
Loans in Loan
Group 1 as of the Initial Cut-off Date and the portion of the
original
Pre-funded Amount allocated to Loan Group 1.
Group 1
Senior Principal Distribution Amount: For any Distribution
Date,
the product of (x) the Senior Principal Distribution Target Amount
and (y) a
fraction, the numerator of which is the Group 1 Principal
Distribution Target
Amount for Loan Group 1 and the denominator of which is the sum of
the Group 1
Principal Distribution Target Amount and the Group 2 Principal
Distribution
Target Amount.
Group 1
Tax Net Rate Cap: As defined in the Preliminary Statement.
Group 2
Mortgage Loans: The Mortgage Loans in Loan Group 2.
Group 2
Overcollateralization Reduction Amount: For any Distribution
Date,
the Overcollateralization Reduction Amount for such Distribution
Date multiplied
by a fraction, the numerator of which is the Principal Remittance
Amount for
Loan Group 2 for such Distribution Date, and the denominator of
which is the
aggregate Principal Remittance Amount for Loan Group 1 and Loan
Group 2 for such
Distribution Date.
Group 2
Principal Distribution Target Amount: For any Distribution
Date,
the excess of (1) the aggregate Class Certificate Balance of the
Group 2 Senior
Certificates immediately prior
23
<PAGE>
to such Distribution Date, over (2) the lesser of (x) 84.80% of the
aggregate
Stated Principal Balance of the Mortgage Loans in Loan Group 2 as
of the Due
Date in the month of that Distribution Date (after giving effect to
Principal
Prepayments received in the related Prepayment Period) and (y) the
aggregate
Stated Principal Balance of the Mortgage Loans in Loan Group 2 as
of the Due
Date in the month of that Distribution Date (after giving effect to
Principal
Prepayments received in the related Prepayment Period) minus 0.35%
of the sum of
the aggregate Stated Principal Balance of the Mortgage Loans in
Loan Group 2 as
of the Initial Cut-off Date and the portion of the original
Pre-funded Amount
allocated to Loan Group 2.
Group 2
Senior Principal Distribution Amount: For any Distribution
Date,
the product of (x) the Senior Principal Distribution Target Amount
and (y) a
fraction, the numerator of which is the Group 2 Principal
Distribution Target
Amount for Loan Group 2 and the denominator of which is the sum of
the Group 1
Principal Distribution Target Amount and the Group 2 Principal
Distribution
Target Amount.
Group 2
Tax Net Rate Cap: As defined in the Preliminary Statement.
Index:
With respect to any Interest Accrual Period for the COFI
Certificates, if any, the then-applicable index used by the Trustee
pursuant to
Section 4.07 to determine the applicable Pass-Through Rate for such
Interest
Accrual Period for the COFI Certificates.
Indirect
Participant: A broker, dealer, bank or other financial
institution or other Person that clears through or maintains a
custodial
relationship with a Depository Participant.
Initial
Certification: As defined in Section 2.02(a).
Initial
Component Balance: As specified in the Preliminary Statement.
Initial
Cut-off Date: With respect to any Initial Mortgage Loan, the
later
of (i) the date of origination of such Mortgage Loan and (ii)
November 1, 2006.
Initial
Cut-off Date Pool Principal Balance: $799,232,004.
Initial
Mortgage Loan: With respect to any Mortgage Loan included in
Loan
Group 1 or Loan Group 2, a Mortgage Loan conveyed to the Trust Fund
on the
Closing Date pursuant to this Agreement as identified on the
Mortgage Loan
Schedule delivered to the Trustee on the Closing Date.
Initial
Periodic Rate Cap: As to each Mortgage Loan and the related
Mortgage Note, the provision therein that limits permissible
increases and
decreases in the Mortgage Rate on the first Adjustment Date for
that Mortgage
Loan to not more than the amount set forth therein.
Insurance
Policy: With respect to any Mortgage Loan included in the Trust
Fund, any insurance policy, including all riders and endorsements
thereto in
effect, including any replacement policy or policies for any
Insurance Policies.
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.
24
<PAGE>
Insured
Expenses: Expenses covered by an Insurance Policy or any other
insurance policy with respect to the Mortgage Loans.
Interest
Accrual Period: With respect to each Class of Delay
Certificates,
its corresponding REMIC Regular Interest and any Distribution Date,
the calendar
month prior to the month of such Distribution Date. With respect to
any Class of
Non-Delay Certificates, its corresponding REMIC Regular Interest
and any
Distribution Date, the period commencing on the Distribution Date
in the month
preceding the month in which such Distribution Date occurs (other
than the first
Distribution Date, for which it is the Closing Date) and ending on
the day
preceding such Distribution Date.
Interest
Carry Forward Amount: With respect to each Class of Offered
Certificates and each Distribution Date, the excess of (i) the
Current Interest
for such Class with respect to prior Distribution Dates over (ii)
the amount
actually distributed to such Class with respect to interest on such
prior
Distribution Dates.
Interest
Determination Date: With respect to (a) any Interest Accrual
Period for any LIBOR Certificates and (b) any Interest Accrual
Period for the
COFI Certificates for which the applicable Index is LIBOR, the
second Business
Day prior to the first day of such Interest Accrual Period.
Interest
Funds: With respect to any Distribution Date and Loan Group,
the
excess of the Interest Remittance Amount for that Loan Group over
the portion of
the Trustee Fee for such Distribution Date allocable to such Loan
Group.
Interest
Remittance Amount: With respect to the Mortgage Loans in a Loan
Group and any Distribution Date, (x) the sum, without duplication,
of (i) all
scheduled interest on the Mortgage Loans in that Loan Group due on
the related
Due Date and received on or prior to the related Determination
Date, less the
related Master Servicing Fees and any payments made in respect of
premiums on
Lender PMI Mortgage Loans, (ii) all interest on Principal
Prepayments on the
Mortgage Loans in that Loan Group, other than Prepayment Interest
Excess, (iii)
all Advances relating to interest with respect to the Mortgage
Loans in that
Loan Group, (iv) all Compensating Interest with respect to the
Mortgage Loans in
that Loan Group, (v) Liquidation Proceeds with respect to the
Mortgage Loans in
that Loan Group during the related Prepayment Period (to the extent
such
Liquidation Proceeds relate to interest) and (vi) with respect to
each Loan
Group, on each Funding Period Distribution Date, the amount, if
any, transferred
from the Capitalized Interest Account in respect of the applicable
Capitalized
Interest Requirement with respect to such Loan Group, less (y)
all
reimbursements to the Master Servicer since the immediately
preceding Due Date
for Advances of interest previously made allocable to such Loan
Group.
Investment
Letter: As defined in Section 5.02(b).
ISDA
Master Agreement: The 1992 ISDA Master Agreement (Multicurrency
-
Cross Border), including the Schedule and Credit Support Annex
thereto, dated
November 30, 2006, between the Swap Counterparty and the Swap
Contract
Administrator.
Item 1119
Party: The Depositor, any Seller, the Master Servicer, the
Trustee, any Subservicer, any originator identified in the
Prospectus
Supplement, the Swap Counterparty and
25
<PAGE>
any other material transaction party, as identified in Exhibit X
hereto, as
updated pursuant to Section 11.04.
Latest
Possible Maturity Date: The Distribution Date following the
third
anniversary of the scheduled maturity date of the Mortgage Loan
having the
latest scheduled maturity date as of the Cut-off Date.
Lender PMI
Mortgage Loan: Certain Mortgage Loans as to which the lender
(rather than the Mortgagor) acquires the Primary Insurance Policy
and charges
the related Mortgagor an interest premium.
LIBOR: The
London interbank offered rate for one-month United States
dollar deposits calculated in the manner described in Section
4.08.
LIBOR
Certificates: As specified in the Preliminary Statement.
Limited
Exchange Act Reporting Obligations: The obligations of the
Master
Servicer under Section 3.16(b), Section 6.02 and Section 6.04 with
respect to
notice and information to be provided to the Depositor and Article
XI (except
Section 11.07(a)(1) and (2)).
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
Master Servicer has determined (in accordance with this Agreement)
that it has
received all amounts it expects to receive in connection with the
liquidation of
such Mortgage Loan, including the final disposition of an REO
Property.
Liquidation Proceeds: 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 Master Servicing Fees,
Servicing Advances
and Advances.
Loan
Group: Any of Loan Group 1 and Loan Group 2, as applicable.
Loan Group
1: All Mortgage Loans identified as Loan Group 1 Mortgage Loans
on the Mortgage Loan Schedule.
Loan Group
2: All Mortgage Loans identified as Loan Group 2 Mortgage Loans
on the Mortgage Loan Schedule.
Loan-to-Value Ratio: With respect to any Mortgage Loan and as to
any date
of determination, the fraction (expressed as a percentage) the
numerator of
which is the principal balance of the related Mortgage Loan at that
date of
determination and the denominator of which is the Appraised Value
of the related
Mortgaged Property.
Lost
Mortgage Note: Any Mortgage Note the original of which was
permanently lost or destroyed and has not been replaced.
26
<PAGE>
Maintenance: With respect to any Cooperative Unit, the rent paid by
the
Mortgagor to the Cooperative Corporation pursuant to the
Proprietary Lease.
Majority in
Interest: As to any Class of Regular Certificates, the Holders
of Certificates of such Class evidencing, in the aggregate, at
least 51% of the
Percentage Interests evidenced by all Certificates of such
Class.
Master
REMIC: As described in the Preliminary Statement.
Master
Servicer: Countrywide Home Loans Servicing LP, a Texas limited
partnership, and its successors and assigns, in its capacity as
master servicer
hereunder.
Master
Servicer Advance Date: As to any Distribution Date, 12:30 p.m.
Pacific time on the Business Day immediately preceding such
Distribution Date.
Master
Servicing Fee: As to each Mortgage Loan and any Distribution
Date,
an amount payable out of each full payment of interest received on
such Mortgage
Loan and equal to one-twelfth of the Master Servicing Fee Rate
multiplied by the
Stated Principal Balance of such Mortgage Loan as of the Due Date
in the month
preceding the month of such Distribution Date, subject to reduction
as provided
in Section 3.14.
Master
Servicing Fee Rate: With respect to each Mortgage Loan, the per
annum rate set forth on the Mortgage Loan Schedule for such
Mortgage Loan.
Maximum
Mortgage Rate: With respect to each Mortgage Loan, the maximum
rate of interest set forth as such in the related Mortgage
Note.
MERS:
Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or
any successor
to Mortgage Electronic Registration Systems, Inc.
MERS Mortgage Loan:
Any Mortgage Loan registered with MERS on the MERS(R)
System.
MERS(R)
System: The system of recording transfers of mortgages
electronically maintained by MERS.
MIN: The
mortgage identification number for any MERS Mortgage Loan.
Minimum
Auction Amount: With respect to any auction of the Mortgage
Loans
and any REO Properties pursuant to Section 9.04, the sum of (i) the
Termination
Price that would be payable by the NIM Insurer if the Optional
Termination were
exercised in the following calendar month pursuant to Section 9.01
and (ii) all
reasonable fees and expenses incurred by the Trustee in connection
with any
auction conducted pursuant to Section 9.04.
Minimum
Mortgage Rate: With respect to each Mortgage Loan, the minimum
rate of interest set forth as such in the related Mortgage Note,
which, with
respect to certain Mortgage Loans is equal to the related Gross
Margin.
27
<PAGE>
MOM Loan:
Any Mortgage Loan as to which MERS is acting as mortgagee,
solely as nominee for the originator of such Mortgage Loan and its
successors
and assigns.
Monthly
Statement: The statement delivered to the Certificateholders
pursuant to Section 4.06.
Moody's:
Moody's Investors Service, Inc., or any successor thereto. If
Moody's is designated as a Rating Agency in the Preliminary
Statement, for
purposes of Section 10.05(b) the address for notices to Moody's
shall be Moody's
Investors Service, Inc., 99 Church Street, New York, New York
10007, Attention:
Residential Pass-Through Monitoring, or such other address as
Moody's may
hereafter furnish to the Depositor or the Master Servicer.
Mortgage:
The mortgage, deed of trust or other instrument creating a
first
lien on an estate in fee simple or leasehold interest in real
property securing
a Mortgage Note.
Mortgage
File: The mortgage documents listed in Section 2.01 pertaining
to
a particular Mortgage Loan and any additional documents delivered
to the Trustee
to be added to the Mortgage File pursuant to this Agreement.
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, the addition of any Supplemental Mortgage Loans pursuant to
the
provisions of this Agreement and any Supplemental Transfer
Agreement and the
deletion of Deleted Mortgage Loans pursuant to the provisions of
this Agreement)
transferred to the Trustee as part of the Trust Fund and from time
to time
subject to this Agreement, attached to this Agreement as Schedule
I, setting
forth the following information with respect to each Mortgage
Loan:
(i) the loan
number;
(ii) the Loan
Group;
(iii) the Mortgagor's name and the street address of the
Mortgaged
Property, including the zip code;
(iv) the maturity
date;
(v) the original
principal balance; (vi) the Cut-off Date
Principal Balance;
(vii) the first payment date of the Mortgage Loan;
(viii) the Scheduled Payment in effect as of the Cut-off Date;
(ix) the Loan-to-Value
Ratio at origination;
(x) a code
indicating whether the residential dwelling at the time
of origination was represented to be owner-occupied;
28
<PAGE>
(xi) a code indicating
whether the residential dwelling is either
(a) a detached or attached single family dwelling, (b) a dwelling
in
a de minimis PUD, (c) a condominium unit or PUD (other than a
de
minimis PUD) or (d) a two- to four-unit residential property or
(e)
a Cooperative Unit;
(xii) the Mortgage Rate as of the Cut-off Date, the Gross
Margin,
the Initial Periodic Rate Cap, the Subsequent Periodic Rate Cap,
the
Maximum Mortgage Rate and the Minimum Mortgage Rate;
(xiii) the initial Adjustment Date and the Master Servicing Fee
Rate
both before and after the initial Adjustment Date for each
Mortgage
Loan;
(xiv) a code indicating whether the Mortgage Loan is a Lender
PMI
Mortgage Loan and, in the case of any Lender PMI Mortgage Loan,
a
percentage representing the amount of the related interest
premium
charged to the borrower;
(xv) the purpose for
the Mortgage Loan;
(xvi) the type of documentation program pursuant to which the
Mortgage Loan was originated;
(xvii) a code indicating whether the Mortgage Loan is a
Countrywide
Mortgage Loan, a Park Granada Mortgage Loan, a Park Monaco
Mortgage
Loan or a Park Sienna Mortgage Loan;
(xviii)
the direct servicer of such Mortgage Loan as of the Cut-off
Date; and
(xix) a code indicating whether the Mortgage Loan is a MERS
Mortgage
Loan.
Such
schedule shall also set forth the total of the amounts
described
under (iv) and (v) above for all of the Mortgage Loans and for each
Loan Group.
Countrywide shall update he Mortgage Loan Schedule in connection
with each
Supplemental Transfer Agreement within a reasonable period of time
after
delivery to it of the Schedule of Supplemental Mortgage Loans
attached to the
related Supplemental Transfer Agreement as Schedule A thereto.
Mortgage
Loans: Such of the mortgage loans as from time to time are
transferred and assigned to the Trustee pursuant to the provisions
of this
Agreement and any Supplemental Transfer Agreement and that are held
as a part of
the Trust Fund (including any REO Property), the mortgage loans so
held being
identified in the Mortgage Loan Schedule, notwithstanding
foreclosure or other
acquisition of title of the related Mortgaged Property.
Mortgage
Note: The original executed note or other evidence of
indebtedness evidencing the indebtedness of a Mortgagor under a
Mortgage Loan.
Mortgage
Pool: The aggregate of the Mortgage Loans identified in the
Mortgage Loan Schedule.
29
<PAGE>
Mortgage
Rate: The annual rate of interest borne by a Mortgage Note from
time to time, net of any interest premium charged by the mortgagee
to obtain or
maintain any Primary Insurance Policy.
Mortgaged
Property: The underlying property securing a Mortgage Loan,
which, with respect to a Cooperative Loan, is the related Coop
Shares and
Proprietary Lease.
Mortgagor:
The obligor(s) on a Mortgage Note.
National
Cost of Funds Index: The National Monthly Median Cost of Funds
Ratio to SAIF-Insured Institutions published by the Office of
Thrift
Supervision.
Net
Prepayment Interest Shortfalls: As to any Distribution Date and
Loan
Group, the excess of the amount of the aggregate Prepayment
Interest Shortfalls
for that Loan Group during the related Prepayment Period over the
sum of (i) the
Compensating Interest for such Loan Group and Distribution Date and
(ii) the
excess, if any, of the Compensating Interest for the other Loan
Group for such
Distribution Date over the Prepayment Interest Shortfall for such
other Loan
Group.
Net Rate
Cap: For each Distribution Date and the Senior Certificates the
weighted average Adjusted Net Mortgage Rate on the Mortgage Loans
in the related
Loan Group as of the Due Date in the prior calendar month (after
giving effect
to Principal Prepayments received in the Prepayment Period related
to that prior
Due Date), adjusted to an effective rate reflecting the accrual of
interest on
the basis of a 360-day year and the actual number of days that
elapsed in the
related Interest Accrual Period, minus the Swap Adjustment Rate for
such
Distribution Date and the related Loan Group. For each Distribution
Date and the
Subordinated Certificates, the Subordinate Net Rate Cap.
Net Rate
Carryover: For any Class of LIBOR Certificates and any
Distribution Date, the sum of (A) the excess of (i) the amount of
interest that
such Class would otherwise have accrued for such Distribution Date
had the
Pass-Through Rate for such Class not been determined based on the
applicable Net
Rate Cap, over (ii) the amount of interest accrued on such Class at
the
applicable Net Rate Cap for such Distribution Date and (B) the Net
Rate
Carryover for such Class for all previous Distribution Dates not
previously paid
pursuant to Section 4.02, together with interest thereon at the
then applicable
Pass-Through Rate for such Class, without giving effect to the
applicable Net
Rate Cap.
Net Swap
Payment: With respect to the Swap Contract, any Distribution
Date
and payment by the Swap Contract Administrator to the Swap
Counterparty, the
excess, if any, of the "Fixed Amount" (as defined in the Swap
Contract) with
respect to such Distribution Date over the "Floating Amount" (as
defined in the
Swap Contract) with respect to such Distribution Date. With respect
to any
Distribution Date and payment by the Swap Counterparty to the Swap
Contract
Administrator, the excess, if any, of the "Floating Amount" (as
defined in the
Swap Contract) with respect to such Distribution Date over the
"Fixed Amount"
(as defined in the Swap Contract) with respect to such Distribution
Date.
NIM
Insurer: Any insurer guarantying at the request of Countrywide
certain
payments under notes backed or secured by the Class C or Class P
Certificates.
30
<PAGE>
Non-Delay
Certificates: As specified in the Preliminary Statement.
Nonrecoverable Advance: Any portion of an Advance previously made
or
proposed to be made by the Master Servicer that, in the good faith
judgment of
the Master Servicer, will not be ultimately recoverable by the
Master Servicer
from the related Mortgagor, related Liquidation Proceeds or
otherwise.
Notice of
Final Distribution: The notice to be provided pursuant to
Section 9.02 to the effect that final distribution on any of the
Certificates
shall be made only upon presentation and surrender thereof.
Notional
Amount: Not applicable.
Notional
Amount Certificates: As specified in the Preliminary Statement.
OC Floor:
With respect to any Distribution Date prior to the Distribution
Date in December 2026, an amount equal to 0.35% of the sum of the
Initial
Cut-off Date Pool Principal Balance and the original Pre-funded
Amount. With
respect to any Distribution Date on or after the Distribution Date
in December
2026, the greater of (a) 0.35% of the sum of the Initial Cut-off
Date Pool
Principal Balance and the original Pre-funded Amount and (b) the
sum of (x) the
aggregate Stated Principal Balance of the 40-Year Mortgage Loans as
of the Due
Date in the month of that Distribution Date (after giving effect to
Principal
Prepayments received in the related Prepayment Period) and (y)
0.10% of the sum
of the Initial Cut-off Date Pool Principal Balance and the original
Pre-funded
Amount.
Offered
Certificates: As specified in the Preliminary Statement.
Officer's
Certificate: A certificate (i) in the case of the Depositor,
signed by the Chairman of the Board, the Vice Chairman of the
Board, the
President, a Managing Director, a Vice President (however
denominated), an
Assistant Vice President, the Treasurer, the Secretary, or one of
the Assistant
Treasurers or Assistant Secretaries of the Depositor, (ii) in the
case of the
Master Servicer, signed by the President, an Executive Vice
President, a Vice
President, an Assistant Vice President, the Treasurer, or one of
the Assistant
Treasurers or Assistant Secretaries of Countrywide GP, Inc., its
general
partner, (iii) if provided for in this Agreement, signed by a
Servicing Officer,
as the case may be, and delivered to the Depositor and the Trustee,
as the case
may be, as required by this Agreement or (iv) in the case of any
other Person,
signed by an authorized officer of such Person.
One-Year
LIBOR: As of any date of determination, the per annum rate
equal
to the average of the London interbank offered rates for one-year
U.S. dollar
deposits in the London market, generally as set forth in either The
Wall Street
Journal or some other source generally accepted in the residential
mortgage loan
origination business and specified in the related Mortgage Note,
or, if such
rate ceases to be published in The Wall Street Journal or becomes
unavailable
for any reason, then based upon a new index selected by the Master
Servicer,
based on comparable information, in each case, as most recently
announced as of
either 45 days prior to, or the first business day of the month
immediately
preceding the month of, such Adjustment Date.
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<PAGE>
Opinion of
Counsel: A written opinion of counsel, who may be counsel for a
Seller, the Depositor or the Master Servicer, including, in-house
counsel,
reasonably acceptable to the Trustee; provided, however, that with
respect to
the interpretation or application of the REMIC Provisions, such
counsel must (i)
in fact be independent of a Seller, the Depositor and the Master
Servicer, (ii)
not have any direct financial interest in a Seller, the Depositor
or the Master
Servicer or in any affiliate thereof, and (iii) not be connected
with a Seller,
the Depositor or the Master Servicer as an officer, employee,
promoter,
underwriter, trustee, partner, director or person performing
similar functions.
Optional
Termination: The termination of the Trust Fund provided
hereunder
pursuant to clause (a) of the first sentence of Section 9.01.
Optional
Termination Date: The first Distribution Date on which the
aggregate Stated Principal Balance of the Mortgage Loans is less
than or equal
to 10% of the sum of (a) the Initial Cut-off Date Pool Principal
Balance and (b)
any amount on deposit in the Pre-funding Account on the Closing
Date.
Original
Mortgage Loan: The mortgage loan refinanced in connection with
the origination of a Refinancing Mortgage Loan.
OTS: The
Office of Thrift Supervision.
Outside
Reference Date: As to any Interest Accrual Period for the COFI
Certificates, the close of business on the tenth day thereof.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore executed and
authenticated under
this Agreement except:
(i) Certificates theretofore canceled by the Trustee or
delivered to the Trustee for cancellation; and
(ii) Certificates in exchange for which or in lieu of which
other Certificates have been executed and delivered by the
Trustee pursuant to
this Agreement.
Outstanding Mortgage Loan: As of any Due Date, a Mortgage Loan with
a
Stated Principal Balance greater than zero, which was not the
subject of a
Principal Prepayment in Full prior to the end of the related
Prepayment Period
and which did not become a Liquidated Mortgage Loan prior to the
end of the
related Prepayment Period.
Overcollateralization Deficiency Amount: With respect to any
Distribution
Date, the amount, if any, by which the Overcollateralization Target
Amount
exceeds the Overcollateralized Amount on such Distribution Date
(after giving
effect to distributions in respect of the Principal Remittance
Amount for each
Loan Group on such Distribution Date).
Overcollateralization Reduction Amount: With respect to any
Distribution
Date, the amount equal to the lesser of (i) the Excess
Overcollateralization
Amount for the Distribution Date and (ii) the Principal Remittance
Amount for
Loan Group 1 and Loan Group 2 for the Distribution Date.
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<PAGE>
Overcollateralization Target Amount: With respect to any
Distribution
Date, (i) prior to the Stepdown Date, an amount equal to the
greater of (a) the
product of (1) 0.35%, (2) the Initial Cut-Off Date Pool Principal
Balance and
(3) the original Pre-funded Amount and (b) the OC Floor, and (ii)
on or after
the Stepdown Date, an amount equal to the greater of (a) the
product of (1)
0.70% and (2) the aggregate Stated Principal Balance of the
Mortgage Loans as of
the Due Date in the month of that Distribution Date (after giving
effect to
principal prepayments, the principal portion of any liquidation
proceeds and any
Subsequent Recoveries received in the related Prepayment Period)
and (b) the OC
Floor provided, however, that if a Trigger Event is in effect on
any
Distribution Date, the Overcollateralization Target Amount will be
the
Overcollateralization Target Amount as in effect for the prior
Distribution
Date.
Overcollateralized Amount: For any Distribution Date, the amount,
if any,
by which (x) the aggregate Stated Principal Balance of the Mortgage
Loans as of
the Due Date in the month of that Distribution Date (after giving
effect to
Principal Prepayments, the principal portion of any Liquidation
Proceeds and any
Subsequent Recoveries received in the related Prepayment Period)
exceeds (y) the
aggregate Class Certificate Balance of the Offered Certificates as
of such
Distribution Date (after giving effect to distributions of the
Principal
Remittance Amount for each Loan Group to be made on such
Distribution Date) and,
in the case of the Distribution Date immediately following the end
of the
Funding Period, any amounts to be released from the Pre-funding
Account.
Ownership
Interest: As to any Residual Certificate, any ownership
interest
in such Certificate including any interest in such Certificate as
the Holder
thereof and any other interest therein, whether direct or indirect,
legal or
beneficial.
Park
Granada: Park Granada LLC, a Delaware limited liability company,
and
its successors and assigns, in its capacity as the seller of the
Park Granada
Mortgage Loans to the Depositor.
Park
Granada Mortgage Loans: The Mortgage Loans identified as such on
the
Mortgage Loan Schedule for which Park Granada is the applicable
Seller.
Park
Monaco: Park Monaco Inc., a Delaware corporation, and its
successors
and assigns, in its capacity as the seller of the Park Monaco
Mortgage Loans to
the Depositor.
Park
Monaco Mortgage Loans: The Mortgage Loans identified as such on
the
Mortgage Loan Schedule for which Park Monaco is the applicable
Seller.
Park
Sienna: Park Sienna LLC, a Delaware limited liability company,
and
its successors and assigns, in its capacity as the seller of the
Park Sienna
Mortgage Loans to the Depositor.
Park
Sienna Mortgage Loans: The Mortgage Loans identified as such on
the
Mortgage Loan Schedule for which Park Sienna is the applicable
Seller.
Pass-Through Margin: With respect to the Interest Accrual Period
for any
Distribution Date and Class of LIBOR Certificates, the per annum
rate indicated
in the following table:
33
<PAGE>
------------------ ------------------------
-----------------------
Class Pass-Through
Margin (1)
Pass-Through Margin (2)
------------------ ------------------------
-----------------------
Class 1-A........
0.160%
0.320%
------------------ ------------------------
-----------------------
Class 2-A-1......
0.090%
0.180%
------------------ ------------------------
-----------------------
Class 2-A-2A.....
0.180%
0.360%
------------------ ------------------------
-----------------------
Class 2-A-2B.....
0.220%
0.440%
------------------ ------------------------
-----------------------
Class 2-A-3......
0.230%
0.460%
------------------ ------------------------
-----------------------
Class M-1........
0.300%
0.450%
------------------ ------------------------
-----------------------
Class M-2........
0.310%
0.465%
------------------ ------------------------
-----------------------
Class M-3........
0.340%
0.510%
------------------ ------------------------
-----------------------
Class M-4........
0.420%
0.630%
------------------ ------------------------
-----------------------
Class M-5........
0.460%
0.690%
------------------ ------------------------
-----------------------
Class M-6........
0.510%
0.765%
------------------ ------------------------
-----------------------
Class M-7........
1.200%
1.800%
------------------ ------------------------
-----------------------
Class M-8........
1.450%
2.175%
------------------ ------------------------
-----------------------
(1) For the
Interest Accrual Period related to any Distribution
Date occurring on or prior to the Optional Termination Date.
(2) For the
Interest Accrual Period related to any Distribution
Date occurring after the Optional Termination Date.
Pass-Through Rate: With respect to any Interest Accrual Period and
each
Class of LIBOR Certificates the lesser of (x) LIBOR for such
Interest Accrual
Period plus the Pass-Through Margin for such Class and Interest
Accrual Period
and (y) the applicable Net Rate Cap for such Class and the related
Distribution
Date.
Percentage
Interest: As to any Certificate, the percentage interest
evidenced thereby in distributions required to be made on the
related Class,
such percentage interest being set forth on the face thereof or
equal to the
percentage obtained by dividing the Denomination of such
Certificate by the
aggregate of the Denominations of all Certificates of the same
Class. With
respect to the Class C, Class P and Class A-R Certificates, the
portion of the
Class evidenced thereby, expressed as a percentage, as stated on
the face of
such Certificate.
Performance
Certification: As defined in Section 11.05.
Permitted
Investments: At any time, any one or more of the following
obligations and securities:
(i) obligations of the United States or any agency thereof,
provided
such obligations
are backed by the full faith and credit of the
United States;
(ii) general obligations of or obligations guaranteed by any
state
of the United States or the District of Columbia receiving the
highest long-term debt rating of each Rating Agency, or such
lower
rating as will not result in the downgrading or withdrawal of
the
ratings then assigned to the Certificates by each Rating
Agency;
(iii) commercial or finance company paper which is then
receiving
the highest commercial or finance company paper rating of each
Rating Agency, or such
34
<PAGE>
lower rating as will not result in the downgrading or withdrawal
of
the ratings then assigned to the Certificates by each Rating
Agency;
(iv) certificates of deposit, demand or time deposits, or
bankers'
acceptances issued by any depository institution or trust
company
incorporated under the laws of the United States or of any
state
thereof and subject to supervision and examination by federal
and/or
state banking authorities, provided that the commercial paper
and/or
long term unsecured debt obligations of such depository
institution
or trust company (or in the case of the principal depository
institution in a holding company system, the commercial paper
or
long-term unsecured debt obligations of such holding company,
but
only if Moody's is not a Rating Agency) are then rated one of
the
two highest long-term and the highest short-term ratings of
each
Rating Agency for such securities, or such lower ratings as will
not
result in the downgrading or withdrawal of the rating then
assigned
to the Certificates by either Rating Agency;
(v) repurchase obligations with respect to any security described
in
clauses (i) and (ii) above, in either case entered into with a
depository institution or trust company (acting as principal)
described in clause (iv) above;
(vi) units of a taxable money-market portfolio having the
highest
rating assigned by each Rating Agency (except if Fitch is a
Rating
Agency and has not rated the portfolio, the highest rating
assigned
by Moody's) and restricted to obligations issued or guaranteed
by
the
United States of America or entities whose obligations are
backed by the full faith and credit of the United States of
America
and repurchase agreements collateralized by such obligations;
and
(vii) such other relatively risk free investments bearing
interest
or sold at a discount acceptable to each Rating Agency as will
not
result in the downgrading or withdrawal of the rating then
assigned
to the Certificates by either Rating Agency, as evidenced by a
signed writing delivered by each Rating Agency, and reasonably
acceptable to the NIM Insurer, as evidenced by a signed writing
delivered by the NIM Insurer;
provided, that no such instrument shall be a Permitted Investment
if such
instrument evidences the right to receive interest only payments
with respect to
the obligations underlying such instrument.
Permitted Transferee: Any person other than (i) the United States,
any State or
political subdivision thereof, or any agency or instrumentality of
any of the
foregoing, (ii) a foreign government, International Organization or
any agency
or instrumentality of either of the foregoing, (iii) an
organization (except
certain farmers' cooperatives described in Section 521 of the Code)
which is
exempt from tax imposed by Chapter 1 of the Code (including the tax
imposed by
Section 511 of the Code on unrelated business taxable income) on
any excess
inclusions (as defined in Section 860E(c)(1) of the Code) with
respect to any
Residual Certificate, (iv) rural electric and telephone
cooperatives described
in Section 1381(a)(2)(C) of the Code, (v) an "electing large
partnership" as
defined in Section 775 of the Code, (vi) a Person that is not a
citizen or
resident of the United States, a corporation, partnership, or other
entity
35
<PAGE>
created or organized in or under the laws of the United States, any
state
thereof or the District of Columbia, or an estate or trust whose
income from
sources without the United States is includible in gross income for
United
States federal income tax purposes regardless of its connection
with the conduct
of a trade or business within the United States or a trust if a
court within the
United States is able to exercise primary supervision over the
administration of
the trust and one or more United States persons have the authority
to control
all substantial decisions of the trust unless such Person has
furnished the
transferor and the Trustee with a duly completed Internal Revenue
Service Form
W-8ECI or any applicable successor form, and (vii) any other Person
so
designated by the Depositor based upon an Opinion of Counsel that
the Transfer
of an Ownership Interest in a Residual Certificate to such Person
may cause any
REMIC created under this Agreement to fail to qualify as a REMIC at
any time
that the Certificates are outstanding. The terms "United States,"
"State" and
"International Organization" shall have the meanings set forth in
Section 7701
of the Code or successor provisions. A corporation will not be
treated as an
instrumentality of the United States or of any State or political
subdivision
thereof for these purposes if all of its activities are subject to
tax and, with
the exception of the Federal Home Loan Mortgage Corporation, a
majority of its
board of directors is not selected by such government unit.
Person:
Any individual, corporation, partnership, joint venture,
association, limited liability company, joint-stock company,
trust,
unincorporated organization or government, or any agency or
political
subdivision thereof.
Physical
Certificate: As specified in the Preliminary Statement.
Pool
Characteristics: With respect to the Mortgage Loans in Loan Group
1
and Loan Group 2 as of the Cut-off Date, the related
characteristics set forth
in the sixth bullet point under "The Mortgage Pool--Conveyance of
Supplemental
Mortgage Loans" set forth on page S-65 of the Prospectus
Supplement.
Pool
Stated Principal Balance: The aggregate of the Stated Principal
Balances of the Outstanding Mortgage Loans plus the amount on
deposit in the
Pre-funding Account, exclusive of any investment income included
therein.
Pre-funded
Amount: The amount deposited in the Pre-funding Account on the
Closing Date, which shall equal $9,002,510.
Pre-funding Account: The separate Eligible Account created and
maintained
by the Trustee pursuant to Section 3.05 in the name of the Trustee
for the
benefit of the Certificateholders and designated "The Bank of New
York, in trust
for registered holders of Alternative Loan Trust 2006-OC10,
Mortgage
Pass-Through Certificates, Series 2006-OC10, Offered Certificates."
Funds in the
Pre-funding Account shall be held in trust for the
Certificateholders for the
uses and purposes set forth in this Agreement and shall not be a
part of any
REMIC created hereunder; provided, however, that any investment
income earned
from Permitted Investments made with funds in the Pre-funding
Account shall be
for the account of the Depositor.
Prepayment
Charge: With respect to any Mortgage Loan, the charges or
premiums, if any, due in connection with a full or partial
prepayment of such
Mortgage Loan within the related Prepayment Charge Period in
accordance with the
terms thereof.
36
<PAGE>
Prepayment
Charge Amount: As to any Distribution Date, the sum of the
Prepayment Charges collected on the Mortgage Loans during the
related Prepayment
Period and any amounts paid pursuant to Section 3.20 with respect
to such
Distribution Date.
Prepayment
Charge Period: With respect to any Mortgage Loan, the period of
time during which a Prepayment Charge may be imposed.
Prepayment
Charge Schedule: As of the Cut off Date with respect to each
Mortgage Loan, a list attached hereto as Schedule VII (including
the prepayment
charge summary attached thereto), setting forth the following
information with
respect to each Prepayment Charge:
(i) the Mortgage Loan identifying number;
(ii) a code indicating the type of Prepayment Charge;
(iii) the state of origination of the related Mortgage Loan;
(iv) the date on which the first monthly payment was due on the
related
Mortgage Loan;
(v) the term of the related Prepayment Charge; and
(vi) the principal balance of the related Mortgage Loan as of
the
Cut off
Date.
As of the
Closing Date, the Prepayment Charge Schedule shall contain the
necessary information for each Mortgage Loan. The Prepayment Charge
Schedule
shall be amended from time to time by the Master Servicer in
accordance with the
provisions of this Agreement and a copy of each related amendment
shall be
furnished by the Master Servicer to the Class P and Class C
Certificateholders
and the NIM Insurer.
Prepayment
Interest Excess: As to any Principal Prepayment received by the
Master Servicer from the first day through the fifteenth day of any
calendar
month (other than the calendar month in which the Initial Cut-off
Date occurs),
all amounts paid by the related Mortgagor in respect of interest on
such
Principal Prepayment. All Prepayment Interest Excess shall be paid
to the Master
Servicer as additional master servicing compensation.
Prepayment
Interest Shortfall: As to any Distribution Date, Mortgage Loan
and Principal Prepayment received on or after the sixteenth day of
the month
preceding the month of such Distribution Date (or, in the case of
the first
Distribution Date, on or after November 1, 2006) and on or before
the last day
of the month preceding the month of such Distribution Date, the
amount, if any,
by which one month's interest at the related Mortgage Rate, net of
the related
Master Servicing Fee Rate, on such Principal Prepayment exceeds the
amount of
interest paid in connection with such Principal Prepayment.
Prepayment
Period: As to any Distribution Date and the related Due Date,
the period from the 16th day of the calendar month immediately
preceding the
month in which the Distribution Date occurs (or, in the case of the
first
Distribution Date, from November 1, 2006) through the 15th day of
the calendar
month in which the Distribution Date occurs.
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Primary
Insurance Policy: Each policy of primary mortgage guaranty
insurance or any replacement policy therefor with respect to any
Mortgage Loan.
Prime
Rate: The prime commercial lending rate of The Bank of New York,
as
publicly announced to be in effect from time to time. The Prime
Rate shall be
adjusted automatically, without notice, on the effective date of
any change in
such prime commercial lending rate. The Prime Rate is not
necessarily The Bank
of New York's lowest rate of interest.
Principal
Distribution Amount: With respect to each Distribution Date and
Loan Group, the sum of: (i) (1) the Principal Remittance Amount for
such Loan
Group and Distribution Date, less any portion of such amount used
to cover any
payment due to the Swap Counterparty with respect to such
Distribution Date, and
(2) the Extra Principal Distribution Amount for such Loan Group and
Distribution
Date minus (ii) (1) the Group 1 Overcollateralization Reduction
Amount for the
Distribution Date, in the case of Loan Group 1, and (2) the Group
2
Overcollateralization Reduction Amount for the Distribution Date,
in the case of
Loan Group 2.
Principal
Prepayment: Any payment of principal by a Mortgagor on a
Mortgage Loan that is received in advance of its scheduled Due Date
and is not
accompanied by an amount representing scheduled interest due on any
date or
dates in any month or months subsequent to the month of prepayment.
Partial
Principal Prepayments shall be applied by the Master Servicer in
accordance with
the terms of the related Mortgage Note.
Principal
Prepayment in Full: Any Principal Prepayment made by a
Mortgagor
of the entire principal balance of a Mortgage Loan.
Principal
Remittance Amount: As to any Distribution Date and either Loan
Group, (x) the sum, without duplication, of (a) the principal
portion of each
Scheduled Payment (without giving effect to any reductions thereof
caused by any
Debt Service Reductions or Deficient Valuations) due on each
Mortgage Loan in
that Loan Group (other than a Liquidated Mortgage Loan) on the
related Due Date,
(b) the principal portion of the Purchase Price of each Mortgage
Loan in that
Loan Group that was repurchased by the applicable Seller or
purchased by the
Master Servicer pursuant to this Agreement as of such Distribution
Date, (c) the
Substitution Adjustment Amount in connection with any Deleted
Mortgage Loan in
that Loan Group received with respect to such Distribution Date,
(d) any
Insurance Proceeds or Liquidation Proceeds allocable to recoveries
of principal
of Mortgage Loans in that Loan Group that are not yet Liquidated
Mortgage Loans
received during the calendar month preceding the month of such
Distribution
Date, (e) with respect to each Mortgage Loan in that Loan Group
that became a
Liquidated Mortgage Loan during the related Prepayment Period, the
amount of the
Liquidation Proceeds allocable to principal received during such
Prepayment
Period with respect to such Mortgage Loan, (f) all Principal
Prepayments on the
Mortgage Loans in that Loan Group received during the related
Prepayment Period,
(g) any Subsequent Recoveries on the Mortgage Loans in that Loan
Group received
during the related Prepayment Period and (h) with respect to the
last Funding
Period Distribution Date, the related Remaining Pre-funded Amount
minus (y) all
Advances on the Mortgage Loans in that Loan Group relating to
principal and
certain expenses reimbursable pursuant to Section 6.03 and
reimbursed since the
immediately preceding Due Date.
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<PAGE>
Principal
Reserve Fund: The separate Eligible Account created and
initially maintained by the Trustee pursuant to Section 3.05(c) in
the name of
the Trustee for the benefit of the Holders of the Class P
Certificates and
designated "The Bank of New York in trust for registered holders of
CWALT, Inc.,
Alternative Loan Trust 2006-OC10, Mortgage Pass-Through
Certificates, Series
2006-OC10." Funds in the Principal Reserve Fund shall be held in
trust for the
Holders of the Class P Certificates for the uses and purposes set
forth in this
Agreement.
Priority
Amount: Not applicable.
Priority
Percentage: Not applicable.
Private
Certificate: As specified in the Preliminary Statement.
Proprietary Lease: With respect to any Cooperative Unit, a lease
or
occupancy agreement between a Cooperative Corporation and a holder
of related
Coop Shares.
Prospectus: The prospectus dated November 14, 2006 generally
relating to
mortgage pass-through certificates to be sold by the Depositor.
Prospectus
Supplement: The prospectus supplement dated November 29, 2006
relating to the Offered Certificates.
PUD:
Planned Unit Development.
Purchase
Price: With respect to any Mortgage Loan required to be
purchased
by the applicable Seller pursuant to Section 2.02 or 2.03 or
purchased at the
option of the Master Servicer pursuant to Section 3.11, an amount
equal to the
sum of (i) 100% of the unpaid principal balance of the Mortgage
Loan on the date
of such purchase, (ii) accrued interest thereon at the applicable
Mortgage Rate
(or at the applicable Adjusted Mortgage Rate if (x) the purchaser
is the Master
Servicer or (y) if the purchaser is Countrywide and Countrywide is
an affiliate
of the Master Servicer) from the date through which interest was
last paid by
the Mortgagor to the Due Date in the month in which the Purchase
Price is to be
distributed to Certificateholders and (iii) costs and damages
incurred by the
Trust Fund in connection with a repurchase pursuant to Section 2.03
that arises
out of a violation of any predatory or abusive lending law with
respect to the
related Mortgage Loan.
Qualified
Bidder: With respect to any auction pursuant to Section 9.04,
any institution that is a regular purchaser and/or seller in the
secondary
market of residential mortgage loans as determined by the Trustee
(or any
advisor on its behalf), in its sole discretion, and any holder of
an interest in
the Class C Certificates; provided, however, that neither
Countrywide nor any of
its affiliates shall constitute a Qualified Bidder.
Qualified
Insurer: A mortgage guaranty insurance company duly qualified
as
such under the laws of the state of its principal place of business
and each
state having jurisdiction over such insurer in connection with the
insurance
policy issued by such insurer, duly authorized and licensed in such
states to
transact a mortgage guaranty insurance business in such states and
to write the
insurance provided by the insurance policy issued by it, approved
as a
FNMA-approved mortgage insurer and having a claims paying ability
rating of at
least "AA" or equivalent rating
39
<PAGE>
by a nationally recognized statistical rating organization. Any
replacement
insurer with respect to a Mortgage Loan must have at least as high
a claims
paying ability rating as the insurer it replaces had on the Closing
Date.
Rating
Agency: Each of the Rating Agencies specified in the
Preliminary
Statement. If any such organization or a successor is no longer in
existence,
"Rating Agency" shall be such nationally recognized statistical
rating
organization, or other comparable Person, identified as a "Rating
Agency" under
the Underwriter's Exemption, as is designated by the Depositor,
notice of which
designation shall be given to the Trustee. References in this
Agreement to a
given rating category of a Rating Agency shall mean such rating
category without
giving effect to any modifiers.
Realized
Loss: With respect to each Liquidated Mortgage Loan, an amount
(not less than zero or more than the Stated Principal Balance of
the Mortgage
Loan) as of the date of such liquidation, equal to (i) the Stated
Principal
Balance of the Liquidated Mortgage Loan as of the date of such
liquidation, plus
(ii) interest at the Adjusted Net Mortgage 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 Adjusted Net Mortgage Rate and to
principal of the
Liquidated Mortgage Loan. With respect to each Mortgage Loan which
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.
To the
extent the Master Servicer receives Subsequent Recoveries with
respect to any Mortgage Loan, the amount of Realized Losses with
respect to that
Mortgage Loan will be reduced by the amount of such Subsequent
Recoveries.
Recognition Agreement: With respect to any Cooperative Loan, an
agreement
between the Cooperative Corporation and the originator of such
Mortgage Loan
which establishes the rights of such originator in the Cooperative
Property.
Record
Date: With respect to any Distribution Date and the Delay
Certificates, the last Business Day of the month preceding the
month of a
Distribution Date. With respect to any Distribution Date and the
Non-Delay
Certificates, the Business Day immediately preceding such
Distribution Date, or
if such Certificates are no longer Book-Entry Certificates, the
last Business
Day of the month preceding the month of such Distribution Date.
Reference
Bank: As defined in Section 4.08(b).
Refinancing Mortgage Loan: Any Mortgage Loan originated in
connection with
the refinancing of an existing mortgage loan.
Regular
Certificates: As specified in the Preliminary Statement.
40
<PAGE>
Regulation
AB: Subpart 229.1100 - Asset Backed Securities (Regulation AB),
17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended from time
to time, and
subject to such clarification and interpretation as have been
provided by the
Commission in the adopting release (Asset-Backed Securities,
Securities Act
Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (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.
Relief
Act: The Servicemembers Civil Relief Act and any similar state
or
local laws.
Remaining
Pre-funded Amount: With respect to the last Funding Period
Distribution Date and any Loan Group, any portion of the Pre-funded
Amount
allocated to such Loan Group remaining in the Pre-funding
Account.
REMIC: A
"real estate mortgage investment conduit" within the meaning of
Section 860D of the Code.
REMIC
Change of Law: Any proposed, temporary or final regulation,
revenue
ruling, revenue procedure or other official announcement or
interpretation
relating to REMICs and the REMIC Provisions issued after the
Closing Date.
REMIC
Provisions: Provisions of the federal income tax law relating
to
real estate mortgage investment conduits, which appear at Sections
860A through
860G of Subchapter M of Chapter 1 of the Code, and related
provisions, and
regulations promulgated thereunder, as the foregoing may be in
effect from time
to time as well as provisions of applicable state laws.
REO
Property: A Mortgaged Property acquired by the Trust Fund
through
foreclosure or deed-in-lieu of foreclosure in connection with a
defaulted
Mortgage Loan.
Reportable
Event: Any event required to be reported on Form 8-K, and in
any event, the following:
(a) entry into a definitive agreement related to the Trust Fund,
the
Certificates or the Mortgage Loans, or an amendment to a
Transaction
Document,
even if the Depositor is not a party to such agreement (e.g., a
servicing
agreement with a servicer contemplated by Item 1108(a)(3) of
Regulation
AB);
(b) termination of a Transaction Document (other than by
expiration
of the
agreement on its stated termination date or as a result of all
parties
completing their obligations under such agreement), even if the
Depositor
is not a party to such agreement (e.g., a servicing agreement
with a
servicer contemplated by Item 1108(a)(3) of Regulation AB);
(c) with respect to the Master Servicer only, if the Master
Servicer
becomes
aware of any bankruptcy or receivership with respect to
Countrywide, the Depositor, the Master Servicer, any Subservicer,
the
Trustee,
the Swap Counterparty, any enhancement or support provider
contemplated by Items 1114(b) or 1115 of Regulation AB, or any
other
material
party contemplated by Item 1101(d)(1) of Regulation AB;
41
<PAGE>
(d) with respect to the Trustee, the Master Servicer and the
Depositor
only, the occurrence of an early amortization, performance
trigger or
other event, including an Event of Default under this
Agreement;
(e) the resignation, removal, replacement, substitution of the
Master
Servicer, any Subservicer or the Trustee;
(f) with respect to the Master Servicer only, if the Master
Servicer
becomes
aware that (i) any material enhancement or support specified in
Item
1114(a)(1) through (3) of Regulation AB or Item 1115 of Regulation
AB
that was
previously applicable regarding one or more classes of the
Certificates has terminated other than by expiration of the
contract on
its stated
termination date or as a result of all parties completing their
obligations under such agreement; (ii) any material enhancement
specified
in Item
1114(a)(1) through (3) of Regulation AB or Item 1115 of
Regulation
AB has
been added with respect to one or more classes of the
Certificates;
or (iii)
any existing material enhancement or support specified in Item
1114(a)(1)
through (3) of Regulation AB or Item 1115 of Regulation AB with
respect to
one or more classes of the Certificates has been materially
amended or
modified; and
(g) with respect to the Trustee, the Master Servicer and the
Depositor
only, a required distribution to Holders of the Certificates is
not made
as of the required Distribution Date under this Agreement.
Reporting
Subcontractor: With respect to the Master Servicer or the
Trustee, any Subcontractor determined by such Person pursuant to
Section
11.08(b) to be "participating in the servicing function" within the
meaning of
Item 1122 of Regulation AB. References to a Reporting Subcontractor
shall refer
only to the Subcontractor of such Person and shall not refer to
Subcontractors
generally
Request
for Release: The Request for Release submitted by the Master
Servicer to the Trustee, substantially in the form of Exhibits M
and N to this
Agreement, as appropriate.
Required
Insurance Policy: With respect to any Mortgage Loan, any
insurance policy that is required to be maintained from time to
time under this
Agreement.
Residual
Certificates: As specified in the Preliminary Statement.
Responsible Officer: When used with respect to the Trustee, any
Vice
President, any Assistant Vice President, the Secretary, any
Assistant Secretary,
any Trust Officer or any other officer of the Trustee customarily
performing
functions similar to those performed by any of the above designated
officers and
also to whom, with respect to a particular matter, such matter is
referred
because of such officer's knowledge of and familiarity with the
particular
subject.
Rolling
Sixty-Day Delinquency Rate: With respect to any Distribution
Date
on or after the Stepdown Date, the average of the Sixty-Day
Delinquency Rates
for such Distribution Date and the two immediately preceding
Distribution Dates.
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<PAGE>
S&P:
Standard & Poor's, a division of The McGraw-Hill Companies,
Inc. If
S&P is designated as a Rating Agency in the Preliminary
Statement, for purposes
of Section 10.05(b) the address for notices to S&P shall be
Standard & Poor's,
55 Water Street, New York, New York 10041, Attention: Mortgage
Surveillance
Monitoring, or such other address as S&P may hereafter furnish
to the Depositor
and the Master Servicer.
Sarbanes-Oxley Certification: As defined in Section 11.05.
Scheduled
Balances: Not applicable.
Scheduled
Classes: As specified in the Preliminary Statement.
Scheduled
Payment: The scheduled monthly payment on a Mortgage Loan due
on
any Due Date allocable to principal and/or interest on such
Mortgage Loan which,
unless otherwise specified in this Agreement, shall give effect to
any related
Debt Service Reduction and any Deficient Valuation that affects the
amount of
the monthly payment due on such Mortgage Loan.
Securities
Act: The Securities Act of 1933, as amended.
Seller:
Countrywide, Park Granada, Park Monaco or Park Sienna, as
applicable.
Senior
Certificates: As specified in the Preliminary Statement.
Senior
Enhancement Percentage: With respect to a Distribution Date on
and
after the Stepdown Date, the fraction (expressed as a percentage)
(1) the
numerator of which is the excess of (a) the aggregate Stated
Principal Balance
of the Mortgage Loans for the preceding Distribution Date over (b)
(i) before
the Class Certificate Balances of the Senior Certificates have been
reduced to
zero, the sum of the Class Certificate Balances of the Senior
Certificates, or
(ii) after the Class Certificate Balances of the Senior
Certificates have been
reduced to zero, the Class Certificate Balance of the most senior
Class of
Subordinated Certificates outstanding as of the preceding Master
Servicer
Advance Date and (2) the denominator of which is the aggregate
Stated Principal
Balance of the Mortgage Loans for the preceding Distribution
Date.
Senior
Principal Distribution Allocation Amount: For any Distribution
Date, (a) with respect to the Class 1-A Certificates, the Group 1
Senior
Principal Distribution Amount and (b) with respect to the Group 2
Senior
Certificates, the Group 2 Senior Principal Distribution Amount.
Senior
Principal Distribution Target Amount: As to any Distribution
Date,
the excess of (x) the aggregate Class Certificate Balance of the
Senior
Certificates immediately prior to such Distribution Date, over (y)
the lesser of
(i) 84.80% of the aggregate Stated Principal Balance of the
Mortgage Loans as of
the Due Date in the month of such Distribution Date (after giving
effect to
Principal Prepayments, the principal portion of any Liquidation
Proceeds and any
Subsequent Recoveries received in the related Prepayment Period)
and (ii) the
aggregate Stated Principal Balance of the Mortgage Loans as of the
Due Date in
the month of such Distribution Date (after giving effect to
Principal
Prepayments, the principal portion of any Liquidation Proceeds and
any
Subsequent Recoveries received in the related Prepayment Period),
minus the OC
Floor.
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<PAGE>
Servicing
Advances: All customary, reasonable and necessary "out of
pocket" costs and expenses incurred in the performance by the
Master Servicer of
its servicing obligations, including, but not limited to, the cost
of (i) the
preservation, restoration and protection of a Mortgaged Property,
(ii) any
expenses reimbursable to the Master Servicer pursuant to Section
3.11 and any
enforcement or judicial proceedings, including foreclosures, (iii)
the
management and liquidation of any REO Property and (iv) compliance
with the
obligations under Section 3.09.
Servicing
Criteria: The "servicing criteria" set forth in Item 1122(d) of
Regulation AB.
Servicing
Officer: Any officer of the Master Servicer involved in, or
responsible for, the administration and servicing of the Mortgage
Loans whose
name and facsimile signature appear on a list of servicing officers
furnished to
the Trustee by the Master Servicer on the Closing Date pursuant to
this
Agreement, as such list may from time to time be amended.
Shift
Percentage: Not applicable.
Sixty-Day
Delinquency Rate: With respect to any Distribution Date on or
after the Stepdown Date, a fraction, expressed as a percentage, the
numerator of
which is the aggregate Stated Principal Balance of all Mortgage
Loans 60 or more
days delinquent as of the close of business on the last day of the
calendar
month preceding such Distribution Date (including Mortgage Loans in
foreclosure,
bankruptcy and REO Properties) and the denominator of which is the
aggregate
Stated Principal Balance for such Distribution Date of the Mortgage
Loans as of
the related Due Date (after giving effect to Principal Prepayments,
the
principal portion of any Liquidation Proceeds and any Subsequent
Recoveries
received in the related Prepayment Period).
Startup
Day: The Closing Date.
Stated
Principal Balance: As to any Mortgage Loan and Due Date, the
unpaid
principal balance of such Mortgage Loan as of such Due 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) minus the sum of: (i) any previous partial Principal
Prepayments
and the payment of principal due on such Due Date, irrespective of
any
delinquency in payment by the related Mortgagor, (ii) Liquidation
Proceeds
allocable to principal (other than with respect to any Liquidated
Mortgage Loan)
received in the prior calendar month and Principal Prepayments
received through
the last day of the related Prepayment Period, in each case, with
respect to
that Mortgage Loan and (iii) any Realized Loss previously incurred
in connection
with a Deficient Valuation. The Stated Principal Balance of any
Mortgage Loan
that becomes a Liquidated Mortgage Loan will be zero on each date
following the
Due Period in which such Mortgage Loan becomes a Liquidated
Mortgage Loan.
Stepdown
Date: The earlier to occur of: (1) the Distribution Date
immediately following the Distribution Date on which the aggregate
Class
Certificate Balance of the Senior Certificates is reduced to zero,
and (2) the
later to occur of (x) the Distribution Date in December 2009 and
(y) the first
Distribution Date on which the aggregate Class Certificate Balance
of the Senior
Certificates (after calculating anticipated distributions on such
Distribution
Date) is less than or equal to 84.80% of the aggregate Stated
Principal Balance
of the Mortgage Loans as of the Due
44
<PAGE>
Date in the month of that Distribution Date (after giving effect to
Principal
Prepayments, the principal portion of any Liquidation Proceeds and
any
Subsequent Recoveries received in the Prepayment Period related to
that prior
Due Date).
Stepdown
Target Subordination Percentage: With respect to any Class of
Subordinated Certificates, the respective percentage indicated in
the following
table:
Stepdown Target
Subordination
Percentage
---------------
Class
M-1.....................................
10.80%
Class
M-2.....................................
7.10%
Class
M-3.....................................
5.90%
Class
M-4.....................................
4.70%
Class
M-5.....................................
3.70%
Class
M-6.....................................
2.70%
Class
M-7.....................................
1.70%
Class
M-8.....................................
0.70%
Streamlined Documentation Mortgage Loan: Any Mortgage Loan
originated
pursuant to Countrywide's Streamlined Loan Documentation Program
then in effect.
For the purposes of this Agreement, a Mortgagor is eligible for a
mortgage
pursuant to Countrywide's Streamlined Loan Documentation Program if
that
Mortgagor is refinancing an existing mortgage loan that was
originated or
acquired by Countrywide where, among other things, the mortgage
loan has not
been more than 30 days delinquent in payment during the previous
twelve month
period.
Strip
REMIC: As defined in the Preliminary Statement.
Subcontractor: Any vendor, subcontractor or other Person that is
not
responsible for the overall servicing (as "servicing" is commonly
understood by
participants in the mortgage-backed securities market) of Mortgage
Loans but
performs one or more discrete functions identified in Item 1122(d)
of Regulation
AB with respect to the Mortgage Loans under the direction or
authority of the
Master Servicer or a Subservicer or the Trustee, as the case may
be.
Subordinated Certificates: As specified in the Preliminary
Statement.
Subordinated Class Principal Distribution Target Amount: With
respect to
any Distribution Date and any Class of Subordinated Certificates
and
Distribution Date will equal the excess of: (1) the sum of: (a) the
aggregate
Class Certificate Balance of the Senior Certificates (after taking
into account
the distribution of the Senior Principal Distribution Amount for
such
Distribution Date), (b) the aggregate Class Certificate Balance of
any Class(es)
of Subordinated Certificates that are senior to the subject Class
(in each case,
after taking into account distribution of the Subordinated Class
Principal
Distribution Target Amount(s) for such more senior Class(es) of
Certificates for
such Distribution Date), and (c) the Class Certificate Balance of
the subject
Class of Subordinated Certificates immediately prior to such
Distribution Date
over (2) the lesser of (a) the product of (x) 100% minus the
Stepdown Target
Subordination Percentage for the subject Class of Certificates and
(y) the
aggregate Stated Principal Balance of
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<PAGE>
the Mortgage Loans in the Mortgage Pool for such Distribution Date
and (b) the
aggregate Stated Principal Balance of the Mortgage Loans in the
Mortgage Pool
for such Distribution Date minus the OC Floor; provided, however,
that if such
Class of Subordinated Certificates is the only Class of
Subordinated
Certificates outstanding on such Distribution Date, that Class will
be entitled
to receive the entire remaining Principal Distribution Amount until
its Class
Certificate Balance is reduced to zero.
Subordinate Net Rate Cap: For each Distribution Date, the weighted
average
of the Group 1 Net Rate Cap and the Group 2 Net Rate Cap weighted
on the basis
of the respective Subordinate Portion of their corresponding Loan
Groups.
Subordinate Portion: For any Distribution Date and Loan Group, the
excess
of the aggregate Stated Principal Balance of the Mortgage Loans in
such Loan
Group as of the Due Date in the prior month (after giving effect to
Principal
Prepayments received in the Prepayment Period related to such prior
Due Date)
over the aggregate Class Certificate Balance of the Group 1 Senior
Certificates
in the case of Loan Group 1 and the aggregate Class Certificate
Balance of the
Group 2 Senior Certificates in the case of Loan Group 2, in each
case,
immediately prior to such Distribution Date.
Subsequent
Periodic Rate Cap: As to each Mortgage Loan and the related
Mortgage Note, the provision therein that limits permissible
increases and
decreases in the Mortgage Rate on the each Adjustment Date after
the first
Adjustment Date for that Mortgage Loan to not more than the amount
set forth
therein.
Subsequent
Recoveries: As to any Distribution Date and Loan Group, with
respect to a Liquidated Mortgage Loan in that Loan Group that
resulted in a
Realized Loss in a prior calendar month, unexpected amounts
received by the
Master Servicer (net of any related expenses permitted to be
reimbursed pursuant
to Section 3.08) specifically related to such Liquidated Mortgage
Loan after the
classification of such Mortgage Loan as a Liquidated Mortgage
Loan.
Subservicer: Any
person to whom the Master Servicer has contracted for the
servicing of all or a portion of the Mortgage Loans pursuant to
Section 3.02.
Substitute
Mortgage Loan: A Mortgage Loan substituted by the applicable
Seller for a Deleted Mortgage Loan which must, on the date of such
substitution,
as confirmed in a Request for Release, substantially in the form of
Exhibit M,
(i) have a Stated Principal Balance, after deduction of the
principal portion of
the Scheduled Payment due in the month of substitution, not in
excess of, and
not more than 10% less than the Stated Principal Balance of the
Deleted Mortgage
Loan; (ii) be accruing interest at a rate no lower than and not
more than 1% per
annum higher than, that of the Deleted Mortgage Loan; (iii) have a
Loan-to-Value
Ratio no higher than that of the Deleted Mortgage Loan; (iv) have a
remaining
term to maturity no greater than (and not more than one year less
than that of)
the Deleted Mortgage Loan; (v) have a maximum interest rate no
lower than and
not more than 1% per annum higher than, that of the Deleted
Mortgage Loan; (vi)
have a minimum interest specified in its related mortgage note not
more than 1%
per annum higher or lower than the minimum mortgage rate of the
Deleted Mortgage
Loan; (vii) have the same mortgage index reset period and periodic
rate cap as
the Deleted Mortgage Loan and a gross margin not more than 1% per
annum higher
or lower than that of the Deleted Mortgage Loan; (viii) not be a
Cooperative
Loan unless the Deleted Mortgage Loan was
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a Cooperative Loan; and (ix) comply with each representation and
warranty set
forth in Section 2.03.
Substitution Adjustment Amount: The meaning ascribed to such term
pursuant
to Section 2.03.
Successful
Auction: An auction held pursuant to Section 9.04 at which at
least three Qualified Bidders submitted bids and at least one of
those bids was
an Acceptable Bid Amount.
Supplemental Cut-off Date: With respect to any Supplemental
Mortgage Loan,
the later of (i) the date of origination of such Mortgage Loan and
(ii) the
first day of the month in which the related Supplemental Transfer
Date occurs.
Supplemental Mortgage Loan: Any Mortgage Loan in each Loan Group
other
than an Initial Mortgage Loan in that Loan Group conveyed to the
Trust Fund
pursuant to Section 2.01 hereof and to a Supplemental Transfer
Agreement, which
Mortgage Loan shall be listed on the revised Mortgage Loan Schedule
delivered
pursuant to this Agreement and on Schedule A to such Supplemental
Transfer
Agreement. When used with respect to a single Supplemental Transfer
Date,
Supplemental Mortgage Loan shall mean a Supplemental Mortgage Loan
conveyed to
the Trust Fund on that Supplemental Transfer Date.
Supplemental
Transfer Agreement: A Supplemental Transfer Agreement
substantially in the form of Exhibit P hereto, executed and
delivered by the
related Seller or Sellers, the Master Servicer, the Depositor and
the Trustee as
provided in Section 2.01 hereof.
Supplemental Transfer Date: For any Supplemental Transfer
Agreement, the
date the related Supplemental Mortgage Loans are transferred to the
Trust Fund
pursuant to the related Supplemental Transfer Agreement.
Swap
Account: The separate Eligible Account created and initially
maintained by the Swap Trustee pursuant to Section 4.09.
Swap
Adjustment Rate: For any Distribution Date and Loan Group, a
fraction, (A) the numerator of which is the product of (i) the sum
of (a) the
Net Swap Payment payable to the Swap Counterparty under the Swap
Contract with
respect to such Distribution Date times a fraction, the numerator
of which is
equal to 360 and the denominator of which is equal to the actual
number of days
in the related Interest Accrual Period and (b) any Swap Termination
Payment
payable to the Swap Counterparty under the Swap Contract for such
Distribution
Date (other than a Swap Termination Payment due to a Swap
Counterparty Trigger
Event), and (ii) a fraction, the numerator of which is the Interest
Funds for
that Loan Group and the denominator of which is the aggregate of
the Interest
Funds for both Loan Groups and (B) the denominator of which is
equal to the
aggregate Stated Principal Balance of the Mortgage Loans in that
Loan Group as
of the Due Date in the prior calendar month (after giving effect to
Principal
Prepayments, the principal portion of Liquidation Proceeds and any
Subsequent
Recoveries received in the Prepayment Period related to that prior
Due Date).
Swap
Contract: With respect to the LIBOR Certificates, the
transaction
evidenced by the confirmation (as assigned to the Swap Contract
Administrator
pursuant to the Swap Contract Assignment Agreement), a form of
which is attached
hereto as Exhibit R.
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Swap
Contract Administration Agreement: The swap contract
administration
agreement dated as of the Closing Date among Countrywide, the
Trustee and the
Swap Contract Administrator, a form of which is attached hereto as
Exhibit S-2.
Swap
Contract Administrator: The Bank of New York, in its capacity as
swap
contract administrator under the Swap Contract Administration
Agreement and its
successors and assigns.
Swap
Contract Assignment Agreement: The assignment agreement dated as
of
the Closing Date among Countrywide, the Swap Contract Administrator
and the Swap
Counterparty, a form of which is attached hereto as Exhibit
S-1.
Swap
Contract Termination Date: The Distribution Date in January
2011.
Swap Counterparty:
Lehman Brothers Special Financing Inc. and its
successors.
Swap
Counterparty Trigger Event: A Swap Termination Payment that is
triggered upon (i) an "Event of Default" under the ISDA Master
Agreement with
respect to which the Swap Counterparty is the sole "Defaulting
Party" (as
defined in the ISDA Master Agreement) or (ii) a "Termination Event"
(other than
an Illegality or a Tax Event (as such terms are defined in the ISDA
Master
Agreement)) or "Additional Termination Event" under the ISDA Master
Agreement
with respect to which the Swap Counterparty is the sole "Affected
Party" (as
defined in the ISDA Master Agreement).
Swap
Termination Payment: The payment payable to either party under
the
ISDA Master Agreement due to an early termination of the Swap
Contract.
Swap
Trust: The trust fund established by Section 4.09.
Swap
Trustee: The Bank of New York, a New York banking corporation, not
in
its individual capacity, but solely in its capacity as trustee for
the benefit
of the Holders of the LIBOR Certificates under this Agreement, and
any successor
thereto, and any corporation or national banking association
resulting from or
surviving any consolidation or merger to which it or its successors
may be a
party and any successor trustee as may from time to time be serving
as successor
trustee hereunder.
Tax
Matters Person: The person designated as "tax matters person" in
the
manner provided under Treasury regulation ss. 1.860F-4(d) and
Treasury
regulation ss. 301.6231(a)(7)1. Initially, the Tax Matters Person
shall be the
Trustee.
Tax
Matters Person Certificate: The Class A-R Certificate with a
Denomination of $0.01.
Termination Price: As defined in Section 9.01.
Terminator: As defined in Section 9.01.
Transaction Documents: This Agreement, the Swap Contract, the
Swap
Administration Agreement, each Supplemental Transfer Agreement and
any other
document or agreement entered into in connection with the Trust
Fund, the
Certificates or the Mortgage Loans.
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Transfer:
Any direct or indirect transfer or sale of any Ownership
Interest in a Residual Certificate.
Trigger
Event: With respect to a Distribution Date on or after the
Stepdown Date, either a Delinquency Trigger Event or a Cumulative
Loss Trigger
Event is in effect with respect to that Distribution Date.
Trust
Fund: The corpus of the trust created under this Agreement
consisting of (i) the Mortgage Loans and all interest and principal
received on
or with respect thereto after the Cut-off Date to the extent not
applied in
computing the Cut-off Date Principal Balance of the Mortgage Loans;
(ii) the
Certificate Account, the Distribution Account, the Pre-funding
Account, the
Capitalized Interest Account and the Carryover Reserve Fund and all
amounts
deposited therein pursuant to the applicable provisions of this
Agreement; (iii)
property that secured a Mortgage Loan and has been acquired by
foreclosure,
deed-in-lieu of foreclosure or otherwise; and (iv) all proceeds of
the
conversion, voluntary or involuntary, of any of the foregoing.
Trustee:
The Bank of New York and its successors and, if a successor
trustee is appointed under this Agreement, such successor.
Trustee
Advance Rate: With respect to any Advance made by the Trustee
pursuant to Section 4.01(b), a per annum rate of interest
determined as of the
date of such Advance equal to the Prime Rate in effect on such date
plus 5.00%.
Trustee
Fee: As to any Distribution Date, an amount equal to
one-twelfth
of the Trustee Fee Rate multiplied by the Pool Stated Principal
Balance with
respect to such Distribution Date.
Trustee
Fee Rate: With respect to each Mortgage Loan, 0.009% per annum.
Underwriters: As specified in the Preliminary Statement.
Underwriter's Exemption: Prohibited Transaction Exemption 2002-41,
67 Fed.
Reg. 54487 (2002), as amended (or any successor thereto), or any
substantially
similar administrative exemption granted by the U.S. Department of
Labor.
Unpaid
Realized Loss Amount: For any Class of LIBOR Certificates, (x)
the
portion of the aggregate Applied Realized Loss Amount previously
allocated to
that Class remaining unpaid from prior Distribution Dates minus (y)
any increase
in the Class Certificate Balance of that Class of Subsequent
Recoveries to the
Class Certificate Balance of that Class pursuant to Section
4.02(h).
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 each Class of Notional
Amount
Certificates, if any (such Voting Rights to be allocated among the
holders of
Certificates of each such Class in accordance with their respective
Percentage
Interests), (b) 1% of all Voting Rights shall be allocated to each
of the Class
A-R, Class C and Class P Certificates, and (c) the remaining Voting
Rights (or
100% of the Voting Rights if there is no Class of Notional Amount
Certificates)
shall be allocated among
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Holders of the remaining Classes of Certificates in proportion to
the
Certificate Balances of their respective Certificates on such
date.
Weighted
Average Adjusted Net Mortgage Rate: As to any Distribution
Date,
the average of the Adjusted Net Mortgage Rates on the Mortgage
Loans, weighted
on the basis of the Stated Principal Balance of each Mortgage Loan
as of the Due
Date in the prior calendar month (after giving effect to Principal
Prepayments
received in the Prepayment Period related to that prior Due
Date).
Winning
Bidder: With respect to a Successful Auction, the Qualified
Bidder
that bids the highest price.
SECTION
1.02. Certain Interpretive Provisions.
All terms
defined in this Agreement shall have the defined meanings when
used in any certificate, agreement or other document delivered
pursuant hereto
unless otherwise defined therein. For purposes of this Agreement
and all such
certificates and other documents, unless the context otherwise
requires: (a)
accounting terms not otherwise defined in this Agreement, and
accounting terms
partly defined in this Agreement to the extent not defined, shall
have the
respective meanings given to them under generally accepted
accounting
principles; (b) the words "hereof," "herein" and "hereunder" and
words of
similar import refer to this Agreement (or the certificate,
agreement or other
document in which they are used) as a whole and not to any
particular provision
of this Agreement (or such certificate, agreement or document); (c)
references
to any Section, Schedule or Exhibit are references to Sections,
Schedules and
Exhibits in or to this Agreement, and references to any paragraph,
subsection,
clause or other subdivision within any Section or definition refer
to such
paragraph, subsection, clause or other subdivision of such Section
or
definition; (d) the term "including" means "including without
limitation"; (e)
references to any law or regulation refer to that law or regulation
as amended
from time to time and include any successor law or regulation; (f)
references to
any agreement refer to that agreement as amended from time to time;
(g)
references to any Person include that Person's permitted successors
and assigns;
and (h) a Mortgage Loan is "30 days delinquent" if any Scheduled
Payment has not
been received by the close of business on the day immediately
preceding the Due
Date on which the next Scheduled Payment is due. Similarly for "60
days
delinquent," "90 days delinquent" and so on.
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ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
SECTION
2.01. Conveyance of Mortgage Loans
(a) Each Seller, concurrently with the execution and delivery
hereof, hereby sells, transfers, assigns, sets over and otherwise
conveys to the
Depositor, without recourse, all its respective right, title and
interest in and
to the related Initial Mortgage Loans, including all interest and
principal
received or receivable by such Seller, on or with respect to the
applicable
Initial Mortgage Loans after the Initial Cut-off Date and all
interest and
principal payments on the related Initial Mortgage Loans received
prior to the
Initial Cut-off Date in respect of installments of interest and
principal due
thereafter, but not including payments of principal and interest
due and payable
on such Initial Mortgage Loans, on or before the Initial Cut-off
Date. On or
prior to the Closing Date, Countrywide shall deliver to the
Depositor or, at the
Depositor's direction, to the Trustee or other designee of the
Depositor, the
Mortgage File for each Mortgage Loan listed in the Mortgage Loan
Schedule
(except that, in the case of the Delay Delivery Mortgage Loans
(which may
include Countrywide Mortgage Loans, Park Granada Mortgage Loans,
Park Monaco
Mortgage Loans and Park Sienna Mortgage Loans), such delivery may
take place
within thirty (30) days following the Closing Date or twenty (20)
days following
the applicable Supplemental Transfer Date, as applicable). Such
delivery of the
Mortgage Files shall be made against payment by the Depositor of
the purchase
price, previously agreed to by the Sellers and Depositor, for the
Mortgage
Loans. With respect to any Initial Mortgage Loan that does not have
a first
payment date on or before the Due Date in the month of the first
Distribution
Date or any Supplemental Mortgage Loan that does not have a first
payment date
on or before the Due Date in the month after the related
Supplemental Transfer
Date, Countrywide shall deposit into the Distribution Account on or
before the
Distribution Account Deposit Date relating to the first applicable
Distribution
Date, an amount equal to one month's interest at the related
Adjusted Mortgage
Rate on the Cut-off Date Principal Balance of such Mortgage
Loan.
(b) Immediately upon the conveyance of the Initial Mortgage
Loans
referred to in clause (a), the Depositor sells, transfers, assigns,
sets over
and otherwise conveys to the Trustee for the benefit of the
Certificateholders,
without recourse, all the right, title and interest of the
Depositor in and to
the Trust Fund together with the Depositor's right to require each
Seller to
cure any breach of a representation or warranty made herein by such
Seller or to
repurchase or substitute for any affected Mortgage Loan in
accordance herewith.
(c) In connection with the transfer and assignment set forth in
clause (b) above, the Depositor has delivered or caused to be
delivered to the
Trustee (or, in the case of the Delay Delivery Mortgage Loans that
are Initial
Mortgage Loans, will deliver or cause to be delivered to the
Trustee within
thirty (30) days following the Closing Date and in the case of the
Delay
Delivery Mortgage Loans that are Supplemental Mortgage Loans, will
deliver or
cause to be delivered to the Trustee within twenty (20) days
following the
applicable Supplemental Transfer Date) for the benefit of the
Certificateholders
the following documents or instruments with respect to each
Mortgage Loan so
assigned:
(i) (A) the original Mortgage Note endorsed by manual or
facsimile
signature
in blank in the following form: "Pay to the order of
____________ without
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recourse,"
with all intervening endorsements showing a complete chain of
endorsement from the originator to the Person endorsing the
Mortgage Note
(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); or
(B) with respect to any Lost Mortgage Note, a lost note
affidavit
from
Countrywide stating that the original Mortgage Note was lost or
destroyed,
together with a copy of such Mortgage Note;
(ii) except as provided below and for each Mortgage Loan that is
not a
MERS
Mortgage Loan, the original recorded Mortgage or a copy of such
Mortgage,
with recording information, (or, in the case of a Mortgage for
which the
related Mortgaged Property is located in the Commonwealth of
Puerto
Rico, a true copy of the Mortgage certified as such by the
applicable
notary) and in the case of each MERS Mortgage Loan, the
original
Mortgage or a copy of such mortgage, with recording
information,
noting the
presence of the MIN of the Mortgage Loans and either language
indicating
that the Mortgage Loan is a MOM Loan if the Mortgage Loan is a
MOM Loan
or if the Mortgage Loan was not a MOM Loan at origination, the
original
Mortgage and the assignment thereof to MERS, with evidence of
recording
indicated thereon, or a copy of the Mortgage certified by the
public
recording office in which such Mortgage has been recorded;
(iii) in the case of each Mortgage Loan that is not a MERS
Mortgage
Loan, a
duly executed assignment of the Mortgage or a copy of such
assignment, with recording information, (which may be included in
a
blanket
assignment or assignments), together with, except as provided
below, all
interim recorded assignments of such mortgage or a copy of such
assignment, with recording information, (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 the Mortgage may exclude the information to be provided by
the recording office;
provided, further, that such assignment of Mortgage
need not
be delivered in the case of a Mortgage for which the related
Mortgaged
Property is located in the Commonwealth of Puerto Rico;
(iv) the original or copies of each assumption, modification,
written
assurance
or substitution agreement, if any;
(v) except as provided below, the original or a copy of lender's
title
policy or
a printout of the electronic equivalent and all riders thereto;
and
(vi) in the case of a Cooperative Loan, the originals of the
following
documents
or instruments:
(A) The Coop Shares, together with a stock power in blank;
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<PAGE>
(B) The
executed Security Agreement;
(C) The executed Proprietary Lease;
(D) The executed Recognition Agreement;
(E) The executed UCC-1 financing statement with evidence of
recording
thereon which have been filed in all places required to perfect
the
applicable Seller's interest in the Coop Shares and the
Proprietary
Lease;
and
(F) The 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).
In
addition, in connection with the assignment of any MERS Mortgage
Loan,
each Seller agrees that it will cause, at the Trustee's expense,
the MERS(R)
System to indicate that the Mortgage Loans sold by such Seller to
the Depositor
have been assigned by that Seller to the Trustee in accordance with
this
Agreement (and any Supplemental Transfer Agreement, as applicable)
for the
benefit of the Certificateholders by including (or deleting, in the
case of
Mortgage Loans which are repurchased in accordance with this
Agreement) in such
computer files the information required by the MERS(R) System to
identify the
series of the Certificates issued in connection with such Mortgage
Loans. Each
Seller further agrees that it will not, and will not permit the
Master Servicer
to, and the Master Servicer agrees that it will not, alter the
information
referenced in this paragraph with respect to any Mortgage Loan sold
by such
Seller to the Depositor during the term of this Agreement unless
and until such
Mortgage Loan is repurchased in accordance with the terms of this
Agreement.
In the
event that in connection with any Mortgage Loan that is not a
MERS
Mortgage Loan the Depositor cannot deliver (a) the original
recorded Mortgage or
a copy of such mortgage, with recording information, or (b) all
interim recorded
assignments or a copy of such assignments, with recording
information, or (c)
the lender's title policy or a copy of lender's title policy
(together with all
riders thereto) satisfying the requirements of clause (ii), (iii)
or (v) above,
respectively, concurrently with the execution and delivery of this
Agreement
because such document or documents have not been returned from the
applicable
public recording office in the case of clause (ii) or (iii) above,
or because
the title policy has not been delivered to either the Master
Servicer or the
Depositor by the applicable title insurer in the case of clause (v)
above, the
Depositor shall promptly deliver to the Trustee, in the case of
clause (ii) or
(iii) above, such original Mortgage or a copy of such mortgage,
with recording
information, or such interim assignment or a copy of such
assignments, with
recording information, as the case may be, with evidence of
recording indicated
thereon upon receipt thereof from the public recording office, or a
copy
thereof, certified, if appropriate, by the relevant recording
office, but in no
event shall any such delivery of the original Mortgage and each
such interim
assignment or a copy thereof, certified, if appropriate, by the
relevant
recording office, be made later than one year following the Closing
Date, or, in
the case of clause (v) above, no later than 120 days following the
Closing Date;
provided, however, in the event the Depositor is unable to deliver
by such date
each Mortgage and each such interim assignment by reason of the
fact that any
such documents have
53
<PAGE>
not been returned by the appropriate recording office, or, in the
case of each
such interim assignment, because the related Mortgage has not been
returned by
the appropriate recording office, the Depositor shall deliver such
documents to
the Trustee as promptly as possible upon receipt thereof and, in
any event,
within 720 days following the Closing Date. The Depositor shall
forward or cause
to be forwarded to the Trustee (a) from time to time additional
original
documents evidencing an assumption or modification of a Mortgage
Loan and (b)
any other documents required to be delivered by the Depositor or
the Master
Servicer to the Trustee. In the event that the original Mortgage is
not
delivered and in connection with the payment in full of the related
Mortgage
Loan and 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 Master Servicer shall execute and deliver or
cause to be
executed and delivered such a document to the public recording
office. In the
case where a public recording office retains the original recorded
Mortgage or
in the case where a Mortgage is lost after recordation in a public
recording
office, Countrywide shall deliver to the Trustee a copy of such
Mortgage
certified by such public recording office to be a true and complete
copy of the
original recorded Mortgage.
As
promptly as practicable subsequent to such transfer and assignment,
and
in any event, within one hundred twenty (120) days after such
transfer and
assignment, the Trustee shall (A) as the assignee thereof, affix
the following
language to each assignment of Mortgage: "CWALT, Inc. Series
2006-OC10, The Bank
of New York as trustee", (B) cause such assignment to be in proper
form for
recording in the appropriate public office for real property
records and (C)
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
(i) with respect to any assignments of Mortgage as to which the
Trustee has not
received the information required to prepare such assignment in
recordable form,
the Trustee'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 any
event within thirty (30) days after receipt thereof and (ii) the
Trustee need
not cause to be recorded any assignment which relates to a Mortgage
Loan, the
Mortgaged Property and Mortgage File relating to which are located
in any
jurisdiction (including Puerto Rico) under the laws of which the
recordation of
such assignment is not necessary to protect the Trustee's and
the
Certificateholders' interest in the related Mortgage Loan as
evidenced by an
opinion of counsel delivered by Countrywide to the Trustee within
90 days of the
Closing Date (which opinion may be in the form of a "survey"
opinion and is not
required to be delivered by counsel admitted to practice law in the
jurisdiction
as to which such legal opinion applies).
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, will deposit in the Certificate Account the portion of
such payment
that is required to be deposited in the Certificate Account
pursuant to Section
3.05.
Notwithstanding anything to the contrary in this Agreement, within
thirty
(30) days after the Closing Date with respect to the Initial
Mortgage Loans,
Countrywide (on its own behalf and on behalf of Park Granada, Park
Monaco and
Park Sienna) shall either (i) deliver to the Depositor, or at the
Depositor's
direction, to the Trustee or other designee of the Depositor the
Mortgage File
as required pursuant to this Section 2.01 for each Delay Delivery
Mortgage Loan
or (ii) either (A) substitute a Substitute Mortgage Loan for the
Delay Delivery
Mortgage Loan or (B) repurchase the Delay Delivery Mortgage Loan,
which
substitution or repurchase shall be
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accomplished in the manner and subject to the conditions set forth
in Section
2.03 (treating each Delay Delivery Mortgage Loan as a Deleted
Mortgage Loan for
purposes of such Section 2.03); provided, however, that if
Countrywide fails to
deliver a Mortgage File for any Delay Delivery Mortgage Loan within
the thirty
(30)-day period provided in the prior sentence, Countrywide (on its
own behalf
and on behalf of Park Granada, Park Monaco and Park Sienna) shall
use its best
reasonable efforts to effect a substitution, rather than a
repurchase of, such
Deleted Mortgage Loan and provided further that the cure period
provided for in
Section 2.02 or in Section 2.03 shall not apply to the initial
delivery of the
Mortgage File for such Delay Delivery Mortgage Loan, but rather
Countrywide (on
its own behalf and on behalf of Park Granada, Park Monaco and Park
Sienna) shall
have five (5) Business Days to cure such failure to deliver. At the
end of such
thirty (30)-day period the Trustee shall send a Delay Delivery
Certification for
the Delay Delivery Mortgage Loans delivered during such thirty
(30)-day period
in accordance with the provisions of Section 2.02.
(d) Subject to the execution and delivery of the related
Supplemental Transfer Agreement as provided in Section 2.01(e)
hereof and the
terms and conditions of this Agreement, each Seller sells,
transfers, assigns,
sets over and otherwise conveys to the Depositor, without recourse,
on each
Supplemental Transfer Date, with respect to each Supplemental
Mortgage Loan sold
by such Seller to the Depositor, all the right, title and interest
of that
Seller in and to the Supplemental Mortgage Loans sold by it
identified in such
Supplemental Transfer Agreement, including all interest and
principal received
and receivable by such Seller on or with respect to the related
Supplemental
Mortgage Loans on and after the related Supplemental Cut-off Date
(to the extent
not applied in computing the Cut-off Date Principal Balance
thereof) or
deposited into the Certificate Account by the related Seller, other
than
principal and interest due on such Supplemental Mortgage Loans
prior to the
related Supplemental Cut-off Date.
Immediately upon the conveyance of the Supplemental Mortgage
Loans
referred to in the preceding paragraph, the Depositor sells,
transfers, assigns,
sets over and otherwise conveys to the Trustee for benefit of
the
Certificateholders, without recourse, all right title and interest
in all of the
Supplemental Mortgage Loans.
Each
Seller has entered into this Agreement in consideration for the
purchase of the Mortgage Loans sold by such Seller to the Depositor
and has
agreed to take the actions specified herein. The Depositor,
concurrently with
the execution and delivery of this Agreement, hereby sells,
transfers, assigns
and otherwise conveys to the Trustee for the use and benefit of
the
Certificateholders, without recourse, all right title and interest
in the
portion of the Trust Fund not otherwise conveyed to the Trust Fund
pursuant to
Sections 2.01(a) or (b).
(e) Upon five (5) Business Days written notice to the Trustee,
the
Depositor, the Master Servicer (if the Master Servicer is not a
Seller) and the
Rating Agencies, on any other Business Day during the Funding
Period designated
by Countrywide, Park Granada, Park Monaco and Park Sienna, if
applicable, the
Depositor and the Trustee shall complete, execute and deliver a
Supplemental
Transfer Agreement so long as no Rating Agency has provided notice
that the
execution and delivery of such Supplemental Transfer Agreement will
result in a
reduction or withdrawal of the any ratings assigned to the
Certificates. After
the execution and delivery of such Supplemental Transfer Agreement,
on the
Supplemental Transfer Date, the Trustee shall set aside in the
Pre-funding
Account an amount equal to the Aggregate Supplemental Purchase
Amount.
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The
transfer of Supplemental Mortgage Loans and the other property
and
rights relating to them on a Supplemental Transfer Date is subject
to the
satisfaction of each of the following conditions:
(i) each Supplemental Mortgage Loan conveyed on such
Supplemental Transfer Date satisfies the representations and
warranties
applicable
to it under this Agreement; provided, however, that with
respect to
a breach of a representation and warranty with respect to a
Supplemental Mortgage Loan, the obligation under Section 2.03(c) of
this
Agreement
of Countrywide, Park Granada, Park Monaco and Park Sienna, if
applicable, to cure, repurchase or replace such Supplemental
Mortgage Loan
shall
constitute the sole remedy against such Seller respecting such
breach
available to Certificateholders, the Depositor or the Trustee;
(ii) the Trustee, the Underwriter and the Rating Agencies are
provided
with an Opinion of Counsel or Opinions of Counsel with respect
to
the tax
treatment of the Trust Fund, to be delivered as provided
pursuant
to Section
2.01(f);
(iii) the Rating Agencies and the Underwriter are provided
with an
Opinion of Counsel or Opinions of Counsel with respect to the
validity
of the conveyance of the Supplemental Mortgage Loans conveyed
on
such
Supplemental Transfer Date, to be delivered as provided pursuant
to
Section
2.01(f);
(iv) the execution and delivery of such Supplemental Transfer
Agreement
or conveyance of the related Supplemental Mortgage Loans does
not result
in a reduction or withdrawal of any ratings assigned to the
Certificates by
the Rating Agencies;
(v) the Supplemental Mortgage Loans conveyed on such
Supplemental Transfer Date were selected in a manner reasonably
believed
not to be
adverse to the interests of the Certificateholders;
(vi) no Supplemental Mortgage Loan conveyed on such
Supplemental Transfer date was 30 or more days delinquent;
(vii) following the conveyance of the Supplemental Mortgage
Loans on
such Supplemental Transfer Date to the Trust Fund, the
characteristics of the Mortgage Loans will comply with the Pool
Characteristics (including the permitted variances listed
therein);
provided,
that for the purpose of making these calculations, the
characteristics for any Initial Mortgage Loan made will be taken as
of the
Initial
Cut-off Date and the characteristics for any Supplemental
Mortgage
Loan will
be taken as of the related Supplemental Cut-off Date;
(ix) none of the Sellers or the Depositor shall be insolvent
or shall
be rendered insolvent as a result of such transfer; and
(x) the Depositor shall have delivered to the Trustee an
Officer's
Certificate confirming the satisfaction of each of these
conditions
precedent.
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<PAGE>
The
Trustee shall not be required to investigate or otherwise
verify
compliance with these conditions, except for its own receipt of
documents
specified above, and shall be entitled to rely on the required
Officer's
Certificate.
(f) Within seven Business Days after each Supplemental Transfer
Date, upon (1) delivery to the Trustee by the Depositor or
Countrywide of the
Opinions of Counsel referred to in Sections 2.01(e)(ii) and (iii),
(2) delivery
to the Trustee by Countrywide of a revised Mortgage Loan Schedule
reflecting the
Supplemental Mortgage Loans conveyed on such Supplemental Transfer
Date to the
Loan Group into which each Supplement Mortgage Loan was conveyed
and (3)
delivery to the Trustee by the Depositor of an Officer's
Certificate confirming
the satisfaction of each of the conditions precedent set forth in
this Section
2.01(f), the Trustee shall pay to each Seller the Aggregate
Supplemental
Transfer Amount for such Loan Group used to purchase Supplemental
Mortgage Loans
for such Loan Group from such Seller from those funds that were set
aside in the
Pre-funding Account pursuant to Section 2.01(e). The positive
difference, if
any, between the Aggregate Supplemental Transfer Amount for such
Loan Group and
the Aggregate Supplemental Purchase Amount for such Loan Group
shall be
reinvested by the Trustee in the Pre-funding Account and shall
remain designated
as a portion of the Pre-funded Amount allocated to such Loan
Group.
(g) The Trustee shall not be required to investigate or
otherwise
verify compliance with the conditions set forth in the preceding
paragraph,
except for its own receipt of documents specified above, and shall
be entitled
to rely on the required Officer's Certificate.
Within
thirty days after the final Supplemental Transfer Date, the
Depositor shall deliver to the Trustee a letter of a nationally
recognized firm
of independent public accountants stating whether or not the
Supplemental
Mortgage Loans conveyed on such Supplemental Transfer Date conform
to the
characteristics in Section 2.01(e)(vi), (vii) and (viii) for that
Loan Group.
(h) Neither the Depositor nor the Trust will acquire or hold
any
Mortgage Loan that would violate the representations made by
Countrywide set
forth in clause (50) of Schedule III-A hereto.
SECTION
2.02. Acceptance by Trustee of the Mortgage Loans.
(a) The
Trustee acknowledges receipt of the documents identified in the
Initial Certification in the form annexed hereto as Exhibit F-1 (an
"Initial
Certification (Initial Mortgage Loans)") and declares that it holds
and will
hold such documents and the other documents delivered to it
constituting the
Mortgage Files, and that it holds or will hold such other assets as
are included
in the Trust Fund, in trust for the exclusive use and benefit of
all present and
future Certificateholders. The Trustee acknowledges that it will
maintain
possession of the Mortgage Notes in the State of California, unless
otherwise
permitted by the Rating Agencies.
The
Trustee agrees to execute and deliver on the Closing Date to
the
Depositor, the Master Servicer and Countrywide (on its own behalf
and on behalf
of Park Granada, Park Monaco and Park Sienna) an Initial
Certification in the
form annexed to this Agreement as Exhibit F-1. Based on its review
and
examination, and only as to the documents identified in such
Initial
Certification, the Trustee acknowledges that such documents appear
regular on
their face and relate to the Initial Mortgage Loans. The Trustee
shall be under
no duty or obligation to
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inspect, review or examine said documents, instruments,
certificates or other
papers to determine that the same are genuine, enforceable or
appropriate for
the represented purpose or that they have actually been recorded in
the real
estate records or that they are other than what they purport to be
on their
face.
On or
about the thirtieth (30th) day after the Closing Date, the
Trustee
shall deliver to the Depositor, the Master Servicer and Countrywide
(on its own
behalf and on behalf of Park Granada, Park Monaco and Park Sienna)
a Delay
Delivery Certification with respect to the Initial Mortgage Loans
in the form
annexed hereto as Exhibit G-1 (a "Delay Delivery Certification
(Initial Mortgage
Loans)"), with any applicable exceptions noted thereon.
Not later
than 90 days after the Closing Date, the Trustee shall deliver
to the Depositor, the Master Servicer and Countrywide (on its own
behalf and on
behalf of Park Granada, Park Monaco and Park Sienna) a Final
Certification with
respect to the Initial Mortgage Loans in the form annexed hereto as
Exhibit H-1
(a "Final Certification (Initial Mortgage Loans)"), with any
applicable
exceptions noted thereon.
If, in the
course of such review, the Trustee finds any document
constituting a part of a Mortgage File that does not meet the
requirements of
Section 2.01, the Trustee shall list such as an exception in the
Final
Certification; provided, however that the Trustee shall not make
any
determination as to whether (i) any endorsement is sufficient to
transfer all
right, title and interest of the party so endorsing, as noteholder
or assignee
thereof, in and to that Mortgage Note or (ii) any assignment is in
recordable
form or is sufficient to effect the assignment of and transfer to
the assignee
thereof under the mortgage to which the assignment relates.
Countrywide (on its
own behalf and on behalf of Park Granada, Park Monaco and Park
Sienna) shall
promptly correct or cure such defect within 90 days from the date
it was so
notified of such defect and, if Countrywide does not correct or
cure such defect
within such period, Countrywide (on its own behalf and on behalf of
Park
Granada, Park Monaco and Park Sienna) shall either (a) 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
in Section
2.03, or (b) purchase such Mortgage Loan from the Trustee within 90
days from
the date Countrywide (on its own behalf and on behalf of Park
Granada, Park
Monaco and Park Sienna) was notified of such defect in writing at
the Purchase
Price of such Mortgage Loan; provided, however, that in no event
shall such
substitution or purchase occur more than 540 days from the Closing
Date, except
that if the substitution or purchase of a Mortgage Loan pursuant to
this
provision is required by reason of a delay in delivery of any
documents by the
appropriate recording office, and there is a dispute between either
the Master
Servicer or Countrywide (on its own behalf and on behalf of Park
Granada, Park
Monaco and Park Sienna) and the Trustee over the location or status
of the
recorded document, then such substitution or purchase shall occur
within 720
days from the Closing Date. The Trustee shall deliver written
notice to each
Rating Agency within 270 days from the Closing Date indicating each
Mortgage
Loan (a) that has not been returned by the appropriate recording
office or (b)
as to which there is a dispute as to location or status of such
Mortgage Loan.
Such notice shall be delivered every 90 days thereafter until the
related
Mortgage Loan is returned to the Trustee. Any such substitution
pursuant to (a)
above or purchase pursuant to (b) above shall not be effected prior
to the
delivery to the Trustee of the Opinion of Counsel required by
Section 2.05, if
any, and any substitution pursuant to (a) above shall not be
effected prior to
the additional delivery to the Trustee of a Request for Release
substantially in
the form of Exhibit N. No substitution is permitted to be made in
any calendar
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<PAGE>
month after the Determination Date for such month. The Purchase
Price for any
such Mortgage Loan shall be deposited by Countrywide (on its own
behalf and on
behalf of Park Granada, Park Monaco and Park Sienna) in the
Certificate Account
on or prior to the Distribution Account Deposit Date for the
Distribution Date
in the month following the month of repurchase and, upon receipt of
such deposit
and certification with respect thereto in the form of Exhibit N
hereto, the
Trustee shall release the related Mortgage File to Countrywide (on
its own
behalf and on behalf of Park Granada, Park Monaco and Park Sienna)
and shall
execute and deliver at Countrywide's (on its own behalf and on
behalf of Park
Granada, Park Monaco and Park Sienna) request such instruments of
transfer or
assignment prepared by Countrywide, in each case without recourse,
as shall be
necessary to vest in Countrywide (on its own behalf and on behalf
of Park
Granada, Park Monaco and Park Sienna), or its designee, the
Trustee's interest
in any Mortgage Loan released pursuant hereto. If pursuant to the
foregoing
provisions Countrywide (on its own behalf and on behalf of Park
Granada, Park
Monaco and Park Sienna) repurchases an Initial Mortgage Loan that
is a MERS
Mortgage Loan, the Master Servicer shall either (i) cause MERS to
execute and
deliver an assignment of the Mortgage in recordable form to
transfer the
Mortgage from MERS to Countrywide (on its own behalf and on behalf
of Park
Granada, Park Monaco and Park Sienna) or its designee and shall
cause such
Mortgage to be removed from registration on the MERS(R) System in
accordance
with MERS' rules and regulations or (ii) cause MERS to designate on
the MERS(R)
System Countrywide (on its own behalf and on behalf of Park
Granada, Park Monaco
and Park Sienna) or its designee as the beneficial holder of such
Mortgage Loan.
(b) Upon delivery of the Supplemental Mortgage Loans pursuant to
a
Supplemental Transfer Agreement, the Trustee shall acknowledge
receipt of the
documents identified in any Supplemental Certification in the form
annexed
hereto as Exhibit F-2 (an "Initial Certification (Supplemental
Mortgage Loans)")
and declare that it will hold such documents and the other
documents delivered
to it constituting the Mortgage Files, and that it will hold such
other assets
as are included in the Trust Fund, in trust for the exclusive use
and benefit of
all present and future Certificateholders. The Trustee acknowledges
that it will
maintain possession of the Mortgage Notes in the State of
California, unless
otherwise permitted by the Rating Agencies.
The Trustee agrees to execute and deliver on the Supplemental
Transfer Date to the Depositor, the Master Servicer and Countrywide
(on its own
behalf and on behalf of Park Granada, Park Monaco and Park Sienna)
a
Supplemental Certification in the form annexed hereto as Exhibit
F-2. Based on
its review and examination, and only as to the documents identified
in such
Supplemental Certification, the Trustee shall acknowledge that such
documents
appear regular on their face and relate to such Supplemental
Mortgage Loan. The
Trustee shall be under no duty or obligation to inspect, review or
examine said
documents, instruments, certificates or other papers to determine
that the same
are genuine, enforceable or appropriate for the represented purpose
or that they
have actually been recorded in the real estate records or that they
are other
than what they purport to be on their face.
On or about the twentieth (20th) day after the Supplemental
Transfer
Date, the Trustee shall deliver to the Depositor, the Master
Servicer and
Countrywide (on its own behalf and on behalf of Park Granada, Park
Monaco and
Park Sienna) a Delay Delivery Certification with respect to the
Supplemental
Mortgage Loans in the form annexed hereto as Exhibit G-2 (a
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<PAGE>
"Delay Delivery Certification (Supplemental Mortgage Loans)"), with
any
applicable exceptions noted thereon.
Not later than 90 days after the final Supplemental Transfer
Date,
the Trustee shall deliver to the Depositor, the Master Servicer and
Countrywide
(on its own behalf and on behalf of Park Granada, Park Monaco and
Park Sienna) a
Final Certification with respect to the Supplemental Mortgage Loans
in the form
annexed hereto as Exhibit H-2 (a "Final Certification (Supplemental
Mortgage
Loans)"), with any applicable exceptions noted thereon.
(c) If, in the course of such review of the Mortgage Files
relating
to the Supplemental Mortgage Loans, the Trustee finds any document
constituting
a part of a Mortgage File which does not meet the requirements of
Section 2.01,
the Trustee shall list such as an exception in the Final
Certification;
provided, however that the Trustee shall not make any determination
as to
whether (i) any endorsement is sufficient to transfer all right,
title and
interest of the party so endorsing, as noteholder or assignee
thereof, in and to
that Mortgage Note or (ii) any assignment is in recordable form or
is sufficient
to effect the assignment of and transfer to the assignee thereof
under the
mortgage to which the assignment relates. Countrywide (on its own
behalf and on
behalf of Park Granada, Park Monaco and Park Sienna) shall promptly
correct or
cure such defect within 90 days from the date it was so notified of
such defect
and, if Countrywide does not correct or cure such defect within
such period,
Countrywide (on its own behalf and on behalfof Park Granada, Park
Monaco and
Park Sienna) shall either (a) 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 in Section 2.03, or (b)
purchase such
Mortgage Loan from the Trustee within 90 days from the date
Countrywide (on its
own behalf and on behalf of Park Granada, Park Monaco and Park
Sienna) was
notified of such defect in writing at the Purchase Price of such
Mortgage Loan;
provided, however, that in no event shall such substitution or
purchase occur
more than 540 days from the Closing Date, except that if the
substitution or
purchase of a Mortgage Loan pursuant to this provision is required
by reason of
a delay in delivery of any documents by the appropriate recording
office, and
there is a dispute between either the Master Servicer or
Countrywide (on its own
behalf and on behalf of Park Granada, Park Monaco and Park Sienna)
and the
Trustee over the location or status of the recorded document, then
such
substitution or purchase shall occur within 720 days from the
Closing Date. The
Trustee shall deliver written notice to each Rating Agency within
270 days from
the Closing Date indicating each Mortgage Loan (a) which has not
been returned
by the appropriate recording office or (b) as to which there is a
dispute as to
location or status of such Mortgage Loan. Such notice shall be
delivered every
90 days thereafter until the related Mortgage Loan is returned to
the Trustee.
Any such substitution pursuant to (a) above or purchase pursuant to
(b) above
shall not be effected prior to the delivery to the Trustee of the
Opinion of
Counsel required by Section 2.05 hereof, if any, and any
substitution pursuant
to (a) above shall not be effected prior to the additional delivery
to the
Trustee of a Request for Release substantially in the form of
Exhibit N. No
substitution is permitted to be made in any calendar month after
the
Determination Date for such month. The Purchase Price for any such
Mortgage Loan
shall be deposited by Countrywide (on its own behalf and on behalf
of Park
Granada, Park Monaco and Park Sienna) in the Certificate Account on
or prior to
the Distribution Account Deposit Date for the Distribution Date in
the month
following the month of repurchase and, upon receipt of such deposit
and
certification with respect thereto in the form of Exhibit N hereto,
the Trustee
shall release the related Mortgage File to Countrywide (on its own
behalf and on
behalf
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of Park Granada, Park Monaco and Park Sienna) and shall execute and
deliver at
Countrywide's (on its own behalf and on behalf of Park Granada,
Park Monaco and
Park Sienna) request such instruments of transfer or assignment
prepared by
Countrywide, in each case without recourse, as shall be necessary
to vest in
Countrywide (on its own behalf and on behalf of Park Granada, Park
Monaco and
Park Sienna), or a designee, the Trustee's interest in any Mortgage
Loan
released pursuant hereto. If pursuant to the foregoing provisions
Countrywide
(on its own behalf and on behalf of Park Granada, Park Monaco and
Park Sienna)
repurchases a Supplemental Mortgage Loan that is a MERS Mortgage
Loan, the
Master Servicer shall either (i) cause MERS to execute and deliver
an assignment
of the Mortgage in recordable form to transfer the Mortgage from
MERS to
Countrywide (on its own behalf and on behalf of Park Granada, Park
Monaco and
Park Sienna) and shall cause such Mortgage to be removed from
registration on
the MERS(R) System in accordance with MERS' rules and regulations
or (ii) cause
MERS to designate on the MERS(R) System Countrywide (on its own
behalf and on
behalf of Park Granada, Park Monaco and Park Sienna) or its
designee as the
beneficial holder of such Mortgage Loan.
(d) The
Trustee shall retain possession and custody of each Mortgage
File
in accordance with and subject to the terms and conditions set
forth in this
Agreement. The Master Servicer shall promptly deliver to the
Trustee, upon the
execution or receipt thereof, the originals of such other documents
or
instruments constituting the Mortgage File as come into the
possession of the
Master Servicer from time to time.
(e) It is
understood and agreed that the respective obligations of each
Seller to substitute for or to purchase any Mortgage Loan sold to
the Depositor
by it which does not meet the requirements of Section 2.01 above
shall
constitute the sole remedy respecting such defect available to the
Trustee, the
Depositor and any Certificateholder against that Seller.
SECTION
2.03. Representations, Warranties and Covenants of the Sellers
and
Master Servicer.
(a) Countrywide hereby makes the representations and warranties
set
forth in (i) Schedule II-A, Schedule II-B, Schedule II-C and
Schedule II-D
hereto, and by this reference incorporated herein, to the
Depositor, the Master
Servicer and the Trustee, as of the Closing Date, (ii) Schedule
III-A hereto,
and by this reference incorporated herein, to the Depositor, the
Master Servicer
and the Trustee, as of the Closing Date, or if so specified
therein, as of the
Initial Cut-off Date with respect to all of the Initial Mortgage
Loans and as of
the related Supplemental Cut-off Date with respect to all of the
Supplemental
Mortgage Loans, and (iii) Schedule III-B hereto, and by this
reference
incorporated herein, to the Depositor, the Master Servicer and the
Trustee, as
of the Closing Date, or if so specified therein, as of the Initial
Cut-off Date
with respect to the Initial Mortgage Loans that are Countrywide
Mortgage Loans
and as of the related Supplemental Cut-off Date with respect to the
Supplemental
Mortgage Loans that are Countrywide Mortgage Loans. Park Granada
hereby makes
the representations and warranties set
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<PAGE>
forth in (i) Schedule II-B hereto, and by this reference
incorporated herein, to
the Depositor, the Master Servicer and the Trustee, as of the
Closing Date and
(ii) Schedule III-C hereto, and by this reference incorporated
herein, to the
Depositor, the Master Servicer and the Trustee, as of the Closing
Date, or if so
specified therein, as of the Initial Cut-off Date with respect to
the Initial
Mortgage Loans that are Park Granada Mortgage Loans and as of the
related
Supplemental Cut-off Date with respect to the Supplemental Mortgage
Loans that
are Park Granada Mortgage Loans. Park Monaco hereby makes the
representations
and warranties set forth in (i) Schedule II-C hereto, and by this
reference
incorporated herein, to the Depositor, the Master Servicer and the
Trustee, as
of the Closing Date and (ii) Schedule III-D hereto, and by this
reference
incorporated herein, to the Depositor, the Master Servicer and the
Trustee, as
of the Closing Date, or if so specified therein, as of the Initial
Cut-off Date
with respect to the Initial Mortgage Loans that are Park Monaco
Mortgage Loans
and as of the related Supplemental Cut-off Date with respect to the
Supplemental
Mortgage Loans that are Park Monaco Mortgage Loans. Park Sienna
hereby makes the
representations and warranties set forth in (i) Schedule II-D
hereto, and by
this reference incorporated herein, to the Depositor, the Master
Servicer and
the Trustee, as of the Closing Date and (ii) Schedule III-E hereto,
and by this
reference incorporated herein, to the Depositor, the Master
Servicer and the
Trustee, as of the Closing Date, or if so specified therein, as of
the Initial
Cut-off Date with respect to the Initial Mortgage Loans that are
Park Sienna
Mortgage Loans and as of the related Supplemental Cut-off Date with
respect to
the Supplemental Mortgage Loans that are Park Sienna Mortgage
Loans.
(b) The
Master Servicer hereby makes the representations and warranties
set forth in Schedule IV hereto, and by this reference incorporated
herein, to
the Depositor and the Trustee, as of the Closing Date.
(c) Upon
discovery by any of the parties hereto of a breach of a
representation or warranty with respect to a Mortgage Loan made
pursuant to
Section 2.03(a) or a breach of a representation or warranty with
respect to a
Supplemental Mortgage Loan under Section 2.01(e)(i) that materially
and
adversely affects the interests of the Certificateholders in that
Mortgage Loan,
the party discovering such breach shall give prompt notice thereof
to the other
parties, the NIM Insurer and the Swap Counterparty. Each Seller
hereby covenants
that within 90 days of the earlier of its discovery or its receipt
of written
notice from any party of a breach of any representation or warranty
with respect
to a Mortgage Loan sold by it pursuant to Section 2.03(a) and with
respect to a
breach of a representation and warranty with respect to a
Supplemental Mortgage
Loan sold by it under Section 2.01(e)(i) that materially and
adversely affects
the interests of the Certificateholders in that Mortgage Loan, it
shall cure
such breach in all material respects, and if such breach is not so
cured, shall,
(i) if such 90-day period expires prior to the second anniversary
of the Closing
Date, remove such Mortgage Loan (a "Deleted Mortgage Loan") from
the Trust Fund
and substitute in its place a Substitute Mortgage Loan, in the
manner and
subject to the conditions set forth in this Section; or (ii)
repurchase the
affected Mortgage Loan or Mortgage Loans from the Trustee at the
Purchase Price
in the manner set forth below; provided, however, that any such
substitution
pursuant to (i) above shall not be effected prior to the delivery
to the Trustee
of the Opinion of Counsel required by Section 2.05, if any, and any
such
substitution pursuant to (i) above shall not be effected prior to
the additional
delivery to the Trustee of a Request for Release substantially in
the form of
Exhibit N and the Mortgage File for any such Substitute Mortgage
Loan. The
Seller repurchasing a Mortgage Loan pursuant to this Section
2.03(c) shall
promptly reimburse the Master Servicer and the Trustee for any
expenses
reasonably incurred by the Master Servicer or the Trustee in
respect of
enforcing the remedies for such breach. With respect to the
representations and
warranties described in this Section which are made to the best of
a Seller's
knowledge, if it is discovered by either the Depositor, a Seller or
the Trustee
that the substance of such representation and warranty is
inaccurate and such
inaccuracy materially and adversely affects the value of the
related Mortgage
Loan or the interests of the Certificateholders therein,
notwithstanding that
Seller's lack of knowledge with respect to the substance of such
representation
or warranty, such
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<PAGE>
inaccuracy shall be deemed a breach of the applicable
representation or
warranty. Any breach of a representation set forth in clauses (45)
through (64)
of Schedule III-A with respect to a Mortgage Loan in Loan Group 1
shall be
deemed to materially and adversely affect the
Certificateholders.
With
respect to any Substitute Mortgage Loan or Loans sold to the
Depositor by a Seller, Countrywide (on its own behalf and on behalf
of Park
Granada, Park Monaco and Park Sienna) shall deliver to the Trustee
for the
benefit of the Certificateholders the Mortgage Note, the Mortgage,
the related
assignment of the Mortgage, and such other documents and agreements
as are
required by Section 2.01, with the Mortgage Note endorsed and the
Mortgage
assigned as required by Section 2.01. No substitution is permitted
to be made in
any calendar month after the Determination Date for such month.
Scheduled
Payments due with respect to Substitute Mortgage Loans in the month
of
substitution shall not be part of the Trust Fund and will be
retained by the
related Seller on the next succeeding Distribution Date. For the
month of
substitution, distributions to Certificateholders will include the
monthly
payment due on any Deleted Mortgage Loan for such month and
thereafter that
Seller shall be entitled to retain all amounts received in respect
of such
Deleted Mortgage Loan. The Master Servicer shall amend the Mortgage
Loan
Schedule for the benefit of the Certificateholders to reflect the
removal of
such Deleted Mortgage Loan and the substitution of the Substitute
Mortgage Loan
or Loans and the Master Servicer shall deliver the amended Mortgage
Loan
Schedule to the Trustee. Upon such substitution, the Substitute
Mortgage Loan or
Loans shall be subject to the terms of this Agreement in all
respects, and the
related Seller shall be deemed to have made with respect to such
Substitute
Mortgage Loan or Loans, as of the date of substitution, the
representations and
warranties made pursuant to Section 2.03(a) with respect to such
Mortgage Loan.
Upon any such substitution and the deposit to the Certificate
Account of the
amount required to be deposited therein in connection with such
substitution as
described in the following paragraph, the Trustee shall release the
Mortgage
File held for the benefit of the Certificateholders relating to
such Deleted
Mortgage Loan to the related Seller and shall execute and deliver
at such
Seller's direction such instruments of transfer or assignment
prepared by
Countrywide (on its own behalf and on behalf of Park Granada, Park
Monaco and
Park Sienna), in each case without recourse, as shall be necessary
to vest title
in that Seller, or its designee, the Trustee's interest in any
Deleted Mortgage
Loan substituted for pursuant to this Section 2.03.
For any
month in which a Seller substitutes one or more Substitute
Mortgage Loans for one or more Deleted Mortgage Loans, the Master
Servicer will
determine the amount (if any) by which the aggregate principal
balance of all
Substitute Mortgage Loans sold to the Depositor by that Seller as
of the date of
substitution is less than the aggregate Stated Principal Balance of
all Deleted
Mortgage Loans repurchased by that Seller (after application of the
scheduled
principal portion of the monthly payments due in the month of
substitution). The
amount of such shortage (the "Substitution Adjustment Amount") plus
an amount
equal to the aggregate of any unreimbursed Advances with respect to
such Deleted
Mortgage Loans shall be deposited in the Certificate Account by
Countrywide (on
its own behalf and on behalf of Park Granada, Park Monaco and Park
Sienna) on or
before the Distribution Account Deposit Date for the Distribution
Date in the
month succeeding the calendar month during which the related
Mortgage Loan
became required to be purchased or replaced hereunder.
In the
event that a Seller shall have repurchased a Mortgage Loan, the
Purchase Price therefor shall be deposited in the Certificate
Account pursuant
to Section 3.05 on or before the
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Distribution Account Deposit Date for the Distribution Date in the
month
following the month during which that Seller became obligated
hereunder to
repurchase or replace such Mortgage Loan and upon such deposit of
the Purchase
Price, the delivery of the Opinion of Counsel required by Section
2.05 and
receipt of a Request for Release in the form of Exhibit N hereto,
the Trustee
shall release the related Mortgage File held for the benefit of
the
Certificateholders to such Person, and the Trustee shall execute
and deliver at
such Person's direction such instruments of transfer or assignment
prepared by
such Person, in each case without recourse, as shall be necessary
to transfer
title from the Trustee. It is understood and agreed that the
obligation under
this Agreement of any Person to cure, repurchase or replace any
Mortgage Loan as
to which a breach has occurred and is continuing shall constitute
the sole
remedy against such Persons respecting such breach available to
Certificateholders, the Depositor or the Trustee on their
behalf.
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 each Mortgage Loan as of the date of this Agreement or such
other date set
forth in this Agreement that as of the Closing Date, and following
the transfer
of the Mortgage Loans to it by each Seller, the Depositor had good
title to the
Mortgage Loans and the Mortgage Notes were subject to no offsets,
defenses or
counterclaims.
The Depositor
hereby assigns, transfers and conveys to the Trustee all of
its rights with respect to the Mortgage Loans including, without
limitation, the
representations and warranties of each Seller made pursuant to
Section 2.03(a),
together with all rights of the Depositor to require a Seller to
cure any breach
thereof or to repurchase or substitute for any affected Mortgage
Loan in
accordance with this Agreement.
It is
understood and agreed that the representations and warranties
set
forth in this Section 2.04 shall survive delivery of the Mortgage
Files to the
Trustee. Upon discovery by the Depositor or the Trustee of a breach
of any of
the foregoing representations and warranties set forth in this
Section 2.04
(referred to herein as a "breach"), which breach materially and
adversely
affects the interest of the Certificateholders, the party
discovering such
breach shall give prompt written notice to the others and to each
Rating Agency
and the NIM Insurer.
SECTION
2.05. Delivery of Opinion of Counsel in Connection with
Substitutions.
(a)
Notwithstanding any contrary provision of this Agreement, no
substitution pursuant to Section 2.02 or Section 2.03 shall be made
more than 90
days after the Closing Date unless Countrywide delivers to the
Trustee an
Opinion of Counsel, which Opinion of Counsel shall not be at the
expense of
either the Trustee or the Trust Fund, addressed to the Trustee, to
the effect
that such substitution will not (i) result in the imposition of the
tax on
"prohibited transactions" on the Trust Fund or contributions after
the Startup
Date, as defined in Sections 860F(a)(2) and 860G(d) of the Code,
respectively,
or (ii) cause any REMIC created under this Agreement to fail to
qualify as a
REMIC at any time that any Certificates are outstanding.
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(b) Upon
discovery by the Depositor, a Seller, the Master Servicer, or
the
Trustee that any Mortgage Loan does not constitute a "qualified
mortgage" within
the meaning of Section 860G(a)(3) of the Code, the party
discovering such fact
shall promptly (and in any event within five (5) Business Days of
discovery)
give written notice thereof to the other parties and the NIM
Insurer. In
connection therewith, the Trustee shall require Countrywide (on its
own behalf
and on behalf of Park Granada, Park Monaco and Park Sienna) at its
option, to
either (i) substitute, if the conditions in Section 2.03(c) with
respect to
substitutions are satisfied, a Substitute Mortgage Loan for the
affected
Mortgage Loan, or (ii) repurchase the affected Mortgage Loan within
90 days of
such discovery in the same manner as it would a Mortgage Loan for a
breach of
representation or warranty made pursuant to Section 2.03. The
Trustee shall
reconvey to Countrywide the Mortgage Loan to be released pursuant
to this
Section in the same manner, and on the same terms and conditions,
as it would a
Mortgage Loan repurchased for breach of a representation or
warranty contained
in Section 2.03.
SECTION
2.06. Execution and Delivery of Certificates.
The
Trustee acknowledges the transfer and assignment to it of the
Trust
Fund and, concurrently with such transfer and assignment, has
executed and
delivered to or upon the order of the Depositor, the Certificates
in authorized
denominations evidencing directly or indirectly the entire
ownership of the
Trust Fund. The Trustee agrees to hold the Trust Fund and exercise
the rights
referred to above for the benefit of all present and future Holders
of the
Certificates and to perform the duties set forth in this Agreement,
to the end
that the interests of the Holders of the Certificates may be
adequately and
effectively protected.
SECTION
2.07. REMIC Matters.
The
Preliminary Statement sets forth the designations and "latest
possible
maturity date" for federal income tax purposes of all interests
created hereby.
The "Startup Day" for purposes of the REMIC Provisions shall be the
Closing
Date. The "tax matters person" with respect to each REMIC hereunder
shall be the
Trustee and the Trustee shall hold the Tax Matters Person
Certificate. Each
REMIC's fiscal year shall be the calendar year.
SECTION
2.08. Covenants of the Master Servicer.
The Master
Servicer hereby covenants to the Depositor and the Trustee as
follows:
(a) the
Master Servicer shall comply in the performance of its
obligations
under this Agreement with all reasonable rules and requirements of
the insurer
under each Required Insurance Policy; and
(b) no
written information, certificate of an officer, statement
furnished
in writing or written report delivered to the Depositor, any
affiliate of the
Depositor or the Trustee and prepared by the Master Servicer
pursuant to this
Agreement will contain any untrue statement of a material fact or
omit to state
a material fact necessary to make such information, certificate,
statement or
report not misleading.
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ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
SECTION
3.01. Master Servicer to Service Mortgage Loans.
For and on
behalf of the Certificateholders, the Master Servicer shall
service and administer the Mortgage Loans in accordance with the
terms of this
Agreement and customary and usual standards of practice of prudent
mortgage loan
servicers. In connection with such servicing and administration,
the Master
Servicer shall have full power and authority, acting alone and/or
through
Subservicers as provided in Section 3.02, subject to the terms of
this Agreement
(i) to execute and deliver, on behalf of the Certificateholders and
the Trustee,
customary consents or waivers and other instruments and documents,
(ii) to
consent to transfers of any Mortgaged Property and assumptions of
the Mortgage
Notes and related Mortgages (but only in the manner provided in
this Agreement),
(iii) to collect any Insurance Proceeds and other Liquidation
Proceeds (which
for the purpose of this Section 3.01 includes any Subsequent
Recoveries), and
(iv) to effectuate foreclosure or other conversion of the ownership
of the
Mortgaged Property securing any Mortgage Loan; provided that the
Master Servicer
shall not take any action that is inconsistent with or prejudices
the interests
of the Trust Fund or the Certificateholders in any Mortgage Loan or
the rights
and interests of the Depositor, the Trustee and the
Certificateholders under
this Agreement. The Master Servicer shall represent and protect the
interests of
the Trust Fund in the same manner as it protects its own interests
in mortgage
loans in its own portfolio in any claim, proceeding or litigation
regarding a
Mortgage Loan, and shall not make or permit any modification,
waiver or
amendment of any Mortgage Loan which would cause any REMIC created
under this
Agreement to fail to qualify as a REMIC or result in the imposition
of any tax
under section 860F(a) or section 860G(d) of the Code. Without
limiting the
generality of the foregoing, the Master Servicer, in its own name
or in the name
of the Depositor and the Trustee, is hereby authorized and
empowered by the
Depositor and the Trustee, when the Master Servicer believes it
appropriate in
its reasonable judgment, to execute and deliver, on behalf of the
Trustee, the
Depositor, the Certificateholders or any of them, any and all
instruments of
satisfaction or cancellation, or of partial or full release or
discharge and all
other comparable instruments, with respect to the Mortgage Loans,
and with
respect to the Mortgaged Properties held for the benefit of the
Certificateholders. The Master Servicer shall prepare and deliver
to the
Depositor and/or the Trustee such documents requiring execution and
delivery by
either or both of them as are necessary or appropriate to enable
the Master
Servicer to service and administer the Mortgage Loans to the extent
that the
Master Servicer is not permitted to execute and deliver such
documents pursuant
to the preceding sentence. Upon receipt of such documents, the
Depositor and/or
the Trustee shall execute such documents and deliver them to the
Master
Servicer. The Master Servicer further is authorized and empowered
by the
Trustee, on behalf of the Certificateholders and the Trustee, in
its own name or
in the name of the Subservicer, when the Master Servicer or the
Subservicer, as
the case may be, believes it appropriate in its best judgment to
register any
Mortgage Loan on the MERS(R) System, or cause the removal from the
registration
of any Mortgage Loan on the MERS(R) System, to execute and deliver,
on behalf of
the Trustee and the Certificateholders or any of them, any and all
instruments
of assignment and other comparable instruments with respect to such
assignment
or re-recording of a Mortgage in the name of MERS, solely as
nominee for the
Trustee and its successors and assigns.
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In
accordance with the standards of the preceding paragraph, the
Master
Servicer shall advance or cause to be advanced funds as necessary
for the
purpose of effecting the payment of taxes and assessments on the
Mortgaged
Properties, which advances shall be reimbursable in the first
instance from
related collections from the Mortgagors pursuant to Section 3.06,
and further as
provided in Section 3.08. The costs incurred by the Master
Servicer, if any, in
effecting the timely payments of taxes and assessments on the
Mortgaged
Properties and related insurance premiums shall not, for the
purpose of
calculating monthly distributions to the Certificateholders, be
added to the
Stated Principal Balances of the related Mortgage Loans,
notwithstanding that
the terms of such Mortgage Loans so permit.
SECTION
3.02. Subservicing; Enforcement of the Obligations of
Subservicers.
(a) The
Master Servicer may arrange for the subservicing of any
Mortgage
Loan by a Subservicer pursuant to a subservicing agreement;
provided, however,
that such subservicing arrangement and the terms of the related
subservicing
agreement must provide for the servicing of such Mortgage Loans in
a manner
consistent with the servicing arrangements contemplated under this
Agreement;
provided, however, that the NIM Insurer shall have consented to
such
subservicing agreements (which consent shall not be unreasonably
withheld).
Unless the context otherwise requires, references in this Agreement
to actions
taken or to be taken by the Master Servicer in servicing the
Mortgage Loans
include actions taken or to be taken by a Subservicer on behalf of
the Master
Servicer. Notwithstanding the provisions of any subservicing
agreement, any of
the provisions of this Agreement relating to agreements or
arrangements between
the Master Servicer and a Subservicer or reference to actions taken
through a
Subservicer or otherwise, the Master Servicer shall remain
obligated and liable
to the Depositor, the Trustee and the Certificateholders for the
servicing and
administration of the Mortgage Loans in accordance with the
provisions of this
Agreement without diminution of such obligation or liability by
virtue of such
subservicing agreements or arrangements or by virtue of
indemnification from the
Subservicer and to the same extent and under the same terms and
conditions as if
the Master Servicer alone were servicing and administering the
Mortgage Loans.
All actions of each Subservicer performed pursuant to the related
subservicing
agreement shall be performed as an agent of the Master Servicer
with the same
force and effect as if performed directly by the Master
Servicer.
(b) For
purposes of this Agreement, the Master Servicer shall be deemed
to
have received any collections, recoveries or payments with respect
to the
Mortgage Loans that are received by a Subservicer regardless of
whether such
payments are remitted by the Subservicer to the Master
Servicer.
SECTION
3.03. Rights of the Depositor, the NIM Insurer and the Trustee
in
Respect of the Master Servicer.
The
Depositor may, but is not obligated to, enforce the obligations of
the
Master Servicer under this Agreement and may, but is not obligated
to, perform,
or cause a designee to perform, any defaulted obligation of the
Master Servicer
under this Agreement and in connection with any such defaulted
obligation to
exercise the related rights of the Master Servicer under this
Agreement;
provided that the Master Servicer shall not be relieved of any of
its
obligations under this Agreement by virtue of such performance by
the Depositor
or its designee. None of the Trustee, the NIM Insurer or the
Depositor shall
have any responsibility or liability for any action
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or failure to act by the Master Servicer nor shall the Trustee or
the Depositor
be obligated to supervise the performance of the Master Servicer
under this
Agreement or otherwise.
SECTION
3.04. Trustee to Act as Master Servicer.
In the
event that the Master Servicer shall for any reason no longer
be
the Master Servicer under this Agreement (including by reason of an
Event of
Default or termination by the Depositor), the Trustee or its
successor shall
then assume all of the rights and obligations of the Master
Servicer under this
Agreement arising thereafter (except that the Trustee shall not be
(i) liable
for losses of the Master Servicer pursuant to Section 3.09 or any
acts or
omissions of the predecessor Master Servicer under this Agreement),
(ii)
obligated to make Advances if it is prohibited from doing so by
applicable law,
(iii) obligated to effectuate repurchases or substitutions of
Mortgage Loans
under this Agreement including, but not limited to, repurchases or
substitutions
of Mortgage Loans pursuant to Section 2.02 or 2.03, (iv)
responsible for
expenses of the Master Servicer pursuant to Section 2.03 or (v)
deemed to have
made any representations and warranties of the Master Servicer
under this
Agreement). Any such assumption shall be subject to Section 7.02.
If the Master
Servicer shall for any reason no longer be the Master Servicer
(including by
reason of any Event of Default or termination by the Depositor),
the Trustee or
its successor shall succeed to any rights and obligations of the
Master Servicer
under each subservicing agreement.
The Master
Servicer shall, upon request of the Trustee, but at the expense
of the Master Servicer, deliver to the assuming party all documents
and records
relating to each subservicing agreement or substitute subservicing
agreement and
the Mortgage Loans then being serviced thereunder and an accounting
of amounts
collected or held by it and otherwise use its best efforts to
effect the orderly
and efficient transfer of the substitute subservicing agreement to
the assuming
party.
SECTION
3.05. Collection of Mortgage Loan Payments; Certificate
Account;
Distribution Account; Carryover Reserve Fund; Principal
Reserve Fund; the Pre-funding Account; the Capitalized
Interest Account.
(a) The
Master Servicer shall make reasonable efforts in accordance
with
the customary and usual standards of practice of prudent mortgage
servicers to
collect all payments called for under the terms and provisions of
the Mortgage
Loans to the extent such procedures shall be consistent with this
Agreement and
the terms and provisions of any related Required Insurance Policy.
Consistent
with the foregoing, the Master Servicer may in its discretion (i)
waive any late
payment charge or, subject to Section 3.20, any Prepayment Charge
or penalty
interest in connection with the prepayment of a Mortgage Loan and
(ii) extend
the due dates for payments due on a Mortgage Note for a period not
greater than
180 days; provided, however, that the Master Servicer cannot extend
the maturity
of any such Mortgage Loan past the date on which the final payment
is due on the
latest maturing Mortgage Loan as of the Cut-off Date. In the event
of any such
arrangement, the Master Servicer shall make Advances on the related
Mortgage
Loan in accordance with the provisions of Section 4.01 during the
scheduled
period in accordance with the amortization schedule of such
Mortgage Loan
without modification thereof by reason of such arrangements. In
addition, the
NIM Insurer's prior written consent shall be required for any
waiver of
Prepayment Charges or for the extension of the due dates for
payments due on a
Mortgage Note, if the aggregate number of outstanding Mortgage
Loans that
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have been granted such waivers or extensions exceeds 5% of the
aggregate number
of Mortgage Loans. The Master Servicer shall not be required to
institute or
join in litigation with respect to collection of any payment
(whether under a
Mortgage, Mortgage Note or otherwise or against any public or
governmental
authority with respect to a taking or condemnation) if it
reasonably believes
that enforcing the provision of the Mortgage or other instrument
pursuant to
which such payment is required is prohibited by applicable law.
(b) The
Master Servicer shall establish and maintain a Certificate
Account
into which the Master Servicer shall deposit or cause to be
deposited no later
than two Business Days after receipt (or, if the current long-term
credit rating
of Countrywide is reduced below "A-" by S&P or "A3" by Moody's,
the Master
Servicer shall deposit or cause to be deposited on a daily basis
within one
Business Day of receipt), except as otherwise specifically provided
in this
Agreement, the following payments and collections remitted by
Subservicers or
received by it in respect of Mortgage Loans subsequent to the
Cut-off Date
(other than in respect of principal and interest due on the
Mortgage Loans on or
before the Cut-off Date) and the following amounts required to be
deposited
under this Agreement:
(i) all payments on account of principal on the Mortgage Loans,
including
Principal Prepayments;
(ii) all payments on account of interest on the Mortgage Loans,
net
of the
related Master Servicing Fee, Prepayment Interest Excess and
any
lender paid
mortgage insurance premiums;
(iii) all Insurance Proceeds, Subsequent Recoveries and
Liquidation
Proceeds,
other than proceeds to be applied to the restoration or repair
of a
Mortgaged Property or released to the Mortgagor in accordance
with
the Master
Servicer's normal servicing procedures;
(iv) any amount required to be deposited by the Master Servicer
or
the
Depositor in connection with any losses on Permitted Investments
for
which it
is responsible;
(v) any amounts required to be deposited by the Master Servicer
pursuant
to Section 3.09(c) and in respect of net monthly rental income
from REO
Property pursuant to Section 3.11;
(vi) all Substitution Adjustment Amounts;
(vii) all Advances made by the Master Servicer pursuant to
Section
4.01;
(viii) all Prepayment Charges collected; and
(ix) any other amounts required to be deposited under this
Agreement.
In
addition, with respect to any Mortgage Loan that is subject to
a
buydown agreement, on each Due Date for such Mortgage Loan, in
addition to the
monthly payment remitted by the Mortgagor, the Master Servicer
shall cause funds
to be deposited into the Certificate Account in an amount required
to cause an
amount of interest to be paid with respect to such Mortgage
Loan
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equal to the amount of interest that has accrued on such Mortgage
Loan from the
preceding Due Date at the Mortgage Rate net of the related Master
Servicing Fee.
The
foregoing requirements for remittance by the Master Servicer shall
be
exclusive, it being understood and agreed that, without limiting
the generality
of the foregoing, payments in the nature of late payment charges or
assumption
fees, if collected, need not be remitted by the Master Servicer. In
the event
that the Master Servicer shall remit any amount not required to be
remitted, it
may at any time withdraw or direct the institution maintaining the
Certificate
Account to withdraw such amount from the Certificate Account, any
provision in
this Agreement to the contrary notwithstanding. Such withdrawal or
direction may
be accomplished by delivering written notice thereof to the Trustee
or such
other institution maintaining the Certificate Account which
describes the
amounts deposited in error in the Certificate Account. The Master
Servicer shall
maintain adequate records with respect to all withdrawals made
pursuant to this
Section. All funds deposited in the Certificate Account shall be
held in trust
for the Certificateholders until withdrawn in accordance with
Section 3.08.
(c) The
Trustee shall establish and maintain, on behalf of the
Certificateholders, a Principal Reserve Fund in the name of the
Trustee. On the
Closing Date, the Depositor shall deposit into the Principal
Reserve Fund $100.
Funds on deposit in the Principal Reserve Fund shall not be
invested. The
Principal Reserve Fund shall be treated as an "outside reserve
fund" under
applicable Treasury regulations and shall not be part of any REMIC
created under
this Agreement. Amounts on deposit in the Principal Reserve Fund
shall not be
invested.
(d) The
Trustee shall establish and maintain, on behalf of the
Certificateholders, the Distribution Account. The Trustee shall,
promptly upon
receipt, deposit in the Distribution Account and retain in the
Distribution
Account the following:
(i) the
aggregate amount remitted by the Master Servicer to the Trustee
pursuant to Section 3.08(a)(ix);
(ii) any
amount deposited by the Master Servicer or the Depositor
pursuant
to Section 3.05(e) in connection with any losses on Permitted
Investments for
which it is responsible; and
(iii) any
other amounts deposited hereunder which are required to be
deposited in the Distribution Account.
In the
event that the Master Servicer shall remit any amount not
required
to be remitted, it may at any time direct the Trustee to withdraw
such amount
from the Distribution Account, any provision in this Agreement to
the contrary
notwithstanding. Such direction may be accomplished by delivering
an Officer's
Certificate to the Trustee which describes the amounts deposited in
error in the
Distribution Account. All funds deposited in the Distribution
Account shall be
held by the Trustee in trust for the Certificateholders until
disbursed in
accordance with this Agreement or withdrawn in accordance with
Section 3.08. In
no event shall the Trustee incur liability for withdrawals from the
Distribution
Account at the direction of the Master Servicer.
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(e) Each
institution at which the Certificate Account, the Distribution
Account, the Pre-funding Account or the Capitalized Interest
Account is
maintained shall invest the funds therein as directed in writing by
the Master
Servicer in Permitted Investments, which shall mature not later
than (i) in the
case of the Certificate Account, the Pre-funding Account and the
Capitalized
Interest Account, the second Business Day next preceding the
related
Distribution Account Deposit Date (except that if such Permitted
Investment is
an obligation of the institution that maintains such account, then
such
Permitted Investment shall mature not later than the Business Day
next preceding
such Distribution Account Deposit Date) and (ii) in the case of the
Distribution
Account, the Business Day next preceding the Distribution Date
(except that if
such Permitted Investment is an obligation of the institution that
maintains
such fund or account, then such Permitted Investment shall mature
not later than
such Distribution Date) and, in each case, shall not be sold or
disposed of
prior to its maturity. All such Permitted Investments shall be made
in the name
of the Trustee, for the benefit of the Certificateholders. All
income and gain
net of any losses realized from any such investment of funds on
deposit in the
Certificate Account, or the Distribution Account shall be for the
benefit of the
Master Servicer as servicing compensation and shall be remitted to
it monthly as
provided in this Agreement. The amount of any realized losses in
the Certificate
Account or the Distribution Account incurred in any such account in
respect of
any such investments shall promptly be deposited by the Master
Servicer in the
Certificate Account or paid to the Trustee for deposit into the
Distribution
Account, as applicable. The amount of any losses in the Pre-funding
Account or
the Capitalized Interest Account incurred in respect of any such
investments
shall promptly be deposited by the Depositor in the Pre-funding
Account or the
Capitalized Interest Account, as applicable. All income or gain
(net of any
losses) realized from any such investment of funds on deposit in
the Capitalized
Interest Account shall be credited to the Capitalized Interest
Account. The
Trustee in its fiduciary capacity shall not be liable for the
amount of any loss
incurred in respect of any investment or lack of investment of
funds held in the
Certificate Account, the Distribution Account, the Pre-funding
Account or the
Capitalized Interest Account and made in accordance with this
Section 3.05.
(f) The
Master Servicer shall give notice to the Trustee, each Seller,
each Rating Agency and the Depositor of any proposed change of the
location of
the Certificate Account prior to any change thereof. The Trustee
shall give
notice to the Master Servicer, each Seller, each Rating Agency and
the Depositor
of any proposed change of the location of the Distribution Account,
the
Pre-funding Account, the Capitalized Interest Account or the
Carryover Reserve
Fund prior to any change thereof.
(g) On the
Closing Date, the Trustee shall establish and maintain in its
name, in trust for the benefit of the Holders of the Offered
Certificates, the
Carryover Reserve Fund and shall deposit $1,000 therein upon
receipt from or on
behalf of the Depositor of such amount. The Carryover Reserve Fund
shall be an
Eligible Account, and funds on deposit therein shall be held
separate and apart
from, and shall not be commingled with, any other moneys, including
without
limitation, other moneys held by the Trustee pursuant to this
Agreement.
Funds in
the Carryover Reserve Fund may be invested in Permitted
Investments at the direction of the Majority of the Holders of the
Class C
Certificates, which Permitted Investments shall mature not later
than the
Business Day immediately preceding the first Distribution Date that
follows the
date of such investment (except that if such Permitted
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Investment is an obligation of the institution that maintains the
Carryover
Reserve Fund, then such Permitted Investment shall mature not later
than such
Distribution Date) and shall not be sold or disposed of prior to
maturity. All
such Permitted Investments shall be made in the name of the
Trustee, for the
benefit of the Holders of the Class C Certificates. In the absence
of such
written direction, all funds in the Carryover Reserve Fund shall be
invested by
the Trustee in The Bank of New York cash reserves. Any net
investment earnings
on such amounts shall be retained therein until withdrawn as
provided in Section
3.08. Any losses incurred in the Carryover Reserve Fund in respect
of any such
investments shall be charged against amounts on deposit in the
Carryover Reserve
Fund (or such investments) immediately as realized. The Trustee
shall not be
liable for the amount of any loss incurred in respect of any
investment or lack
of investment of funds held in the Carryover Reserve Fund and made
in accordance
with this Section 3.05. The Carryover Reserve Fund will not
constitute an asset
of any REMIC created hereunder. The Class C Certificates shall
evidence
ownership of the Carryover Reserve Fund for federal tax
purposes.
(h) The Trustee shall establish and maintain, on behalf of the
Certificateholders, the Pre-funding Account. On the Closing Date
Countrywide
shall remit the Pre-funded Amount to the Trustee for deposit in the
Pre-funding
Account. On each Supplemental Transfer Date, upon satisfaction of
the conditions
for such Supplemental Transfer Date set forth in Section 2.01(e),
with respect
to the related Supplemental Transfer Agreement, the Trustee shall
pay to each
Seller selling Supplemental Mortgage Loans to the Depositor on such
Supplemental
Transfer Date the portion of the Aggregate Supplemental Transfer
Amount held in
escrow pursuant to Section 2.01(e) as payment of the purchase price
for the
Supplemental Mortgage Loans sold by such Seller. If at any time the
Depositor
becomes aware that the aggregate Cut-off Date Stated Principal
Balance of
Supplemental Mortgage Loans reflected on any Supplemental Transfer
Agreement
exceeds the actual aggregate Cut-off Date Stated Principal Balance
of the
relevant Supplemental Mortgage Loans, the Depositor may so notify
the Trustee
and the Trustee shall redeposit into the Pre-funding Account the
excess reported
to it by the Depositor.
If any
funds remain in the Pre-funding Account at the end of the
Funding
Period, to the extent that they represent earnings on the amounts
originally
deposited into the Pre-funding Account, the Trustee shall
distribute them to the
order of the Depositor. The remaining funds shall be transferred to
the
Distribution Account to be included as part of the Principal
Remittance Amount
for each Loan Group.
(i) The Trustee shall establish and maintain, on behalf of the
Certificateholders, the Capitalized Interest Account. On the
Closing Date,
Countrywide shall remit the aggregate Capitalized Interest
Requirement to the
Trustee for deposit in the Capitalized Interest Account. On each
Distribution
Account Deposit Date related to a Funding Period Distribution Date,
upon
satisfaction of the conditions for such Supplemental Transfer Date
set forth in
Section 2.01(e), with respect to the related Supplemental Transfer
Agreement,
the Trustee shall transfer from the Capitalized Interest Account to
the
Distribution Account an amount equal to the Capitalized Interest
Requirement
(which, to the extent required, may include investment earnings on
amounts on
deposit therein) with respect to the amount remaining in the
Pre-funding Account
for the related Distribution Date as identified by Countrywide in
the
Supplemental Transfer Agreement.
If any
funds remain in the Capitalized Interest Account at the end of
the
Funding Period, the Trustee shall make the transfer described in
the preceding
paragraph if necessary for the
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remaining Funding Period Distribution Date and the Trustee shall
distribute any
remaining funds in the Capitalized Interest Account to the order of
the
Depositor.
SECTION
3.06. Collection of Taxes, Assessments and Similar Items;
Escrow
Accounts.
(a) To the
extent required by the related Mortgage Note and not violative
of current law, the Master Servicer shall establish and maintain
one or more
accounts (each, an "Escrow Account") and deposit and retain therein
all
collections from the Mortgagors (or advances by the Master
Servicer) for the
payment of taxes, assessments, hazard insurance premiums or
comparable items for
the account of the Mortgagors. Nothing in this Agreement shall
require the
Master Servicer to compel a Mortgagor to establish an Escrow
Account in
violation of applicable law.
(b)
Withdrawals of amounts so collected from the Escrow Accounts may
be
made only to effect timely payment of taxes, assessments, hazard
insurance
premiums, condominium or PUD association dues, or comparable items,
to reimburse
the Master Servicer out of related collections for any payments
made pursuant to
Sections 3.01 (with respect to taxes and assessments and insurance
premiums) and
3.09 (with respect to hazard insurance), to refund to any
Mortgagors any sums
determined to be overages, to pay interest, if required by law or
the terms of
the related Mortgage or Mortgage Note, to Mortgagors on balances in
the Escrow
Account or to clear and terminate the Escrow Account at the
termination of this
Agreement in accordance with Section 9.01. The Escrow Accounts
shall not be a
part of the Trust Fund.
(c) The
Master Servicer shall advance any payments referred to in
Section
3.06(a) that are not timely paid by the Mortgagors on the date when
the tax,
premium or other cost for which such payment is intended is due,
but the Master
Servicer shall be required so to advance only to the extent that
such advances,
in the good faith judgment of the Master Servicer, will be
recoverable by the
Master Servicer out of Insurance Proceeds, Liquidation Proceeds or
otherwise.
SECTION
3.07. Access to Certain Documentation and Information Regarding
the Mortgage Loans.
The Master
Servicer shall afford each Seller, the Depositor, the NIM
Insurer and the Trustee reasonable access to all records and
documentation
regarding the Mortgage Loans and all accounts, insurance
information and other
matters relating to this Agreement, such access being afforded
without charge,
but only upon reasonable request and during normal business hours
at the office
designated by the Master Servicer.
Upon
reasonable advance notice in writing, the Master Servicer will
provide to each Certificateholder and/or Certificate Owner which is
a savings
and loan association, bank or insurance company certain reports and
reasonable
access to information and documentation regarding the Mortgage
Loans sufficient
to permit such Certificateholder and/or Certificate Owner to comply
with
applicable regulations of the OTS or other regulatory authorities
with respect
to investment in the Certificates; provided that the Master
Servicer shall be
entitled to be reimbursed by each such Certificateholder and/or
Certificate
Owner for actual expenses incurred by the Master Servicer in
providing such
reports and access. Upon request, the Master Servicer
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shall furnish to the Trustee and the NIM Insurer its most recent
publicly
available financial statements and any other information relating
to its
capacity to perform its obligations under this Agreement reasonably
requested by
the NIM Insurer.
SECTION
3.08. Permitted Withdrawals from the Certificate Account, the
Distribution Account, the Carryover Reserve Fund and the
Principal Reserve Fund.
(a) The
Master Servicer may from time to time make withdrawals from the
Certificate Account for the following purposes:
(i) to pay to the Master Servicer (to the extent not previously
retained
by the Master Servicer) the servicing compensation to which it
is
entitled
pursuant to Section 3.14 and to pay to the Master Servicer, as
additional
servicing compensation, earnings on or investment income with
respect to funds in or
credited to the Certificate Account;
(ii) to reimburse each of the Master Servicer and the Trustee
for
unreimbursed Advances made by it, such right of reimbursement
pursuant to
this
subclause (ii) being limited to amounts received on the
Mortgage
Loan(s) in
respect of which any such Advance was made;
(iii) to reimburse each of the Master Servicer and the Trustee
for
any
Nonrecoverable Advance previously made by it;
(iv) to reimburse the Master Servicer for Insured Expenses from
the
related
Insurance Proceeds;
(v) to reimburse the Master Servicer for (a) unreimbursed
Servicing
Advances,
the Master Servicer's right to reimbursement pursuant to this
clause (a)
with respect to any Mortgage Loan being limited to amounts
received
on such Mortgage Loan(s) that represent late recoveries of the
payments
for which such advances were made pursuant to Section 3.01 or
Section
3.06 and (b) for unpaid Master Servicing Fees as provided in
Section
3.11;
(vi) to pay to the purchaser, with respect to each Mortgage Loan
or
property
acquired in respect thereof that has been purchased pursuant to
Section
2.02, 2.03 or 3.11, all amounts received on such Mortgage Loan
after the
date of such purchase;
(vii) to reimburse the Sellers, the Master Servicer, the NIM
Insurer
or the
Depositor for expenses incurred by any of them and reimbursable
pursuant
to Section 6.03;
(viii) to withdraw any amount deposited in the Certificate
Account
and not
required to be deposited in the Certificate Account;
(ix) on or prior to the Distribution Account Deposit Date, to
withdraw
an amount equal to the Interest Remittance Amount, Principal
Remittance
Amount,
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Prepayment
Charge Amount and Trustee Fee for such Distribution Date and
remit such
amount to the Trustee for deposit in the Distribution Account;
and
(x) to clear and terminate the Certificate Account upon
termination
of this
Agreement pursuant to Section 9.01.
The Master
Servicer shall keep and maintain separate accounting, on a
Mortgage Loan by Mortgage Loan basis, for the purpose of justifying
any
withdrawal from the Certificate Account pursuant to such subclauses
(i), (ii),
(iv), (v) and (vi). Prior to making any withdrawal from the
Certificate Account
pursuant to subclause (iii), the Master Servicer shall deliver to
the Trustee an
Officer's Certificate of a Servicing Officer indicating the amount
of any
previous Advance determined by the Master Servicer to be a
Nonrecoverable
Advance and identifying the related Mortgage Loans(s), and their
respective
portions of such Nonrecoverable Advance.
(b) The
Trustee shall withdraw funds from the Distribution Account for
distributions to Certificateholders and remittance to the Swap
Account, in the
manner specified in this Agreement (and to withhold from the
amounts so
withdrawn, the amount of any taxes that it is authorized to
withhold pursuant to
the third paragraph of Section 8.11). In addition, the Trustee may
from time to
time make withdrawals from the Distribution Account for the
following purposes:
(i) to pay to itself the Trustee Fee for the related
Distribution
Date;
(ii) to pay to the Master Servicer as additional servicing
compensation earnings on or investment income with respect to funds
in the
Distribution Account;
(iii) to withdraw and return to the Master Servicer any amount
deposited
in the Distribution Account and not required to be deposited
therein;
(iv) to reimburse the Trustee for any unreimbursed Advances made
by
it
pursuant to Section 4.01(b) hereof, such right of reimbursement
pursuant
to this subclause (iv) being limited to (x) amounts received on
the
related Mortgage Loan(s) in respect of which any such Advance was
made
and (y)
amounts not otherwise reimbursed to the Trustee pursuant to
Section
3.08(a)(ii) hereof;
(v) to reimburse the Trustee for any Nonrecoverable Advance
previously
made by the Trustee pursuant to Section 4.01(b) hereof, such
right of
reimbursement pursuant to this subclause (v) being limited to
amounts
not otherwise reimbursed to the Trustee pursuant to Section
3.08(a)(iii) hereof; and
(vi) to clear and terminate the Distribution Account upon
termination of the Agreement pursuant to Section 9.01.
(c) The
Trustee shall withdraw funds from the Carryover Reserve Fund
for
distribution to the LIBOR Certificates and the Class C Certificates
in the
manner specified in Section 4.02(e) (and to withhold from the
amounts so
withdrawn the amount of any taxes that it is authorized to retain
pursuant to
the third paragraph of Section 8.11). In addition, the Trustee
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may from time to time make withdrawals from the Carryover Reserve
Fund for the
following purposes:
(i) to withdraw any amount deposited in the Carryover Reserve
Fund
and not
required to be deposited therein; and
(ii) to clear and terminate the Carryover Reserve Fund upon the
termination of this Agreement pursuant to Section 9.01.
(d) On the
Business Day before the Class P Principal Distribution Date,
the Trustee shall transfer $100.00 from the Principal Reserve Fund
to the
Distribution Account and shall distribute such amount to the Class
P
Certificates on the Class P Principal Distribution Date. Following
the
distributions to be made in accordance with the preceding sentence,
the Trustee
shall then terminate the Principal Reserve Fund.
SECTION
3.09. Maintenance of Hazard Insurance; Maintenance of Primary
Insurance Policies.
(a) The
Master Servicer shall cause to be maintained, for each Mortgage
Loan, hazard insurance with extended coverage in an amount that is
at least
equal to the lesser of (i) the maximum insurable value of the
improvements
securing such Mortgage Loan or (ii) the greater of (y) the
outstanding principal
balance of the Mortgage Loan and (z) an amount such that the
proceeds of such
policy shall be sufficient to prevent the Mortgagor and/or the
mortgagee from
becoming a co-insurer. Each such policy of standard hazard
insurance shall
contain, or have an accompanying endorsement that contains, a
standard mortgagee
clause. Any amounts collected by the Master Servicer under any such
policies
(other than the amounts to be applied to the restoration or repair
of the
related Mortgaged Property or amounts released to the Mortgagor in
accordance
with the Master Servicer's normal servicing procedures) shall be
deposited in
the Certificate Account. Any cost incurred by the Master Servicer
in maintaining
any such insurance shall not, for the purpose of calculating
monthly
distributions to the Certificateholders or remittances to the
Trustee for their
benefit, be added to the principal balance of the Mortgage Loan,
notwithstanding
that the terms of the Mortgage Loan so permit. Such costs shall be
recoverable
by the Master Servicer out of late payments by the related
Mortgagor or out of
proceeds of liquidation of the Mortgage Loan or Subsequent
Recoveries to the
extent permitted by Section 3.08. It is understood and agreed that
no earthquake
or other additional insurance is to be required of any Mortgagor or
maintained
on property acquired in respect of a Mortgage other than pursuant
to such
applicable laws and regulations as shall at any time be in force
and as shall
require such additional insurance. If the Mortgaged Property is
located at the
time of origination of the Mortgage Loan in a federally designated
special flood
hazard area and such area is participating in the national flood
insurance
program, the Master Servicer shall cause flood insurance to be
maintained with
respect to such Mortgage Loan. Such flood insurance shall be in an
amount equal
to the least of (i) the outstanding principal balance of the
related Mortgage
Loan, (ii) the replacement value of the improvements which are part
of such
Mortgaged Property, and (iii) the maximum amount of such insurance
available for
the related Mortgaged Property under the national flood insurance
program.
(b)
[Reserved].
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(c) The
Master Servicer shall not take any action which would result in
non-coverage under any applicable Primary Insurance Policy of any
loss which,
but for the actions of the Master Servicer, would have been covered
thereunder.
The Master Servicer shall not cancel or refuse to renew any such
Primary
Insurance Policy that is in effect at the date of the initial
issuance of the
Certificates and is required to be kept in force hereunder unless
the
replacement Primary Insurance Policy for such canceled or
non-renewed policy is
maintained with a Qualified Insurer.
Except
with respect to any Lender PMI Mortgage Loans, the Master
Servicer
shall not be required to maintain any Primary Insurance Policy (i)
with respect
to any Mortgage Loan with a Loan-to-Value Ratio less than or equal
to 80% as of
any date of determination or, based on a new appraisal, the
principal balance of
such Mortgage Loan represents 80% or less of the new appraised
value or (ii) if
maintaining such Primary Insurance Policy is prohibited by
applicable law. With
respect to the Lender PMI Mortgage Loans, the Master Servicer shall
maintain the
Primary Insurance Policy for the life of such Mortgage Loans,
unless otherwise
provided for in the related Mortgage Note or prohibited by law.
The Master
Servicer agrees to effect the timely payment of the premiums on
each Primary Insurance Policy, and such costs not otherwise
recoverable shall be
recoverable by the Master Servicer from the related proceeds of
liquidation and
Subsequent Recoveries.
(d) In
connection with its activities as Master Servicer of the
Mortgage
Loans, the Master Servicer agrees to present on behalf of itself,
the Trustee
and Certificateholders, claims to the insurer under any Primary
Insurance
Policies and, in this regard, to take such reasonable action as
shall be
necessary to permit recovery under any Primary Insurance Policies
respecting
defaulted Mortgage Loans. Any amounts collected by the Master
Servicer under any
Primary Insurance Policies shall be deposited in the Certificate
Account.
SECTION
3.10. Enforcement of Due-on-Sale Clauses; Assumption
Agreements.
(a) Except
as otherwise provided in this Section, when any property
subject to a Mortgage has been conveyed by the Mortgagor, the
Master Servicer
shall to the extent that it has knowledge of such conveyance,
enforce any
due-on-sale clause contained in any Mortgage Note or Mortgage, to
the extent
permitted under applicable law and governmental regulations, but
only to the
extent that such enforcement will not adversely affect or
jeopardize coverage
under any Required Insurance Policy. Notwithstanding the foregoing,
the Master
Servicer is not required to exercise such rights with respect to a
Mortgage Loan
if the Person to whom the related Mortgaged Property has been
conveyed or is
proposed to be conveyed satisfies the terms and conditions
contained in the
Mortgage Note and Mortgage related thereto and the consent of the
mortgagee
under such Mortgage Note or Mortgage is not otherwise so required
under such
Mortgage Note or Mortgage as a condition to such transfer. In the
event that the
Master Servicer is prohibited by law from enforcing any such
due-on-sale clause,
or if coverage under any Required Insurance Policy would be
adversely affected,
or if nonenforcement is otherwise permitted hereunder, the Master
Servicer is
authorized, subject to Section 3.10(b), to take or enter into an
assumption and
modification agreement from or with the person to whom such
property has been or
is about to be conveyed, pursuant to which such person becomes
liable under the
Mortgage Note and, unless prohibited by applicable state law, the
Mortgagor
remains liable thereon, provided that the Mortgage Loan shall
continue to be
covered (if so covered
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before the Master Servicer enters such agreement) by the applicable
Required
Insurance Policies. The Master Servicer, subject to Section
3.10(b), is also
authorized with the prior approval of the insurers under any
Required Insurance
Policies to enter into a substitution of liability agreement with
such Person,
pursuant to which the original Mortgagor is released from liability
and such
Person is substituted as Mortgagor and becomes liable under the
Mortgage Note.
Notwithstanding the foregoing, the Master Servicer shall not be
deemed to be in
default under this Section by reason of any transfer or assumption
which the
Master Servicer reasonably believes it is restricted by law from
preventing, for
any reason whatsoever.
(b)
Subject to the Master Servicer's duty to enforce any
due-on-sale
clause to the extent set forth in Section 3.10(a), in any case in
which a
Mortgaged Property has been conveyed to a Person by a Mortgagor,
and such Person
is to enter into an assumption agreement or modification agreement
or supplement
to the Mortgage Note or Mortgage that requires the signature of the
Trustee, or
if an instrument of release signed by the Trustee is required
releasing the
Mortgagor from liability on the Mortgage Loan, the Master Servicer
shall prepare
and deliver or cause to be prepared and delivered to the Trustee
for signature
and shall direct, in writing, the Trustee to execute the assumption
agreement
with the Person to whom the Mortgaged Property is to be conveyed
and such
modification agreement or supplement to the Mortgage Note or
Mortgage or other
instruments as are reasonable or necessary to carry out the terms
of the
Mortgage Note or Mortgage or otherwise to comply with any
applicable laws
regarding assumptions or the transfer of the Mortgaged Property to
such Person.
In connection with any such assumption, no material term of the
Mortgage Note
may be changed. In addition, the substitute Mortgagor and the
Mortgaged Property
must be acceptable to the Master Servicer in accordance with its
underwriting
standards as then in effect. Together with each such substitution,
assumption or
other agreement or instrument delivered to the Trustee for
execution by it, the
Master Servicer shall deliver an Officer's Certificate signed by a
Servicing
Officer stating that the requirements of this subsection have been
met in
connection therewith. The Master Servicer shall notify the Trustee
that any such
substitution or assumption agreement has been completed by
forwarding to the
Trustee the original of such substitution or assumption agreement,
which in the
case of the original shall be added to the related Mortgage File
and shall, for
all purposes, be considered a part of such Mortgage File to the
same extent as
all other documents and instruments constituting a part thereof.
Any fee
collected by the Master Servicer for entering into an assumption or
substitution
of liability agreement will be retained by the Master Servicer as
additional
servicing compensation.
SECTION
3.11. Realization Upon Defaulted Mortgage Loans; Repurchase of
Certain Mortgage Loans.
(a) The
Master Servicer shall use reasonable efforts to foreclose upon
or
otherwise comparably convert the ownership of properties securing
such of the
Mortgage Loans as come into and continue in default and as to which
no
satisfactory arrangements can be made for collection of delinquent
payments. In
connection with such foreclosure or other conversion, the Master
Servicer shall
follow such practices and procedures as it shall deem necessary or
advisable and
as shall be normal and usual in its general mortgage servicing
activities and
meet the requirements of the insurer under any Required Insurance
Policy;
provided, however, that the Master Servicer shall not be required
to expend its
own funds in connection with any foreclosure or towards the
restoration of any
property unless it shall determine (i) that such restoration and/or
foreclosure
will increase the proceeds of liquidation of the Mortgage Loan
after
reimbursement
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<PAGE>
to itself of such expenses and (ii) that such expenses will be
recoverable to it
through the proceeds of liquidation of the Mortgage Loan and
Subsequent
Recoveries (respecting which it shall have priority for purposes of
withdrawals
from the Certificate Account). The Master Servicer shall be
responsible for all
other costs and expenses incurred by it in any such proceedings;
provided,
however, that it shall be entitled to reimbursement thereof from
the proceeds of
liquidation of the Mortgage Loan and Subsequent Recoveries with
respect to the
related Mortgaged Property, as provided in the definition of
Liquidation
Proceeds. If the Master Servicer has knowledge that a Mortgaged
Property which
the Master Servicer is contemplating acquiring in foreclosure or by
deed in lieu
of foreclosure is located within a 1 mile radius of any site listed
in the
Expenditure Plan for the Hazardous Substance Clean Up Bond Act of
1984 or other
site with environmental or hazardous waste risks known to the
Master Servicer,
the Master Servicer will, prior to acquiring the Mortgaged
Property, consider
such risks and only take action in accordance with its established
environmental
review procedures.
With
respect to any REO Property, the deed or certificate of sale shall
be
taken in the name of the Trustee for the benefit of the
Certificateholders, or
its nominee, on behalf of the Certificateholders. The Trustee's
name shall be
placed on the title to such REO Property solely as the Trustee
hereunder and not
in its individual capacity. The Master Servicer shall ensure that
the title to
such REO Property references the Pooling and Servicing Agreement
and the
Trustee's capacity thereunder. Pursuant to its efforts to sell such
REO
Property, the Master Servicer shall either itself or through an
agent selected
by the Master Servicer protect and conserve such REO Property in
the same manner
and to such extent as is customary in the locality where such REO
Property is
located and may, incident to its conservation and protection of the
interests of
the Certificateholders, rent the same, or any part thereof, as the
Master
Servicer deems to be in the best interest of the Certificateholders
for the
period prior to the sale of such REO Property. The Master Servicer
shall prepare
for and deliver to the Trustee a statement with respect to each REO
Property
that has been rented showing the aggregate rental income received
and all
expenses incurred in connection with the maintenance of such REO
Property at
such times as is necessary to enable the Trustee to comply with the
reporting
requirements of the REMIC Provisions. The net monthly rental
income, if any,
from such REO Property shall be deposited in the Certificate
Account no later
than the close of business on each Determination Date. The Master
Servicer shall
perform the tax reporting and withholding required by Sections 1445
and 6050J of
the Code with respect to foreclosures and abandonments, the tax
reporting
required by Section 6050H of the Code with respect to the receipt
of mortgage
interest from individuals and any tax reporting required by Section
6050P of the
Code with respect to the cancellation of indebtedness by certain
financial
entities, by preparing such tax and information returns as may be
required, in
the form required, and delivering the same to the Trustee for
filing.
In the
event that the Trust Fund acquires any Mortgaged Property as
aforesaid or otherwise in connection with a default or imminent
default on a
Mortgage Loan, the Master Servicer shall dispose of such Mortgaged
Property as
soon as practicable in a manner that maximizes the Liquidation
Proceeds thereof,
but in no event later than three years after its acquisition by the
Trust Fund.
In that event, the Trustee shall have been supplied with an Opinion
of Counsel
to the effect that the holding by the Trust Fund of such Mortgaged
Property
subsequent to a three-year period, if applicable, will not result
in the
imposition of taxes on "prohibited transactions" of any REMIC
hereunder as
defined in Section 860F of the Code or cause any REMIC hereunder to
fail to
qualify as a REMIC at any time that any Certificates are
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outstanding, and that the Trust Fund may continue to hold such
Mortgaged
Property (subject to any conditions contained in such Opinion of
Counsel) after
the expiration of such three-year period. Notwithstanding any other
provision of
this Agreement, no Mortgaged Property acquired by the Trust Fund
shall be rented
(or allowed to continue to be rented) or otherwise used for the
production of
income by or on behalf of the Trust Fund in such a manner or
pursuant to any
terms that would (i) cause such Mortgaged Property to fail to
qualify as
"foreclosure property" within the meaning of Section 860G(a)(8) of
the Code or
(ii) subject any REMIC hereunder to the imposition of any federal,
state or
local income taxes on the income earned from such Mortgaged
Property under
Section 860G(c) of the Code or otherwise, unless the Master
Servicer has agreed
to indemnify and hold harmless the Trust Fund with respect to the
imposition of
any such taxes.
In the
event of a default on a Mortgage Loan one or more of whose
obligor
is not a United States Person, as that term is defined in Section
7701(a)(30) of
the Code, in connection with any foreclosure or acquisition of a
deed in lieu of
foreclosure (together, "foreclosure") in respect of such Mortgage
Loan, the
Master Servicer will cause compliance with the provisions of
Treasury Regulation
Section 1.1445-2(d)(3) (or any successor thereto) necessary to
assure that no
withholding tax obligation arises with respect to the proceeds of
such
foreclosure except to the extent, if any, that proceeds of such
foreclosure are
required to be remitted to the obligors on such Mortgage Loan.
The
decision of the Master Servicer to foreclose on a defaulted
Mortgage
Loan shall be subject to a determination by the Master Servicer
that the
proceeds of such foreclosure would exceed the costs and expenses of
bringing
such a proceeding. The income earned from the management of any REO
Properties,
net of reimbursement to the Master Servicer for expenses incurred
(including any
property or other taxes) in connection with such management and net
of
unreimbursed Master Servicing Fees, Advances and Servicing
Advances, shall be
applied to the payment of principal of and interest on the related
defaulted
Mortgage Loans (with interest accruing as though such Mortgage
Loans were still
current) and all such income shall be deemed, for all purposes in
this
Agreement, to be payments on account of principal and interest on
the related
Mortgage Notes and shall be deposited into the Certificate Account.
To the
extent the net income received during any calendar month is in
excess of the
amount attributable to amortizing principal and accrued interest at
the related
Mortgage Rate on the related Mortgage Loan for such calendar month,
such excess
shall be considered to be a partial prepayment of principal of the
related
Mortgage Loan.
The
proceeds from any liquidation of a Mortgage Loan, as well as
any
income from an REO Property, will be applied in the following order
of priority:
first, to reimburse the Master Servicer for any related
unreimbursed Servicing
Advances and Master Servicing Fees; second, to reimburse the Master
Servicer or
the Trustee for any unreimbursed Advances; third, to reimburse the
Certificate
Account for any Nonrecoverable Advances (or portions thereof) that
were
previously withdrawn by the Master Servicer or the Trustee pursuant
to Section
3.08(a)(iii) that related to such Mortgage Loan; fourth, to accrued
and unpaid
interest (to the extent no Advance has been made for such amount or
any such
Advance has been reimbursed) on the Mortgage Loan or related REO
Property, at
the Adjusted Net Mortgage Rate to the Due Date occurring in the
month in which
such amounts are required to be distributed; and fifth, as a
recovery of
principal of the Mortgage Loan. Excess Proceeds, if any, from the
liquidation of
a Liquidated
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Mortgage Loan will be retained by the Master Servicer as additional
servicing
compensation pursuant to Section 3.14.
The Master
Servicer, in its sole discretion, shall have the right to
purchase for its own account from the Trust Fund any Mortgage Loan
which is 151
days or more delinquent at a price equal to the Purchase Price;
provided,
however, that the Master Servicer may only exercise this right on
or before the
next to the last day of the calendar month in which such Mortgage
Loan became
151 days delinquent (such month, the "Eligible Repurchase Month");
provided
further, that any such Mortgage Loan which becomes current but
thereafter
becomes delinquent may be purchased by the Master Servicer pursuant
to this
Section in any ensuing Eligible Repurchase Month. The Master
Servicer, in its
sole discretion, shall also have the right to purchase for its own
account from
the Trust Fund at a price equal to the Purchase Price any Eligible
EPD Protected
Mortgage Loan. The Master Servicer's right to purchase any such
Eligible EPD
Protected Mortgage Loan shall expire on the 270th day following the
date on
which such Mortgage Loan became an Eligible EPD Protected Mortgage
Loan. The
Purchase Price for any Mortgage Loan purchased under this Section
3.11 shall be
deposited in the Certificate Account and the Trustee, upon receipt
of a
certificate from the Master Servicer in the form of Exhibit N to
this Agreement,
shall release or cause to be released to the purchaser of such
Mortgage Loan the
related Mortgage File and shall execute and deliver such
instruments of transfer
or assignment prepared by the purchaser of such Mortgage Loan, in
each case
without recourse, as shall be necessary to vest in the purchaser of
such
Mortgage Loan any Mortgage Loan released pursuant hereto and the
purchaser of
such Mortgage Loan shall succeed to all the Trustee's right, title
and interest
in and to such Mortgage Loan and all security and documents related
thereto.
Such assignment shall be an assignment outright and not for
security. The
purchaser of such Mortgage Loan shall thereupon own such Mortgage
Loan, and all
security and documents, free of any further obligation to the
Trustee or the
Certificateholders with respect thereto.
(b)
Countrywide may agree to a modification of any Mortgage Loan
(the
"Modified Mortgage Loan") if (i) the modification is in lieu of a
refinancing
and (ii) the Mortgage Rate on the Modified Mortgage Loan is
approximately a
prevailing market rate for newly originated mortgage loans having
similar terms
and (iii) Countrywide purchases the Modified Mortgage Loan from the
Trust Fund
as described below. Effective immediately after the modification,
and, in any
event, on the same Business Day on which the modification occurs,
all interest
of the Trustee in the Modified Mortgage Loan shall automatically be
deemed
transferred and assigned to Countrywide and all benefits and
burdens of
ownership thereof, including the right to accrued interest thereon
from the date
of modification and the risk of default thereon, shall pass to
Countrywide. The
Master Servicer shall promptly deliver to the Trustee a
certification of a
Servicing Officer to the effect that all requirements of this
paragraph have
been satisfied with respect to the Modified Mortgage Loan. For
federal income
tax purposes, the Trustee shall account for such purchase as a
prepayment in
full of the Modified Mortgage Loan.
Countrywide shall remit to the Master Servicer and the Master
Service
shall deposit the Purchase Price for any Modified Mortgage Loan in
the
Certificate Account pursuant to Section 3.05 within one Business
Day after the
purchase of the Modified Mortgage Loan. Upon receipt by the Trustee
of written
notification of any such deposit signed by a Servicing Officer, the
Trustee
shall release to Countrywide the related Mortgage File and shall
execute and
deliver such instruments of transfer or assignment, in each case
without
recourse, as shall be necessary to vest in Countrywide any Modified
Mortgage
Loan previously transferred and assigned pursuant
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hereto. Countrywide covenants and agrees to indemnify the Trust
Fund against any
liability for any "prohibited transaction" taxes and any related
interest,
additions, and penalties imposed on the Trust Fund established
hereunder as a
result of any modification of a Mortgage Loan effected pursuant to
this
subsection (b), any holding of a Modified Mortgage Loan by the
Trust Fund or any
purchase of a Modified Mortgage Loan by Countrywide (but such
obligation shall
not prevent Countrywide or any other appropriate Person from in
good faith
contesting any such tax in appropriate proceedings and shall not
prevent
Countrywide from withholding payment of such tax, if permitted by
law, pending
the outcome of such proceedings). Countrywide shall have no right
of
reimbursement for any amount paid pursuant to the foregoing
indemnification,
except to the extent that the amount of any tax, interest, and
penalties,
together with interest thereon, is refunded to the Trust Fund or
Countrywide.
SECTION
3.12. Trustee to Cooperate; Release of Mortgage Files.
Upon the
payment in full of any Mortgage Loan, or the receipt by the
Master Servicer of a notification that payment in full will be
escrowed in a
manner customary for such purposes, the Master Servicer will
immediately notify
the Trustee by delivering, or causing to be delivered a "Request
for Release"
substantially in the form of Exhibit N of this Agreement. Upon
receipt of such
request, the Trustee shall promptly release the related Mortgage
File to the
Master Servicer, and the Trustee shall at the Master Servicer's
direction
execute and deliver to the Master Servicer the request for
reconveyance, deed of
reconveyance or release or satisfaction of mortgage or such
instrument releasing
the lien of the Mortgage in each case provided by the Master
Servicer, together
with the Mortgage Note with written evidence of cancellation on the
Mortgage
Note. The Master Servicer is authorized to cause the removal from
the
registration on the MERS(R) System of such Mortgage and to execute
and deliver,
on behalf of the Trustee and the Certificateholders or any of them,
any and all
instruments of satisfaction or cancellation or of partial or full
release.
Expenses incurred in connection with any instrument of satisfaction
or deed of
reconveyance shall be chargeable to the related Mortgagor. From
time to time and
as shall be appropriate for the servicing or foreclosure of any
Mortgage Loan,
including for such purpose, collection under any policy of flood
insurance, any
fidelity bond or errors or omissions policy, or for the purposes of
effecting a
partial release of any Mortgaged Property from the lien of the
Mortgage or the
making of any corrections to the Mortgage Note or the Mortgage or
any of the
other documents included in the Mortgage File, the Trustee shall,
upon delivery
to the Trustee of a Request for Release in the form of Exhibit M
signed by a
Servicing Officer, release the Mortgage File to the Master
Servicer. Subject to
the further limitations set forth below, the Master Servicer shall
cause the
Mortgage File or documents so released to be returned to the
Trustee when the
need therefor by the Master Servicer no longer exists, unless the
Mortgage Loan
is liquidated and the proceeds thereof are deposited in the
Certificate Account,
in which case the Master Servicer shall deliver to the Trustee a
Request for
Release in the form of Exhibit N, signed by a Servicing
Officer.
If the
Master Servicer at any time seeks to initiate a foreclosure
proceeding in respect of any Mortgaged Property as authorized by
this Ag
