EXHIBIT 99.1
The Pooling and Servicing Agreement
<PAGE>
Exhibit 99.1
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 October 1, 2006
-----------------------------------
ALTERNATIVE LOAN TRUST 2006-OC9
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2006-OC9
=======================
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
Page
----
ARTICLE I DEFINITIONS
<S>
<C>
SECTION 1.01.
Defined
Terms.....................................................................11
SECTION 1.02.
Certain Interpretive
Provisions...................................................44
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND
WARRANTIES
SECTION 2.01.
Conveyance of Mortgage
Loans......................................................45
SECTION 2.02.
Acceptance by Trustee of the Mortgage
Loans.......................................49
SECTION 2.03.
Representations, Warranties and Covenants of the Sellers and Master
Servicer......51
SECTION 2.04.
Representations and Warranties of the Depositor as to the Mortgage
Loans..........53
SECTION 2.05.
Delivery of Opinion of Counsel in Connection with
Substitutions...................54
SECTION 2.06.
Execution and Delivery of
Certificates............................................54
SECTION 2.07.
REMIC
Matters.....................................................................55
SECTION 2.08.
Covenants of the Master
Servicer..................................................55
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
SECTION 3.01.
Master Servicer to Service Mortgage
Loans.........................................56
SECTION 3.02.
Subservicing; Enforcement of the Obligations of
Subservicers......................57
SECTION 3.03.
Rights of the Depositor, the NIM Insurer and the Trustee in
Respect of the Master
Servicer....................................................57
SECTION 3.04.
Trustee to Act as Master
Servicer.................................................58
SECTION 3.05.
Collection of Mortgage Loan Payments; Certificate Account;
Distribution Account; Carryover Reserve Fund; Principal Reserve
Fund..............58
SECTION 3.06.
Collection of Taxes, Assessments and Similar Items; Escrow
Accounts...............62
SECTION 3.07.
Access to Certain Documentation and Information Regarding the
Mortgage Loans......62
SECTION 3.08.
Permitted Withdrawals from the Certificate Account, the
Distribution Account,
the Carryover Reserve Fund and the Principal Reserve
Fund.........................63
SECTION 3.09.
Maintenance of Hazard Insurance; Maintenance of Primary Insurance
Policies........65
SECTION 3.10.
Enforcement of Due-on-Sale Clauses; Assumption
Agreements.........................66
SECTION 3.11.
Realization Upon Defaulted Mortgage Loans; Repurchase of
Certain
Mortgage
Loans....................................................................67
SECTION 3.12.
Trustee to Cooperate; Release of Mortgage
Files...................................71
SECTION 3.13.
Documents, Records and Funds in Possession of Master Servicer to
be
Held for the
Trustee..............................................................72
i
<PAGE>
SECTION 3.14.
Servicing
Compensation............................................................72
SECTION 3.15.
Access to Certain
Documentation...................................................73
SECTION 3.16.
Annual Statement as to
Compliance.................................................73
SECTION 3.17.
Errors and Omissions Insurance; Fidelity
Bonds....................................73
SECTION 3.18.
Notification of
Adjustments.......................................................74
SECTION 3.19.
The Swap
Contract.................................................................74
SECTION 3.20.
Prepayment
Charges................................................................76
ARTICLE IV DISTRIBUTIONS AND ADVANCES BY THE MASTER SERVICER
SECTION 4.01.
Advances..........................................................................78
SECTION 4.02.
Priorities of
Distribution........................................................79
SECTION 4.03.
[Reserved]........................................................................83
SECTION 4.04.
[Reserved]........................................................................83
SECTION 4.05.
[Reserved]........................................................................83
SECTION 4.06.
Monthly Statements to
Certificateholders..........................................83
SECTION 4.07.
Determination of Pass-Through Rates for COFI
Certificates.........................84
SECTION 4.08.
Determination of Pass-Through Rates for LIBOR
Certificates........................85
SECTION 4.09.
Swap Trust and Swap
Account.......................................................86
ARTICLE V THE CERTIFICATES
SECTION 5.01.
The
Certificates..................................................................88
SECTION 5.02.
Certificate Register; Registration of Transfer and Exchange of
Certificates.......89
SECTION 5.03.
Mutilated, Destroyed, Lost or Stolen
Certificates.................................94
SECTION 5.04.
Persons Deemed
Owners.............................................................94
SECTION 5.05.
Access to List of Certificateholders' Names and
Addresses.........................94
SECTION 5.06.
Maintenance of Office or
Agency...................................................95
ARTICLE VI THE DEPOSITOR AND THE MASTER SERVICER
SECTION 6.01.
Respective Liabilities of the Depositor and the Master
Servicer...................96
SECTION 6.02.
Merger or Consolidation of the Depositor or the Master
Servicer...................96
SECTION 6.03.
Limitation on Liability of the Depositor, the Sellers, the Master
Servicer,
the NIM Insurer and
Others........................................................96
SECTION 6.04.
Limitation on Resignation of Master
Servicer......................................97
ARTICLE VII DEFAULT
SECTION 7.01.
Events of
Default.................................................................98
SECTION 7.02.
Trustee to Act; Appointment of
Successor.........................................100
SECTION 7.03.
Notification to
Certificateholders...............................................101
ARTICLE VIII CONCERNING THE TRUSTEE
SECTION 8.01.
Duties of
Trustee................................................................102
SECTION 8.02.
Certain Matters Affecting the
Trustee............................................103
ii
<PAGE>
SECTION 8.03.
Trustee Not Liable for Certificates or Mortgage
Loans............................104
SECTION 8.04.
Trustee May Own
Certificates.....................................................104
SECTION 8.05.
Trustee's Fees and
Expenses......................................................104
SECTION 8.06.
Eligibility Requirements for
Trustee.............................................105
SECTION 8.07.
Resignation and Removal of
Trustee...............................................105
SECTION 8.08.
Successor
Trustee................................................................106
SECTION 8.09.
Merger or Consolidation of
Trustee...............................................107
SECTION 8.10.
Appointment of Co-Trustee or Separate
Trustee....................................107
SECTION 8.11.
Tax
Matters......................................................................109
SECTION 8.12.
Monitoring of Significance
Percentage............................................111
ARTICLE IX TERMINATION
SECTION 9.01.
Termination upon Liquidation or Purchase of all Mortgage
Loans...................113
SECTION 9.02.
Final Distribution on the
Certificates...........................................113
SECTION 9.03.
Additional Termination
Requirements..............................................115
SECTION 9.04.
Auction of the Mortgage Loans and REO
Properties.................................116
ARTICLE X MISCELLANEOUS PROVISIONS
SECTION 10.01.
Amendment........................................................................120
SECTION 10.02.
Recordation of Agreement;
Counterparts...........................................121
SECTION 10.03.
Governing
Law....................................................................122
SECTION 10.04.
Intention of
Parties.............................................................122
SECTION 10.05.
Notices..........................................................................123
SECTION 10.06.
Severability of
Provisions.......................................................125
SECTION 10.07.
Assignment.......................................................................125
SECTION 10.08.
Limitation on Rights of
Certificateholders.......................................125
SECTION 10.09.
Inspection and Audit
Rights......................................................126
SECTION 10.10.
Certificates Nonassessable and Fully
Paid........................................126
SECTION 10.11.
[Reserved].......................................................................126
SECTION 10.12.
Protection of
Assets.............................................................126
SECTION 10.13. Rights
of NIM
Insurer............................................................126
ARTICLE XI EXCHANGE ACT REPORTING
SECTION 11.01. Filing
Obligations...............................................................127
SECTION 11.02. Form
10-D
Filings................................................................128
SECTION 11.03. Form
8-K
Filings.................................................................129
SECTION 11.04. Form
10-K
Filings................................................................129
SECTION 11.05.
Sarbanes-Oxley
Certification.....................................................130
SECTION 11.06. Form 15
Filing...................................................................130
SECTION 11.07. Report
on Assessment of Compliance and
Attestation...............................130
SECTION 11.08. Use of
Subservicers and
Subcontractors...........................................132
SECTION 11.09.
Amendments.......................................................................133
SECTION 11.10.
Reconciliation of
Accounts.......................................................133
iii
<PAGE>
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......................................F-1-1
Exhibit F-2:
[Reserved]....................................................................F-2-1
Exhibit G-1: Form of Delay
Delivery Certification of
Trustee...............................G-1-1
Exhibit G-2:
[Reserved]....................................................................G-2-1
Exhibit H-1: Form of Final
Certification of
Trustee........................................H-1-1
Exhibit H-2:
[Reserved]....................................................................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
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
iv
<PAGE>
Exhibit P:
[Reserved]......................................................................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
</TABLE>
v
<PAGE>
THIS
POOLING AND SERVICING AGREEMENT, dated as of October 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
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 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.
1
<PAGE>
SWAP-IO REMIC:
The Swap-IO REMIC Interests will have the principal balances
and
pass-through rates as set forth below:
<TABLE>
<CAPTION>
SWAP-IO REMIC Interests
Initial Principal Balance(1)
Pass-Through Rate
-----------------------
-------------------------
-----------------
<S>
<C>
<C>
SWR-1A
$
2,012,597.55
(2)
SWR-1B
$
2,012,597.55
(3)
SWR-2A
$
2,384,879.86
(2)
SWR-2B
$
2,384,879.86
(3)
SWR-3A
$
2,753,245.57
(2)
SWR-3B
$
2,753,245.57
(3)
SWR-4A
$
3,115,817.02
(2)
SWR-4B
$
3,115,817.02
(3)
SWR-5A
$
3,470,545.57
(2)
SWR-5B
$
3,470,545.57
(3)
SWR-6A
$
3,815,698.67
(2)
SWR-6B
$
3,815,698.67
(3)
SWR-7A
$
4,149,392.33
(2)
SWR-7B
$
4,149,392.33
(3)
SWR-8A
$
4,469,594.75
(2)
SWR-8B
$
4,469,594.75
(3)
SWR-9A
$
4,760,753.54
(2)
SWR-9B
$
4,760,753.54
(3)
SWR-10A
$ 5,016,329.35
(2)
SWR-10B
$
5,016,329.35
(3)
SWR-11A
$
5,187,251.83
(2)
SWR-11B
$
5,187,251.83
(3)
SWR-12A
$
5,198,717.28
(2)
SWR-12B
$
5,198,717.28
(3)
SWR-13A
$
5,106,487.70
(2)
SWR-13B
$
5,106,487.70
(3)
SWR-14A
$
5,000,068.57
(2)
SWR-14B
$
5,000,068.57
(3)
SWR-15A
$
4,896,108.28
(2)
SWR-15B
$
4,896,108.28
(3)
SWR-16A
$
4,794,432.85
(2)
SWR-16B
$
4,794,432.85
(3)
SWR-17A
$
4,694,876.62
(2)
SWR-17B
$
4,694,876.62
(3)
SWR-18A
$
4,597,282.36
(2)
SWR-18B
$
4,597,282.36
(3)
SWR-19A
$
4,501,501.53
(2)
SWR-19B
$
4,501,501.53
(3)
SWR-20A
$
4,407,394.40
(2)
SWR-20B
$
4,407,394.40
(3)
SWR-21A
$
4,317,071.57
(2)
2
<PAGE>
SWAP-IO REMIC Interests
Initial Principal Balance(1)
Pass-Through Rate
-----------------------
-------------------------
-----------------
SWR-21B
$
4,317,071.57
(3)
SWR-22A
$
4,228,301.26
(2)
SWR-22B
$
4,228,301.26
(3)
SWR-23A
$
4,202,004.38
(2)
SWR-23B
$
4,202,004.38
(3)
SWR-24A
$
4,364,187.94
(2)
SWR-24B
$
4,364,187.94
(3)
SWR-25A
$
4,229,045.04
(2)
SWR-25B
$
4,229,045.04
(3)
SWR-26A
$
4,087,298.03
(2)
SWR-26B
$
4,087,298.03
(3)
SWR-27A
$
3,949,383.02
(2)
SWR-27B
$
3,949,383.02
(3)
SWR-28A
$
3,816,263.89
(2)
SWR-28B
$
3,816,263.89
(3)
SWR-29A
$
3,653,166.78
(2)
SWR-29B
$
3,653,166.78
(3)
SWR-30A
$
3,387,452.20
(2)
SWR-30B
$ 3,387,452.20
(3)
SWR-31A
$
3,281,265.63
(2)
SWR-31B
$
3,281,265.63
(3)
SWR-32A
$
3,233,782.71
(2)
SWR-32B
$
3,233,782.71
(3)
SWR-33A
$
3,145,566.49
(2)
SWR-33B
$
3,145,566.49
(3)
SWR-34A
$
4,449,109.36
(2)
SWR-34B
$
4,449,109.36
(3)
SWR-35A
$
8,735,428.35
(2)
SWR-35B
$
8,735,428.35
(3)
SWR-36A
$
2,753,520.21
(2)
SWR-36B
$
2,753,520.21
(3)
SWR-37A
$
2,493,193.59
(2)
SWR-37B
$
2,493,193.59
(3)
SWR-38A
$
2,418,882.11
(2)
SWR-38B
$
2,418,882.11
(3)
SWR-39A
$
2,346,794.61
(2)
SWR-39B
$
2,346,794.61
(3)
SWR-40A
$
2,275,594.70
(2)
SWR-40B
$
2,275,594.70
(3)
SWR-41A
$
2,204,907.30
(2)
SWR-41B
$
2,204,907.30
(3)
SWR-42A
$
2,134,893.95
(2)
SWR-42B
$
2,134,893.95
(3)
SWR-43A
$
2,071,806.80
(2)
SWR-43B
$
2,071,806.80
(3)
3
<PAGE>
SWAP-IO REMIC Interests
Initial Principal Balance(1)
Pass-Through Rate
-----------------------
-------------------------
-----------------
SWR-44A
$
2,010,574.77
(2)
SWR-44B
$
2,010,574.77
(3)
SWR-45A
$
2,001,987.35
(2)
SWR-45B
$
2,001,987.35
(3)
SWR-46A
$
2,010,190.35
(2)
SWR-46B
$
2,010,190.35
(3)
SWR-47A
$
2,014,657.47
(2)
SWR-47B
$
2,014,657.47
(3)
SWR-48A
$
1,771,105.10
(2)
SWR-48B
$
1,771,105.10
(3)
SWR-49A
$
1,718,781.91
(2)
SWR-49B
$
1,718,781.91
(3)
SWR-50A
$
1,667,996.07
(2)
SWR-50B
$
1,667,996.07
(3)
SWR-51A
$
1,618,702.57
(2)
SWR-51B
$
1,618,702.57
(3)
SWR-52A
$
1,571,277.58
(2)
SWR-52B
$
1,571,277.58
(3)
SWR-53A
$
1,524,803.53
(2)
SWR-53B
$
1,524,803.53
(3)
SWR-54A
$
1,479,696.85
(2)
SWR-54B
$
1,479,696.85
(3)
SWR-55A
$
1,436,322.72
(2)
SWR-55B
$
1,436,322.72
(3)
SWR-56A
$
1,427,897.99
(2)
SWR-56B
$
1,427,897.99
(3)
SWR-57A
$
1,427,313.64
(2)
SWR-57B
$
1,427,313.64
(3)
SWR-58A
$
1,549,750.50
(2)
SWR-58B
$
1,549,750.50
(3)
SWR-59A
$
1,876,777.77
(2)
SWR-59B
$
1,876,777.77
(3)
SWR-60A
$ 40,415,203.61
(2)
SWR-60B
$ 40,415,203.61
(3)
SWR-Support
(4)
(5)
SWR-P
$ 100.00
(6)
SW-A-R
(7)
(7)
</TABLE>
---------------
(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.
4
<PAGE>
(2) Prior to the 61st
Distribution Date, a rate equal to twice the Pool Tax
Cap
less 10.40% per annum. On and after the 61st 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 61st
Distribution Date, a rate equal to the lesser of (i)
10.40% per annum and (ii) twice the Pool Tax Cap. On and after the
61st
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
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) over 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.
(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>
------------------------------- ----------------------------
------------------------- -------------------------------
STRIP
Initial
Pass-Through
Corresponding Class of
REMIC Interests
Principal Balance
Rate
Certificates
------------------------------- ----------------------------
------------------------- -------------------------------
<S>
<C>
<C>
<C>
STR-A-1
(1)
(2)
Class A-1
------------------------------- ----------------------------
------------------------- -------------------------------
STR-A-2A
(1)
(2)
Class A-2A
------------------------------- ----------------------------
------------------------- -------------------------------
STR-A-2B
(1)
(2)
Class A-2B
------------------------------- ----------------------------
------------------------- -------------------------------
5
<PAGE>
------------------------------- ----------------------------
------------------------- -------------------------------
STRIP
Initial
Pass-Through
Corresponding Class of
REMIC Interests
Principal Balance
Rate
Certificates
------------------------------- ----------------------------
------------------------- -------------------------------
STR-A-3
(1)
(2)
Class 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 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 Overcollateralization 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
Overcollateralization 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
<PAGE>
(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 Class
Certificate
Balances and Pass-Through Rates as set forth in the following
table:
Original Class
Class
Certificate Balance
Pass-Through Rate
Class A-1
$214,596,000
(1)
Class A-2A
$177,849,000
(1)
Class A-2B
$19,761,000
(1)
Class A-3
$100,749,000
(1)
Class M-1
$7,430,000
(1)
Class M-2
$6,880,000
(1)
Class M-3
$4,403,000
(1)
Class M-4
$3,302,000
(1)
Class M-5
$2,752,000
(1)
Class M-6
$3,027,000
(1)
Class M-7
$3,027,000
(1)
Class M-8
$2,752,000
(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 Senior
Certificate (other
than the Class A-R Certificate) and Class M Certificate will be
subject to a
cap equal to the Strip REMIC Cap rather than the Net Rate Cap.
7
<PAGE>
(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-OC,
STR-C-Swap-IO and STR-X 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.
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.
Inverse Floating Rate
Certificates........................
None.
LIBOR Certificates..................
The Senior Certificates and the Subordinated Certificates.
Non-Delay Certificates..............
The LIBOR Certificates.
Notional Amount
9
<PAGE>
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 A-1, Class A-2A, Class A-2B and Class 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.
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.
10
<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 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: 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
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.
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,
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
11
<PAGE>
Liquidation Proceeds and Subsequent Recoveries received in the
month of such
Distribution Date and (ii) all Scheduled Payments 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 Balance 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
aggregate
Stated Principal Balance of the Mortgage Loans as of the Due Date
in the month
in which such Distribution Date occurs. With respect to each Class
of Senior
Certificates and any Distribution Date on or after which the
aggregate Class
Certificate Balance of the Subordinated Certificates is equal to
zero and the
Overcollateralized Amount 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 Senior Certificates
(after all
distributions of principal on such Distribution Date) exceeds the
aggregate
Stated Principal Balance of the Mortgage Loans as of the Due Date
in the month
in which such Distribution Date occurs.
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 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
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.
12
<PAGE>
Calculation Rate: For each Distribution Date, the product of (i) 10
and
(ii) the weighted average rate of the outstanding Class A and Class
B
Interests, treating each Class A Interest as having an interest
rate of 0.00%
per annum.
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-OC9, Mortgage Pass-Through
Certificates,
Series 2006-OC9." 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.
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-OC9, Mortgage
Pass-Through
Certificates Series 2006-OC9."
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.
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
13
<PAGE>
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.
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 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 15, 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.
14
<PAGE>
Component Certificates: As specified in the Preliminary
Statement.
Component Notional Amount: Not applicable.
Coop
Shares: Shares issued by a Cooperative Corporation.
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-OC9, 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 Cut-off Date Pool Principal Balance as set forth below:
<TABLE>
<CAPTION>
Distribution Date
Percentage
-----------------
----------
<S>
<C>
November 2008 - October 2009................... 0.25% with respect to November
2008, plus an additional 1/12th of
0.35% for each month thereafter through
15
<PAGE>
Distribution Date
Percentage
-----------------
----------
October 2009
November 2009 - October 2010................... 0.60% with respect to November
2009, plus an additional 1/12th of
0.45% for each month thereafter through October 2010
November 2010 - October 2011................... 1.05% with respect to November
2010, plus an additional 1/12th of
0.45% for each month thereafter through October 2011
November 2011 - October 2012................... 1.50% with respect to November
2011, plus an additional 1/12th of
0.30% for each month thereafter through October 2012
November 2012 and thereafter................... 1.80%
</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: As to any Mortgage Loan, the later of the date of
origination of that Mortgage Loan and October 1, 2006.
Cut-off Date Pool Principal Balance: $550,351,612.91.
Cut-off Date Principal Balance: As to any Mortgage Loan, the
Stated
Principal Balance thereof as of the close of business on the
Cut-off Date.
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).
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<PAGE>
Delay Certificates: As specified in the Preliminary Statement.
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. With respect to up to 50% of the Mortgage Loans, the
Depositor
may deliver all or a portion of each related Mortgage File to the
Trustee not
later than thirty days after the Closing 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) 40.00%.
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.
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-OC9,
Mortgage Pass-Through Certificates, Series 2006-OC9." Funds in
the
Distribution Account shall be held in trust for the
Certificateholders for the
uses and purposes set forth in this Agreement.
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<PAGE>
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 November 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 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 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.
Eligible Repurchase Month: As defined in Section 3.11.
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.
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<PAGE>
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), (ii) the
amount
remaining as set forth in Section 4.02(b)(i)(F) 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
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, the lesser of (1) the Overcollateralization Deficiency Amount
and (2)
the Excess Cashflow available for payment pursuant to Section
4.02(c).
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.
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<PAGE>
Final Certification: As defined in Section 2.02(a).
Final Maturity OC Trigger Event: With respect to a Distribution
Date on
or after the Distribution Date in November 2026, the
Overcollateralization
Amount is less than 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).
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.
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.
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 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.
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<PAGE>
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.
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, the excess
of the
Interest Remittance Amount over the Trustee Fee for such
Distribution Date.
Interest Remittance Amount: With respect to the Mortgage Loans and
any
Distribution Date, (x) the sum, without duplication, of (i) all
scheduled
interest on the Mortgage Loans 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, other
than Prepayment Interest Excess, (iii) all Advances relating to
interest, (iv)
all Compensating Interest and (v) Liquidation Proceeds during the
related
Prepayment Period (to the extent such Liquidation Proceeds relate
to
interest), less (y) all reimbursements to the Master Servicer since
the
immediately preceding Due Date for Advances of interest previously
made.
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 15, 2006, between the Counterparty and the Swap
Contract
Administrator.
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<PAGE>
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 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-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.
Maintenance: With respect to any Cooperative Unit, the rent paid by
the
Mortgagor to the Cooperative Corporation pursuant to the
Proprietary Lease.
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<PAGE>
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.
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.
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<PAGE>
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 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) [reserved];
(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;
(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;
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<PAGE>
(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 (v) and (vi) above for all of the Mortgage Loans.
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 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.
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.
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<PAGE>
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,
the
excess of the aggregate Prepayment Interest Shortfalls for such
Distribution
Date over the Compensating Interest for such Distribution Date.
Net
Rate Cap: For each Distribution Date and the LIBOR Certificates,
the
weighted average Adjusted Net Mortgage Rate on the Mortgage Loans
as of the
Due Date in the prior calendar month (except for the first
Distribution Date,
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.
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 Net Rate
Cap, over (ii) the amount of interest accrued on such Class at the
Net Rate
Cap for such Distribution Date and (B) the unpaid portion of any
such excess
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 Net
Rate Cap.
Net
Swap Payment: With respect to 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.
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.
26
<PAGE>
Notional Amount Certificates: As specified in the Preliminary
Statement.
OC
Floor: With respect to any Distribution Date (i) prior to the
Distribution Date in November 2026, an amount equal to 0.35% of the
Cut-off
Date Pool Principal Balance and (ii) on or after the Distribution
Date in
November 2026, the greater of (a) 0.35% of the Cut-off Date Pool
Principal
Balance and (b) 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).
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.
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 Cut-off Date Pool Principal Balance.
27
<PAGE>
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 of the Principal Remittance Amount on
such
Distribution Date).
Overcollateralization Reduction Amount: With respect to any
Distribution
Date, the lesser of (i) the Excess Overcollateralization Amount for
such
Distribution Date and (ii) the Principal Remittance Amount for
such
Distribution Date.
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) 0.70% and (2) the Cut-Off Date Pool Principal
Balance 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) 1.40% and (2) the aggregate
Stated
Principal Balance of the Mortgage Loans in the Mortgage Pool as of
the Due
Date in the month of that Distribution Date 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 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 to be made on such Distribution Date).
Ownership Interest: As to any Residual Certificate, any
ownership
interest in such Certificate including any interest in such
Certificate as the
Holder thereof and any other interest therein, whether direct or
indirect,
legal or beneficial.
28
<PAGE>
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:
------------------------- ------------------------
------------------------
Class
Pass-Through Margin (1) Pass-Through Margin (2)
------------------------- ------------------------
------------------------
Class A-1
0.075%
0.150%
------------------------- ------------------------
------------------------
Class A-2A
0.160%
0.320%
------------------------- ------------------------
------------------------
Class A-2B
0.240%
0.480%
------------------------- ------------------------
------------------------
Class A-3
0.250%
0.500%
------------------------- ------------------------
------------------------
Class M-1
0.300%
0.450%
------------------------- ------------------------
------------------------
Class M-2
0.320%
0.480%
------------------------- ------------------------
------------------------
Class M-3
0.340%
0.510%
------------------------- ------------------------
------------------------
Class M-4
0.400%
0.600%
------------------------- ------------------------
------------------------
Class M-5
0.450%
0.675%
------------------------- ------------------------
------------------------
Class M-6
0.500%
0.750%
------------------------- ------------------------
------------------------
Class M-7
1.250%
1.875%
------------------------- ------------------------
------------------------
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 Net Rate Cap for such Class and the related
Distribution Date.
29
<PAGE>
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 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
30
<PAGE>
(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 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
Stated Principal Balance: The aggregate of the Stated Principal
Balances of the Outstanding Mortgage Loans.
31
<PAGE>
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.
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 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 October 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.
32
<PAGE>
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 October 1, 2006) through the 15th day of
the calendar
month in which the Distribution Date occurs.
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,
the sum of: (1) the excess of (A) the Principal Remittance Amount
for such
Distribution Date over (B) the sum of (i) any portion of such
amount used to
cover any payment due to the Swap Counterparty with respect to
such
Distribution Date not paid from the Interest Funds and (ii) the
Overcollateralization Reduction Amount for such Distribution Date,
and (2) the
Extra Principal Distribution Amount for such Distribution Date.
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, (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
(other than a
Liquidated Mortgage Loan) on the related Due Date, (b) the
principal portion
of the Purchase Price of each Mortgage Loan 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 received with respect
to such
Distribution Date, (d) any Insurance Proceeds or Liquidation
Proceeds
allocable to recoveries of principal of Mortgage Loans 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 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 received during the related
Prepayment
Period and (g) any Subsequent Recoveries on the Mortgage Loans
received during
the related Prepayment Period minus (y) all Advances on the
Mortgage Loans
relating to principal and certain expenses reimbursable pursuant to
Section
6.03 and reimbursed since the immediately preceding Due Date.
33
<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-OC9, Mortgage Pass-Through
Certificates,
Series 2006-OC9." 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 14,
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
34
<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.
35
<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.
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;
(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;
36
<PAGE>
(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.
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.
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<PAGE>
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
Subordinate 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 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) 86.40% of the aggregate Stated Principal Balance of the
Mortgage Loans
as of the Due Date in the month of such Distribution Date and (ii)
the
aggregate Stated Principal Balance of the Mortgage Loans as of the
Due Date in
the month of such Distribution Date, minus the OC Floor.
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.
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<PAGE>
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.
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 November 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 86.40% of the aggregate
Stated
Principal Balance of the Mortgage Loans as of the Due Date in the
month of
that Distribution 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............................
10.90%
Class M-2............................
8.40%
Class M-3............................
6.80%
Class M-4............................
5.60%
Class M-5............................
4.60%
Class M-6............................
3.50%
Class M-7............................
2.40%
Class M-8............................
1.40%
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<PAGE>
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 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
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 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.
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, with respect to
a
Liquidated Mortgage Loan 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.
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<PAGE>
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 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.
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, 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 with respect to such Distribution
Date and
(b) any Swap Termination Payment payable to the Swap Counterparty
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
360 and the denominator of which is the actual number of days in
the related
Interest Accrual Period, and (B) the denominator of which is the
aggregate
Stated Principal Balance of the Mortgage Loans as of the Due Date
in the prior
calendar month.
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.
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.
41
<PAGE>
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 November
2011.
Swap
Counterparty: BNP Paribas 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 and any other document or agreement
entered into in
connection with the Trust Fund, the Certificates or the Mortgage
Loans.
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.
42
<PAGE>
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 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 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).
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<PAGE>
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.
44
<PAGE>
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 of
this
Agreement, 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 Mortgage Loans, including all
interest and
principal received or receivable by such Seller, on or with respect
to the
applicable Mortgage Loans after the Cut-off Date and all interest
and
principal payments on the related Mortgage Loans received prior to
the 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
Mortgage Loans on or before the 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). 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
Mortgage Loan that does not have a first payment date on or before
the Due
Date in the month of the first applicable Distribution Date,
Countrywide shall
deposit into the Distribution Account on or before the Distribution
Account
Deposit Date relating to the first 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. On the Closing Date,
Countrywide, as
Seller, shall deposit $29,771.06 into the Distribution Account,
which shall be
allocated to the Principal Distribution Amount.
(b)
Immediately upon the conveyance of the 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 in this Agreement
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, will
deliver or
cause to be delivered to the Trustee within thirty (30) days
following the
Closing 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 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
45
<PAGE>
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;
(B) The executed Security Agreement;
(C) The executed Proprietary Lease;
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<PAGE>
(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 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 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
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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-OC9, 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 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 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
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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)
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") 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 Mortgage Loans. 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 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 Mortgage Loans in the
form annexed
hereto as Exhibit G-1 (a "Delay Delivery Certification"), 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 Mortgage Loans in the form annexed hereto as
Exhibit H-1
(a "Final Certification"), 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
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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 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 a 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
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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)
[Reserved].
(c)
[Reserved].
(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 Cut-off Date with respect to the 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 Cut-off Date with respect to the Mortgage Loans
that are
Countrywide Mortgage Loans. Park Granada hereby makes the
representations and
warranties set 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 Cut-off
Date with
respect to the 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 Cut-off Date with respect to the
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
Cut-off Date with respect to the Mortgage Loans that are Park
Sienna Mortgage
Loans.
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<PAGE>
(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) 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) 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 inaccuracy shall
be deemed
a breach of the applicable representation or warranty.
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
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<PAGE>
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 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.
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<PAGE>
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.
(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
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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.
(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 payments on account of Prepayment Charges on the
Mortgage
Loans; 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
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an amount required to cause an amount of interest to be paid with
respect to
such Mortgage Loan 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 or the
Distribution
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 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 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 or
the Distribution 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
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
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
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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.
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
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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 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;
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(ix) on or prior to the Distribution Account Deposit Date, to
withdraw an amount equal to the Interest Remittance Amount,
Principal
Remittance Amount, Prepayment Charge Amount collected and the
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
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is authorized to retain pursuant to the third paragraph of Section
8.11). In
addition, the Trustee 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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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 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
Agreement, the Master Servicer shall deliver or cause to be
delivered to the
Trustee, for signature, as appropriate, any court pleadings,
requests for
trustee's sale or other documents necessary to effectuate such
foreclosure or
any legal action brought to obtain judgment against the Mortgagor
on the
Mortgage Note or the Mortgage or to obtain a deficiency judgment or
to enforce
any other remedies or rights provided by the Mortgage Note or the
Mortgage or
otherwise available at law or in equity.
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SECTION 3.13. Documents, Records and Funds in Possession of
Master
Servicer to be Held for the Trustee.
Notwithstanding any other provisions of this Agreement, the
Master
Servicer shall transmit to the Trustee as required by this
Agreement all
documents and instruments in respect of a Mortgage Loan coming into
the
possession of the Master Servicer from time to time and shall
account fully to
the Trustee for any funds received by the Master Servicer or which
otherwise
are collected by the Master Servicer as Liquidation Proceeds,
Insurance
Proceeds or Subsequent Recoveries in respect of any Mortgage Loan.
All
Mortgage Files and funds collected or held by, or under the control
of, the
Master Servicer in respect of any Mortgage Loans, whether from the
collection
of principal and interest payments or from Liquidation Proceeds and
any
Subsequent Recoveries, including but not limited to, any funds on
deposit in
the Certificate Account, shall be held by the Master Servicer for
and on
behalf of the Trustee and shall be and remain the sole and
exclusive property
of the Trustee, subject to the applicable provisions of this
Agreement. The
Master Servicer also agrees that it shall not create, incur or
subject any
Mortgage File or any funds that are deposited in the Certificate
Account,
Distribution Account or any Escrow Account, or any funds that
otherwise are or
may become due or payable to the Trustee for the benefit of the
Certificateholders, to any claim, lien, security interest,
judgment, levy,
writ of attachment or other encumbrance, or assert by legal action
or
otherwise any claim or right of setoff against any Mortgage File or
any funds
collected on, or in connection with, a Mortgage Loan, except,
however, that
the Master Servicer shall be entitled to set off against and deduct
from any
such funds any amounts that are properly due and payable to the
Master
Servicer under this Agreement.
SECTION 3.14. Servicing Compensation.
As
compensation for its activities hereunder, the Master Servicer
shall
be entitled to retain or withdraw from the Certificate Account an
amount equal
to the Master Servicing Fee; provided, that the aggregate Master
Servicing Fee
with respect to any Distribution Date shall be reduced (i) by an
amount equal
to the aggregate of the Prepayment Interest Shortfalls, if any,
with respect
to such Distribution Date, but not by more than the Compensating
Interest for
that Distribution Date, and (ii) with respect to the first
Distribution Date,
an amount equal to any amount to be deposited into the Distribution
Account by
the Depositor pursuant to Section 2.01(a) and not so deposited.
Additional servicing compensation in the form of Excess
Proceeds,
Prepayment Interest Excess, assumption fees, late payment charges
and all
income and gain net of any losses realized from Permitted
Investments shall be
retained by the Master Servicer to the extent not required to be
deposited in
the Certificate Account pursuant to Section 3.05. The Master
Servicer shall be
required to pay all expenses incurred by it in connection with its
master
servicing activities hereunder (including payment of any premiums
for hazard
insurance and any Primary Insurance Policy and maintenance of the
other forms
of insurance coverage required by this Agreement) and shall not be
entitled to
reimbursement therefor except as specifically provided in this
Agreement.
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SECTION 3.15. Access to Certain Documentation.
The
Master Servicer shall provide to the OTS and the FDIC and to
comparable regulatory authorities supervising Holders and/or
Certificate
Owners and the examiners and supervisory agents of the OTS, the
FDIC and such
other authorities, access to the documentation regarding the
Mortgage Loans
required by applicable regulations of the OTS and the FDIC. Such
access shall
be afforded without charge, but only upon reasonable and prior
written request
and during normal business hours at the offices designated by the
Master
Servicer. Nothing in this Section shall limit the obligation of the
Master
Servicer to observe any applicable law prohibiting disclosure of
information
regarding the Mortgagors and the failure of the Master Servicer to
provide
access as provided in this Section as a result of such obligation
shall not
constitute a breach of this Section.
The
Master Servicer acknowledges that as part of its servicing
activities, the Master Servicer shall fully furnish, in accordance
with the
Fair Credit Reporting Act and its implementing regulations,
accurate and
complete information (i.e., favorable and unfavorable) on its
borrower credit
files related to the Mortgage Loans to Equifax, Experian and Trans
Union
Credit Information Company (three of the nationally recognized
credit bureaus)
on a monthly basis.
SECTION 3.16. Annual Statement as to Compliance.
(a)
The Master Servicer shall deliver to the Depositor and the Trustee
on
or before March 15 of each year, commencing with its 2007 fiscal
year, an
Officer's Certificate stating, as to the signer thereof, that (i) a
review of
the activities of the Master Servicer during the preceding calendar
year (or
applicable portion thereof) and of the performance of the Master
Servicer
under this Agreement has been made under such officer's supervision
and (ii)
to the best of such officer's knowledge, based on such review, the
Master
Servicer has fulfilled all its obligations under this Agreement in
all
material respects throughout such year (or applicable portion
thereof), or, if
there has been a failure to fulfill any such obligation in any
material
respect, specifying each such failure known to such officer and the
nature and
status thereof.
(b)
The Master Servicer shall cause each Subservicer to deliver to
the
Depositor and the Trustee on or before March 15 of each year,
commencing with
its 2007 fiscal year, an Officer's Certificate stating, as to the
signer
thereof, that (i) a review of the activities of such Subservicer
during the
preceding calendar year (or applicable portion thereof) and of the
performance
of the Subservicer under the applicable Subservicing Agreement or
primary
servicing agreement, has been made under such officer's supervision
and (ii)
to the best of such officer's knowledge, based on such review,
such
Subservicer has fulfilled all its obligations under the
applicable
Subservicing Agreement or primary servicing agreement, in all
material
respects throughout such year (or applicable portion thereof), or,
if there
has been a failure to fulfill any such obligation in any material
respect,
specifying each such failure known to such officer and the nature
and status
thereof.
(c) The Trustee shall
forward a copy of each such statement to each
Rating Agency.
SECTION 3.17. Errors and Omissions Insurance; Fidelity Bonds.
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The
Master Servicer shall for so long as it acts as master servicer
under
this Agreement, obtain and maintain in force (a) a policy or
policies of
insurance covering errors and omissions in the performance of its
obligations
as Master Servicer hereunder and (b) a fidelity bond in respect of
its
officers, employees and agents. Each such policy or policies and
bond shall,
together, comply with the requirements from time to time of FNMA or
FHLMC for
persons performing servicing for mortgage loans purchased by FNMA
or FHLMC. In
the event that any such policy or bond ceases to be in effect, the
Master
Servicer shall obtain a comparable replacement policy or bond from
an insurer
or issuer, meeting the requirements set forth above as of the date
of such
replacement.
SECTION 3.18. Notification of Adjustments.
On
each Adjustment Date, the Master Servicer shall make interest
rate
adjustments for each Mortgage Loan in compliance with the
requirements of the
related Mortgage and Mortgage Note and applicable regulations. The
Master
Servicer shall execute and deliver the notices required by each
Mortgage and
Mortgage Note and applicable regulations regarding interest rate
adjustments.
The Master Servicer also shall provide timely notification to the
Trustee of
all applicable data and information regarding such interest rate
adjustments
and the Master Servicer's methods of implementing such interest
rate
adjustments. Upon the discovery by the Master Servicer or the
Trustee that the
Master Servicer has failed to adjust or has incorrectly adjusted a
Mortgage
Rate or a monthly payment pursuant to the terms of the related
Mortgage Note
and Mortgage, the Master Servicer shall immediately deposit in the
Certificate
Account from its own funds the amount of any interest loss caused
thereby
without reimbursement therefor; provided, however, the Master
Servicer shall
be held harmless with respect to any interest rate adjustments made
by any
servicer prior to the Master Servicer.
SECTION 3.19. The Swap Contract.
Countrywide shall cause The Bank of New York to enter into the
Swap
Contract Administration Agreement and shall assign all of its
right, title and
interest in and to the interest rate swap transaction evidenced by
the Swap
Contract to, and shall cause all of its obligations in respect of
such
transaction to be assumed by, the Swap Contract Administrator, on
the terms
and conditions set forth in the Swap Contract Assignment Agreement.
The
Trustee's rights to receive certain proceeds of the Swap Contract
as provided
in the Swap Contract Administration Agreement shall be rights of
the Trustee
as Swap Trustee hereunder, shall be an asset of the Swap Trust and
shall not
be an asset of the Trust Fund nor of any REMIC. The Swap Trustee
shall deposit
any amounts received from time to time from the Swap Contract
Administrator
with respect to the Swap Contract into the Swap Account. The Master
Servicer
shall deposit any amounts received on behalf of the Swap Trustee
from time to
time with respect to the Swap Contract into the Swap Account.
On
the Business Day preceding each Distribution Date, the Swap
Trustee
shall notify the Swap Contract Administrator of any amounts
distributable to
the Covered Certificates pursuant to Section 4.02(d)(iii) through
(viii) that
will remain unpaid following all distributions to be made on such
Distribution
Date pursuant to Section 4.02(a) through (c).
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No
later than two Business Days following each Distribution Date,
the
Trustee shall provide the Swap Contract Administrator with
information
regarding the aggregate Class Certificate Balance of the LIBOR
Certificates
after all distributions on such Distribution Date.
Upon
the Swap Contract Administrator obtaining actual knowledge of
the
rating of the Swap Counterparty falling below the Approved Ratings
Threshold
(as defined in the ISDA Master Agreement) or upon the Swap
Contract
Administrator obtaining actual knowledge of the rating of the
Swap
Counterparty falling below the Required Ratings Threshold (as
defined in the
ISDA Master Agreement), the Swap Trustee shall direct the Swap
Contract
Administrator to (i) demand payment of the Delivery Amount (as
defined in the
ISDA Master Agreement) from the Swap Counterparty on each Valuation
Date (as
defined in the ISDA Master Agreement) and to perform its other
obligations in
accordance with the ISDA Master Agreement or (ii) take such other
action
required under the ISDA Master Agreement. If a Delivery Amount is
demanded,
the Swap Contract Administrator, in accordance with the Swap
Contract
Administration Agreement, shall establish an account to hold cash
and other
eligible investments pledged under the ISDA Master Agreement. Any
cash or
other Eligible Collateral (as defined in the ISDA Master Agreement)
pledged
under the ISDA Master Agreement shall not be part of the
Distribution Account
or the Swap Account unless remitted to such accounts by the Swap
Contract
Administrator in accordance with the Swap Contract Administration
Agreement.
If Eligible Collateral (as defined in the ISDA Master Agreement)
with a value
equal to the Delivery Amount is not delivered to the Swap
Contract
Administrator by the Swap Counterparty, the Swap Trustee shall
direct the Swap
Contract Administrator to notify the Swap Counterparty of such
failure.
Upon the Swap Trustee
obtaining actual knowledge of an Event of Default
(as defined in the ISDA Master Agreement) or Termination Event (as
defined in
the ISDA Master Agreement) for which the Swap Contract
Administrator has the
right to designate an Early Termination Date (as defined in the
ISDA Master
Agreement), the Swap Trustee shall act at the written direction of
the
Depositor as to whether to direct the Swap Contract Administrator
to designate
an Early Termination Date; provided, however, that the Swap Trustee
shall
provide written notice to each Rating Agency following the Event of
Default or
Termination Event. Upon the termination of the Swap Contract under
the
circumstances contemplated by this Section 3.19, the Swap Trustee
shall use
its reasonable best efforts to enforce the rights of the Swap
Contract
Administrator as may be permitted by the terms of the ISDA Master
Agreement
and consistent with the terms hereof and Countrywide shall assist
the Swap
Contract Administrator in procuring a replacement swap contract
with terms
approximating those of the original Swap Contract.
Any
Swap Termination Payment received from the Swap Counterparty shall
be
used to pay any upfront amount required under any replacement swap
contract
and any excess shall be distributed to Countrywide and will not be
available
to make distributions in respect of any Class of Certificates. In
the event
that a replacement swap contract cannot be procured, any Swap
Termination
Payment received from the Swap Counterparty in respect of the
termination of
the original Swap Contract shall, in accordance with the Swap
Contract
Administration Agreement, be held in the Swap Administration
Account and
distributed to the Swap Trustee on future Distribution Date for
deposit into
the Swap Account to the extent necessary to make distributions
pursuant to
Section 4.02(d)(iii) through (viii).
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In
the event that a replacement swap is procured and the
replacement
counterparty pays an upfront amount to the Swap Contract
Administrator in
connection with the execution of the replacement swap contract, the
Swap
Contract Administrator, in accordance with the Swap Contract
Administration
Agreement, shall remit to the Swap Trustee such upfront amount to
be included
in Interest Funds and the Principal Distribution Amount for the
following
Distribution Date to the extent that a Swap Termination Payment is
payable to
the Swap Counterparty in connection with the termination of the
original Swap
Contract (or was previously paid to the Swap Counterparty and
Interest Funds
and the Principal Distribution Amount for one or more preceding
Distribution
Dates were used to cover such Swap Termination Payment). Any
upfront amount
paid by a replacement counterparty that is not remitted by the Swap
Contract
Administrator to the Swap Trustee to cover any Swap Termination
Payment
payable or previously paid to the Swap Counterparty in respect of
the original
Swap Contract for the following Distribution Date shall be
distributed to
Countrywide and will not be available to make distributions in
respect of any
Class of Certificates. The Trustee shall provide the Swap
Contract
Administrator with all information necessary to make payments to
the Swap
Trustee pursuant to this paragraph.
The
Swap Counterparty shall be an express third party beneficiary of
this
Agreement for the purpose of enforcing the provisions hereof to the
extent of
the Swap Counterparty's rights explicitly specified herein as if a
party
hereto.
SECTION 3.20. Prepayment Charges.
(a)
Notwithstanding anything in this Agreement to the contrary, in
the
event of a Principal Prepayment in full or in part of a Mortgage
Loan, the
Master Servicer may not waive any Prepayment Charge or portion
thereof
required by the terms of the related Mortgage Note unless (i) such
Mortgage
Loan is in default or the Master Servicer believes that such a
default is
imminent, and the Master Servicer determines that such waiver would
maximize
recovery of Liquidation Proceeds for such Mortgage Loan, taking
into account
the value of such Prepayment Charge, or (ii) (A) the enforceability
thereof is
limited (1) by bankruptcy, insolvency, moratorium, receivership, or
other
similar law relating to creditors' rights generally or (2) due to
acceleration
in connection with a foreclosure or other involuntary payment, or
(B) the
enforceability is otherwise limited or prohibited by applicable
law. In the
event of a Principal Prepayment in full or in part with respect to
any
Mortgage Loan, the Master Servicer shall deliver to the Trustee an
Officer's
Certificate substantially in the form of Exhibit T no later than
the third
Business Day following the immediately succeeding Determination
Date with a
copy to the Class P Certificateholders. If the Master Servicer has
waived or
does not collect all or a portion of a Prepayment Charge relating
to a
Principal Prepayment in full or in part due to any action or
omission of the
Master Servicer, other than as provided above, the Master Servicer
shall
deliver to the Trustee, together with the Principal Prepayment in
full or in
part, the amount of such Prepayment Charge (or such portion thereof
as had
been waived) for deposit into the Certificate Account (not later
than 1:00
p.m. Pacific time on the immediately succeeding Master Servicer
Advance Date,
in the case of such Prepayment Charge) for distribution in
accordance with the
terms of this Agreement.
(b)
Upon discovery by the Master Servicer or a Responsible Officer of
the
Trustee of a breach of the foregoing subsection (a), the party
discovering the
breach shall give prompt written notice to the other parties.
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(c)
Countrywide represents and warrants to the Depositor and the
Trustee,
as of the Closing Date, that the information in the Prepayment
Charge Schedule
(including the attached prepayment charge summary) is complete and
accurate in
all material respects at the dates as of which the information is
furnished
and each Prepayment Charge is permissible and enforceable in
accordance with
its terms under applicable state law, except as the enforceability
thereof is
limited due to acceleration in connection with a foreclosure or
other
involuntary payment.
(d)
Upon discovery by the Master Servicer or a Responsible Officer of
the
Trustee of a breach of the foregoing clause (c) that materially and
adversely
affects right of the Holders of the Class P Certificates to any
Prepayment
Charge, the party discovering the breach shall give prompt written
notice to
the other parties. Within 60 days of the earlier of discovery by
the Master
Servicer or receipt of notice by the Master Servicer of breach, the
Master
Servicer shall cure the breach in all material respects or shall
pay into the
Certificate Account the amount of the Prepayment Charge that would
otherwise
be due from the Mortgagor, less any amount representing such
Prepayment Charge
previously collected and paid by the Master Servicer into the
Certificate
Account.
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ARTICLE IV
DISTRIBUTIONS AND
ADVANCES BY THE MASTER SERVICER
SECTION 4.01. Advances.
(a)
The Master Servicer shall determine on or before each Master
Servicer
Advance Date whether it is required to make an Advance pursuant to
the
definition thereof. If the Master Servicer determines it is
required to make
an Advance, it shall, on or before the Master Servicer Advance
Date, either
(i) deposit into the Certificate Account an amount equal to the
Advance or
(ii) make an appropriate entry in its records relating to the
Certificate
Account that any Amount Held for Future Distribution has been used
by the
Master Servicer in discharge of its obligation to make any such
Advance. Any
funds so applied shall be replaced by the Master Servicer by
deposit in the
Certificate Account no later than the close of business on the next
Master
Servicer Advance Date. The Master Servicer shall be entitled to be
reimbursed
from the Certificate Account for all Advances of its own funds made
pursuant
to this Section as provided in Section 3.08. The obligation to make
Advances
with respect to any Mortgage Loan shall continue if such Mortgage
Loan has
been foreclosed or otherwise terminated and the related Mortgaged
Property has
not been liquidated.
(b)
If the Master Servicer determines that it will be unable to
comply
with its obligation to make the Advances as and when described in
the second
sentence of Section 4.01(a), it shall use its best efforts to give
written
notice thereof to the Trustee (each such notice a "Trustee Advance
Notice";
and such notice may be given by telecopy), not later than 3:00
P.M., New York
time, on the Business Day immediately preceding the related Master
Servicer
Advance Date, specifying the amount that it will be unable to
deposit (each
such amount an "Advance Deficiency") and certifying that such
Advance
Deficiency constitutes an Advance hereunder and is not a
Nonrecoverable
Advance. If the Trustee receives a Trustee Advance Notice on or
before 3:30
P.M., New York time on a Master Servicer Advance Date, the Trustee
shall, not
later than 3:00 P.M., New York time, on the related Distribution
Date, deposit
in the Distribution Account an amount equal to the Advance
Deficiency
identified in such Trustee Advance Notice unless it is prohibited
from so
doing by applicable law. Notwithstanding the foregoing, the Trustee
shall not
be required to make such deposit if the Trustee shall have received
written
notification from the Master Servicer that the Master Servicer has
deposited
or caused to be deposited in the Certificate Account an amount
equal to such
Advance Deficiency. All Advances made by the Trustee pursuant to
this Section
4.01(b) shall accrue interest on behalf of the Trustee at the
Trustee Advance
Rate from and including the date such Advances are made to but
excluding the
date of repayment, with such interest being an obligation of the
Master
Servicer and not the Trust Fund. The Master Servicer shall
reimburse the
Trustee for the amount of any Advance made by the Trustee pursuant
to this
Section 4.01(b) together with accrued interest, not later than the
fifth day
following the related Master Servicer Advance Date. In the event
that the
Master Servicer does not reimburse the Trustee in accordance with
the
requirements of the preceding sentence, the Trustee shall have the
right, but
not the obligation, to immediately (a) terminate all of the rights
and
obligations of the Master Servicer under this Agreement in
accordance with
Section 7.01 and (b) subject to the limitations set forth in
Section 3.04,
assume all of the rights and obligations of the Master Servicer
hereunder.
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(c)
The Master Servicer shall, not later than the close of business
on
the second Business Day immediately preceding each Distribution
Date, deliver
to the Trustee a report (in form and substance reasonably
satisfactory to the
Trustee) that indicates (i) the Mortgage Loans with respect to
which the
Master Servicer has determined that the related Scheduled Payments
should be
advanced and (ii) the amount of the related Scheduled Payments. The
Master
Servicer shall deliver to the Trustee on the related Master
Servicer Advance
Date an Officer's Certificate of a Servicing Officer indicating the
amount of
any proposed Advance determined by the Master Servicer to be a
Nonrecoverable
Advance.
SECTION 4.02. Priorities of Distribution.
(a)
Distributions of Interest Funds. On each Distribution Date, the
Interest Funds for such Distribution Date shall be allocated by the
Trustee
from the Distribution Account in the following order of
priority:
(i) to the Swap Account, the amount of any Net Swap Payment and
any
Swap
Termination Payment (other than a Swap Termination Payment due to
a
Swap
Counterparty Trigger Event) payable to the Swap Counterparty
with
respect to such Distribution Date;
(ii) to each Class of Senior Certificates, the Current Interest
and
Interest Carry Forward Amount for such Class and such Distribution
Date,
pro
rata, based on the amount of interest each such Class is entitled
to
receive on that Distribution Date;
(iii) sequentially, to 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, in
that
order, the Current Interest for each such Class and such
Distribution
Date; and
(iv) any remainder as part of the Excess Cashflow.
(b)
Distributions of Principal Distribution Amount. On each
Distribution
Date, the Principal Distribution Amount for such Distribution Date
shall be
allocated by the Trustee from the Distribution Account in the
following order
of priority with all distributions pursuant to this clause (b)
being made
first from the Principal Remittance Amount:
(i) For each Distribution Date prior to the Stepdown Date or on
which a Trigger Event is in effect, sequentially:
(A) to the Class
A-R Certificates, until its Class Certificate
Balance is reduced to zero;
(B) to the Class A-1 Certificates, until its Class Certificate
Balance is reduced to zero;
(C) concurrently, to the Class A-2A and Class A-2B
Certificates, pro rata, until their respective Class
Certificate
Balances are reduced to zero;
(D) to the Class A-3 Certificates, until its Class Certificate
Balance is reduced to zero;
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(E) sequentially, to 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,
in
that order, until their respective Class Certificate Balances
are
reduced to zero; and
(F) any remainder as part of the Excess Cashflow.
(ii) For each Distribution Date on or after the Stepdown Date and
so
long
as a Trigger Event is not in effect, sequentially:
(A) in an amount up to the Senior Principal Distribution Target
Amount, sequentially:
(1) to the Class A-1 Certificates, until its Class
Certificate Balance is reduced to zero;
(2) concurrently, to the Class A-2A and Class A-2B
Certificates, pro rata, until their respective Class
Certificate Balances are reduced to zero; and
(3) to the Class A-3 Certificates, until its Class
Certificate Balance is reduced to zero;
(B) sequentially to 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,
in
that order, the Subordinated Class Principal Distribution
Target
Amount for each such Class, in each case until its Class
Certificate
Balance is reduced to zero; and
(C) any remainder as part of the Excess Cashflow.
(c)
Distributions of Excess Cashflow. With respect to any
Distribution
Date, any Excess Cashflow will be paid to the Classes of
Certificates in the
following order of priority, in each case to the extent of
remaining Excess
Cashflow:
(i) to the Classes of Offered Certificates then entitled to
receive
distributions in respect of principal, in an aggregate amount equal
to
the
Extra Principal Distribution Amount payable to the Classes of
Certificates as part of the Principal Distribution Amount pursuant
to
Section 4.02(b) hereof;
(ii) concurrently, to the Classes of Senior Certificates, pro
rata
based on the amount of Unpaid Realized Loss Amounts for each such
Class,
in
an amount equal to the Unpaid Realized Loss Amount for each
such
Class; provided, however, that any amounts allocable to the Class
A-2B
Certificates will be allocated first to the Class A-2A
Certificates, in
an
amount up to the Unpaid Realized Loss Amount for such Class;
(iii) sequentially, to 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, in
that
order, in each case first in an amount equal to any Interest
Carry
Forward Amount for such Class and then in an amount equal to the
Unpaid
Realized Loss Amount for such Class;
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(iv) to the Carryover Reserve Fund and then from the Carryover
Reserve Fund, concurrently, to the Classes of LIBOR Certificates,
in an
amount up to their pro rata share based on their respective
Class
Certificate Balances to the extent needed to pay any unpaid Net
Rate
Carryover for each such Class; and then any Excess Cashflow
remaining
after such allocation to pay Net Rate Carryover based on Class
Certificate Balances of the Certificates will be distributed
concurrently
to
each Class of LIBOR Certificates with respect to which there
remains
any
unpaid Net Rate Carryover, pro rata, based on the amount of
such
unpaid Net Rate Carryover;
(v) on any Distribution Date on which a Final Maturity OC
Trigger
Event is in effect, in an amount up to the amount necessary to
increase
the
Overcollateralized Amount so that it is equal to the aggregate
Stated
Principal Balance of the 40-Year Mortgage Loans as of th
